Civil Liability On An Independent Audit

Shocked by a series cases about misstatement,especially the Enron case and the case of "Yingguangxia",most countries around the world began to question the credibility of Certified Public Accountant.What are the reasons of the frequent occurrence of auditing failure? With this problem,I do some research in this field,and I found the most important resons of this phenomenon is that the legal liability of Certified Public Accountant is not clear,expecially that the civil liability is in default and the liability cost for false audit report is too low. This article are tend to analysis the current civil liability and try to find the way to improve the current situation.This article consist of three part:The first part introduces the concept of legal liability of Certified Public Accountant and the role of civil liability of Certified Public Accountant and emphasize the importance of civil liability in securities market.The second part introduce the current development of Chinese civil liability of Certified Public Accountant and the current situation of foreign countries .Through the analysis of the current situation of China ,the paper figure out the problems China is facing now.The third part focus on how to solve the problems and how to improve the current situation ,which is the key issue in this paper.It particularly includes:the clear definition of "the interested third party",the nature of the civil liability of Certified Public Accountant toward the interested third party,the burden of proof,the liability insurance of Certified Public Accountant ,etc.At the end of this article,the paper summarized the conclusion of this article.