A Case Study On Audit Risk Of M&A In Zhejiang Newspaper Digital Culture Group

M&A is one of the important ways for enterprises to achieve breakthrough development.However,in 2018,China's M&A market has fallen back.This means that the M&A market is gradually becoming rational and blind expansion is not desirable.On the other hand,strict supervision of the M&A market also makes the M&A path more difficult for enterprises.Faced with the new situation of mergers and acquisitions,firms play an increasingly important role in the process of mergers and acquisitions.In the process of participating in M&A auditing,firms often have to audit earnings forecast besides regular financial statements,which indicates that firms often take higher risks in the process of M&A auditing.Therefore,how to identify and guard against risks in M&A auditing is an important issue for firms in M&A auditing.This paper mainly uses case analysis method to analyze the audit case of digital culture merger and acquisition of Zhejiang Newspaper undertaken by Tianjian Firm,and to study and discuss the risks involved.The first part of this paper is the introduction,which mainly elaborates the background and significance of the research which invovles innovation points and summarizes the research results of scholars at home and abroad.The second part is the case description,which introduces the basic situation of the firm and the merger and acquisition parties and the basic process of the merger and acquisition audit.It mainly includes three events: the complex merger and acquisition audit environment,the audit of high-value goodwill and the continuous cooperation between Tianjian Accounting Firm and Zhejiang Mathematical Culture are three incidents.In this paper,Tianjian Accounting Firm undertakes the M&A audit case.The M&A party is Zhejiang Newspaper Digital Culture Group,while the M&A party is Shanda Entertainment's subsidiary Hangzhou Frontier and Shanghai Haofang.Complex auditing relationship increases the difficulty and risk of auditing,and the process of M&A auditing becomes more complicated.The third part of the article is a case study,focusing on the relevant concepts and theories,and making a concrete analysis of the risk points in the process of M&A audit.In this M&A audit case,there are three main risks: internal and external environmental risk,overvaluation risk and independence risk.The internaland external environmental risks are the most complex,including industry risks,policy risks and internal control risks of the target enterprises.The fourth part of the article puts forward specific suggestions for different M&A audit risks in order to reduce the risks in the process of M&A audit.The article hopes that through the analysis and discussion of the risks in the M&A audit case undertaken by Tianjian,more scholars will pay attention to and study the M&A audit,and provide some reference and thinking for the future firms in the process of M&A audit.