| Audit risk is the possibility that the Accounting networks and associations will undertake the audit of the annual financial report of the listed company and issue improper opinions,including the risk of material misstatement and the risk of inspection.Under the modern risk-oriented audit model,whether the Certified Public Accountant can properly assess the risk of material misstatement and effectively deal with it directly determines the quality of annual report audit and whether it will be held accountable for audit responsibility;This not only depends on whether the Certified Public Accountant follow the Auditing Standards and professional ethics,whether the professional competent,listed companies annual report audit business complexity,operational risk level also has a significant impact;If the audit process to identify the assessment of Inadequate Certified Public Accountant,response procedures are not in place,not only audit quality assurance is difficult,the likelihood of being held accountable for audit liability will be greatly increased.Since 2016,Yinyi group has undergone a strategic transformation through cross-border cross-industry mergers and acquisitions.It has taken three years and spent 12 billion yuan of capital,but it has had to maintain its operations through frequent equity pledges and over-borrowing,finally June 14,2019 to the Ningbo court for reorganization,and in September 2019 was the SFC punishment.Accounting Networks and associations was commissioned to audit the Group’s annual reports from 2014 to 2018,issued unqualified audit reports from 2014 to 2017 and qualified audit reports from 2018.On the basis of reviewing the existing strategic transition risk and audit risk research,this paper first analyzes the risk of material misstatement in the audit process of Yinyi annual report by using Information asymmetry theory and modern risk-oriented audit theory.It is found that the strategic transformation decision-making of Yinyi Group has greatly increased the operational and financial risks,resulting in a substantial increase in the risk of material misstatement in financial statements,for example,the decrease of market share,the centralization of equity governance structure and the radical management idea result in the increase of the risk of material misstatement Large goodwill is faced with the liquidity crisisof short-term assets,such as asset impairment,frequent equity pledge and high dividends,which leads to a large increase of the risk of major misstatement at the level of recognition,as well as the special risk caused by the use of large capital by related parties;The concealment of these risks has also led to a significant increase in the audit risk of annual reports;finally,in the future,the auditor should fully understand the macro-environment and industry environment of the audited entity,pay attention to the ownership governance structure and management idea of the audited entity,pay attention to the rationality of the valuation of the audited entity and the risk of the impairment of large goodwill,pay attention to whether the audited entity has the affiliated party occupying the funds,pay attention to the pledge of equity and large dividends,pay attention to the improvement of audit quality,and the Accounting networks and associations should raise the supervision efficiency;I hope it can provide reference for the Accounting networks and associations and related organizations. |
