The Application Of Risk - Oriented Auditing In Our Country

The fraud question of financial report is the problem for auditing circle all the time. Risk-Oriented Auditing as an effective solution was developed by big five, which are popular in west world. But this method is questioned with the financial report of listed company practicing fraud in Enron, Communication of the world and so on. The viewpoints on Risk-Oriented Auditing are so opposite. Is Risk-Oriented Auditing a developed technology, or the cause of auditing failure? And should be this method used in China?This article draws a conclusion from theory and practice: Risk-Oriented Auditing is the development of System-Oriented Auditing and it represents the new tendency of modern auditing methods, although it has some flaws. But it will be effective only if some demands are satisfied. This article analyses the changes in the cost and benefit of auditing firm used Risk-Oriented Auditing, which affect this methods used by the auditing firms in China. At last, some suggestions are made to solve these questions.