Financial Fraud Case Analysis Based On Fraud Triangle Theory Lanshan Technology As An Example

Chinese President Xi Jinping announced at the International Trade Summit on September 2,2021 that China will continue to deepen the reform of the New OTC Market,fully support the innovative development of small and medium-sized enterprises,and establish the Beijing Stock Exchange to build another powerful platform for the innovative development of small and medium-sized enterprises.Since its establishment,the new three board market development speed rapid,expanding the size of the market,has now become an integral part of our country capital market puzzle,but with the continuous development of our social economy,financial fraud happened frequently,seriously affecting the orderly development of capital markets,therefore,need to pay more attention to the new three board market order,to protect the interests of small and medium-sized enterprises,To promote the steady development of small and medium-sized enterprises,and then promote the further development of China’s capital market.This paper selects the typical case of "star enterprise" Lanshan Technology in the New OTC Market market,combined with the dynamic mechanism model of fraud triangle theory,and puts forward corresponding governance suggestions according to the research results.This paper first introduces the research background and significance,and then defines the research ideas and research methods by consulting the relevant literature on the New OTC Market market,Beijing Stock Exchange and the motivation,means and governance of financial fraud.Secondly,through the literature research on the motivation theory of financial fraud,it is found that the fraud triangle theory is the most widely used.Therefore,we choose the fraud triangle theory combined with the dynamic mechanism model of fraud triangle theory to focus on the typical case of Lanshan technology,and focus on the financial fraud means of Lanshan technology,including falsely increasing bank deposits,fictitious circular purchase and sales business,fictitious R & D business and R & D expenditure,and falsely listing freight,Fictitious disposal and sale of assets and other relevant disclosures are untrue.Then,the dynamic mechanism of fraud triangle theory is analyzed for the financial fraud cases of Lanshan technology,and the financial data are analyzed combined with Z-socre model.It is found that Lanshan technology has the pressure of impacting the selection layer,the capital pressure and operation pressure of controlling shareholders and themselves in terms of pressure factors;In terms of opportunity factors,there are opportunities such as the imperfect system of the New OTC Market market,the failure of intermediaries to perform their duties diligently,and the unreasonable ownership structure of Lanshan technology;In terms of excuse factors,there are excuses such as the management does not establish the values of honesty and trustworthiness and weak legal awareness.Then,it analyzes the impact of Lanshan technology financial fraud on enterprise value,stakeholders and the New OTC Market market.Finally,according to the research and analysis results,for the enterprises in the New OTC Market market,it is proposed to formulate practical expected organizational objectives and optimize financing channels and methods to alleviate the pressure of fraud;It is proposed to improve the New OTC Market system,optimize the internal governance structure of enterprises and strengthen market supervision to reduce the opportunity of fraud;It is proposed that the management should establish the values of honesty and trustworthiness,enhance the legal awareness of enterprise management and cultivate excellent enterprise culture to eliminate the excuse of fraud,so as to make China’s new three markets develop healthily and orderly in the future.