The Study On Audit Failure Of CPA

Since1981, the system of certified public accountants (CPA) has recovery inChina, the CPA Audit has experienced more than30years. In this process, to adapt tothe market economy, in particular the requirements of establish and improve thesecurities market, the CPA Audit has been rapid and sustained development. The CPAAudit as an important part of the control mechanism of market economy, promote theefficiency of the market economic control mechanisms，to ensure the effectivefunctioning of the market economy, and has been widely recognized of society, andinitially confirmed its position in the socio-economic structure. But at the same time,there has a growing gap between the role played by the audit and the expectations ofthe public, and facing more and more litigation. In recent years, China’s securitiesmarket has occurred “Guangxia "" Kelon "" Macat " and other significant audit cases,the Chinese Institute of Certified Public Accountants has severely criticized by thegovernment, social justice (including investors and creditors) and other aspects. Thisis a wake-up call for the China Institute of Certified Public Accountants. In any case,we can not overlook the importance of the audit risk.In this paper, the author investigated48penalty cases about accountancy firmsand Certified Public Accountant (CPA) by China Securities Regulatory Commission(CSRC) for the past12years, using both normative research and cases study from thepoint of relative theory and research status in audit failure. A prevention measure isproposed upon audit failure in the national securities market based on the currentsituation in China, from part to whole, from abstract to concrete, and step by stepfrom the problem to the countermeasure research.