Financial Problem Analysis On The Equal Merger Of China's CSR And CNR

In recent decades,global railway transportation equipment industry develop rapidly,which is a strategic industry for one country.It plays a leading role in economic transition,improving one country's international competition.Now many countries are drawing the blue print of railway development so that the global market is developing in an exceeding speed.China has also put forward highspeed railway plan and placed urban railway as priority in 13 th plan of five-year national development.China South Locomotive Group and China Nouth Locomotive Group are China's leading companies in railway transportation industry.In 2015,these two companies announced to merge into CRRC Corporation Limited.It will bring dramatic change to the whole industry.Due to the fact that the merger of North and South car is new event,previous scholars only studied CSR and CNR separately.Research on the merger events is still very rare.More importantly,two giant companies merged as one,which will expose many problems.It will conclude valuable experience.So it is necessary to study the case.This paper concludes the research fruits of merger and acquisition on integration and performance from domestic and foreign scholars,by combining theoretic analysis,accounting analysis and case analysis.This paper places the case of equal merger of CSR and CNR as the object of study,exploring the measures after they merged.There are five financial problems after the merger.One is the financial management system.The integration of financial risk management system is not enough;the role assignment in financing is not clear enough between group companies and listed companies.The second is the imperfect financial decision-making mechanism caused by the merger.It lacks in integration of existing resources in the North and South in the overseas market,and forward-looking investment layout in the overseas market development.In terms of financial control problem,the companies in the domestic market invest too much,resulting in excess capacity,and headquarters did not carry out effective financial control.Finally,in the Financial Shared Service Center Construction,it lacks basic conditions and the corresponding preparation.In terms of investment and financing system,the company should make clear group companies and listed companies in the investment and financing of role assignment,prompting the company to play a better role in the capital operation.In the financial decision-making,the company should strengthen company culture,promoting the unity of the core values,and the integration of financial management and decision making.At the same time,the system arrangement of financial decision-making power is further improved by increasing financial subjects.In the financial investment,CRRC should further invest and set up overseas regional branch,the integration of overseas resources,and enhance the supply chain network in domestic and foreign investment,through the supply chain to further enhance the promotion of product quality and technical level.In financial control,CRRC should improve internal financial control system,chose CFO for enterprise,establish financial information system to strengthen financial supervision and control on enterprise.On the construction of the Financial Shared Service Center,it should realize the standardization of the financial management system,innovate the financial organization,and reconstruct the financial process,so as to establish the Financial Shared Service Center as soon as possible.