A Case Study Of P Firm's Audit Failure To L Company

With the rise and rapid development of securities markets in various countries,the role of accounting information in economic decision-making is increasing.The wave of fraud in the global capital market has made financial fraud of listed companies and its governance a difficult problem worldwide.Not only do financial fraud of Listed Companies in developing countries prevail,but also in developed countries such as Britain and the United States,where capital markets are well developed and strictly regulated.There are also serious fraudulent practices of listed companies.Financial fraud in capital market can not be eliminated from a realistic point of view.Financial fraud in listed companies not only causes huge losses to investors,but also harms the rational allocation of resources and the orderly development of capital market.Combining with the special institutional background and environmental factors in our country,from the empirical analysis,the primary motivation of listed companiesTraud is financing,and fraud for the purpose of re-financing such as allotment,additional issuance;secondly,fraud for the purpose of avoiding loss,taking off the hat and guaranteeing the card,beautifying the performance,etc.Because of this,as the last line of defense against financial fraud,the quality of CPA's profession plays an increasingly prominent role in the governance of financial fraud.For the CPA industry,the task and pressure of anti-fraud is increasing.With the continuous innovation of fraud means,auditing means and auditing countermeasures must be innovated constantly to meet the needs of anti-fraudThis paper takes P firm's audit failure case of L company as the research object,and studies the causes of audit failure.This paper first introduces the concepts of audit failure,causes,hazards and related concepts of financial fraud.Secondly,it analyses the performance and causes of audit failure of P Firm.Finally,according to China's national conditions This paper finds that,on the one hand,L company,as an agricultural company,has laid hidden dangers for audit failure due to its special operation status and favorable fraud environment of management.On the other hand,the direct causes of audit failure are the participation of accounting firms in fraud,the insufficient professional level of CPAs,and the inadequate quality control of accounting firms.On this basis,the paper puts forward some countermeasures and suggestions to prevent the audit failure of listed companies'financial fraud,including strengthening the independence of audit,improving the identification of financial statements fraud,strengthening the response to fraud risk signals,improving the internal quality control of accounting firms and strengthening the construction of the audit team of certified public accountants,etc.The innovation of this paper is that the selected cases are the cases of accounting firms jointly participating in fraud,and L company itself is an agricultural company.Its operating characteristics increase the motivation and opportunity of financial fraud,and increase the risk of audit failure.In this paper,while analyzing the performance of audit failure of P firms,the essence of audit failure is analyzed through phenomena.What defects exist in the audit process of P firms and the specific reasons for audit failure are discussed.The law of financial fraud of listed companies is explored,and feasible audit countermeasures are formulated in order to improve audit quality and reduce audit failure.To maintain the healthy and orderly development of China's securities market.The shortcomings lie in the single data source,inadequate disclosure of some financial fraud and audit details of L company,incomplete analysis of the reasons for audit failure of listed companies,and the feasibility of the preventive measures proposed remains to be verified.