On the CPA Audit Failure Causes and Countermeasures英语论文.doc
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1、On the CPA Audit Failure Causes and CountermeasuresAbstract: CPA audit failure is prevalent in the audit practice and very serious problem, and also contributed to the practice of accounting firms and associated persons to take up the responsibility of the main reason for the audit. In this paper, r
2、eference cases, analyzes the causes of audit failures and proposes specific measures to resolve it. Key words: Audit risk; professional discretion; audit procedures; audit responsibilities Audit failure is the extreme case of audit risk that practitioners did not comply with auditing standards and p
3、rofessional discretion to form or make a wrong audit opinion, the information the user accordingly made the wrong judgments or decisions, and therefore requiring accountants Service and signature of the CPA held accountable. I. Analysis of the causes of audit failures 1. The lack of audit independen
4、ce According to the World Communications April 22, 2002 to provide a Call for the right to vote statement (Proxy Statement), Arthur Andersen and WorldCom in 2001 collected a total of 16.8 million U.S. dollars in service costs, of which 4.4 million U.S. dollars audit fees, tax, consulting 7.6 million
5、 U.S. dollars, non-financial statement audit (mainly outsourced internal financial audit) 160 million and other advisory services to 3.2 million U.S. dollars. Since 1989, Arthur Andersen has served as WorldComs auditor until the Enron scandal, the world communications only in the May 14, 2002 dismis
6、sal of Arthur Andersen, KPMG employed instead. Andersen not only in the past 10 years, communications around the world providing audit services, to provide consulting services. Although so far there are not sufficient evidence to prove that the authority also provides audit and consulting services a
7、ccounting firms could undermine the independence, but the July 30, 2002 adopted the Sarbanes - Oxley Act accounting and internal to the agent 9 consulting services and auditing made prohibitions as well as tax advisory restrictive regulations made, or at least explain the public and the legislature
8、also offering auditing and consulting could undermine the independence of the concerns. In addition, WorldCom has always been the Arthur Andersen Jackson, Mississippi (the worlds communications headquarters) Branch of the most valuable single customer, this fact can not help but have doubts about th
9、e independence of Arthur Andersen. Jackson branch of the established purpose is to wait and keep the worlds communications that bring a lot of money to the Arthur Andersen auditing and consulting income customers. This case, the Jackson branch of the Arthur Andersen partner in global communications
10、will inevitably have a non-standard accounting treatment to be accommodating. The trial of the world communication partner, the loss of such a large customer, the consequences are unimaginable. 2. The audit process failed to maintain proper professional care and professional doubts Kelon Electrical
11、problems, the CPA is obvious dereliction of duty. If the CPA can be in strict accordance with the relevant system of due diligence work, to make judgments based on the principle of prudence audit, then the so-called myth Kelon will not last so long, Kelon legend can not be confused so many people ov
12、er such a long time, even a China Central Televisions annual economic figures, impact and misled many people. Therefore, from the role of subjective or objective reality point of view, the event went Kelon Now this way, the CPA did not fulfill their duties, is indisputable. Gu Chujun financial maneu
13、vers tricks, huge capital flows and sources, under the conditions of modern technology in the accounting statements can not but leave traces. Inter-bank deposits and loans, related accounts exchanges, the financial can not be unaware. Informed rather than genuinely truthful information and early war
14、ning information on not only the dereliction of duty, as well as suspected of dereliction of duty, which greatly damaged the interests of investors, it also undermines the enterprise and the state long-term interests. 3. The audit process, there are many deficiencies in the implementation of the Aud
15、iting standards require that a registered accountants in private practice, and should maintain the attention they deserve. The object should be implemented to audit risk assessment process. Especially for certain specific audit content, key program can not be omitted, but in the silver Guangsha cond
16、uct annual audit, certified public accountants over-reliance on the audited units to provide audit information. No evidence of the crucial evidence in person. Such as accounts receivable, bank deposits, the audit procedures used circularization. Required by auditing standards, Xunzheng Han, as well
17、as the establishment and send replies. Certified Public Accountant should be himself. However, in actual operation, CPA puts Xunzheng Han handed over to the audited units issued by an accounting firm and then gave them back, which is being audited unit forged circularization results provide a conven
18、ient, this procedure to obtain the external compromised the authenticity of audit evidence, circularization meaningless. In the Silver Guangsha incident, the practice of certified public accountant is not strictly enforce the necessary audit procedures, resulting in the audit failure. 4. Auditors ha
19、ve violated the code of ethics, provision of false audit reports Shanghai Qin Industry accounting firm of a registered accountant in the March 2, 2006 -2,006 years, March 8 7 days period of time, issued 166 copies of the content of false verification report, the Shanghai Xing in the accounting firm
20、of a registered accountant in 2005, June -2,005 years in September, for 68 units of a significant false verification report to verify the registered capital of 86.13 million yuan, have dried up registered capital of 68 units have been illegally registered. Constitutes a grave violation of the CPA co
21、de of ethics, causing huge losses to investors, resulting in the audit failure. Reposted elsewhere in the paper for free download http:/ Second, specific measures to resolve the audit failure 1. Kejin due professional care is the key to preventing audit failure Audit Failure generally refers to the
22、absence of certified public accountants to comply with generally accepted auditing standards and the serious misrepresentation of the financial statements the wrong audit opinion. In reality there is another phenomenon, namely, certified public accountants to comply with the auditing standards, but
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