Application Of Due Diligence In Risk-Oriented Audit

With the development of the society,the economic business becomes more and more complex.The traditional auditing mode can not find the fraud effectively,which not only damages the interests of the investors,but also is not conducive to the healthy development of the capital market.The professional ethics,independence and professional competence of CPA have also been questioned by the public.Therefore,the modern risk oriented audit mode is the inevitable trend of CPA audit development.The modern risk oriented audit model transfers the focus of the audit work from the audit test link to the risk assessment link.The CPA first needs to evaluate the risk control of the audited units and then execute the additional audit procedure.Due diligence is also a comprehensive investigation of the risks in the production and operation of enterprises.Therefore,this paper,starting from the study of domestic and foreign due diligence and risk oriented audit,studies the general rules and methods of the due diligence through the study of the case of the survey of muddy water company in the case of muddy water company,and explores how to apply the method of due diligence to the risk oriented trial.The final conclusion is that the application of the method of due diligence to the risk oriented audit can make the center of audit shift forward,the process of risk assessment from scattered to structured,and thus can implement the personalized audit test procedure,so it can effectively find the fraud behavior,identify various kinds of risks and improve the audit efficiency.The research ideas of this paper are as follows: first,we collate and read the related literature of due diligence and risk oriented audit,and understand the current situation of the research of due diligence and risk oriented auditing at home and abroad,and further elaborate the meaning of risk oriented audit and due diligence.Then,through the study of the due diligence of the company to the Hui Shan dairy industry,we get some inspiration from it,summarize the merit of its investigation method in the process of audit risk identification,and explore it in the risk oriented audit: from the background of the company,the financial due diligence,the business due diligence and the legal due diligence.To identify and assess the risks faced by enterprises,we can achieve the purpose of controlling audit risks.Finally,some suggestions are put forward for the construction of the environment needed for due diligence in risk oriented auditing.