Research On Audit Risk Control Of Related Party Transactions Of Company A

In recent years,the financial fraud in listed companies has not only affected the normal operation of our capital market,but also seriously damaged the investment confidence of small and medium-sized investors.Among the many fraud methods,the related party transactions have some concealment,if the listed companies do not make relevant disclosure in the financial statements,auditors are not easy to find in the audit work,so it is difficult for the auditors to find them in the audit work because of the concealment of the related party transactions.Related-party transactions are used by many listed companies to make some illegal transactions to grab profits.In this paper,A Company,which was severely punished by CSRC in 2018,was chosen as the research object of this paper.Through the reading of foreign documents,and according to fraud motivation theory,risk-oriented audit theory,and so on,Through a series of analysis of related party transaction fraud in Company A,the following conclusions are drawn: first,there is a phenomenon of "one share being the largest" in Company A,in which Wang Xing and Wang Yan undefined brother and sister together hold 35.31% shares,which is much higher than that of the third largest shareholder.And apart from Wang Xing and Wang Yan brother and sister other shareholders are more dispersed;Second,A company internal control almost exist in name,two major shareholders of Wang Xing and Wang Yan above the internal control;Third,due to the imperfection of the relevant laws and regulations,the lack of strict supervision and the low cost of violating the rules,the administrative penalty of the CSRC does not impose favorable restrictions on the behavior of the major shareholders,coupled with the company mismanagement and the pursuit of its own interests.A company actually controls a series of related party transactions without disclosure;Fourthly,CPA did not pay enough attention to the audit risk of related party transactions,and the audit procedure was not perfect,which made A company have the chance of fraud.In this regard,accounting firms should be careful to select customers,improve audit-related procedures,strengthen the internal management of the firm;Certified public accountants should improve the professional level of audit,strengthen professional prudence in the audit process,and make rational and effective use of analytical procedures.In addition to the theoretical part,they also need to strengthen their own professional ethics construction.To provide reference value for many accounting firms to audit related party transactions by issuing audit reports in accordance with the actual situation of the enterprise.