The Research On The Financial Statement Fraud

Financial statement fraud is not only an important problem in accounting theory but also a comprehensive problem. Financial statement fraud have a significant impact on economic. Actually financial statement fraud has been threating the improvement of the capital market and social economic development. So there has strongly theoretical and practical significance to study financial statement fraud.In this paper, we intend to research on financial statement fraud in a a new perspective in that there has so many similar studies on financial statement fraud.We find that in this problem there has a useful and enduring pattern called earnings manipulation which still consist in Chinese listed company but it has fade in frequency and magnitude.The cash flow is considered that it is hard to manipulated in the theory field and the practice field. But out of the expectations of people, the cash flow can also be manipulated through some means. So we select all listed companies from2007to2010in the Shanghai Stock Exchange and Shenzhen Stock Exchange and calculate the value of abnormal operating cash flow. The research shows that the listed companies in China have cash flow manipulation. The trend of magnitude of cash flow manipulation suggests that the incentive to manipulate cash flow is becoming greater in recent years. So a developing tendency from earnings manipulation to cash flow manipulation become more and more evident in Chinese listed companies recently.We find that the earnings manipulation and cash flow manipulation are perpetually developing in which the financial instrument have played an important role in. Study found that corporate management fool the people who care accounting report in many means. Some of those means is unprecedented. The impact is very huge. We also found that these can not be simply summarized to earnings manipulation or cash flow manipulation, this may be an isolated phenomenon, but we can not rule out the existence of a new model. We insist that the financial statements fraud could be divided into earnings manipulation, cash flow manipulation and financial instruments manipulation.