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On the legal liability of Certified Public Accountants causes and Countermeasures

Author: JiaXia From: www.yourpaper.net Posted: 2010-06-13 10:10:27 Read:

Abstract: the legal liability of the certified public accountant of the has been a hot topic in the legal profession of certified public accountants.The legal responsibility of the registered accountant influence the social economic order, therefore must accurate, comprehensive analysis of CPA liability form, and to study the countermeasures, can contribute to healthy development of the CPA industry.In this paper, firstly introduces the legal responsibility of the registered accountant's meaning, analyzes the reasons for the second generation of CPA's legal liability, and finally puts forward a series of countermeasures to evade legal responsibility.
keywords: CPA legal liability of

a, the legal responsibility of the registered accountant's meaning of

the legal responsibility of the registered accountant is a certified public accountant in the process of hosting services, failed to fulfill the terms of the contract, or fails to maintain proper occupation cautious, or deliberately not according to professional standards issued by a qualified report, audit report users suffer a loss, in accordance with relevant laws and regulations, the legal liability of certified public accountant or the CPA firm should undertake.According to the different contents should bear the responsibility, the legal responsibility of the registered accountant can be divided into administrative responsibility, civil liability and criminal liability of three, three, can also be, can also be a separate investigation.
two, the legal responsibility of the registered accountant's genesis
(a) the social factors of
social the public trust of CPA and highly expected value is the social factors that lead to the legal responsibility of the registered accountant has, in recent years, the social public to the audit report issued by certified public accountants pay more and more attention of certified public accountants, public trust and have increasingly high expectations, but at the same time as the public is still a lack of adequate understanding of the CPA industry, therefore, lead to social public put forward many unreasonable demands on the CPA, all the users of financial statements and interest groups hope the CPA can check m audited all error exists in the report, fraud and illegal behavior, in fact this is confusing accounting responsibility and audit responsibility, once the audit report concluded with the auditee is not the real case. The investors or creditors suffered losses, they always hope to get the rest of compensation and no matter who was wrong.On the other hand, because of the time constraints of audit, audit methods and cost of CPA audit unit, find all errors. Fraud and illegal behavior is not possible.
(two) the economic factors of
in recent years, with the development of the CPA industry competition intensifies. Some firms in order to increase the volume of business, for customers, the pursuit of economic benefits, in the choice of the audited units lost due caution, not to take the necessary measures to audit history unit to carry out the necessary understanding, evaluation of its quality objective to find out the real trust.A certified public accountant in the drive of their own interests, regardless of occupation morals, a party to the unreasonable demands, the entity to be audited report false errors allow someone to continue, issue false audit report, or with the entity under audit collusive fraud.At the same time, because China's audit fees than international counterparts, some government departments for accounting firm established minimum criteria for the charges, in order to survival and development of certified public accountants have to reduce the audit cost. It is impossible to spend a lot of manpower, material resources to audit a project, one can imagine the audit quality.
(three) environmental factors
the operation of the market economy of our country at the present stage is not normative environment factor is CPA legal liability.From the point of view of internal environment, at present China's corporate governance exists in name only, state-owned legal person shares vacancy, excessive concentration of stock ownership, the board of directors, board of supervisors manipulated by the large shareholders, or the internal control situation is very serious, so as the earnings management to the management, to whitewash statements, profit manipulation provided an opportunity.Lack of internal control, internal control, the cause of loose and inefficient, report to senior management on financial, especially on the accounting policy choice and change, the company control or monopoly financial decision by one or a few, the lack of independence of internal audit staff and industry training, internal audit departments only a symbolic significance.The operator by the audit people into the audit client, CPA, indulge in the fierce market competition, listing Corporation, listing Corporation is acquiescence, almost become a "rational choice" CPA is an important participant in the market, their behavior is affected by other market participants, no good practice environment, CPA is difficult to alone.
(four) the legal factor
the actual needs of China's relevant laws and regulations lag behind the economic development is the legal factors causing CPA legal liability.With the development of market economy, changes in accounting environment, legal conflicts arising in different understanding of accounting information in the relevant civil disputes, most problems.However, this provision is the most is not perfect, but also the most lack.
three, avoid countermeasures CPA legal liability
(a) regulations of CPA legal liability to supplement and improve the relevant laws and regulations in
CPA industry for industry interests and development. Should not wait for the legislative and judicial branches to amend the relevant laws and regulations, and should actively try to resolve conflicts between different laws.The Ministry of Finance shall be the legal liability of CPA actively coordinate with the relevant judicial departments, registered accountant industry in order to protect the legitimate rights and interests.And the legal liability of CPA is most closely related to the law of the people's Republic of China "accounting law", because the law promulgated earlier, there are many problems in the actual implementation process, such as the civil liability provisions is relatively weak, the lack of critical fault and causality conditions; the relevant part and subsequently enacted other laws and regulations on the legal responsibility of the disorder; vague. So the method to promote the current in the ongoing revision.Improve the "accountant law" and other relevant laws and regulations of registered supplementary, increased protection of CPA rights provisions in the relevant laws, stipulated in the legal liability, responsibility and the responsibility of the object and so on. So as to ensure the interference of CPA from unnecessary litigation.
(two) determine the "independent auditing standards" in the judicial practice of the status of
"independent auditing standards" on the basis of "certified public accountant law" enacted, by the Ministry of Finance issued and implemented, it belongs to the category of administrative regulations, should have certain legal effect."Independent auditing standards" is the authority of the professional standards of CPA independent auditing, the CPA firms and CPAs in the implementation of "certified public accountant law" provisions of article fourteenth of the audit (verification) business, must comply with.However, in actual judicial practice, "independent auditing standards" are many judges as pure industry standards, not enough to become a CPA defense basis."Independent auditing standards" is the practice of certified public accountants to judge whether there is the only technology based on negligence, especially the accounting and auditing responsibilities, fair, reasonable assurance concept for the protection of registered accountants.Rationally determine the essential of CPA's legal liability.In this case, the maintenance of CPA based on the interests of legal status, must promote the "independent auditing standards", make it become an important legal basis. Otherwise it can not play a protective role of certified public accountants.
(three) advocated the establishment of partnership accounting firm
starting in 1998, accounting firms start from restructuring, and completed by the end of 1999.According to statistics from the restructuring of most of the firms with limited liability, few firms adopt the form of partnership.Accounting firm with limited liability in order to win the initiative in the fierce competition, a stable customer.Increase market share but often ignored or
Abandoned the independent auditing standards.Therefore, the Institute of certified public accountants should adapt to the development of CPA domestic trouble and foreign invasion environment and international CPA industry requirements, to speed up the development of partnership accounting firm specific organizational rules and procedures, and actively guide and promote the accounting firm partnership system, to strengthen the CPA industry awareness of credit risk, establish a certified public accountant "the public image of being honest and trustworthy".
(four) improve the corporate governance structure of the listing Corporation.To improve the financial information disclosure standards
now is whether the audit report of listing Corporation financial information or certified public accountants are facing a hitherto unknown credibility crisis.Look at this crisis from the surface is issued by the certified public accountant's report caused. The deep reason lies in the weakness of Chinese listing Corporation corporate governance structure.To improve the corporate governance structure of listing Corporation and improve financial information disclosure standards is essential to regulate the securities market, but also the essence of CPA's legal liability.If not from the root to improve the weak link of listing Corporation and securities markets, and constantly increase the legal responsibility of the registered accountant. Not commensurate with the specific historical stage and its commitment to make CPA occupation or the risk of the whole industry, will greatly dampen the confidence, is not conducive to the healthy development of the securities market.
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