Research On The Audit Failure Of Certified Public Accountants

With the rapid development of China’s market economy,listed companies need to disclose their annual reports before the deadline specified by the CSRC every year.Investors in the market pay close attention to the annual reports.At the same time,since the owners of enterprises often employ independent professional managers to manage the company,it is easy to reduce the access of enterprise owners to company information.As far as the domestic securities market is concerned,The investors on the market must also audit the known corporate financial information of the listed companies through an independent third party.All listed companies must publish their annual reports within the prescribed deadline.Therefore,the audit by certified public accountants is very important for the owners and investors of listed companies.In recent years,but in recent years,more and more accounting firms in China have been punished by the CSRC when auditing the annual reports of listed companies.Audit failure cases emerge in an endless stream,and the quality of audit reports is uneven.Many audit failure cases also have a lot of impact on the capital market,damaging the interests of relevant investors,so we need to pay attention to the situation of audit failure.With the release of the No.30 Document of the State Council on July 30,2021,the state has become more strict in the supervision of the certified public accountants industry.It is more necessary for certified public accountants to improve audit quality and avoid audit failures.This article mainly uses the case analysis method to carry out research,and strives to analyze the factors that lead to the audit failure and explore the reasons for the audit errors through the specific case of audit failure of Soling Shares by Ruihua Certified Public Accountants,and at the same time,propose countermeasures on how to prevent audit failure,especially quality control,in the practical work of certified public accountants and accounting firms.By exploring the relevant causes of audit failure,we found that the main reasons include: the quality of certified public accountants’ practice is poor,and they fail to adhere to the corresponding principle of professional prudence;The quality management of the accounting firm is not well implemented;The industry supervision is not perfect.Therefore,this paper proposes to take measures on relevant countermeasures,mainly including:improving the professional ability and professional prudence of certified public accountants in the audit process,and being diligent and dutiful;Strengthen the construction of the quality control system of accounting firms and improve the three-level review process;The regulatory authorities strengthened the monitoring and punishment of accounting firms and auditees,and strictly monitored the development of the industry according to national policies to reduce the frequency of audit failures.