Research On Risk-oriented Auditing And Its Application In Our Country

Risk exists in every country at every time. The past decade has been one of unprecedented change in the global economy and capital markets. With the change of social and economic environments, lawsuits aimed at CPA profession increased explosively all around the world. CPA is becoming a high-risk profession. Some incidents happened recently, such as "Yin Guan Ixia" and "Hu Bei Li Hua" incidents, stroke the "professional credit" of the CPA profession heavily. In such circumstances, it is no longer desirable for Chinese auditors to use the transaction-oriented auditing or system-oriented auditing as they used to.A new auditing mode called ROA had appeared in the west since 1980's showing great prospect. So indubitably, ROA is a modern auditing mode, which can reduce the auditing risk effectively. But at the beginning in 21st century ,the An LAN company's bankruptcy reveal the "enormous black hole" of the USA auditing industry. The Anderson & co, which praised as one of the international accounting company of auditing circle, is unable to escape from disintegrating destiny. This make us suspect whether the ROA is our best choice of the country?So, the author decide to do some analysis on ROA's theoretical system and current situation and necessity of ROA's application in our country .meantime probe into some countermeasures of ROA's application in our country. From this, the author expects to find out a ROA method that are suitable to our national conditions, which will help to enhance our national auditing theory's research and application, to improve our national auditing technical level and international competitiveness of the accountant firm.The article consists of four chapters:Chapter one reveals the production and theoretical foundation of ROA. Audit mode had developed from transaction-oriented auditing , system-oriented auditing to ROA according to the change of auditing goal sequentially. Compared with the first two kinds of auditing modes, it has five major superiorities . Meanwhile, this chapter points out that the production of ROA has certain theoretical foundations, including risk theory, importance theory and way theory.Chapter two does some analysis about auditing risk .At first analyzes the meaning of auditing risk, points out that the essential characteristic of auditing risk is: the possibility of auditor bear lost. Because of change of the economic environment of external world, business risk and report risk increase, in addition to the essential characteristic of auditing risk showing as to bear legal liability, so the author puts forward the new auditing risk model: Audit risk =(business risk + inherent risk *control risk * check the risk + report the risk)* legal risk. According to auditing risk model, the author analyzes every risk key element, from big management environment of periphery at first, considering various kinds of risk factors that enterprises are facing, confirms the total auditing risk level, secondly through evaluating inherent risk and control risk, confirms acceptable check risk level, finally calculates the sample amount of confirming substantive test.Chapter three introduces the basic procedure and method of ROA.Chapter four states our country's present auditing mode and existing problems and points out that the application of ROA in our country has certain necessities and limitations under the overall description of ROA's theoretical system in first several chapters, combining the actual conditions of our country .But how to guarantee the application of ROA in our country? From criterion, staff training, company's managing, office management, legal system environment and popularizing using, etc. this text makes some discussions on the relevant counter-measure of ROA's application in our country.