A Study Of The Defense System Of The Growth Enterprise Market IPO Audit Failure

In August 28,2017,Xintai Electric formally withdrew from the A-share market.So far,the company took the position of "the first stock of the GEM(Growth Enterprise Market)delisting" and became the first GEM listed company in the A-share market to be delisted due to fraudulent issuance.It is not difficult to see that the case of Xintai Electric shows the landmark significance of the SFC's determination to deter fraudulent listing and regulate the capital market.Compared with the main board and the small board,the GEM offers opportunities for small to medium-sized enterprises that have potential for development but lack access to financing.Moreover,compared with the indexes such as capital stock and profitability,the GEM market places more emphasis on the company's growth and innovation capabilities.Therefore,its listing conditions are relatively low,and it also has a high inherent risk.Once the auditors and the audit institutions let the risks out of control in practice,it is very likely to lead to audit failure of IPO projects.Audit failure will not only damage the interests of the users of the report,but also produce a series of negative effects.For example,allowing investors and the general public to become suspicious of the independence and authority of the audit units and auditors,loss of confidence in the securities market,and unrealistic operational data may bias the formulation of policies.Therefore,how to prevent the frequent occurrence of audit failure has become an urgent problem.The article mainly solves two problems.First,it clarifies the reasons for the failure of the audit.Second,it combines the specific case of audit failure to construct the IPO audit failure defense system of the GEM.This article is divided into the following parts.First,it introduces the background and research significance of the article,presents the research route of the article,and puts forward the innovation of the thesis;second,it makes a literature review and summarizes the related research achievements of scholars both at home and abroad,and learned more about the failure of the audit;third,the part summarizes relevant theories,concepts and definitions of audit failure and lays the foundation for subsequent case analysis;fourth,the article analyzes the audit characteristics of the GEM IPO,and summarizes the current status of the IPO audit of the GEM and the causes of the IPO audit failure of the GEM;fifth,a detailed analysis of Xintai Electric fraudulent listing case,discusses the company's financial fraud,and draws lessons from the case,as well as a series of adverse effects caused by the failure of the audit;finally,the construction of the audit failure defense system of the GEM is completed.To prevent recurrence of audit failures,not only requires certified public accountants and firms to strictly implement the procedures,do a good job in quality control,play its own core role in the prevention work.What's more,the constructions of many supporting mechanisms like auditing practice environment is also of great significance.