Case Study On Related Party Transaction Of Shinewing Audit LeTV

With the rapid growth of China's securities and financial markets,the financial system tends to be diversified.The issuance and listing of IPO has become a means for enterprises to compete in the market.Through reorganization,acquisition and merger,many listed companies have enhanced their competitiveness,the business model has also undergone a qualitative change,the industry has gradually become diversified,and the relationship between enterprises has become more complex.With the increase of business dealings and internal related companies' exchanges of goods and services,the phenomenon of related party transactions also occurs frequently.The related party transaction has its special advantages,for example,the compliant related party transaction can bring considerable benefits for the company,while reducing the cost,it can also improve the enterprise efficiency and manage the capital and debt more effectively;in addition,for a variety of motivations,listed companies can wh itewash their statements,adjust income and profits,and use related party transactions to manipulate profits and transfer investment risks.T herefore,related party transactions are also easy to produce corresponding risks.Some enterprises do not hesitate to use financial fraud to carry out earnings management,which leads to fraud in related party transactions,which not only encroaches on the rights and interests of creditors and investors,but also destroys the normal market order.Although regulators have curbed the growth of some of these unfair related party transactions by formulating relevant laws and regulations,they can not completely put an end to concealing related relations through non-related means,in order to achieve the purpose of evading taxes,manipulating income and profits.The complexity and concealm ent of this kind of business greatly improve the difficulty of examination and identification of certified public accountants.In order to maintain the stability of the capital market order and protect the self-interests of accounting firms and certified public accountants,further research on effective measures to avoid the audit risk of related party transactions has become the focus of this paper.This paper first summarizes the research on related parties and their transactions by scholars at home and abroad,and then introduces the theories related to related parties,including the definition of related parties and their transactions.related party transaction audit and audit risk,fraud triangle model and risk-oriented audit theory.The third chapter selects the typical case of LeTV which has problems in the audit of related party transactions to study the problems related to the audit of related party transactions in the annual financial statement audit conducted by ShineWine accounting firms.The fourth chapter analyzes the causes of the problems raised in the third chapter,and puts forward five reasons that may lead to the failure of related party audit from the perspectives of accounting firms and external regulatory departments.The fifth chapter puts forward the countermeasures to reduce the audit risk of related party transactions and improve the audit quality from six aspects.The sixth chapter summarizes the research content of this paper based on the analysis of the full text and the consideration of the fraud cases of related party transactions on LeTV.