Audit Of Financial Statements Fraud Issues Related To Research

In recent years, a growing number of significant fraud cases have been happening across the world, which not only triggered huge turbulence in the capital market, but also caused negative effects on the social public's business as a whole.Base on introducing fraud in financial reporting, this article focuses on analyzing the cause and methods of fraud on the perspective of incentive, opportunity and rationalization, through which the suggestions towards modern risk guidance audit and audit procedures would be raised.There are four parts in the article:First part is the general introduction of fraud in financial reporting, in which the definition of fraud and fraud in financial reporting have been differentiated and characterized, and also the research scope regarding this article is defined.While introducing four kinds of fraud motivation, the second part elaborates some commonly used frauds in listed companies on the perspective of fraud triangle theory, to analysis the cause of fraud in financial reporting, e.g. increase the sales income and accounts receivable, extends expenses arbitrarily, disguised important item, which are of great help to the research in material audit procedure of fraud in financial reporting.In the third part, the regulations in Chinese Independent Audit Standard towards fraud in financial reporting by certified public accountant is discussed, the influence to audit object caused by audit expectation gap is introduced, and the differences between auditing of fraud in financial reporting audit and fraud auditing is pointed out. This part clarifies the audit responsibility of certified public accountant to the fraud in financial reporting, thus are helpful to finalize the audit pattern to frauds in financial reporting,.As the key-point of this paper, the fourth part focuses on discussing the audit procedure for fraud in financial reporting. In this part, guideline of fraudulent financial reporting audit is introduced, and the audit strategies for fraudulent behavior are elaborated, and the suggested audit procedure of fraudulent financial reporting is issued.This article in analyzed "red flag", on this basis of audit theory as well as micro-economics theory, carried out the multi- angles analysis to the correlation question, leverages the factors and methods which produces frauds from incentive,opportunity and rationalization, and attempted to elaborate the suitable audit pattern of fraudulent financial reporting audit unify the modern risk-oriented audit pattern.