Case Analysis Of Liancheng Orchid Audit Failure

With the continuous development of the capital market, the market economy has a important role in China’s capital market, and people pay more and more attention to the quality of accounting information, but the failure of the audit has led to the public distrust of accountants. This leads to the crisis of confidence in the entire audit industry. Saidi media, DZH, Xintai electric, Liancheng Orchid, these audit failuresexposure to the public view in 2016. Enterprises has not only been severely punished by China Securities Regulatory Commission , but also condemned strongly by the public . In recent years, the case of continuous audit failure,the CPA industry sounded the alarm, but also for the management of the audit failure and improve our attention.Firstly, it introduces the background and significance.Then,this paper introduces the audit failure and related concepts, which is a theoretical foundation for the further study of the latter case. Then, the paper analyzes the audit failure case of Liancheng orchid. Then, around the Liancheng orchid audit failure case analysis of the reasons,First, the main reasons for the audit, including two aspects of certified public accountants and accounting firms. The audit of the existence of the problems are: the overall level of risk assessment is not accurate, some audit program implementation is not in place and for the part of audit evidence to support the audit results of the lack of reliability; REANDA mismanagement and internal audit market environment to the impact of firm Eventually led to REANDA accounting quality control system problems. Secondly, as the object of audit, Liancheng orchid has the existence of fraud mentality and the problems of the management style, which has hidden hidden trouble for audit failure and indirectly led to the failure of audit. Through this case,give advice to prevent audit failure. Audit subject is given from the specific countermeasures of audit procedures and strengthen the quality control system for the accounting firm,proposed the establishment of credit mechanism and mode of operation of the proposed company. Finally, this paper summarizes the research conclusions,and expounds the research results and limitations of the article.This paper analyzes the audit failure case of Liancheng orchid, analysis of the causes of audit failure, put forward effective prevent measures of audit failures. For the development of the audit industry to do a little bit of strength.