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Summary of the practice quality inspection work of the Association of Certified Public Accountants

Accounting firms:
According to the " Certified Public Accountants' Practice Quality Inspection System" of the Chinese Institute of Certified Public Accountants and the "Notice of the Chinese Institute of Certified Public Accountants on Carrying out the Inspection of the Practice Quality of Certified Public Accountants in XX Years", we are in July XX. From the 4th to the 30th of August, 50 accounting firms were inspected and 13 firms reviewed. Reporting from the following four aspects:
First, the characteristics and basic practices of this year's inspection work
Carrying out the supervision and inspection of the quality of practice is the inherent requirement and objective need of the integrity construction of the industry. The inspection work was arranged by the leaders of the association. The supervision department was organized and implemented. Based on the experience of the inspection work in the past, the inspection work in the year of XX was carefully prepared and carefully planned. arrangement.
Do a good job in all preparations before the inspection.
After the inspection of the work arrangement of the AICPA, we revised the practice quality inspection work plan, determined the object, scope, inspection methods and methods of the XX year; held the practice quality inspection work arrangement meeting and deployed this year's business. Quality inspection work.
A training course for inspectors was held to train 40 inspectors before the inspection; for the characteristics of small-scale enterprises, the inspection work of small-scale enterprises was simplified.
Inspection work characteristics and basic practices
In accordance with the requirements of the China Association for the Advancement of Investors, in conjunction with the principle that the supervision office of the Financial Bureau and the Bureau of Supervision of the Finance Bureau do not repeat inspections, 50 enterprises will be inspected, of which 45 newly established after XX years and 2 with qualifications for securities and futures business, within 5 years There were 3 firms that had not received the self-discipline inspection of the association, and the quality of the practice was reviewed for 13 firms that were compulsory for training last year.
Scope of inspection: XX annual audit report of listed companies, large and medium-sized state-owned enterprises and foreign-invested enterprises issued in January-April XX. A total of 2,451 annual audit reports were issued by the inspected offices, and 226 inspections were conducted by the inspection team. The proportion of random inspections was 9.2%.
In order to facilitate the inspection of personnel work, and at the same time does not affect the normal business of the inspected office, unlike previous years, we have taken two methods of on-site inspection and centralized inspection of materials from the actual situation.
When extracting audit business items, select the types of business and business items that fully reflect the level of practice of the firm, so that the sample of inspections taken is broad and representative. For example, select the business items of different audit departments or audit teams; select the audit reports completed by different signed CPAs .
This inspection provided an opportunity for CPAs to interact with each other. Many of the firms that have undergone inspections attach great importance to exchange experience and experience with inspectors. Many firms regard the exchange of inspections between the inspection team and the firm as It is a good opportunity for professional training for CPAs . Through the discussion and exchange between the inspectors and the CPA , the purpose of improving the quality of the firm's business has been achieved.
Second, the main problems found in the inspection
There is a problem with internal quality control
The inspection of the internal quality control of the firm is mainly carried out by questionnaires, on-site inquiries and inspections in conjunction with specific audit items.
During the inspection, most of the firms found a set of internal quality control systems and business project risks with project content, project risk management, responsibilities of all levels of business personnel, audit work draft review requirements, and internal control evaluation procedures. The control procedures provide a guarantee for the quality of the service in the system.
However, a few firms lack specific and feasible systems. If some firms do not have a practice or audit manual, some formally implement a three-level review procedure, but they do not sign opinions. There is no review of the procedures and contents of the review. It is recorded that there is a lack of clear division of responsibilities between the various levels of review, resulting in a three-level review in the form.
The new institutes and small institutes inspected are more concerned about market development, system construction and implementation are in weak links, and project quality control depends on specific practitioners. Therefore, due to the different composition of personnel, different project groups have great differences in the quality of practice between projects, and the risk control standards are not uniform.
Problems with professional ethics
In this inspection, we used questionnaires, on-site and relevant auditors to inquire about the situation, and did not find the case and the CPA maliciously violated professional ethics.
