Research On The IPO Audit Risk Of Pharmaceutical Manufacturing Companies On Science And Technology Innovation Board

The establishment of the Science and Technology Innovation Board in 2019 has provided a platform for the development of emerging R&D-based pharmaceutical manufacturing companies,leading a large number of innovative pharmaceutical companies that failed to successfully list in other boards to choose the Science and Technology Innovation Board to apply for registration,accelerating the transformation process of the pharmaceutical manufacturing industry and promoting the level of domestic pharmaceuticals to the story of the global market.As of May 15,2023,the proportion of unsuccessful registration in the pharmaceutical manufacturing industry is close to 40%.There is no shortage of companies that have been questioned several times and have been audited for more than one year but suffered IPO failure.Due to the characteristics of innovative pharmaceutical manufacturing enterprises,corporate governance,operation,sales expense,R&D expense,and operating income of the enterprises are the high-risk points that the IPO committee will focus on during the audit process,which requires certain professional competence and independence of CPAs,and thus creates higher audit risks.To enable pharmaceutical manufacturing enterprises to be listed smoothly on the Science and Technology Innovation Board and the stable development of the industry,and to protect the quality of information disclosure by auditors,it is of great practical importance to propose improvement measures for the IPO audit risks of pharmaceutical manufacturing enterprises on the Science and Technology Innovation Board.This paper examines the existing literature and establishes a research framework to specifically analyze the IPO audit risk of pharmaceutical manufacturing companies on the Science and Technology Innovation Board in the context of the pilot registration system of the Science and Technology Innovation Board combined with modern risk-based audit theory,and proposes corresponding countermeasures.This paper firstly collates the literature related to audit risk,IPO audit risk,pharmaceutical manufacturing industry,and research on audit focus and risk in science-based companies,and concludes that there is less research on the analysis of Science and Technology Innovation Board IPO audit risk for specific industries;secondly,it composes and analyzes the basic situation of Science and Technology Innovation Board and the IPO status of the pharmaceutical manufacturing industry in Science and Technology Innovation Board,and combines the questions repeatedly asked by the Listing Committee to Pharmaceutical manufacturing enterprises in Science and Technology Innovation Board.Then,the representative Renhui Biological was selected as a case company.The risk of material misstatement in financial statements and determination level of Renhui Biological was analyzed based on the audit risk model,as well as the inspection risk arising from the CPA in completing the IPO audit work;finally,this paper combines the research above content and conclusions to propose corresponding countermeasures to the IPO audit risks of the pharmaceutical manufacturing industry in the Science and Technology Innovation Board from two aspects: CPAs and regulators.This paper concludes that,from the perspective of CPAS,first,for the existence of material misstatement risk auditors should pay more attention to corporate governance,the degree of internal control construction improvement and operation,and perform more audit procedures on key audit matters.Second,in response to the existence of inspection risks auditors should strengthen the principle of regulatory independence,enhance professional competence,and use big data audit methods.From the perspective of regulators,firstly,improve the supervision and illegal cost of IPO companies on the Science and Technology Innovation Board,and secondly,vigorously implement the inspector procedures for on-site inspection of the science and technology board to improve the quality of pharmaceutical manufacturing companies in the capital market and protect the interests of investors.