Audit risk of government subsidies in the new energy industry

Abstract

Green economy has become the world's main goal of economic development in the twenty-first century. The new energy vehicle industry has developed rapidly in a green and low-carbon economy. The government has used subsidies to promote the healthy and efficient development of the new energy vehicle industry in its early development stage. However, due to information asymmetry and the correlation of interests between the government and firms, some new energy vehicle firms have fraudulent behavior to obtain government subsidies. In the face of this fraudulent phenomenon, how should the audit department take corresponding measures to avoid the audit risk of government subsidies for firms, and how can the government face the unknown nature of the development of the emerging industry? The study takes Suzhou Golden Dragon, a new energy automobile firm, as an example to analyze the impact of government subsidies on this automobile firm in recent years and explore the causes of its audit risk and corresponding countermeasures by analyzing the motive and means of its fraudulent behavior, which can play a role in improving the defects of China's government subsidy audit theory and strengthening the rigor of audit practice. By analyzing the fraudulent phenomenon, some reasonable suggestions can be given to the government to promote the healthy and benign development of China's new energy vehicle industry, which can also enrich the means of supporting the development of new industries in the early stage of the future.