Misrepresentation Liability Of Certified Public Accountants

Certified Public Accountants function as the market economy police in the socialism market economy; their responsibility is to audit the finance information of the business enterprise's, prevent fraudulent practices, and help the information user to make an assessment of the information quality. But, shocked by a series misrepresentation cases, the public began to question the credibility of Certified Public Accountants. Why do the accountant often participate in the misrepresentation? Whst's the accountant guarantee the audit quality? Where is independence that the Certified Public Accountants been exactly? How to pursue the Certified Public Accountants' legal liability?With these problems, the paper examines the phenomenon of misrepresentation, and find that one important reason of this phenomenon is that the regulation on the legal liability of Certified Public Accountants is not clear, especially that the liability cost for false audit report is too low. Which caused a law environment in favor of the accountant to break the law, violate the rules to some extent. "Any law can't be without tooth, the system only have to take responsibility as the backing, the power contain the dint of the law"; and every power needs the exterior supervision, great power without supervision cause corruption. Therefore, only strengthening the research to the legal liability of the Certified Public Accountants, can supervise the industry of Certified Public Accountants, improve the quality of the audit, then protecting the legal rights of the investor, promoting healthy development of the market economy.This paper started from the fact analysis, and analyzed the legal liability of the Certified Public Accountants, through summarizing relevant preferences, considered experiences of other country's to inquiry into the concrete problem of the liability system of Certified Public Accountants, and put forward own views.This paper consisted of four parts, the main contents are as follows: Foreword: This part begins from the introduction of the present state of the accountants' liability to drawn a conclusion that the system of the legal liability of Certified Public Accountants in our country is far behind the development of the industry of Certified Public Accountants. Then, this part introduced the domestic and international theories of the legal liability. It is important to improve the legal liability system of Certified Public Accountants.The first part: This part summarize the misrepresentation of Certified Public Accountants. This chapter includes three parts, and analyse the fact of the misrepresentation. At first, this part defining the misrepresentation, then analyzing it's legal characteristic and types. Finally, there are two reasons that seduce Certified Public Accountants to break the law, one is the economic dependence; the other is the low liability cost.The second part: This part analyse the legal liability of Certified Public Accountants in China. This part introduce the law about the legal liability of Certified Public Accountants in China from three aspects: the civil liability, the administrative liability and the criminal liability of Certified Public Accountants.The third part: This part analyse the regulation of the legal liability of Certified Public Accountants in foreign countries. This part also introduce the legal liability of Certified Public Accountants in foreign countries from three aspects: civil liability, administrative liability and criminal liability respectively. With the comparison of the legislation of those foreign countries,it discusses the shortcoming and advantages, to set up a standard for our country in legal drafting.The fourth part: the defect of the law about the auditors' legal liability and improvement. This part includes two sections. One is introduction about the defect of the law about the auditors' legal liability in China according the analysis in the foregoing part. Then, the second section put forward some suggestions towards the defect about the legal liability system. Conclusion: This part emphasizes again that the importance to improve the legal liability system of Certified Public Accountants on the basis of the analysis. However, the legal liability of Certified Public Accountants must be limited in a rational range, otherwise, it would restrain the development of the industry of Certified Public Accountants.