Considering that this title has been widely accepted by the public, the title of audit report issued by certified public accountants in China does not contain the word "independence", but certified public accountants should abide by the requirements of independence when auditing financial statements. The recipient of the audit report refers to the object that the certified public accountant sends the audit report according to the requirements of the engagement letter, and generally refers to the client of the audit business. The audit report shall indicate the full name of the recipient.
The certified public accountant shall reach an agreement with the client on the object of issuing the audit report in the business agreement, so as to prevent disagreement on this issue or abuse of the audit report by the client. Audit reports issued for a set of general financial statements are usually sent to all shareholders or the board of directors of the audited entity. The introduction paragraph of the audit report shall state that the name of the audited entity and the financial statements have been audited, and include the following contents:
(1) indicates the names of financial statements that constitute a complete set of financial statements;
(2) See the notes to the financial statements;
(3) indicate the date and period of the financial statements.
According to the Accounting Standards for Business Enterprises, the names of financial statements in a complete set of financial statements are balance sheet, income statement, statement of changes in owners' (shareholders') equity and cash flow statement. In addition, because the notes are an indispensable part of the financial statements, the notes to the financial statements should also be mentioned. If the financial statements reflect the time and period, the certified public accountant shall indicate the date or period covered by the financial statements in the introduction paragraph.
The introduction is as follows: "We have audited the attached financial statements of ABC Co., Ltd. (hereinafter referred to as ABC Company), including the balance sheet of 20× 1 year1February 3 1 day, the income statement of 20× 1 year, the statement of changes in shareholders' equity, the cash flow statement and the notes to the financial statements. "The management's responsibility for the financial statements shall indicate that it is the management's responsibility to prepare the financial statements according to the applicable accounting standards and relevant accounting systems, and this responsibility includes:
(1) Design, implement and maintain the internal control related to the preparation of financial statements, so that there is no material misstatement caused by fraud or error in the financial statements;
(2) Select and apply appropriate accounting policies;
(3) Make reasonable accounting estimates.
Defining the responsibilities of management in the audit report helps to distinguish the responsibilities of management and CPA, and reduces the possibility that users of financial statements misunderstand the responsibilities of CPA.
Examples of management's responsibilities for financial statements are as follows:
"I. Management's responsibility for financial statements
It is the responsibility of the management of ABC company to prepare financial statements in accordance with the accounting standards for business enterprises and accounting systems. This responsibility includes: (1) designing, implementing and maintaining the internal control related to the preparation of financial statements, so that there is no material misstatement caused by fraud or error in financial statements; (2) Select and apply appropriate accounting policies; (3) Make reasonable accounting estimates. The responsibility part of a certified public accountant shall contain the following contents:
1. The responsibility of certified public accountants is to express audit opinions on financial statements on the basis of performing audit work. Certified public accountants have carried out the audit work in accordance with the auditing standards of China. The auditing standards of certified public accountants in China require certified public accountants to abide by professional ethics, plan and implement auditing work to obtain reasonable assurance on whether there is no material misstatement in financial statements.
2. Audit involves the implementation of audit procedures to obtain audit evidence about the amount and disclosure of financial statements. The selected audit procedure depends on the judgment of certified public accountants, including the assessment of the risk of material misstatement of financial statements due to fraud or error. In risk assessment, certified public accountants consider the internal control related to the preparation of financial statements in order to design appropriate audit procedures, but the purpose is not to express opinions on the effectiveness of internal control. The audit also includes evaluating the appropriateness of management's accounting policies and the rationality of accounting estimates, as well as evaluating the overall presentation of financial statements.
3. Certified public accountants believe that the obtained audit evidence is sufficient and appropriate, which provides a basis for them to express their audit opinions.
Where a certified public accountant is entrusted to express opinions on the effectiveness of internal control in combination with the audit of financial statements, the expression "but the purpose is not to express opinions on the effectiveness of internal control" in Item 2 of this Article shall be omitted.
When understanding the contents of the responsibility part of certified public accountants, we should pay attention to the following points:
The first paragraph expounds the responsibilities of certified public accountants, the criteria for certified public accountants to perform audit business and the core requirements of the auditing criteria for certified public accountants. At the same time, it is explained to the users of financial statements that certified public accountants should plan and implement the audit work in order to obtain reasonable assurance on whether there is no material misstatement in financial statements. There is no material misstatement, which means that the certified public accountant believes that there is no misstatement in the audited financial statements that affects the decision-making of users of financial statements. Reasonable assurance means that certified public accountants obtain sufficient and appropriate audit evidence through continuous revision and systematic practice, express audit opinions on the financial statements as a whole, and provide high-level but not 100% assurance.
The second paragraph expounds the main process of CPA's audit work, including the application of professional judgment to implement risk assessment procedures, control tests (when necessary or when deciding to test) and substantive procedures. At the same time, it explains to the users of financial statements that the audit of certified public accountants is based on risk-oriented audit. In risk assessment, certified public accountants consider the internal control related to the preparation of financial statements in order to design appropriate audit procedures, but the purpose is not to express opinions on the effectiveness of internal control. Therefore, the audit report does not provide any guarantee for internal control.
Article 3 It is clear that certified public accountants have obtained sufficient and appropriate audit evidence through the implementation of audit work and have the basis for expressing audit opinions.
Examples of CPA's responsibilities are as follows:
"Second, the responsibility of certified public accountants.
Our responsibility is to express an audit opinion on the financial statements based on the implementation of the audit work. We have carried out the audit according to the requirements of the auditing standards for certified public accountants in China. The auditing standards of certified public accountants in China require us to abide by professional ethics, plan and implement auditing work to obtain reasonable assurance on whether there is no material misstatement in financial statements.
