Audit Risk And Control Research

As a profession, audit must be provided with certain conditions: When achieving recognition from society and the public, it must undertake great social responsibilities; face and accept a variety of commandments. If aberrance happens, it will deserve all kinds of punishment and losses from economy and other aspects. Therefore, it could be said that as a professional worker, registered accountant is in a potential risk all the time during his/her career. This potential risk will easily turn into an actual one when a single omit occurs. At present, in our market uncertain factors, which will lead to audit risks, exist in a large scale. Therefore, it is necessary to make audit risks clearly understood by the audit community and social public to make sure that audit accountants in China are developing toward a prosperous orientation, and to further improve audit standards of both theory and practice. However, research on audit risks in China is still on a low level with lots of problems that are uncertain or need to be further discussed, for instance, its definition is not clarified clearly yet, research of its evaluation is not enough and mature. Furthermore, problems in non-governmental audit risks should also be further studied. Should these problems be unsolved, the improvement of audit theory and practical standards in China would be hampered, and would further do harm to the development of audit in our country. As far as above is concerned, this passage is trying to analyze the factors that affect audit risks though research of its theory in order to measure the risks and bring forward effective way to control it.The writer started it from the theory of audit risk, and then he defined it by three step-up levels, combined with the definition of some related scholars' theory nowadays. On the basis of the definition, he issued correspondent measure models of the three-level audit risk; moreover, based on these models, he evaluated the factors of risk and quantifies audit risks. The writer measured audit risk from micro and macro aspects in the fourth part, which is an important chapter. The micro control ofaudit risk has three main points as follows: 1.Quantify the audit risk based on its measure models defined in chapter two, 2. Analyze risk control of the main proceeds when using statistics research method, 3. Carry out concrete ways of risk control through small case study, including following aspects:(l) Appraise the honesty and integrity of the management; (2) Measure whether the internal control is integrity or not; (3) Adopt sample statistics to reduce the sample risk; (4) Make audit plan to control non-sample risks; (5) Collect plentiful evidences; (6) Maintain the professional carefulness; (7) Apply some accounting regulations frequently; (8) Design suitable audit procedure; (9) Strengthen investigation of account receivable; (10) Consider the faults and cheatings when making audit plan.In a word, only to integrate and perfect the audit environment and management system, establish objective equity effective independent audit system, can control the audit risk effectively.