Research On Audit Risk Of Related Party Transactions Of D Accounting Firm

China’s capital market is developing rapidly.In order to expand the company scale,many companies will choose merger,joint venture,technical mutual assistance,supply and marketing chain integration and other means to change the relationship between companies into parent-subsidiary companies or joint venture arrangements.Related-party transactions between them are also becoming more common in capital markets.However,this kind of related party transaction commonly exists in the capital market is prone to fraud.From the famous "Enron incident" in foreign countries to the "Letv" in China,there are always related party transaction fraud in major fraud cases.Because related party transaction is easy to operate,hidden and multi-form characteristics,there is a related party relationship between the two enterprises,will use this relatively hidden relationship for financial fraud to whitewash statements.Therefore,participants in the capital market tend to refer to the audit opinions given by accounting firms to identify whether there are signs of related party transaction fraud in a listed company.However,an accounting firm to provide authentication services for the annual report of the auditees,identification of the hidden relationship between related parties for certified public accountants will be due to the subjective of the auditees hide,their own problems,or system is not sound,faced with many obstacles,thus unable to obtain sufficient appropriate audit evidence to reveal its fraud,This will result in CPA issuing inappropriate audit opinions.Among these,the audit risk level of related party transactions is very high.Therefore,it is necessary to further improve the audit strategy of related party transactions and put forward reasonable countermeasures and suggestions to improve the accuracy of audit opinions.This paper selects a representative case in recent years--D Accounting Firm provided audit services to J Company,which was engaged in related party transaction fraud,and did not issue appropriate audit opinions during the three years from 2015 to 2017.The author sorts out the problems and analyzes them in detail,and finally puts forward corresponding countermeasures and suggestions.In terms of research content,the audit risk of related party transactions of J by accounting firm D is selected as the research object,and risk-oriented audit theory is taken as the guidance system.This paper identifies the audit risk in the audit process of D accounting firm’s related party transaction of J Company,and then analyzes the audit risk factors.Finally,it puts forward the countermeasures to the audit risk of related party transaction from two aspects:accounting firm and certified public accountant.The innovation of this paper is to select representative cases for analysis and research.The case theme is relatively new and the amount of money is huge.Combined with the latest theoretical research,it will have a practical impact on the audit of related party transactions.In addition,through the combination of case study method and normative research method,the risks existing in the audit of related party transactions of enterprises by accounting firms are systematically analyzed based on the perspective of wind oriented audit theory.This paper puts forward more detailed prevention countermeasures for such "special" audit process of related party transactions,which is more practical in the actual audit work,so that accounting firms can have reference to solve similar problems in the future,and further improve the relevant audit process.This paper is that the author for the study of related party transactions audit risk theory,although has carried on the detailed case studies and from two aspects:public accounting firms and certified public accountant put forward the solving strategy,but the lack of practicality,effective strategies and recommendations can’t guarantee,specific operation is still questionable.