Case Study Of Kingenta Financial Fraud From The Perspective Of Corporate Governance

In recent years,the rapid development of our capital market,there have been a series of financial fraud cases,these fraud cases have caused great harm to investors,and the stability of the entire stock market has caused a great impact.The release of the new securities law has restrained the financial fraud of the listed companies to some extent,but there are still some listed companies to take risks in disregard of the law to implement financial fraud.In recent years,it has become a major topic for scholars to identify financial fraud from the perspective of corporate governance,find out the causes of financial fraud,and provide solutions to financial fraud.This paper selects Kingenta Corporate Financial Fraud as the research object,adopts the literature research method and case analysis method,and analyzes the concepts and theories of corporate governance and financial fraud on the basis of the literature on corporate governance and financial fraud.After that,the whole process of Kingenta’s financial fraud was sorted out,and the means of Kingenta’s financial fraud were analyzed,mainly including inflated revenue and profits,failure to disclose related parties and related party transactions in accordance with regulations,inflated notes payable,and inflated issuance of commodities,and analyzed the consequences of financial fraud.Then,the motives of Kingenta financial fraud are analyzed from the perspective of corporate governance,specifically from the perspective of internal governance and external governance,the causes of financial fraud from the perspective of internal governance mainly include the imbalance of the equity structure,the monopoly of the voting rights of the shareholders’ meeting by the major shareholders,the failure of the role mechanism of the board of directors,the ineffectiveness of board of directors,the weakening of the functions of supervisory board,and the lack of professional ethics of core executives and the reasons for financial fraud from the perspective of external governance include the lack of responsibilities of third-party audit institutions,the lack of punishment by regulators,the lack of supervision by banks and the lack of media supervision..In view of the above analysis,this paper gives measures to prevent and control financial fraud from the perspective of internal governance and external governance,the internal corporate governance includes optimizing the ownership structure,improving the voting system of the general meeting of shareholders,perfecting the Operation Mechanism of the board of directors,improving the independence of the Board of Supervisors,and strengthening the professional quality of the core executives,the external governance includes improving the audit quality of the third-party audit institutions,increasing the punishment of the supervision institution,strengthening the supervision of the bank to the enterprise,and perfecting the media supervision mechanism.The significance of this study is to enrich and expand the academic research on corporate governance and financial fraud theory,for listed companies from the perspective of corporate governance to prevent and control financial fraud provides practical guidance.The innovation of this paper includes:(1)the study of Kingenta’s financial fraud from the perspective of corporate governance can complement the study of Kingenta’s financial fraud.(2)to study the financial fraud motivation of listed companies from both internal and external perspectives.The internal governance level increases the motivation of core executives,while the external governance level increases the motivation of media and banks.