China's four departments: crack down on the issue of false audit reports by accounting firms
China News Service, Beijing, February 5 (Reporter Zhao Jianhua) The Ministry of Finance, the State-owned Assets Supervision and Administration Commission of the State Council, the China Banking and Insurance Regulatory Commission, and the China Securities Regulatory Commission required on the 5th that companies should strictly implement the relevant regulations of the Ministry of Finance’s Accounting Standards for Business Enterprises and improve accounting information. quality.
The four departments will intensify supervision and inspection, and severely crack down on corporate financial fraud and the issuance of false audit reports by accounting firms.
The four departments stated that in recent years, relevant parties have jointly promoted the effective implementation of accounting standards and achieved positive results. However, it has also exposed some companies’ lack of strict implementation of accounting standards, distortion of accounting information, unauthorized expansion of the use of valuation and judgment space, and even individual problems. Cases such as corporate financial fraud and audit failure of accounting firms.
In 2020, the world will be affected by the new crown pneumonia epidemic. The international situation is severe and complex. Some companies have intensified operating difficulties and faced more risks and challenges.
The four departments have made corresponding regulations on the accounting treatment of related businesses during the new crown pneumonia epidemic and the related accounting treatment of the implementation of the new standards.
The four departments require all localities and related units to clarify in a timely manner the ambiguities in accounting practices, resolutely curb the abuse of accounting standards and arbitrary judgments and estimates, and urge enterprises to truthfully and accurately conduct accounting and reporting.
At the same time, promote the improvement of the audit quality of accounting firms and give full play to the role of social auditing.
The Ministry of Finance will continue to carry out special work to improve the audit quality of accounting firms.
When auditing annual reports, accounting firms should effectively implement risk-oriented audit concepts and methods, focusing on monetary funds, income, inventory, goodwill, financial instruments, business mergers, related party transactions, continuing operations, etc., and maintain professional skepticism , To effectively identify, evaluate and respond to the risk of material misstatement of financial statements caused by fraud and errors; to ensure that adequate and appropriate audit evidence is obtained, independent, objective, and fair audit opinions are issued to ensure the quality of practice and prevent practice risks.
The Ministry of Finance and other four departments will establish and improve the joint working mechanism and major issue consultation mechanism, according to their respective responsibilities, coordinate and cooperate, and effectively increase supervision, closely follow the preparation of corporate annual reports, audits, disclosures, and final accounts, and strengthen information sharing Communicate with.
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