Cause Analysis And Countermeasure Research On The Qinglong Pipe Performance Forecast Correction

Performance forecast means that the management of the listed company forecasts the performance before the end of the accounting year and discloses the expected profit to the investors in advance,which can release the performance risk in time and has the function of risk early warning.In 1998,China Securities Regulatory Commission first proposed that listed companies with expected losses should publish performance forecast,and in 2001,except for the forecast losses,as long as the expected performance will change significantly,they need to timely release the forecast.Then the performance forecast system is constantly improving.However,at present,the quality of the disclosure of the performance forecast in China is uneven,the delayed release of the performance forecast,the inaccuracy of the information and the correction of the performance forecast occur frequently.Although the performance forecast is an estimate,the management should be able to make a reasonable forecast in the absence of without emergencies according to the previous business experience of the enterprise,and there will be no significant difference.Therefore,the real reason for the frequent correction of the performance forecast of listed companies is worth studying.On August 2,2018,Qinglong Pipe management was punished for publishing three performance forecast correction in 2017-2018.The CSRC required the chairman and the Secretary of the board of directors of the company to accept regulatory talks because they failed to fulfill their duties diligently.Prior to that,on November 28,2017,Qinglong management was warned and punished by CSRC for its illegal disclosure of performance forecast.In two years,Qinglong Pipe Industry has been widely concerned because of two penalties for performance forecast correction.This paper uses case study method to select Qinglong Pipe Industry as the research object.Based on the review of previous literature and relevant theoretical systems,this paper analyzes the reasons and interest relations of its performance forecast correction from the internal and external aspects of the company,and puts forward some countermeasures and suggestions.In terms of internal operation and supervision of the company: first,Qinglong management’s operational risk prevention ability is poor,and large shareholders have insufficient control over the risk of high proportion of equit y pledge,which leads to the company’s risk of control transfer,while Qinglong Microfinance Company has poor control over the risk of lending,resulting in a large amount of provision for loan impairment,which is the most direct reason for the performance forecast correction;second,lack of internal supervision,the independent directors can not to maintain independence,the board of supervisors fail to effectively perform its supervisory duties,and the defect of corporate governance structure makes the executives reduce their holdings after issuing false earnings forecast when the loss has become a certainty,and the motivation of their profit becomes the main reason for the performance forecast correction.In the aspect of external supervision and system: first,the market lacks effective control over speculative capital,which makes the hot money borrowing xiong’an hype greatly.After the hype is revived,Qinglong management takes the opportunity to release the earnings forecast inconsistent with the actual situation to support the hot money hype again,leading to the performance forecast correction;second,the performance forecast system is imperfect,the cost of violation of the performance forecast is small and there is no need for advance Audit,to a certain extent,provide conditions for Qinglong’s performance forecast correction.Through the analysis,this paper puts forward several suggestions: first,improve the company’s operating efficiency,strengthen the company’s operational risk control,reduce costs and increase efficiency,improve performance,and fundamentally solve the phenomenon;second,improve the independent director system,strengthen the role of the internal board of supervisors,and avoid the performance forecast as a tool for executives to make profits;third,improve the relevant laws and regulations on speculative capital speculation,and improve the efficiency of external supervision on the company;The fourth is to increase the punishment of violation performance forecast system,increase the performance forecast pre audit,and improve the performance forecast system.It is hoped that the analysis of this paper can provide some solutions for the phenomenon of frequent correction in the performance forecast of Listed Companies in China.