Consideration Of Laws And Regulations In Financial Statement Auditing

In July 2018,the perpetual organism was found to have illegally produced rabies vaccine,which was investigated and fined by the Drug Administration.In the auditing of financial statements in 2017 and before,Changsheng already had relevant penalties and lawsuits and showed obvious risk of violation of laws and regulations,but the audit was not disclosed,and the auditors were not punished after the outbreak of the incident.At present,the Securities Regulatory Commission requires listed companies with major violations to withdraw from the market compulsorily.As the "insurance" of the information quality of capital market,does external audit need to evaluate and disclose the possible consequences of their existing laws and regulations in the risk assessment?Therefore,based on the current auditing standards and theories,this paper explores the rationality and adequacy of the risk assessment of enterprises'violation of laws and regulations in the practice of financial statements auditing through this case.This paper mainly uses the method of normative research and case study to analyze,in order to strengthen the practical guidance role of auditing standards and risk-oriented auditing,improve the CPA's vigilance in auditing the risk of corporate legal compliance,and create a good business and financial environment.At present,due to the imperfection of laws and regulations and the inadequate awareness of legal operation,some Chinese enterprises lack the minimum awareness of legal operation.The company whose corporate governance culture,management level and financial condition are defective will bring about the possibility of fraud and lack of legitimacy.This possibility will also have different effects on financial statements.The existing auditing standards also clearly stipulate how CPAs consider the illegal activities of enterprises.But what does not match with practice is that the research on the impact of corporate legal risk on audit is mostly confined to the empirical point of view,and little is done from the micro-point of view of the enterprise.The relationship between verification and external audit quality or fees is not very instructive in the actual operation with individual indicators of corporate legal acts,such as economic disputes,lawsuit arbitration and irregularities.This paper innovatively analyses the contradiction between accounting treatment and economic business legal norms through case form and current hot events,and considers how CPAs can improve the decision-making usefulness of audit reports and shoulder their due social responsibilities and missions.It has a certain reference significance for auditors in the practical work of financial statement audit and risk identification.Through the research,this paper(1)Audit does not fully consider the enterprise laws and regulations,which is not conducive to the protection of investors'interests and the quality of capital market information.(2)Whether an enterprise has serious violations is very important to the evaluation of continuing operation or to avoid large fines litigation.Under the requirements of the standards and regulations,it is necessary to draw up detailed drafts and quality control procedures for the violation of laws and regulations and the impact on financial statements in audit practice,and to strengthen the evaluation.(3)In the implementation of auditing standards,the accountability of auditors with negligence needs to be strengthened.