Font Size: a A A

Certified Public Accountant Audit Failures

Posted on:2004-08-22Degree:MasterType:Thesis
Country:ChinaCandidate:M DengFull Text:PDF
Abstract/Summary:PDF Full Text Request
In 2001, some serious frauds of listed companies happened, such as the cases of "yinguangxia "and "maikete ". They contributed significantly to the sharp drop of Chinese stock market, and a large number of investors suffered great losses. The accounting firms and CPAs who gave the audit reports for these companies got severe punishment from our government. CPA became the accusatory focus of the whole society. When we just plan to trust in famous international accounting firms, the financial scandal of Anron,Worldcom and Xerox happened. Anderson, who has about 90-year history in audit profession collapsed for the audit failure of Anron. The series of audit failure cases shock the whole world. CPAs are facing unprecedented crisis since the beginning of this profession.CPA is called "economic police" of the modern society. The quality of audit is quite important for the health of capital market, even for the whole society. The effect of audit failure gets attention of the whole public. There are many discussions on audit failure by the people from different groups. Audit failure has become one hotspot that demands our effort to solve. From the aspect of CPA,the system of audit market and corporate governance, people has come up with different opinions. Based on the above background, the author has a try to touch on such a hotspot──audit failure. Audit includes government audit,internal audit and CPA audit. Since the latter has closer relationship to the public, and the failure of it is more serious, the author stresses it in this paper.The research of this MS thesis aims at how to reduce the possibility of audit failure. Chapter 1 is the beginning of this paper, it states the concept of CPA's audit failure. On the basis of it, the following threechapters focus on the reason and solving way of audit failure, they are the emphases of this paper. In chapter 2,3, the author analyzes the reason and environmental factor of audit failure. Then, Chapter 4 points out the measures that can evade audit failure. In the end, Chapter 5 puts forward some concrete countermeasures in auditing of management fraud, since audit failure and management fraud have close relationship. This MS thesis has the following characteristics on the research approach: First, pay attention to solving the realistic problem. Second, try to expand the range of research. Not only, pay attention to audit itself, but also probe into system environment, etc. Third, combine the foreign research results with practical conditions of China. In order to solve the practical problem of China, the author carefully studies the newest audit-failure cases in America, and makes great efforts to combine it with China' s actual conditions.The whole thesis is divided into five chapters.Chapter 1: The definition and consequence of audit failure. First, briefly expounds the definition of audit failure, and then compares it with other relevant concepts : client's mistake or fraud,CPA's fault or swindle, audit risk and client's operation failure. Chapter 2: Analysis of the reason for audit failure. In this part, the author probes into the reason for audit failure from CPA itself. First, the author put forward that CPA's lack of independence is the primary cause of audit failure. Non-audit service is not the key reason for the absence of independence. On the contrary, it is harmful to forbidding accounting firms from offering non-audit service. In fact, invalid audit relationship is the actually crux. Second, probe into the technical reason for audit failure: risk-oriented audit and auditing standards. The author considers that risk-oriented audit is the development trend. It can reduce audit risk effectively. However, in our country, we just begin to use this new auditing mode. It didn't work very well. Chapter 3: Environmental analysis of audit failure. The author thinks that the cause of audit failure exists in many aspects. It is unfair to ascribe all to CPA. Therefore, in this part, the author probes into th...
Keywords/Search Tags:Audit Failure, Independence, Risk-Oriented, Management Fraud
PDF Full Text Request
Related items