What are the risks of audit morality

Audit moral risk refers to the behavior of the audit staff intentionally violated the work procedure and audit discipline, and caused adverse effects and consequences to the audit work. It is the most important form of expression in audit risks.
The causes that cause audit moral risks are many aspects. It mainly includes the following points:
1. Information asymmetric induced audit moral risks
During the audit process, the audit unit often has more sufficient accounting information than the accounting firm: One of the annual reports of each L5 may be reviewed every year. There is no enough hand -handled handling at all, and the number of senior financial experts who can decipher Anran's balance sheet is even more rare. The real world, because people are limited and rational economics, and at the same time, the information is incomplete. The motivation to pursue the maximization of their own interests gives people the opportunity and has enthusiasm to use improper means in transactions to seek their own interests. It also highlights the "insider trading" because of information asymmetry. It is a derivative of the traditional theft under the conditions of new socio -economic relations, and it is a convenient condition to use inside information. It was stealing property from investors' pockets. It is precisely because the information relationship is used to set up a lecture or trap to the victims. It is also a special fraud.
2. Inaccessible commission -agency relationship induced audit moral risks.
It in modern audit relationship mode. The "actual client" of audit services is absent and generates moral risks. At this time, the "actual client" of the audit is the public, but because the audit results have the characteristics of externality and public products, and the actual client has a high transaction cost. The management authorities of the audit unit. my country's audit market does not need to or even exclude high -quality audit in general. The management authorities of the audit unit are only for the "please" government regulatory agencies. They do not choose the needs of high -quality audit. Influence. The audit relationship model has substantially evolved into the audit of the audit unit to audit its performance, which is obviously the buyer's market. The audited unit can choose the auditors they are satisfied with, but the auditors have no or rarely choose the strength of the client, especially when the market is irregular and the vicious competition between the fighters, even if the audit unit needs high quality In audit, the market also lacks an effective mechanism to distinguish between different quality offices. Of course, at this time, shareholders, other stakeholders, and industry organizations can all impact the auditors. However, due to information asymmetry and high transaction costs, the limited nature of other parties, potential unpredictable unpredictable, unpredictable unpredictable. Public claims risk. Its influence is far less direct than the right to choose. Therefore, in the influence of all parties, the option of the audit unit is the most directly affecting whether the auditors have business to do and whether they have economic benefits. From the perspective of contract acquisition. The audit unit is an inevitable behavior orientation of the audit contract, and the risk of audit morality will occur from this distorted commission -agency relationship.
3. Improper competition and prices induced audit moral risks.
Is to hire the client of the accounting firm to authorize the audit, and lose the actual control or supervision power of the audit process. The auditors have these powers for entrustment. Audit trustees execute the audit in accordance with the previous contract and provide a work report to the client. The auditors charge the agreed audit fee from the client after fulfilling the responsibilities stipulated in the audit contract. If the audit agent of the audit unit threatens the survival of the auditors, according to the theory of Maslow's demand level, the first level of human needs is a physiological needs. Only after the physiological needs are basically met can High -level demand. If the auditer pursues high -quality audit, the direct consequence is to increase the audit cost and the increasing cost of auditing fees, increasing costs will only reduce the income; the second is to lose market share- "inferior coins to expel good coins". As a limited rational "economy^ ', auditors or firms will inevitably give up higher -level audit independence and professional ethics pursuit. And the auditors and firms are forced to accept and fulfill the responsibility of auditing contracts due to improper competitive prices. After commensurateing the charging conditions, its rational choice is to achieve a balance of audit transactions by simplifying audit procedures such as audit procedures. This low -fee value is provided for the prerequisites for the incidence of the auditors and the ethics of the office under the asymmetric conditions of the information. Conditions.
4. Softening and legal constraints of too low legal liabilities, amplifying the risk of audit morality.
The legal restraint mechanism in China's audit environment, the civil compensation mechanism cannot live, and the weak regulatory strength has led to audit audits. The probability of discovery of a teacher's behavior is not high, and the probability of prosecution is lower. Even if it is discovered and prosecuted, the punishment is mainly based on administrative punishment. The various restrictions on civil compensation make the compensation probability very low, and the amount of compensation is seriously unreasonable. The deterrent effects of auditors and firms are not great or even invalid, but they have enlarged the bottom line of their moral risks. This low -risk can easily induce new moral risks. Auditor may issue some serious and false financial reports; The above considerations are just awarded some of the tone of ease of ease. More seriously, the larger the size of the accounting firm, the greater the risk of resistance. Good audit opinions. The audit report of no reservation opinions appearing in the audit market in our country is a manifestation of low legal risk. As an auditor, dare to issue standards without reservations. The reason is: legal risk Nearly zero.
5. The defects of the limited liability company system have led to audit moral risks.
During the restructuring of accounting firms, most firm applied the "Company Law" to a limited liability company. The company's system originated from the separation of the two rights, and the accounting firm is a height of both rights. This causes the two dilemma in the form of an accounting firm: on the one hand, it runs according to the partnership system. Uncertain, it is difficult for the firm to accept; on the other hand, the company's system has not been able to grasp the main points of the company's governance structure. Even if it is standardized in accordance with the "Company Law" under the limited liability system, it is easy to violate the regulations and the firm. Under this system, the owner of the office only assumes the liability for compensation for the failure of the audit. As a result, the result is that if the company's income is greater than its violation cost, the auditor will have a positive violation of the rules and issue a false audit report; The lower the registered capital, the lower the compensation when the audit failure fails, the more likely it is possible to adopt the defeat that damaged the credibility of the independent audit. ", Leading to audit moral risks.
The audit objects through" purchase of audit principles ". Further strengthen the moral risks of auditors and firms. , Audit objects often adopt "prefabricated bias to make accounts" There are two options for the "critical verification" of the audit subject: one is to refuse. The second is to buy. Obviously refusing to audit the rules of the game, the rest is only purchased. As for the audit subject. Under an environment for auditing services that lack industry self -discipline. There are also two options: refusal to buy or be bought. Under the pressure of "cruel market competition". It may be the only choice to be purchased for survival. In summary, the ethical risks of audit have both external incentives. Another endogenous variable. If moral risks are used as basic parameters when studying and analyzing audit risks, this is academic value and practical significance for how to restrain the research on ethical risks.