A Optimization Study On The Application Of Confirmation In Independent Auditing

The confirmation is an indispensable part of the audit process,CPA can obtain the external auditing evidence of the audited entity by implementing confirmation.However,throughout domestic and foreign audit failure cases,many of these have traces of not perform confirmation or confirmation ineffectively,even the four major international accounting firms have been improperly implementing confirmation which leads to failure of auditing or even be accused.A series of audit failure case has exposed many problems that exist in CPA implementing confirmation procedure,it also shown the flaws of the standards of confirmation.However,due to the imparity even fraud of the audited entity,the unit that was inquired not attach importance to the confirmation,combined with intensifying competition of the auditing market,CPA practicing environment deteriorative gradually,the implementation and evaluation of the confirmation procedure is faced with many difficulties.The important way to solve the difficulties is CPA implementing confirmation procedure properly and improving standards of confirmation by relevant departments,which is an inevitable requirement to regulate auditors practicing behavior and improve the quality of the audit.Domestic and foreign scholars have been studied on how to improve the quality of auditing,also summed up a number of influencing factors,including the auditing tenure,firm size,auditing fee and auditing independence and so on.These factors are likely to affect the quality of auditing,but the executive condition of the audit process itself is play a decisive role in the quality of auditing.This paper choose confirmation procedure,based on the review of domestic and foreign literature on confirmation procedure and standards of confirmation between auditing and legal circle,then,this paper discussed the audit value of confirmation procedure and further clarifies the necessity of standardizing auditing procedure.After that,the author introduces a case that CPA have obtained important auditing evidence through implementing confirmation properly,combining with the case's enlightenment,aim at the problems of the design,implementation and evaluation of the confirmation procedure currently,and the imperfection of the standards of confirmation,this paper has carried on a multiple perspective and comprehensive analysis.Finally,in view of the above a series of problems,the author put forward the improvement suggestions from three aspects.First,the accounting firm should establish the control system of the confirmation,co-ordination andarrangement work in advance,CPA should to enhance awareness of risk,maintain control during confirmation procedure and prudent evaluation the reply.Second,the banks should be unified standards of charges and the format of confirmation,establish confirmation center and simplify the procedure of bank confirmation,the relevant department should formulate laws and regulations,clear the obligations and responsibilities of asked entity to reply the confirmation,by the way,the asked entity should treat confirmation correctly and reply it positively.Third,the revision of confirmation standards should be more flexible compared with the traditional law and absorb more professional point and view,and further defined relevant rules.After the proposals,the writer reconstructed the confirmation procedure and hope to provide reference for the CPA to implement confirmation and the revision of confirmation standards.In the last chapter of this paper,author makes a summary and put forward some shortcomings of this paper.It is expected that more people will realize the importance and problems of confirmation procedure,and put the procedure in place in the auditing practice so that confirmation can play a real role.