wrap anchor tag around li element

The only legal element allowed inside a <ul> is an <li>. You cannot have an anchor wrapped around the <li>. This holds true in HTML5, where an anchor can wrap around other block level elements.

What you have in CSS is nearly there, just add:

a {
     text-decoration: none;
     display: block;
     width: 100%;
     height: 100%;
}

And your anchor shall fill the entire space of the <li>.

Update for 2022: wrapping your li tags with anchors is now totally acceptable.