Under the current system of CPA audit practice guidelines New Idea

[Abstract] system under the new guidelines, certified public accountants engaged in audit theory and practical work, should firmly establish the scientific concept of development, based on the concept of Economic responsibility entrusted to the core concept of modern risk-based, innovative audit concept, expanding the audit function to strengthen quality control, in order to improve the quality, and promote Economic stability, orderly and healthy development.

[Keywords:] Certified Public Accountants Practice guidelines; audit concept; Innovation

As China's economy more and more widely into the world Economic system, extensive use of information technology, new market instruments, Innovation, certified public accountants under the new situation demands a higher practice. From 1 January 2007 onwards , all of our country began to implement the new accounting firm auditing standards system. This requires that certified public accountants audit techniques, audit methods to achieve new breakthroughs, and the most fundamental point is that the audit concept of Innovation, in order to meet the practice environment requirements. Innovation audit, and that is the height in the formation of new ideas to promote consensus on the scientific development of audit work, the core is the soul of the scientific development concept and guidelines, firmly establish the scientific audit, accurate grasp of the Economic and social development trends and development Law audited give full play to the audit function, to better implement the new standards system, to promote sound and rapid development of the audit to provide scientific guidance.


For scientific, harmonious with the audit concept

December 29, 2008, the PRC National Audit Office audit of the Auditor-General Liu Jiayi conference speech that the audit institutions and auditors should thoroughly study and practice the scientific concept of development, foster a scientific audit of the concept, development of audit development plan.

Liu Zhongli, President of Chinese Institute of CPAs, entitled <<Innovation Auditing Standards System safeguard the public interest>> of the important speech that, based on scientific, rigorous auditing standards, forensic audit of the financial information to ensure the orderly operation of Economic activities It is the Government, the public and market expectations of the CPA profession, is a registered Certified Public Accountant duties.

Liu Zhongli, President of In "" On the bigger and stronger promotion of the views of Certified Public Accountants>> cum <<accounting firm internal governance Guide>> conference speech, also noted that building a socialist harmonious society in the historical process, CPA involvement of industry is an important force, and its emphasis on development of the industry size and scale of economic development, coordinated development of the industry structure, market structure and diversity in coordination within the industry to emphasize harmony, industry and the public to be harmonious.

At present, China is adjusting the economic structure, resource and environment is changing, increasingly prominent social conflicts, which are of a higher audit requirements. Audit workers to carry out their duties, we must firmly establish the scientific and harmonious audit ideas, give full play to the audit function. This is a concept, not a slogan, requires auditors to follow the development trend and adapt economic and social development needs to grasp the basic characteristics and internal audit Laws, and to really implement the actions in the audit really used to guide the work of our audit practice.


Second, the concept of economic responsibility entrusted

Concept of financial responsibility entrusted to experts from the accounting and auditing experts in Economics on principal-agent contract continuation and development of the theory. "Fiduciary relationship between economic responsibility," the existence of the basic premise of the audit, which actually is a generally accepted assumption . Audit scientist Richard Brown, in his discussion of the audit of origin, said: "The origin of the audit and accounting origin dates back to an era not far from ... ... When the need for development of civilization, a person entrusted with property of another, apparently requires the honesty of the former check. "This raised a fiduciary relationship between economic responsibility. from the fiduciary nature of economic responsibility audit, audit-known British scientist, Professor David Flint," as an almost universal truth , any place in the audit, there exists a relationship of fiduciary duty, which is a necessary condition of the audit, the audit relationship is a fiduciary responsibility to ensure the fulfillment of social control mechanisms. "audit of scientists in Australia and Mike White, Vic said:" entrusted with the audit of financial responsibility are closely intertwined, and both are indispensable. unless an organization was responsible for capital investment to the organization, or the audit can not be effective. "
Economic responsibility of the content is entrusted with the political and economic development and democratic progress and continuous development. From a historical point of view, the audit form has been extended to the first financial audit of performance audit, management audit and the form of environmental audit. With development of transnational corporations and international investment, financing and trading activities have become increasingly active and complex, the spatial extent of economic responsibility entrusted also expanding, international relations are entrusted with the fiduciary formation and development of production and the formation of an international audit is a general trend .

