Research On Related Party Transactions Audit Of "China Hi-Tech Group"

Nowadays,with the continuous improvement of economic and the securities market,The corporate governance structure and internal control of listed companies have basically been effectively established.At the same time,with the global economic downturn in recent years,the competition among enterprises has intensified,and for certain special purposes,listed companies often use affiliate transactions to fictitious performance.Due to the hidden nature of the related party transactions and the complexity of the methods,it has brought great challenges to the CPA.It is difficult to identify the related party and related party transactions,which makes the CPA face an extremely high audit risk.Therefore,the related party transaction audit should be used as difficulties in auditing objects,and require CPA pay special attention to it.Cases of failed audits of related party transactions frequently occurred,such as Yaxing Chemicals,Zixin Pharmaceutical,Kangzhi Pharmaceutical,Jade Bird Huaguang,and Beijing Great Wilderness.The failure of these related party transactions failed to audit the credibility of certified public accountants.The increase in the financial responsibility of the accountants' affairs has,on the other hand,also greatly damaged the interests of the public and small and medium shareholders.Therefore,in order to maintain the reputation of certified public accountants and the interests of small and medium shareholders,the research on the audit of related party transactions is of great significance.This paper takes case study as the research method,and selects China Hi-Tech's transactions of related party in 2012 as study case,which is audited by ZhongLei Accounting Firm,to study the existence of related party transactions in the audit process and the reasons for the problems.First of all,based on the transactions of the related parties of China Hi-Tech,this paper analyzes the problems of related party transaction audit:not identifying hidden related party relationships and their transactions,insufficient audit of related party disclosure,inadequate attention and professional prudence,and insufficient audit communication.Secondly,this paper analyzes the transaction audit problems separately from the audited units,accounting firms and related professional standard.Finally,this paper obtains some conclusions and give some suggestions on improving the related party transactions audit.Through the study of the case of China Hi-Tech related party transactions audit,on the basis of considering the feasibility and necessity,this paper give some suggestions on the related party transaction audit:First,the audited units should improve its internal control system;Second,as for accounting firms,procedures and methods of related party transaction audit should be scientific designed,the auditors should improve their professional competence and professional ethics,and at the same time,the firm should improve the quality control system;Third,as for the relevant professional standards,expanding the scope of related parties,strengthening the related party transaction disclosure details management and increasing punishment policy.The main innovations lie in:First,the case company selected was punished by the CSRC in May 2017,so there is no systematic analysis of this case,so timeliness makes the research more consistent with the current situation of the related-party transaction audit;Second,the related party transactions in the case are rather special.The related party transaction method does not directly adopt the method of equity holding,but forms the related party relationship in the form of financial and management teams intervening in the company.It is necessary to make use of the principle that the essence of the standard is more important than form to confirm the relationship of related parties and their transactions.This related party relationship is rather special and difficult to identify,and has innovative value in the case of related party transaction audits;Third,in the part of the proposals,putting forward specific opinions of the relevant professional standards is to study and improve the related party transactions audit issues.