The Accounting Firm's Audit Risk Management Study

Social audit plays an important role in the economy. However, since 1960's, along with the changes of social, economic and legal environments, the complications of audited companies and their activities, and the rising of the expectation of the public on social audit, accounting firms have experienced incessant lawsuit cases and suffered bad losses. Particularly in the beginning of this century, a series of domestic and foreign famous business fraud and audit failure cases make accounting firms' audit risk management become more exigent. Audit risk has become core of modern risk-oriented audit pattern, and strengthening audit risk management is of realistic significance for Chinese accounting firms to increase audit quality, lighten audit responsibility, and enhance competitiveness.The article conducts the research circling around audit risk management of accounting firms. Firstly, the article introduces the background and the significance of the research, the existing study results in China and abroad, and the purpose, approaches and strategies of the research. In the second part, the article analyzes the status quo and problems of Chinese accounting firms implementing audit risk management. Then, the article discusses the relevant concepts and basic theories from the aspects of audit risk and audit risk management. In this part, the evolvement of audit risk model is discussed in detail. The fourth part is the key of the research, where the article studies specifically the audit risk management works in the each step of an audit project, and lists some other assistant measures to strengthen audit risk management. In the fifth part, the article explains and demonstrates the applicable audit risk evaluation methods. Lastly, the article concludes the whole research.