S Of Registered Accountants' Legal Liability

This paper started from the fact analysis, through summarizing relevant preference, have been fully considered experiences of all concerned parties, and focused on the special issues of the legal liability of Certified public accountants(CPA).This paper consist ten chapters. The first part introduced the study background and methods. Certified public accountants are functioning as the most important gate—keepers of process of assuring quality of information disclosure in the market economic, in which the information disclosure system has been severely distorted by the flood of misrepresentation. Shocked by a series cases about misstatement, especially by the Enron case, most countries around the world begin to question the credibility of the Certified public accountants. What are the reasons of the frequent occurrence of failure of audit? How can the industry of Certified public accountants survive from the crisis of the public trust? How can the accounting information disclosure system be guaranteed?Facing with these problems, I conducted this thorough study of the phenomenon of misrepresentation in market economic, such as in security market, and found that one important reason of this phenomenon the leg al liability of Certified public accountants is not clear, especially that the civil liability is in default and the liability cost for false audit report is too low. It is important to re-construct the credibility of Certified public accountants, for both maintaining the order of market economic and protesting the interest of investors. In the process of discussing all these, sociology and economics method have being used as an assistant hand. No doubt, Certified public accountants legal liability processes obvious trend of sociology. We must research this item in conformity with nature of the mankind himself. On the other hand, economics analysis method will represent useful means for us to describe microcosmic facts and data more deeply and clearly.The second part introduced the current situation of the existence of representations in the economic market. It summarized the contents and means of the misrepresentation through analysis of the important misrepresentation red in recent years, and analyzed the role that Certified public accountants played in these misrepresentations through the analysis of the legal feature of Certified public accountants. Summarized the main reasons of the participation of Certified public accountants into misrepresentation as follows: the audit business is at the stage of buyer—market; Independence of Certified public accountants is materially in adequate; the total legal environments is not sound; and the liability cost of Certified public accountants for legal acts is too low, among which the last one is considered to be very important and key reason why the misrepresentation and false audit report of Certified public accountants have occurred so frequently. It is therefore an important mission of China to improve the study of legal liability of Certified public accountants and to impose the civil liability on Certified public accountants for concerned misrepresentations.Part three introduce the current development of foreign countries foreign countries in the field of the study on the legal liability of Certified public accountants, and the problems China is facing, and analyzed the important of the study of this issue. The legalliability of is Certified public accountants has always be an important issue in the economic market all over the world. The achievement of these counties that have an advanced economic market is of the best protection of the interest of the investor, is virtually in default. The only few provision concerning the civil liability is essentially useless due to lock of feasibility. For the above reasons, basic issues on some basic issue concern the civil liability of Certified public accountants, such as the nature of the civil liability, review standard of false audit report, standard of duty of the conduct study on review standard of Certified public accountants, burden of proof, etc., is important legal means to effectively resolve the problem of misrepresentation and will be very important to assure the health growth of the economic market, protect the interest of investors, and re-construct the credibility of the industry of Certified public accountants.Part fourth focused on the content, risk, and professional responsibility of Certified public accountants to practice in the economic market. The essential motive of introducing audit into the economic market is to assure the truthfulness and legality of the statutory requirement ad of audit is therefore is gradually established in the information disclosure system. The audit mainly focused on various financial statements and the audit opinion accordingly issued can be classified into four t types: unqualified, qualified, disagreement and disclaimer. The type of audit opinion is directly related to whether certified accountants s liable and what legal liability to be the financial reports is acceptable and fair.As expert—participants of information disclosure, Certified public accountants have the information advantage, and accordingly have a high duty of care as experts towards the user of the audit reports. And this feature determined that the professional responsibility of Certified public accountants is due—care, which means accountants should use imprudence and diligence when conducting reasonable independent investigations, discover important problems which should be discovered under the professional standard, and give logic and correct opinion based on the investigation.Part fifth is focused on the system of Certified public accountants'liabilities, and analyzed the legal status and function of the system in the practicing of Certified public accountants. The specially of the legal system of the economic market is that there are only general principles in legal aspect for the practice, Certified public accountants, while in the specific audit activities, the more utilized and followed standard is the independent audit standard, which is regarded as industry custom. It therefore raises the problem, which has argued long in the whole world. I.e. whether complains with the requirement under the legal system of accounting information disclosure system is to protect the interest of users of audit reports, while the audit principle is the authoritative standard which could be agreed by both parties of auditing, as the overall strict requirement of the diligence duty of Certified public accountants. In fact, if we want to study the errors and detects in the system of liability of Certified public accountants deeply, we must analysis Negligence, ordinary negligence, gross negligence, and fraudulent, constructive fraud in this part.There are some general stipulations about the third parties in Chinese Law system, such as Procedural Law, and the People's Supreme Court has issued its judicial interpretation on it, all these are too generalized and lack of the flexibility. The mainreason is that scholars in academic circles haven't reached an agreement on the theoretical problem of third parties in administrative litigation. There's a need to further discuss such questions as the classification, characteristics, right and duty, legal statues of a third party in the litigation. But civil liability is the most important aspect, is a"core". The final aim of this paper is to reconstruct a new system of Certified public accountants liability in both theory and practice.