Research On Financial Fraud And Its Economic Consequences Of Listed Companies In The Pharmaceutical Industry

Recent years,in view of the continuous development of the capital market,more and more listed companies appear in my country.At the same time,listed companies play a decisive role in the progress of China’s economic.However,there have been frequent outbreaks of financial fraud incidents that have triggered the society.More and more financial frauds occur in the pharmaceutical industry in recent years,and Kangmei Pharmaceutical is the financial fraud case with the highest amount of fraud and the most serious behavior in the history of A-shares.The pharmaceutical industry is related to the safety of people’s lives and the realization of the “Healthy China” strategy.The country continues to promote reforms and support for the pharmaceutical industry,and a large amount of capital has also poured into the pharmaceutical industry.Many companies have embarked on a rough road of expansion.There are some problems in the pharmaceutical industry,such as high research cost,slow profit and difficult technical supervision.In addition,the pharmaceutical industry is usually dominated by private enterprises,so the enterprise capital is relatively scarce.Once operating income,organizational structure,etc.cannot keep up with the pace of expansion,the probability of financial fraud will increase.Therefore,it is particularly important to study the phenomenon of financial fraud in the pharmaceutical industry.In order to effectively prevent the financial fraud of Listed Companies in the pharmaceutical industry,we must understand the subjective motivation,internal and external objective environment,the means of financial fraud,and the economic consequences before and after the fraudThis article forms an analysis framework on the basis of combing the existing financial fraud theory and literature,and analyzes it in the order from theory to practice,from the overall level of the industry to the specific level of the enterprise.First of all,at the overall industry level,this paper selects the listed companies who were punished by China Securities Regulatory Commission for financial fraud from 2011 to 2020 in the pharmaceutical industry as samples for statistical analysis.It was found that listed companies in the pharmaceutical industry are facing pressure from intensified industry competition and compression of profit margins.The fraudulent ways of listed pharmaceutical companies preferred to disclose financial information in violation of regulations,followed by the occupation of assets and fraud in financial statements.And in the financial statement frauds,they preferred the specific type of fictitious profit.The types of fraud has the correlation,and multiple methods was used to commit fraud at the same time.The regulatory authorities have increased the control and rectification,among which the local securities regulatory bureaus gradually exerted their effort,the administrative punishment of fraud has the delay,the punishment is light,and the amount of punishment is low.Secondly,at the corporate level,this paper analyzes the financial fraud cases of Kangmei pharmaceutical,and explores the antecedents,consequences and means of financial fraud.It was found that the fundamental purpose of Kangmei Pharmaceutical’s financial fraud was to raise funds,mainly through fictitious profits,and the internal and external objective environment of the enterprise provides convenient conditions for the occurrence of financial fraud.After the exposure,the company’s operating conditions were in trouble.Finally,from the perspectives of listed companies,government departments,accounting firms and investors,it puts forward suggestions on the prevention of financial fraud in listed companies,and provides ideas for the containment of financial fraud in the pharmaceutical industry.