Research On The Causes Of The Failure Of Jiadian's Audit And The Countermeasures To Avoid It

According to the statistics of the administrative punishment decision issued by the CSRC,from 2008 to 2018,all 35 accounting firms and 88 certified public accountants were punished by the CSRC due to audit failure.The occurrence of audit failure makes most investors believe that accounting firms and listed companies cheat together and lose confidence in the audit industry.This paper first summarizes the connotation,causes and avoidance strategies of audit failure in existing research results,and then sorts out the three theories of audit failure.Secondly,the audit failure case of JiaDian was analyzed,and it was pointed out that the financial adjustment of JiaDian was carried out in the period of 2013-2015.Found that DaHua did not follow the audit standards in terms of operating costs and sales expenses in the process of auditing JiaDian shares;and the adverse impact of audit failure.Then,based on the information asymmetry theory,principal-agent theory and audit conflict theory,this paper explores the causes of the audit failure of JiaDian shares from the perspective of DaHua,JiaDian shares,audit practice environment and the "coupling" relationship among the three.Finally,countermeasures are proposed for the audit failure cases: the accounting firm should cautiously accept the business,adhere to the "three-level review" and achieve the "five-level combination";The auditee should improve the internal control system of the listed company and make performance commitment to be scientific and prudent,etc.Government departments should regulate market competition and intensify supervision.And draw the conclusion: the connotation of audit failure is the "researcher",accounting firm management does not reach the designated position is the main reason of audit failure,the auditees financial fraud is the secondary cause of the failure of the audit,audit practice environmental chaos is the audit failure of the "coupling" of the relations between and among other reasons and is also the cause of audit failure.In this context,this paper adopts typical case analysis and statistical analysis to analyze the audit failure cases of JiaDian shares and find out the crux of the audit failure,which is of practical significance for accounting firms,auditees and external regulatory departments to avoid audit failure.Among them,accounting firms should optimize the implementation of audit procedures,audit firm review and other aspects to reduce the probability of false audit reports issued by accounting firms.From the aspect of listed companies: to make them aware of the serious impact of financial fraud,and to make performance commitment to be scientific and prudent;Audit practice environment: through the analysis of the audit failure cases of JiaDian shares,it is found that China's audit industry has a low concentration and low cost of violation,which can provide reference for government departments to carry out punishment for violation.