Study On Financial Fraud Of Reverse Take Over In Jiuhao Group

On September 20,2017,The intermediary audit firm about Lianda accounting firm subjected to the administrative punishment of 9 million yuan for issuing the audit report of false records.The intermediary audit agencies are subject to the administrative fines as much as 15 times of listed companies.The backside of the ROT fraud case—Jiuhao groups "borrow shells" from Anzhong limited company,it is also highly concerned by the securities market due to the characteristics of large market influence,wide range of fakery,novelty in the field of fakery,high concealment of false concealment and high professional fabrication.Reverse Take Over as a popular way of mergers and acquisitions in China's securities market,because of its IPO relative to the existence of a higher success rate by private enterprises irrational pursuit.The nature of the Reverse Take Over is the non-listed companies in the form of asset restructuring or mergers and acquisitions to obtain the controlling stake in listed companies to replace the high-quality assets,"shell" of the company's low-quality assets to achieve the purpose of listing and financing expansion.But in the actual operation,due to asymmetric information,the impure listing motive(that is,access to high personal gains motive stronger than the motivation of substantive reorganization),the defects of capital market system and other issues,illegal acts such as financial fraud and insider trading often appear,what is more,The number of the audit failed litigation cases has risen.The above phenomenon reflects the shortcomings of the audit market,as the important "gatekeeper" of securities market,certified public accountants did not curb securities fraud in the event to play its due role.Administrative regulation is the concern of investors as a coercive means of resolving this phenomenon.Based on this,this paper explores the current situation of financial fraud in backdoor listed companies from the perspective of accounting firm audit and administrative supervision,and tries to solve the existing problems in the current situation of fraud.Based on the current situation of financial fraud and administrative supervision of backdoor listing,this paper analyzes the motivations of the failure of backdoor listing audit and the mechanism effect of administrative supervision in auditing market.Based on Jiuhao group which backdoor listing of Anzhong Co.,LTD.as the research object,and expounds the motive and means of financial fraud in the case,identify the reason and responsibility analysis about audit failure of the Lianda Accounting firm At the level of administrative supervision,through the incident research method and based on the investigation of the securities regulatory commission's investigation of listed companies,the market reaction of the intervention of administrative supervision is analyzed The empirical results show that compared with the same industry,the CSRC on the listed company's investigation notice will cause the negative losses of the shares involved in the enterprise.For accounting firms,there is no significant correlation between the Commission's investigation and the auditor's reputation.However,when the firm is subject to administrative penalties,its clients will have a clear negative market response and the firm's reputation will be affected.The results of this study show that in the process of Reverse Take Over,administrative supervision through legal mechanisms and reputation mechanism to play a role,the market will recognize the administrative regulatory intervention mechanism and give the correct pricing.This also shows the need to improve the status quo of China's securities market audit and the positivity of establish a sound administrative supervision system of enthusiasm.The article will be based on the above information,combined with the accounting firm audit and administrative supervision level,from the certified public accountants,certified public accountants,regulators,shell companies and small and medium-sized investors five aspects put forward the proposal on both sides,to protect the orderly operation of the capital market,standardize the backdoor listing of the development process.