Workers, the majority of the audit relationship between economic responsibility entrusted only innovative ideas in order to fully understand the nature of the audit and the development and changes, and auditing theory and practice and lay a solid foundation of innovation.


Third, the audit function to expand the concept

From the perspective of the development history of modern audit, the audit history of modern major change every time behind must be accompanied by the evolution of the modern connotation of the audit function of the expansion and extension, and diversification of modern audit form also requires the audit function as its theoretical basis .

In today's information age, the social, economic, political, legal, driven by multiple factors, many modern audit their own needs with the adaptive changes in the external environment, regulation, continuous improvement and development, which has become an irreversible trend . its performance for the modern form of audit, types, content and other related continuous differentiation, which is the expansion of modern audit function to expand the core of modern audit. In fact, both the CPA audit, state audit or internal audit, in recent years of service to their specific form and content types have suffered different degrees of development and innovation.

A Certified Public Accountant professional services, for example, listed according to the U.S. confirmed that the Committee has the potential to look at the amount of CPA services, products, six earning potential greater than 10 billion dollars in services: risk assessment, business performance evaluation, system validation, health Nursing Care Assessment, elderly care, and network authentication. These business expansion on the domestic audit function provides a good reference base.

Currently, the domestic accounting firms also provide a large number of non-audit services, such as management consulting class of economic activity, business strategy, investment consulting; tax service class tax agents, tax planning and other services.

Chinese CPA system, the basic framework of professional standards included <"China Certified Public Accountants audit standards >>,<< review the operational guidelines of China Certified Public Accountants Certified Public Accountant of China other assurance >>,<< operational guidelines>" and "" China up Accounting Standard on Related Services>> criteria for the different business areas, but also fully reflects the expansion of the CPA auditing the basic direction, and with the continuous improvement of operational guidelines and audit function to achieve all-round development.

Based on the content of modern auditing new trends emerging from the overall understanding of how the extent to which modern audit to play its Applications will directly guide the reality of auditing standards and auditing in the whole society to establish the powers and responsibilities within the range.


Fourth, the modern concept of risk-oriented

February 15, 2006 issued by the Ministry of Finance of 48 certified public accountants auditing standards, the separate lists a set of risk assessment, risk response to the relevant criteria. Including "" China Certified Public Accountants Auditing Standards Section 1201 - Plan Audit >>,<< Chinese Certified Public Accountants Auditing Standards No. 1211 - Learn about the audited entity and its environment and assessing risks of material misstatement >>,<< Chinese Certified Public Accountants Auditing Standards No. 1231 - for the assessment of risks of material misstatement implementation of the program>> auditing standards, including a group of fully reflect the improved risk-based audit model, but also implement the concept of modern risk-based audit of the best interpretation.

Traditional audit practice is built on the traditional audit risk model, that is, audit risk (AR) = inherent risk (IR) × control risk (CR) × detection risk (DR), based on the existence of significant deficiencies. Certified Public Accountants often do not pay attention grasp the macro level, there is the risk of material misstatement of financial statements, but the direct implementation of control testing and substantive procedures, audit failure prone. If the business collusion or management override of internal control over, is the failure of internal control. If the audit officers do not extend to the internal audit perspective beyond the control of, such as industry conditions, regulatory environment, the nature of the enterprise, as well as objectives, strategies and related business risks, etc., are vulnerable to fool and deceive, can not be found because of the internal control failure caused by financial Report risk of material misstatement. because some accounting firms do not conduct a risk assessment, resulting in the audit without grounds of efficiency and effectiveness of the audit.

The guiding ideology of the new standards system based on "reasonable assumptions of professional skepticism", based on the concept of risk of material misstatement introduced to assess the risks of material misstatement oriented to control the level of audit risk to an acceptable target, the original audit risk model is modified to create a new audit risk model: audit risk = risk × detection risk of material misstatement. These are fully reflect the modern risk-based audit model features. which established that the auditing standards of the framework of the new system is established In the modern risk-based audit model based on, which not only meet our current economic environment, audit risk control requirements, while closer to the industry standard of CPA distance and international auditing standards require CPAs to modern risk based audit philosophy throughout the entire process of the audit. Links to Research Papers Download http://www.hi138.com five professional judgments concept

Certified Public Accountant nature of professional occupations, as opposed to speculative commercial purposes, the requirements of professional education, professional self-discipline, practicing certificate and social responsibility characteristics. Professional occupations and other occupations, the main difference is that professionals need to be customer interests and the public interests above personal interests. than the original system of auditing standards, CPA practice guidelines system more emphasis on professional occupations in particular the requirements of professional judgments.