However, we found that the business fees of the firm are mostly low, and some business charges are only 20-30% of the standard fees; CPAs generally do not communicate with the former CPA on the new undertaking business. In addition to the influence of the practicing environment, the quality of the practicing team, and the unfair competition, some of the firms themselves have the situation of heavy income and light quality, especially the release of the batch, and some firms have internal differentiation and business. The trend of loss, this situation will inevitably exacerbate unfair competition among peers.
Third, the analysis of the problems existing in specific audit projects
Legal liability
1. Pay insufficient attention to accounting responsibility and audit responsibility. If the collected financial report is not signed or sealed by the person in charge of the unit or has no official seal of the unit; the name of the firm is used as the header or footer of the notes to the accounting statement; the related party relationship and its transaction are not disclosed in accordance with the requirements of the Accounting Standards for Business Enterprises. The contents of the main statement items are not listed in the notes to the accounting statements; the date of approval of the financial statements is not disclosed; the date of the signing of the management statement is not signed or the date of signing is inconsistent with the date of the audit report.
2. The audit report filed in the draft did not strictly implement the signature and seal system. If the CPA is only stamped, there is no signature or only the signature is not stamped; it should not be used as an auxiliary file for the contents of the audit report. If there is an attached financial statement in the body of the report.
3. The new office and the small office pay insufficient attention to the business book. If there is no business agreement, the instinct of the agreement is incomplete or the content is not appropriate, the audited enterprise is not stamped, and the date of the report or the date of no signing or effective date is not clearly stated. The date of signing is later than the date of the report, and the annual audit report is not properly qualified. The scope of use, etc.
The lack of legal awareness is a relatively common problem found in business inspections this year. We believe that if the audit business of the firm involves relevant departments such as the court and the public security, the above problems will cause the firm and the certified public accountant to bear unnecessary legal responsibilities.
Problems in comprehensive projects
1. Generally, the compilation of audit plans is not taken seriously. Some firms have not prepared an audit plan. Or the specific audit plan is fixed, and it is not adjusted according to the actual situation of the project to meet the needs of the project. The description of the implementation of the audit schedule is generally not taken seriously. The reduction of the audit program without the approval of the responsible person is very arbitrary in the actual implementation process. There is no analysis of the relevant risk factors of the enterprise in the audit plan. There is no process and basis for determining the importance level. There is no description of the audit objectives. The previous annual audit description is simple, there is no expense budget, and important audit areas and subjects. The audit program did not explain.
2. The firm generally did not pay enough attention to the opening balance, did not obtain favorable evidence of the atable opening balance, and did not implement the corresponding auditing program; it did not trace the large amount of carry-over items affecting the current period, and did not fully consider the beginning of the period. The impact of the balance on the accounting statements.
3. There is no audit summary. No conformance test records, audit difference summary tables, and trial balances were prepared.
4. The purpose of the conformity test is not clear. The results of the conformity test do not form a corresponding relationship with the time, nature and scope of the substantive test, and the characteristics of the system-based audit are not reflected. The basis for determining the conformity test sample size is not fully explained.
5. A permanent file has not been established separately. For the first time, the long-term archives are collected.
There is a problem with the substantive test
1. The status of the correspondence to the money

Execution is not in place. The auditing procedures for receivables and payables only have account reconciliation, checklist reconciliation, lack of necessary aging analysis and correspondence procedures; some have issued letters, but in the case of few replies, they have not executed any The alternative program is confirmed. For example, if a firm audits a material company, the company's other receivables amounted to 72.25 million yuan, accounting for 34.74% of the total assets. The audit program that did not implement the certificate was confirmed without any alternative program.
