Key Audit Matters Communication Research On Subsequent Measurement Of Assets Of Company A

In recent years,as the users of the audit report have increased the demand for improving the audit quality and the usefulness of the audit report information,China has closely followed the international trend and issued the "China Certified Public Accountants Auditing Standard No.1504-Communication of Key Audit Matters in the Audit Report.New standards such as Audit Matters,etc.These standards pose new challenges to the professional competency of certified public accountants.However,there have not been much study on how to make judgments and to communicate key audit matters yet.Among the A+H-listed companies that have taken the lead in the implementation of key audit matters,goodwill and inventory are common key audit matters to be shown.The unrecognizable reputation of goodwill leads to the measurement difficulty of goodwill has always been a major problem in asset valuation,accounting,and auditing.Behind the huge acquisition of goodwill,there are often huge hidden risks.Once the impairment occurs,it will bring a heavy blow to the company.This risk requires the auditors to be cautious in particular under the new guidelines.The subsequent measurement of inventories has become a powerful tool for many companies to manipulate data and revise their reports due to the fact that their falling prices are ready to be reversed under certain circumstances.In particular,when the amount involved is huge,inventory devaluation must be given full attention.This article starts from the new auditing standards-the key audit matters communication guidelines,based on the theory of information asymmetry,merger effect theory and asset valuation theory,using a combination of theoretical and case study methods,based on summarizing existing relevant literature.Following specific contributions may be made:(1)Based on an overestimation of the value of assets of Company A in the process of mergers and acquisitions,it may provide audit judgments and communication for the confirmation and valuation of assets in the process of future mergers and acquisitions.Ideas and methods;(2)Analysis of the correspondence between the measurement of goodwill and performance commitments during the merger and acquisition process of Company A,and the expected income estimates during the assessment may provide some direction for future audit judgments on the initial measurement and subsequent measurement of acquired assets;(3)Audit judgments and communication analysis of Company A's large-value inventory impairments,guideline on how to determine the different nature of Company's inventory depreciation reserve and cost adjustment in the future audit,and better discover the company's earnings management behavior;(4)During the financial reports' audit process,how to identify and judge key audit matters and how to make a corresponding disclosure in the audit report so as to provide important documents for future research.