Study On Key Audit Matters And Their Disclosure

In 2015,the International Auditing and Assurance Standards Board issued a series of new audit reporting standards including ISA701,announcing the beginning of audit report reform.This objectively also requires China to adopt the new audit report model to achieve convergence and continuous convergence between China’s audit standards and international standards.In December 2016,the Chinese Institute of Certified Public Accountants issued 12 revised standards.One of the newly revised standards No.1504 requires certified public accountants to communicate key audit matters in the audit report,which also reflects China’s auditing of audits.The report’s new round of reforms officially kicked off.At present,the reform of China’s new audit report has just begun.In 2017,it was first implemented in the audit report of A + H shares companies,and the scope of implementation further was expanded in 2018.This article first collects,collates,and summarizes the current literature related to key audit matters at home and abroad.Existing research believes that disclosure of key audit matters can effectively reduce the degree of asymmetry of information and increase the value of audit reports,but it results in increased audit costs.The negative effects of being too transparent.In the specific disclosure process,there is also the possibility of insufficient information.Based on the summary of the existing literature,this article summarizes the theoretical basis of key audit matters from the definition,decision framework,and disclosure requirements of key audit matters,and establishes the research focus.The current research is mainly focused on market disclosure.For analysis,this paper combines the data of a large sample and the content of a small focus to analyze key audit matters.For the new energy and photovoltaic industries,recent policy changes are frequent,such as the decline in subsidies for new energy vehicles and the 531 new policy in the photovoltaic industry.Compared with industries with stable policies,the key audit matters in this industry need more attention.China Securities Regulatory Commission issued "Accounting Supervision Risk Tips No.8-Goodwill Impairment",which clearly pointed out the problems in the audit of China’s goodwill impairment.Goodwill impairment is a key audit that needs more attention in the 2018 audit reports.This article selects the key audit matters that have been disclosed in the audit report of Luxiao Technology and the industry’s 2018 annual reports,analyzes the industry sample data and the case company,and specifically studies the number and elements of key industry audit disclosures and the contents.On this basis,this article further analyzes the disclosure and confirmation of the key audit matters of Luxiao Technology,points out the current problems in the disclosure of key audit matters,and puts forward corresponding suggestions to improve the disclosure process of key audit matters and increases the value of audit reports.