Research On The Audit Risk Prevention Of Accounting Firms

With the development of society,large-scale enterprises will have the separation of management rights and ownership,making corporate financial information asymmetrical.Accounting firms can help investors obtain more financial information about the company,and the audit of certified public accountants is closely related to the interests of investors.However,during the audit process,there may be problems in the audit process of the CPA due to considerations such as cost,business level,and time factors,which affect the audit results,reduce the quality of audit services,and even audit failures.It makes people doubt the quality of accounting information,which is detrimental to the overall audit industry.This article reviews foreign and domestic research on this issue,introduces theories related to audit risk,and further explores audit failure.Next,the case of Kangdexin audit failure is introduced.In this audit case,Ruihua Certified Public Accountants had a lack of audit procedures by the auditors.The auditors did not strictly abide by the audit procedures,and failed to discover Kangdexin’s financial frauds for many years.Through the study of this audit failure case,it is understood that the audit staff of the firm is insufficient in professional competence,and the auditing for many years has affected the third-party independence of the audit.The multiple merger history of Ruihua Certified Public Accountants also has an impact on the audit quality.Certain influence.Moreover,competition in the audit industry,multi-party supervision,and insufficient punishment were also the reasons for the failure of this audit.The research method of this paper is a combination of theory and case,analyzes typical cases of audit failure,and draws relevant conclusions.This research will help accounting firms improve their audit risk prevention capabilities and reduce audit failures.Improve the credibility of certified public accountants and accounting firms,help companies discover problems and improve them in time,and promote sound social and economic development.At the end of the article,the case is summarized.Through the analysis of the failure of audit,the accounting firm needs to improve the internal governance mechanism,and also to prevent and control risks in the audit process.Regarding the human resources of accounting firms,we will strengthen audit procedures and professional ethics training for certified public accountants,as well as the supervision and management of accounting firms by external agencies...