Study On Financial Fraud In IPO Listing Of GEM

At present,with the rapid development of China’s capital market,listed companies financial fraud phenomenon is also frequent.In October 2009,the GEM officially landed in China’s capital market,the GEM market mainly serving those who set up a short time,small scale,but the growth of relatively high innovative high-tech enterprises,with the establishment of 7 years,the GEM market has developed rapidly,However,more and more financial fraud also appears.2012 "GEM fake first shares," Wanfu Biotechnology financial fraud for the first time knocked on the GEM IP0 financial fraud alarm,and then to the Hirisun IPO fraud,people found that some companies in order to achieve IPO listing Requirements,and then listed on the financing at the expense of financial fraud,and the financial fraud of these GEM companies will not only damage the confidence of investors,especially those small and medium shareholders,and may hit their investment confidence,seriously affecting China’s GEM market’s good development.Therefore,this article for China’s GEM IPO fraud problem in-depth study has a certain practical significance.Based on this background,this paper analyzes the case of Xin Tai Electric Corporation Limited(Xin Tai Electric)IPO fraud,which is one of the typical representatives of IPO listing.The financial fraud is huge and the fraud is typical.Instead of the light punishment,it was forced to withdraw from the market,becoming the first GEM delisting,which once became the hot topic discussed by people.Xin Tai electrical financial fraud phenomenon is typical,involving a wide range,highlighting the current GEM IPO market problems,the research of Xin Tai Electric IPO financial fraud this case can provide some more instructive revelation recommendations for the prevention and management of China’s GEM IPO listed companies financial fraud.This paper first discusses the background of the phenomenon of accounting fraud and its many hazards,and comprehensively sums up the relevant literatures on the contents,motivations,means and precautions of IPO financial fraud at home and abroad,and puts forward research significance.Second,three theories are expounded in detail.The theory of information asymmetry,,insider control theory and the fraud triangle theory,and the theoretical basis of the analysis of Xin Tai Electric case is expounded.Then,characteristics and the main means for the subsequent case analysis provides an objective basis;Besides,the company’s background of Xin Tai Electric has a brief introduction,and then in accordance with the time sequence of its IPO fraud process is collated,and its use Fraud means is analyzed.Then,from the Xintai electrical enterprises themselves,intermediaries and regulatory aspects of the start,the analysis of its IPO financial fraud and the successful reasons for the successful IPO;At the same time,this article also analyzes the consequences of the IPO financial fraud of Xin Tai Electric.As with other financial fraud enterprises,Xin Tai Electric’s financial fraud scandal has brought many influences,for example,Xin Tai Electric was forced to withdraw from the market,all involved in the personnel and institutions have been punished,it has damaged the benefits of investors and the interests of the company’s internal staff,shaking its confidence in the market and so on.Although regulators on the IPO financial fraud has been strengthened,there is no doubt that the market will certainly play a certain role in the alert,but we also need to take more targeted measures to enhance the securities market Governance according to the development of the market.Therefore,this paper will put forward targeted to curb the GEM IPO fraud,promote the development of China’s securities market measures from the company itself,intermediaries and regulatory agencies,Finally,the paper makes a summary,calling for more people to pay attention and monitor the healthy development of China’s GEM market for the GEM and sound the alarm to IPO listed companies,which will build a safe and secure investment environment for the majority of investors.