Research On IPO Audit Failure Of Small And Medium-sized Board

Since the small and medium-sized board launched by Shenzhen Stock Exchange in May 2004,the development momentum of small and medium-sized enterprises has become more and more rapid.At the same time,the position of small an medium-sized enterprises has become more and more important.The development of small and medium-sized enterprises not only promotes our national economy,but also contributes to social stability.For example,the rapid development of small and medium-sized enterprises needs more talents,provides more jobs,and alleviates employment pressure.From the launch of SMEs to now,after 14 years of development,SMEs have become an indispensable backbone of China's capital market.The higher you stand,the greater your responsibility.Small and medium-sized board IPO audit has become a focus of social attention.Because SMEs have the characteristics of high growth,high risk and the majority of private enterprises,it means that the audit of SMEs' IPO will not go smoothly.In recent years,the failure of IPO audit of small and medium-sized boards has repeatedly been exposed,which has caused the public to have a crisis of trust in the industry of certified public accountants and the market of small and medium-sized boards,which has seriously affected the reputation of the profession of certified public accountants,at the same time,It also has an adverse effect on the healthy and orderly development of the small and medium-sized board market.Therefore,finding out the reasons for the failure of small and medium-sized board auditing and giving pertinent suggestions are not only conducive to improving the credibility of the CPA industry,but also conducive to the stable development of the small and medium-sized board market.This paper mainly adopts literature research method and case study method.Firstly,this paper summarizes the relevant researches on audit and audit failure of small and medium-sized board by many domestic and foreign scholars,and takes the fraud triangle theory,principal-agent theory and information asymmetry theory as the theoretical basis for the research on IPO audit failure of small and medium-sized board.Based on the characteristics of SMEs and the current situation of IPO audit of SMEs,from the perspective of certified public accountants and accounting firms,the paper takes D enterprises as an example to find that the audit failure of D enterprises is mainly caused by the following four reasons:(1)The lack of independence of CPA;(2)Certified public accountants lack professional skepticism and due attention;(3)CPA's professional competence is not enough;(4)The quality control system of accounting firms is not perfect.Finally,combined with the analysis of the causes of audit failure in specific cases,the paper puts forward suggestions from the following four aspects in order to reduce the risk of IPO audit failure in small and medium-sized boards:(1)Improve the independence of CPA;(2)CPA maintains professional suspicion throughout the audit process;(3)CPAs must strengthen their professional competence;(4)Accounting firms should not only maintain quality control throughout the audit process,but also carefully analyze the risk points of audit business when undertaking business.Secondly,they should strengthen the management of human resources to prevent the loss of outstanding talents.Through in-depth analysis of the case of D enterprise,this paper enriches the research on the failure of IPO audit of SMEs,strengthens the public's understanding of the reasons for the failure of IPO audit of SMEs,and puts forward some scientific and feasible measures to prevent the failure of IPO audit of SMEs.