2. The inventory supervision program is generally not in place. For the audit of physical assets, generally only the detailed list or inventory table provided by the customer is obtained. There is no supervision or draw record of the firm. Some have counted or drawn records, but the data of the inventory date is not inverted. Checking on the reporting date, the auditing program implemented cannot achieve the auditing purposes; for the physical assets that cannot be executed or drawn for objective reasons, the relevant alternatives are not implemented; the lack of auditors’ attention to the property rights of large assets, For example, invoices for fixed assets with large amounts, customs declaration files for imported equipment, construction permits for construction in progress, housing and land use rights certificates and related mortgages.
For example, the inventory amount of a decoration project audited by a firm is 12.34 million yuan, accounting for 38.77% of the total assets. Among them, the construction of the project was 12.3 million yuan. The certified public accountant did not prepare the detailed list according to the project, did not pay attention to the progress of the project, and did not conduct the auditing program of the physical supervision.
3. The long-term investment draft does not indicate the investment ratio and accounting method. For the investment with a large proportion of the contractual agreement, it is not checked whether the long-term investment is accounted for using the equity method, there is no correct adjustment of the current profit and loss, and whether the consolidated statement should be prepared for judgment.
4. Revenue recognition does not comply with the relevant standards. For example, a construction company's current accounting statements confirmed revenue of 1.53 billion yuan. The CPA did not obtain the confirmation basis for the project settlement income, and did not combine the project contract, project progress, etc. to determine the income, and did not consider the impact of the revenue recognition method team accounting statements.
5. Most of the firms inspected generally had insufficient work papers on the audit of the cash flow statement.
6. The audit evidence collected is insufficient and inappropriate, which is not enough to form a strong support for the audit conclusion. The auditors copied a large number of the company's general ledger, detailed accounts, accounting vouchers and original vouchers, blindly collected invalid audit evidence, and did not analyze the evidence and track and record the professional judgment; some audit evidence did not support the audit conclusion or two. Some cases are inconsistent; some collect audit evidence is not sufficient and the purpose is not strong, the proportion of certificate check is too low, can not be the basis for supporting the audit conclusion; some audit projects, for important matters did not obtain audit evidence, the inspectors can not further judge The impact of the audit opinion.
For example, the income of a company's main business increased by 106.30%, but the main business cost only increased by 20.41%. The annual revenue growth of XX was mainly for sales to a single customer, with sales of 24.89 million yuan, of which accounts receivable was 14.37 million yuan. There is no main business cost for this sale. The transaction was a major abnormal transaction near the balance sheet date. The CPA did not pay sufficient attention to the financial status, sales scale, and solvency of the transaction object. The auditors did not carefully check the relevant contract terms and did not pay attention to whether their sales were consistent. Revenue recognition conditions; did not pay attention to whether the company has actually shipped, did not check the delivery procedures, and did not obtain the relevant acceptance certificate.
7. The type of audit opinion is not appropriate.
The reservations of the audit reports issued by some of the firms are not disclosed in the main text, but are described in the form of audit matters.
The scope of the audit in the audit report is incorrectly defined. A company is a consolidated accounting statement. The audited financial statements of the parent company are only issued to the parent company's accounting statements rather than the consolidated financial statements. However, the statement in the scope of the audit report is “we have audited the attached The balance sheet of the company on December 31, XX, and the income statement and cash flow statement of XX....", virtually expanded the responsibility of the CPA .
Substitute the audit report opinions in the way of the major problems found in the audit process by means of the disclosure of the notes to the financial statements, so as to “evade” the audit risks and cause improper audit opinions. For example, an intangible asset of a certain enterprise - the first quarter of the patent XX year was 1.4 million yuan, an increase of 60 million yuan in June this year, the balance of intangible assets at the end of the period was 61.4 million yuan, and the a year should be amortized by 3.64 million yuan without amortization. The above-mentioned items affected the profit reduction by 3.66 million yuan. It was only disclosed in the report note that it was not disclosed in the report. The type of opinion in the audit report is unqualified.
