The Research On Risks Assessment Of Material Misstatement Of ZhongZhun Accounting Firm Based On ZIXIN Pharmaceutical Industrial

Since October 2003,the International Audit and Assurance Standards Board(IAASB)has issued new standards,introduced the concept of "major misstatement risk" and adjusted the audit risk model to "audit risk = major misstatement risk * inspection risk".From then on,we can reasonably assess the major misstatement risk of customer financial statements,which has becalmed the key criterion and determinant to evaluate the professional competence of accounting firms and certified public accountants and test the audit quality and effect.With the change of enterprise property right structure and the separation of operation right and ownership,in order to cope with the increasingly cruel and compete market's environment and the expectations of stakeholders,the management of enterprises spares no effort to make use of management's flaws to conceal the fact that the operation results are not good.And some auditors are paralyzed by their careers and professions with low skills and literacy made the related risks of related party transaction's audit become a very sensitive part in audit,and attracted great attention in the auditing circles at home and abroad.Therefore,how CPAs understand,identify and evaluate the major misstatement risks related to the relationship between related parties and their transactions through their related work has become a key area in audit practice,and this research has far-reaching significance.Based on the audit of major misstatement risk of ZIXIN Pharmaceutical Industrial by Zhongzhun Accounting Firm(hereinafter referred to as " Zhongzhun Institute"),this paper adopts the research method of combining literature and case analysis,and divided into five parts to elaborate.The first part is the introduction,which mainly introduces the background,purpose and significance of this study,and summarizes the relevant literature.On this basis,it elaborates the content and innovation of this study.The second part is related concepts and theoretical analysis.It mainly introduces the concepts of major misstatement risk,related parties and transactions,and conducts theoretical analysis of transaction cost,principal-agent theory and signal transmission theory.The third part is case analysis.Firstly,the brief introduction of ZIXIN Pharmaceutical Industrial,the situation and results of the penalty imposed by Zhongzhun,and then,according to the results of the penalty,summarizes the problems existing in evaluating the risk of major misstatement of ZIXIN Pharmaceutical Industrial by Zhongzhun.The fourth part is to analyze the causes of the existing problems,mainly from the level of financial reports and identification levels,and put forward countermeasures and suggestions.The fifth part is the summary and outlook.This paperanalyses the problems from two aspects: the overall level of financial statements and the recognition level.On the overall level,it highlights the importance of enterprise management analysis and information identification in the process of auditing by accountants.It also highlights the differences between the nature of industry and the characteristics of enterprises in the selection of auditing methods and procedures,and the specific auditing at the recognition level.The problems existing in the process of procedure execution are also analyzed in detail,which illustrates the importance and irreplaceability of identifying and evaluating the risk of material misstatement throughout the whole process of risk-oriented audit.Finally,we should pay attention to the aspects and suggestions for improvement in the risk assessment of major misstatement when we ascend to the audit level of the Institute in the future.