Case Study Of Related Party Transaction Audit Risk Of Guangxi Beisheng Pharmaceutical

With the development of social economy,the organizational structure of enterprises has become more and more complicated,and the forms of organization of multinational corporations,parent subsidiary companies have appeared.The economic activities between enterprises have gradually diversified,and the related party transactions are the most complicated amoung many economic activities.In recent years,the listed companies use related party transactions for financial fraud occurfrequently,the audit of related party transactions has become one of the areas with high audit risk,the China Securities Regulatory Commission has issued a number of documents to drawattention to the audit risk of related party transactions of listed companies,all social circles have begun to pay attention to the audit of related party transactions.It is the focus of the attention of all sectors of the society,especially the CPA industry,to control the audit risk of related party transactions and reduce the possibility of failure of related party transactions audit.Firstly this paper analyzes the causes of audit risk of related party transactions from two aspects: the risk of significant misstatement of related parties and the inspection risk of related party transactions according to the new audit risk model.With regard to the identification and evaluation of audit risk of related party transactions,the macro environment,the industry environment and the internal management environment of the company pointed out that the certified public accountants should be the focus of assessment,and analyzes macro environment factors and industry environmental factors using analysis method of PEST and Michael Porter's Five Forces Model respectively.Then,study Guangxi Beisheng Pharmaceutical related parties to take the company funds,the use of related party transactions inflated income and assets and other major facts with relevant financial data;Assess the risk of related party transactions of Guangxi Beisheng Pharmaceutical from the macro environment,industry environment and internal management,and then point out the problems that Shenzhen Pengcheng Certified Public Accountants should deal with.Problems comprise failure to identify the undisclosed related party,failure to reasonably assess the risk of related party transactions,not carrying out specific audit procedures and failure to implement strictly quality control review in the stage of audit report.Finally,according to the analysis of theory and practice,this paper puts forward the countermeasures to deal with the audit risk of the related party transactions from the aspects of the external supervision institution,the audit subject and the audit object.It is helpful to improve the relevant laws and regulations,accounting policies and auditing standards system of related party transactions in China,and to establish a targeted audit procedure of releted party transactions.