It is emphasized that the matters highlighted in the paragraph are not part of the revised "Specific Guidelines No. 7 - Audit Report". For example, according to an agreement signed with another company, an asset occupation fee of 3.243 million yuan is included in “other payables”. The CPA made a letter to Company B on this matter at the time of the audit, and Company B did not confirm it. In the audit report, the CPA used this matter as an emphasized section of the unqualified audit report.
The enterprise accounting system was misused and the firm issued an unqualified opinion report. For example, in the opinion section of an audit report, the accounting statements of the audited entity are in compliance with the “Enterprise Accounting System”, but the accounting policy adopted in the notes to the accounting statements is the “Construction Enterprise Accounting System”. At the same time, the company’s statement in the management statement of the audit draft adopted the “Enterprise Accounting System”.
Did not fully consider the impact of major events and non-conformities on audit reports
A standard unqualified audit report issued by a firm, the draft record records the long-term loan correspondence and the statement difference is large, the CPA has no further examination of the reasons for the difference; an enterprise was established in 1995, and the profit statement was not prepared in XX years. The project is based on deferred assets accounting and has no consolidated shareholding of 56%. The XX annual audit opinion is an unqualified opinion with emphasis on matters. The CPA still issued an unqualified opinion report this year.
The CPA keeps a note on the notes to the accounting statements, and the matters that have been accepted and adjusted by the company are still retained in the audit report, blindly avoiding the audit responsibility.
There is insufficient attention to the ability of the insolvent enterprises to continue to operate, and the auditing program is not in place. A firm audited a hotel with a total asset of 73.658 million yuan and a net asset of -45.529 million yuan. The CPA did not pay attention to its ability to continue operations. The CPA only requests the hotel's account balance sheet, fills in the report number in the working paper, and rarely implements the audit program, and issues a standard unqualified audit report.
Fourth, the handling of this inspection
In response to the problems in the above-mentioned inspections, the CPAs and firms with more serious violations during the auditing process were disciplined by the industry:
Criticized and criticized the two firms: Beijing Yongsheng Certified Public Accountants , Beijing Hongdaxing Accounting Firm
Renovation of three firms within a limited time: Beijing Tongdao Certified Public Accountants , Beijing Zhongruncheng Certified Public Accountants , Beijing Huiyun Certified Public Accountants
Remind the six offices: Zhongcheng Hengping Certified Public Accountants , Zhonghande Certified Public Accountants , Beijing Guoxin Haohua Certified Public Accountants , Beijing Lianshou Certified Public Accountants , Xianfeng Rongda CPA Beijing, today's Shenzhen Certified Public Accountants .
The above-mentioned firm will be reminded to sign the CPA due to problems in the audit report.
V. Suggestions and suggestions
1. Based on the principle of helping education and concurrent punishment, we issued a written notice to the above 11 firms, requesting the firm to propose rectification opinions and suggestions for the problems found in the inspection, and write them within one month from the date of notification. In the form of reporting to the association, we will follow up on the results of the rectification. And based on the rectification situation to determine whether to include

One year of review.
2. Strengthen communication with relevant departments, such as letters to banks, often because banks do not strictly follow the relevant regulations of the Ministry of Finance and the People's Bank of China on “Doing a good job in bank deposits, loans and transactions of letters of exchanges”. This caused the CPA to not perform the program that effectively controls the letter. It is recommended to report to the relevant departments to solve the problem of high charge for letters.
3. The inspection office generally reported the problem of low fees. For example, the form of bidding for the audit business is only the price factor, but the degree of attention to other factors is low, which objectively exacerbates the price competition between the firms, making the buyer and seller of the accounting market Rights are more asymmetrical and status is more unequal. It is recommended that relevant departments formulate corresponding audit bidding methods.
4. Strengthen the education of professional ethics and legal responsibilities of certified public accountants . It is recommended to strengthen the training of professional ethics and legal responsibility education, and as an important part of the training system, we must pay attention to the systematic and practical training knowledge, such as case analysis and special seminars to help certified public accountants in their thinking. It has attracted great attention and established a concept of professional ethics and legal responsibility in practice.

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