On Audit Failure Of Jiuhao Group Backdoor Listing

Backdoor listing is an important way for indirect listing of domestic listed companies,and has many advantages compared with IPOs.For example,the process is more convenient and less time and effort.However,in recent years,many cases of backdoor listing fraud have been exposed.For example,ST Protruly submitted a false agreement to inflate the valuation,Yabaite fictional overseas engineering project inflated revenue of 580 million yuan,and Changsheng Bio-technology was suspected of information disclosure violations.These incidents remind us that there are some omissions in the supervision of backdoor listed companies in China,which has led to frequent market fraud and diversified counterfeiting methods.Although China has the "Procedures for the Management of Major Assets Restructuring of Listed Companies",the "Interim Provisions on Strengthening the Supervision of Abnormal Stock Trading Related to Major Asset Restructuring of Listed Companies",and the "Administrative Measures on the Acquisition of Listed Companies" to regulate the listing of enterprises.However,whether the regulatory authorities strictly enforce the requirements of laws and regulations,or the backdoor listed companies use certain means to evade supervision,and whether the accounting firms can effectively audit the backdoor listed companies in accordance with the requirements of relevant laws and regulations,it is an important topic that requires profound research.This paper mainly uses the case study method to study the faults,causes and suggestions of the failure of the Jiuhao Group's backdoor listing audit.The full text is divided into six parts.The first part is the introduction part,expounding the background and research significance of the topic,and summarizing the related literature,explaining the research content and research methods.The second part is the relevant theoretical analysis of the backdoor listing.Based on the theory of backdoor listing,the paper analyzes the objectives,principles and methods of backdoor listing through the model,reasons,effects and risk points of the backdoor listing.The third part introduces and analyzes the whole process of Jiuhao Group's backdoor listing and fraud,the misconduct in the audit.The fourth part explains the reasons for the failure of this backdoor listing audit through three layers.The fifth part puts forward the countermeasures against the above problems and reasons.The sixth part summarizes the research conclusions and research Limitations.Taking case analysis as the research method,this paper analyzes the case through the three perspectives of accounting firm,borrower and external supervision.It is found that the firm lacked the professional suspicion and judgment it deserved,and did not judge whether it could balance the time and efficiency according to its professional competence and risk control ability,and did not properly implement the audit procedures.Jiuhao Group has problems in internal control environment failure,corporate shareholding structure,management structure,and revenue recognition.As well as the regulatory environment is not strict enough,the laws and regulations governing the firm and listed companies are still not perfect,and the penalties for violations of laws and regulations and the violations of the firm are insufficient,and the cost of illegal activities is not high.It should be improved and improved from the following aspects: Firstly,it is necessary to improve the effectiveness of auditing,standardize the audit market to regulate the behavior of auditors,and auditors perform audits in strict accordance with the requirements of auditing standards.Secondly,the equity structure and organizational structure of the Borrower should be sound and effective,ensuring that the internal control environment is comprehensive and internal control measures are reasonable and effective.Thirdly,the market regulators should standardize and improve the laws and regulations related to auditing responsibilities.Under the premise of establishing an effective auditing market standardization,increase the penalties for the supervision and management of CPAs and violations of laws and regulations,increase the cost of violations of laws and regulations,and effectively reduce improper auditing way.