Research On Risk Of Biological Assets Audit

For a long time,accountant firms have regarded agricultural enterprises as high-risk industries.Especially,their biological assets have the characteristics of long life cycle,great natural environment impact,natural value-added and diversity,which makes it more difficult to audit biological assets.At the same time,as the main inventory of agricultural enterprises,the actual circulation of biological assets involves a number of business cycles of enterprises and financial statements,including the procurement and payment cycle,production and inventory cycle and sales and receipts cycle.In recent years,there are many cases of financial fraud using biological assets in the audit of listed companies and IPO audit.Such as Lantian stock,Fengle seed industry,Shenxianyuan,grassland development,green land,Zhenlong specialty,etc.In view of the audit of biological assets,there is still lacking a set of perfect and unified guidelines for reference.China's auditing business started late,the current domestic auditing standards are revised by referring to international standards.The content of biological assets auditing still needs to be improved.It can be seen that the audit of biological assets is the key point and difficulty in the current audit activities.Under the modern risk-oriented audit model,it is of great significance to identify,evaluate and deal with the audit risks of biological assets.On January 31,2018,Zoneco Group Co.,Ltd.issued the "2017 Annual Performance Forecast Amendment Notice" that the company made a huge write-off to the biological assets because some sea areas of bottom-sown shrimp scallops unusual inventory." Zoneco " erupted scallop no-harvest incident again since the "Black Swan" incident in 2014.It has aroused wide concern from all walks of life.This paper takes " Zoneco " as a case studies the biological assets audit risk.Based on modern risk-oriented audit theory,combined with the concept and characteristics of audit risk and biological assets,as well as the related theory of biological assets audit.This paper starts from the scallop extinction incident in 2018,analyzes the changes and influences of " Zoneco " on business and internal control after the last extinction event.In order to discuss the audit risks still existing in the audit of " Zoneco ",and puts forward the prevention and solution to risks from the perspective of audit..Through the analysis of the internal and external environment of the " Zoneco ",the audit risk of its biological assets is mainly embodied in the following aspects.The weak internal control environment,the flaws in the control activities lead to the special risk caused by fraud in the biological assets procurement process.As an important part of the assets,the characteristics of the shrimp scallop lead to its high value uncertainty,which increases the opportunity for enterprises to use it for fraud;Zoneco's products are single,resulting in huge losses due to two scallop extinction incidents,undivided profits have been in negative value for many years.Asset-liability ratio has been at a high level due to asset reduction and the increase in borrowing for development.At the same time the CSRC has filed a case against him of information disclosure.Based on above reasons,there are serious doubts about the sustainable operation of the " Zoneco ".The growth cycle of the scallop is long and proliferates naturally.Cost measurement can not accurately reflect the fair value of the scallop.At the same time,there are many production links in the " Zoneco " and the cost accounting is complex.The possibility of errors in the cost accounting of biological assets is increased.The particularity of biological assets makes it more difficult for auditors to obtain sufficient and appropriate audit evidence in the process of auditing.And doubts about the independence and competence of audit firms increase the risk of drawing wrong conclusions in auditing.In view of the audit risk in the audit of " Zoneco ",this paper puts forward the following suggestions from three aspects: summarizing the experience and data in the practical work,and applying the accounting standards.The accounting firms should implement comprehensive risk management to implement different coping schemes for different risk projects.Coping with high-risk projects,and implement more quality control procedures.The audit project team should provide targeted training for project team members,which can be carried out on the spot.Interview and understand the production process of audit units.During the audit,CPA should design targeted,personalized audit procedures based on the characteristics of enterprises and biological assets.