Research On Key Audit Matters Disclosure In The Real Estate Industry

Traditional audit reports provide investors with information mainly based on audit opinions issued by certified public accountants:qualified or unqualified,very concise,allowing investors to quickly obtain audit conclusions,which have been recognized by the market for a long time.However,with the outbreak of the financial crisis,the capital market has become complicated,and the information content provided by traditional audit reports to investors is no longer sufficient.In this context,the 2015 International Auditing and Assurance Standards Board issued new revised auditing standards.In order to maintain convergence between domestic and international auditing standards,China issued 12 new auditing standards in 2016,the most notable of which is Auditing Standard 1504,which requires communication of key audit matters in the audit report.The disclosure of key audit matters helps to improve the transparency of the audit process.Investors can obtain more incremental information when using audit reports,making the audit reports more relevant and useful.This paper analyzes the disclosure of key audit events in the real estate industry,analyzes the characteristics and problems of key audit event disclosures after the implementation of Standard 1504,and puts forward corresponding suggestions.Firstly,this paper reviews the development of auditing standards in China,uses the theory of signal transmission,the theory of value relevance,the theory of management identification and the risk-oriented auditing theory as the theoretical basis,and discusses the definition,purpose and requirements of no.1504 auditing standards,enriching the theoretical research results of auditing standards.Secondly,this article counted 135 listed real estate company audit report in 2016-2018 statistical analysis on the key audit issues,and by using comparative analysis the key audit matters disclosed and combined with the characteristics of can reflect the characteristics,the company's industry position affect disclosure,the influence of the type of audit report for disclosure,accounting firm audit response of key audit matters were compared,in order to reflect the landing of the key audit matters since the policy implementation.Thirdly,among all the key audit items,the representative items were selected:real estate income recognition,inventory realizable net value assessment and land value added tax calculation and withdrawal.It was found that the confirmation process of key audit items lacked quantitative benchmark,more homogeneous information and less quantity.Finally,in view of these problems,this paper further analyzes the causes of the problems,and from the perspective of certified public accountants,accounting firms,market supervision institutions to give countermeasures.