Judgement is a certified public accountant with professional expertise and experience will be subjective and objective audit of the audit issues and judgments based on behavior and compare some, recognition, on this basis, the formation of the final audit conclusions of the audit activities and the various views. Since the 20th century, 70 years since the audit to determine audit theory has become a hot sector is concerned, its importance in many countries has long been recognized standard-setting bodies. In "" China Certified Public Accountants guidelines for forensic basic business>> specified in the CPA in the planning and implementation of KAM card business, particularly in determining the nature of the evidence collection procedures, timing and extent shall take into consideration the importance of business risk and the available forensic evidence in the quantity and quality. Meanwhile, the CPA should be integrated taking into consideration the importance of the number and nature. In to evaluate specific business and the number and nature of the importance of the relative importance of factors, the need to use CPA Professional Judgement. In "" China Certified Public Accountants Auditing Standards No. 1301 - Audit "Evidence for> such a number of specific guidelines, are required CPA use of professional judgments.

Thus, during the audit, the CPA is essential the use of professional judgments. Professional judgments used consistently throughout the audit, certified public accountants in contact business and audit procedures to determine the nature, timing and scope of the evaluation of audit evidence obtained the audit findings and form an audit opinion can not do without it. Only by establishing a professional certified public accountants to determine the concept and practice work conscientiously perform their duties in order to make the correct assessment issued by the appropriate advice.


Sixth, the concept of quality control

Sound and comprehensive quality control system is to ensure that accounting firms and their personnel to comply with Laws and regulations, "" China Certified Public Accountants Code of Ethics>> and <"China Certified Public Accountants Practice Technical Guidelines>> The foundation of the internal control system of accounting firms core content, but also the development of accounting firms and the basic conditions for survival.

In China, the CPA recovery and reconstruction of the history of the cause of only twenty years, the overall quality of the CPA is not high, accounting firm's management is still not up to standard, quality control in a series of problems still exist. To this end, China up Institute of Chartered Accountants in December 26, 1996 issued a <"China the basic norms of quality control of Certified Public Accountants>>. After ten years, to meet the new situation and with the international standards, and its been revised released <<accountant Office Quality Control Standard No. 5101 - Business Quality Control> "and" "China Certified Public Accountants Auditing Standards No. 1211 - audit of historical financial information for quality control>> the two criteria. the former from the accounting firm to regulate the level of , including historical financial information for auditing, including the business; the latter from the person responsible for the implementation of audit projects to regulate the level, the historical financial information only for audit services.

Quality control criteria systematically summed up the lessons learned from audit failures in recent years, requiring accounting firms to develop a comprehensive quality control system, including the implementation of the quality of business leadership, to ensure compliance with professional Ethics, client relationships and the acceptance of specific business and maintained, human resources, business execution, and monitoring operations in seven papers on the other. accounting firms and certified public accountants must firmly establish the concept of quality control, develop appropriate policies and procedures, will implement the requirements of the guidelines to the audit all aspects of practical work.

Chinese CPA system based on professional standards in the public interest purposes, the full Research and analysis of the new situation, capital market development and practice of certified public accountants practicing the challenges and difficulties, and strengthen the practice of certified public accountants the responsibility of the CPA reveals the refined and guard against market risks guidance. standards require practitioners to strengthen the independence of certified public accountants, to maintain proper professional caution, observe professional Ethics, effective implementation of risk-based ideas to improve the ability to identify and manage risk more actively take on the financial statements The discovery of fraud liability. accounting firms and certified public accountants and firmly establish the concept of continuous innovation audit, and in practice continue to flourish, the practice will improve the quality of certified public accountants, in order to achieve more efficient allocation of resources, promote economic development and maintaining financial stability .


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Links to Research Papers Download http://www.hi138.com