On Civil Liability Of CPA For False Auditing In Securities Market

It is urgent to regulate scientifically civil liability of CPA for false auditing and to burthen reasonable liability to pay compensation on CPAs, concerning that misrepresentation are deluged and quality of audit is anxious in securities market. With the relation between CPA, audit and securities market as a red thread, this thesis summarizes the history and professional traits of audit, analyses auditing relationship and the cause of formation and countermeasure towards absence of auditing independence. The development of accountant firms is depended on two factors, which are management and legal liability of the vocation, and research of CPA's civil liability should accommodate to theory of audit organization form. Secondly, makes comments on the main theories about the character of CPA's civil liability, then holds that special liability for tort provided in special law is the optimal choice, On the basis of analyzing rights and obligations of auditing legal relationship and status contrast. Thirdly, the fault liability principle is applied to this liability, then anatomies the four constitutive elements: CPA offered false comment (illegal conduct), plaintiff suffered loss (damage), there is causality existing between the loss and the false comment (causality) and CPA is fault (fault), and sums up demurrers of CPAs. Lastly, discusses the enforcement problem of tort damage compensation liability on CPA. Concerning misrepresentation cases in securities market are multi-reasons-single-result, auditing party should bear proportionate liability with other tort persons, and liability shares should be confirmed by conductors' fault, contribution to damage and hazard; the accountant firm and chief CPA should bear joint and several liability. LLP is an ideal pattern for accountant firm developing, as it standing out flexible management and personal liability as well as abolished irrational joint liability. The effective function of LLP needs the construction of correlative mechanism and system.