Qualified Opinion Audit Report Professional Judgment

The audit opinion is the conclusion made by the certified public accountant based on the professional judgment of the audit,and it is the bridge between the listed company and the user of the financial report.The issuance of qualified opinion report often conveys important signals of serious misstatemnets in listed company,amd will brings about a series of market conditions.Reserch on the influencing factors,professional judgement and the existing problems of qualified opinion can provide important reference for market regulators and audit reporting information users.This article selects 93 audit repot from 2012 to 2016 in Shanghai and Shenzhen to conduct reserch.Firstly,the article collects the relevant literature about qualified opinion and professional judgement and summarizes the main findings and conclusions,which will serve as a basis for the theoretical analysis and further research of this article.It also analizes the limitation of the study.After consulting a large number of domestic and foreign relevant literature,it is found that there are quite few independent studies on qualified opinion.Secondly,this article elaborates the basic theoretical issues of professional judgement from the perspective of information asymmetry and theoretical signal after introducing the institutional background of qualified opinion and professional judgment.Then,the article briefly introduces the meaning and the content of professional judgement in China.Based on the statistics of thoes 93 audit repot,the article analyzes the listed companies that are issued qualified opinion report from the perspective of both the listed companies themselves and the counting firm.This study finds that vatious types of ST companies are highly likely to be issued audit qualified opinion,especially the husbandry and fishery.The conditions of SME board and GEM market are better than the main board market.The ratio of qualified opinion issued by not “Top Ten” firms is higher than the ratio of “Top Ten” firms’.Futhermore,the case stuty method is used to summarize the situations involved in the professional judgement.The reasons for proposing qualified opinion are that there are great uncertain events,limited scope and the uncertainty for the continuous operation.Great uncertain events represent as the case investigation of the SFC has not yet ended and the lawsuit is pending.The limited audit scope is mainly due to the lack of adequate audit support for the reasonableness and authenticity of transactions,the existence and fairness of assets-liabilities,the accuracy and completeness of related transactions,as well as the existence of major defects in the implementation of internal control.the uncertainty for the continuous operation is reflected in the finance of the company ang it is related to the degree of risk the companry takes.Besides,there are still many problems in the the process of using China’s qualified opinion,for example,the shotage of its quantification and the construction will lead to a vague statemnet.It is not appropriate to have the explanatory paragraph in the audited report,which mix up the qualified opinion and the unqualified opinion.and find out the existing problems.Finally,it summarizes the research conclusion of this paper and makes some tardeted suggestions for the existing problems,mainly include accuracy of basic paragraphs forming reservation opinions,correct use of audit opinion types and proposes that certified public accountant should pay more attention to professional judgement in the audit work,which will improve the audit quality certainly.