Application Of Risk-oriented Audit In Financial Fraud

The system of China's securities market has gradually become more and more perfect with the comprehensive deepening of economic system reform,and the securities market has seized this opportunity to start rapid development.However,the speed of market development has higher requirements for everything,and information disclosure is a very important point.Whether it is the healthy operation of the market or the benign circular investment of investors,it relies on reasonable and fair information disclosure.In other words,the fairness and rationality of the audit report issued by the CPA is crucial.However,the rapid expansion of economic volume has also given opportunists opportunities,and financial fraud incidents are not only more and more,whether it is inflated profits or capital,this fictional amount is also increasing.In the multi-year history of “wrestling with the auditors”,the means of financial fraud has also matured.The “one-stop” service of forgery vouchers makes the book of the company perfectly in a state of being consistent with the accounts,and the traditional auditing method has been difficult to cope with such fraudulent means.The risk-oriented audits that are currently prevalent in the world are good for dealing with such audited units.At the beginning of the audit,multi-dimensional environmental factors are used to identify and assess the audit risk of the audited entity,and a more reasonable and targeted audit plan can be formulated.This is conducive to the improvement of audit quality.This paper makes a comprehensive analysis of the case of ST Kangmei financial fraud,and clarifies the shortcomings of traditional auditing.Firstly,according to the administrative punishment of the CSRC,it analyzes the financial fraud of Kangmei Pharmaceutical,finds the logic of fraud through fraud,and analyzes the motive behind the financial fraud logic with Kangmei Pharmaceutical's shareholding change information.From the analysis of financial fraud,it can be seen that the audit procedures implemented by Zhengzhong Zhujiang Certified Public Accountants in the audit process are flawed.Includes monitoring procedures for consumable biological asset inventories,bank letter procedures,and control procedures for sales and collection cycles.After analyzing the audit defects of ST Kangmei,this paper starts from the risk-oriented concept and re-examines the unaudited financial report of Kangmei Pharmaceutical in 2018.The risk-oriented audit here focuses on two issues,one is the audit risk of the pharmaceutical industry where Kangmei Pharmaceutical is located,and the other is the comparison of Kangmei Pharmaceutical's financial report analysis data with the industry data.From these two perspectives,the problems found coincided with the issues mentioned in the "Administrative Punishment and Market Prohibition Notice" issued by the CSRC.In other words,the risk-oriented audit method is necessary for the audit of financial fraud cases.In order to improve the quality of auditing,this paper puts forward some suggestions for CPA at the end.CPAs who conduct risk-oriented audits should adhere to their own professional ethics and strictly enforce the audit procedures that should be performed.CPA firms should also set strict audit prices and incentives.On the one hand,rigorous prices are designed to avoid financial fraud,and companies are encouraged to work diligently.