Audit work involves the implementation of audit procedures to obtain audit evidence about the amount and disclosure of financial statements. The selected audit procedure depends on the judgment of certified public accountants, including the assessment of the risk of material misstatement of financial statements due to fraud or error. In risk assessment, we consider the internal control related to the preparation of financial statements in order to design appropriate audit procedures, but the purpose is not to express opinions on the effectiveness of internal control. The audit also includes evaluating the appropriateness of management's accounting policies and the rationality of accounting estimates, as well as evaluating the overall presentation of financial statements.
We believe that the audit evidence we obtained is sufficient and appropriate, which provides a basis for expressing audit opinions. (a) the contents of the audit opinion paragraph
The audit opinion part shall explain whether the financial statements are prepared in accordance with the applicable accounting standards and relevant accounting systems, and whether they fairly reflect the financial position, operating results and cash flow of the audited entity in all major aspects.
The purpose of financial statement audit is for certified public accountants to express audit opinions on the following aspects of financial statements by performing audit work: (1) Whether financial statements are prepared in accordance with applicable accounting standards and related accounting systems; (2) Whether the financial statements fairly reflect the financial position, operating results and cash flow of the audited entity in all major aspects. Therefore, after completing the audit and obtaining sufficient and appropriate audit evidence, certified public accountants should express audit opinions on the above contents of financial statements.
(2) Unqualified audit report
If the financial statements meet the following conditions at the same time, the certified public accountant shall issue an unqualified audit report:
(1) The financial statements have been prepared in accordance with the applicable accounting standards and relevant accounting systems, and fairly reflect the financial status, operating results and cash flow of the audited entity in all major aspects;
(2) The CPA has planned and implemented the audit work in accordance with the provisions of the Auditing Standards for Certified Public Accountants in China, and has not been restricted in the audit process.
When issuing unqualified audit reports, certified public accountants should start with "in our opinion" and use terms such as "in all major aspects" and "fair reflection".
An unqualified audit report refers to a certified public accountant who believes that the preparation of the audited entity's financial statements meets the legal and fair requirements through the implementation of the audit work, and reasonably guarantees that there is no major misstatement in the financial statements.
Examples of opinion paragraphs in unqualified audit reports are as follows:
"three. audit opinion
We believe that the financial statements of ABC Company have been compiled in accordance with the provisions of the Accounting Standards for Business Enterprises and the accounting system, and fairly reflect the financial status of ABC Company in 20× 1 year and its operating results and cash flow in February of 20× 1 year. "
(3) Standard audit report
An unqualified audit report issued by a certified public accountant is called a standard audit report if there are no explanatory paragraphs, emphasis paragraphs or any modification clauses attached.
The standard audit report contains the complete elements of the audit report, which is unqualified and does not attach explanatory paragraphs, emphasized paragraphs or any decorative clauses. Otherwise, it cannot be called a standard audit report. The audit report shall be signed and sealed by the certified public accountant.
It is helpful for certified public accountants to sign and seal the audit report to clarify their legal responsibilities. The Notice of the Ministry of Finance on Issues Concerning the Signature and Seal of Certified Public Accountants on Audit Reports (Caishui [2006 54 38+0] 1035) clearly stipulates that:
"Accounting firms shall establish and improve comprehensive quality control policies and procedures as well as the quality control procedures of each audit project, and sign and seal the audit report in strict accordance with the relevant provisions and the requirements of this notice.
Two, the audit report shall be signed by two certified public accountants with relevant business qualifications and stamped with the seal of the accounting firm.
(1) The audit report issued by the partnership accounting firm shall be signed and sealed by the partner in charge of the final review of the audit project and the certified public accountant in charge of the project.
(2) The audit report issued by a limited liability accounting firm shall be signed and sealed by the chief accountant of the accounting firm or its authorized deputy chief accountant and the certified public accountant in charge of the project. "The audit report shall specify the name and address of the accounting firm and affix the official seal of the accounting firm.
According to the provisions of the Law of People's Republic of China (PRC) on Certified Public Accountants, a certified public accountant undertaking business shall be accepted by his accounting firm and sign an entrustment contract with the client. Therefore, the audit report should not only be signed and sealed by the certified public accountant, but also have the name and address of the accounting firm and affix its official seal.
When the certified public accountant indicates the address of the accounting firm in the audit report, it is enough to indicate the city where the accounting firm is located. In practice, audit reports are usually printed by accounting firms and marked with their detailed mailing addresses. Therefore, it is not necessary to indicate the detailed address in the audit report. In addition, according to the relevant regulations of the State Administration for Industry and Commerce, the names of registered enterprises shall not be the same within the jurisdiction of the registration authority. Therefore, there will be no accounting firm with the same name in the same area. The audit report shall indicate the date of the report. The date of the audit report shall not be earlier than the date when the certified public accountant obtains sufficient and appropriate audit evidence (including the evidence that the management recognizes the responsibility for the financial statements and has approved the financial statements) and forms an audit opinion on the financial statements on this basis.
When determining the date of the audit report, the certified public accountant should consider that: (1) the audit procedures that should be implemented have been completed; (two) the matters that should be submitted to the audited entity for adjustment have been put forward, and the audited entity has adjusted or refused to adjust; (3) The financial statements have been formally signed by the management.
The date of the audit report is very important. Certified public accountants have different responsibilities for matters after the balance sheet date in different periods, and the date of audit report is the key point to divide the periods. In practice, certified public accountants usually submit the draft audit report and the audited financial statements to the management together before formally signing the audit report. If the management approves and signs the audited financial statements, the CPA can sign the audit report. The date when the CPA signs the audit report is usually the same as or later than the date when the management signs the audited financial statements. When the date of the audit report is later than the date of signing the audited financial statements by the management, the certified public accountant shall obtain further audit evidence from the date of the management statement to the date of the audit report, such as supplementary management statements.