A Study On The Failure Of Neeq Audit

The NEEQ has become an increasingly important part of China’s capital market in recent years and has developed at an alarming rate since its establishment in 2013.Although the development speed of the NEEQ is fast,the problems of the NEEQ market are gradually exposed.Different from the main board market,the main body of the NEEQ market is mainly small and medium-sized innovative enterprises.Its entry threshold is relatively low and its regulatory environment is poor.Many enterprises with insufficient qualifications have successfully listed in the NEEQ market through deliberate packaging,which has seriously damaged the normal development of the market and increased the risk of CPA auditing the NEEQ business.With the emergence of more and more NEEQ audit failures and financial fraud,a series of trust crises have emerged in the development of certified public accountants.Therefore,in order to promote the good development of China’s NEEQ market and the long-term development of certified public accountants,it is necessary for us to study the NEEQ audit failure cases,so that in the future certified public accountants can reduce the relevant audit risks when conducting the NEEQ audit business,thus reducing audit failures.The problems studied in this paper are the problems and reasons that lead to the failure of the listing audit of the NEEQ.This paper’s research idea is to review the literature from three aspects: audit failure causes,audit failure countermeasures and relevant contents of the NEEQ audit.Based on the theories of audit risk orientation,principal-agent theory and rational economic man theory,this paper adopts the method of case analysis.This paper,from the perspective of accounting firms,takes the new three-board audit conducted by Xinghua accounting firm as an example,analyzes the problems and causes of the failure of the new three-board audit conducted by the firm,and analyzes the areas that should be improved,so that accounting firms can reduce the audit failures in the new three-board audit.The research found that Xinghua’s audit had the following problems: the risk assessment procedures were not in place,the substantive procedures were not implemented in place,and the audit quality control was not strict.The reasons for Xinghua’s audit failure are as follows:(1)the auditor’s professional ability is insufficient;(2)the firm is blind in undertaking business;(3)the CSRC’s punishment is insufficient;(4)the new three boards’ legal and regulatory system is not perfect.Finally,the paper puts forward some suggestions from three aspects: certified public accountants,accounting firms and external supervision in order to provide some ideas for reducing the audit failure of the NEEQ.Due to the late development of the new three-board audit in China,the research fields of scholars in recent years are mainly the development status of the new three-board market,the regulatory environment of the new three-board and the information disclosure of enterprises listed on the new three-board and so on.There is little research on the failure of the new three-board audit conducted by the firm.This paper analyzes the failure of the new three-board audit in combination with representative cases,which has certain practical significance.The research objective of this article is to find out the special features of the NEEQ audit,and to put forward suggestions on the NEEQ audit in China from the aspects of certified public accountants,accounting firms and external supervision environment.I hope these suggestions and countermeasures can be helpful to improve the audit quality of the NEEQ listed enterprise audit projects in the future and contribute to the rapid development of the NEEQ audit in China.