Ruihua Accounting Firm's Specialty For Liaoning Zhenlong Research On Reasons And Countermeasures Of Audit Failure

In recent years,the failure of the audit of IPO enterprises has occurred frequently,which also reflects many problems,whether enterprises or accounting firms have different degrees of problems.For this,China Securities Regulatory Commission(CSRC)has attacked the chaotic phenomena in the capital market.In 2018,310 administrative penalties were imposed,up 38.39 per cent year-on-year,106.41 billion yuan in fines,up 42.28 per cent year-on-year,and 50 people were banned from the market,up 13.64 per cent year-on-year,involving 56 cases of illegal disclosure of information.The whole certified public accountant industry is being questioned by the majority of investors,and its fair,fair and open image is seriously damaged.The auditing industry urgently needs to strengthen control,protect the legitimate rights and interests of investors and promote the harmonious development of the economic marketc.Based on the theory of audit failure,this paper combines the theory of audit failure with the case facts by introducing Ruihua Accounting Co.,Ltd.to audit failure cases of Liaoning Zhenlong specialty.Summarizing and analyzing the specific reasons for the audit failure are:insufficient risk assessment,lax audit procedures,and false audit evidence;After detailed analysis of what Ruihua and Zhenlong specialty products did in the audit of the IPO,the reasons for the audit failure and analysis,and the lack of rigorous audit processes and solutions,the case thinking and enlightenment were finally formed.It is concluded that audit risk can not be avoided in any audit project.Certified public accountants should strengthen the combination of theory and practice,improve the audit process,and strictly follow the auditing standards.The audit process is carefully completed to maximize the avoidance of audit failures and thus promote positive development throughout the industry.