The National Institute of Certified Public Accountants puts independence in a very important position when formulating professional ethics standards. The code of professional ethics formulated by the American Institute of Certified Public Accountants consists of four parts, namely, professional ethics principles, rules of conduct, explanations of rules of conduct and moral rulings. Among them, both professional ethics principles and behavior rules have provisions on independence. The principle of professional ethics embodies the responsibility of certified public accountants and the basic creed of professional ethics. These principles require that even at the expense of personal interests, we should fulfill our professional responsibilities and adhere to correct behavior. One of them is objectivity and independence: members should be objective in performing their professional duties and avoid conflicts of interest. Members engaged in public business should maintain their independence in substance and form when providing audit and other certification services. The first code of conduct, 10 1, emphasizes independence. Independence: Members engaged in public business should abide by the standards issued by organizations recognized by the board of directors and maintain independence when providing professional services. If the principle of professional ethics is the ideal behavior of certified public accountants, then the code of conduct is the minimum standard of certified public accountants' behavior and is mandatory. From the professional ethics standards formulated by the American Institute of Certified Public Accountants, we can see that independence is the minimum standard of CPA's behavior.
The International Federation of Accountants has formulated and promulgated the Code of Ethics for Professional Accountants. The second part applies to professional accountants who perform official duties, that is, certified public accountants. In this part, the description of independence is as follows: independence requirements of legal business: 1 substantial independence. This kind of mentality can make the point of view unaffected by any factors that are not conducive to professional judgment, and enable people to act fairly and maintain objective professional caution. 2 formal independence. Avoid major facts and circumstances that lead a rational third party with sufficient relevant information (including the preventive measures used) to reasonably assume that the impartiality, objectivity or professional caution of the members of the firm or forensic team will be damaged.
II. Provisions on the independence of professional ethics of certified public accountants in China.
Since its establishment at the end of 1988, China Institute of Certified Public Accountants has always attached great importance to the construction of moral standards and moral education for certified public accountants. 1992, the China Institute of Certified Public Accountants issued the Code of Professional Ethics for Certified Public Accountants in China (for Trial Implementation). 1 99665438+On February 26th, with the approval of the Ministry of Finance, China Institute of Certified Public Accountants issued the Basic Code of Professional Ethics for Certified Public Accountants in China (hereinafter referred to as the Code of Professional Ethics), which came into effect on June 1997 65438+ 10/0.
In the Code of Professional Ethics, independence is stipulated as follows: (1) Certified public accountants should abide by the principles of independence, objectivity and impartiality. (2) A certified public accountant shall be independent in form and substance when performing auditing or other authentication services. (3) If an accounting firm has an interest relationship with its client that may damage its independence, it shall not undertake the audit or other authentication business entrusted by it. (4) If a certified public accountant has an interest in performing audit or other authentication business and may damage his independence, he shall make a statement to his accounting firm and withdraw. (5) A certified public accountant shall not concurrently engage in or concurrently hold other businesses or positions that are incompatible with the auditing or other authentication business he performs. (6) In carrying out business, certified public accountants should be realistic and not influenced by others, and their analysis, judgment and objectivity should not be influenced by personal likes and dislikes. (7) A certified public accountant shall treat all interested parties honestly, honestly and fairly when performing business.
In order to meet the urgent needs, China Institute of Certified Public Accountants has formulated the Guiding Opinions on Professional Ethics of Certified Public Accountants in China (hereinafter referred to as "Guiding Opinions"), which gives specific guidance to certified public accountants on how to follow the requirements of professional ethics in their practice activities. The Guiding Opinions stipulates that certified public accountants should maintain their independence in substance and form when carrying out authentication business, and their objective and fair position is not affected by any interests.
Third, reflect on the meaning of independence.
As can be seen from the above provisions, American Institute of Certified Public Accountants, International Federation of Accountants and China Institute of Certified Public Accountants all emphasize independence in substance and form. The so-called substantive independence, also called spiritual independence, means that independence is a state of mind, a kind of self-confidence, and an external pressure and influence when judging. It requires certified public accountants to maintain strict detachment in the practice process, not to protect any party subjectively, especially not to make their conclusions dependent on or subject to the influence and pressure of interest groups or people with objections. The so-called formal independence means that the certified public accountant must have no special interest relationship with the audited enterprise or individual, such as not owning the equity of the audited enterprise or holding its senior position, not being the main lender or asset custodian of the enterprise or having kinship with the management authorities, and so on. Otherwise, it will affect the fair execution of business by certified public accountants. Formal independence can be further divided into organizational independence, economic independence and personnel independence. Substantial independence is intangible and usually difficult to observe and measure, while formal independence is tangible and observable. The public usually infers the substantive independence of certified public accountants through their formal independence. Therefore, in this sense, formal independence is the carrier and important premise of substantive independence.
The author believes that at present, this so-called substantive independence and formal independence is only an ideal state, especially in such a bad practice situation in China.
For enterprises with different organizational forms, the purpose of authentication reports issued by certified public accountants is different. At present, the organizational forms of Chinese enterprises are mainly as follows: among non-corporate enterprises, sole proprietorship enterprises and partnership enterprises are small in scale, but they are numerous. The demand for audit reports by such enterprises is mostly due to the requirements of the finance and taxation departments, such as annual inspection and tax inspection. Most accounting firms that issue audit reports for such enterprises are small and medium-sized firms. Nowadays, the competition in the audit market is fierce, and it is difficult for small and medium-sized firms to maintain their independence for their own survival and development. Firms often pull business through personal relationships, which makes the quality of audit reports worse.
We can simply divide corporate enterprises into listed companies (some joint-stock companies) and unlisted companies (some joint-stock companies and limited liability companies). A large part of unlisted companies are companies invested by individuals. For such companies, investors are generally operators. The so-called separation of investors and operators is not reflected in such companies. The organizational structure of such companies is not standardized. In addition to the requirements of the financial and tax departments, the purpose of issuing audit reports is to obtain bank loans. Investors usually hire accounting firms to audit the companies they invest in and operate. In this case, how can certified public accountants maintain their independence? The audit report issued by an accounting firm does not meet the wishes of the client and will often be dismissed. Being fired means no income. Without income, who can guarantee the survival of certified public accountants? Auditing such companies, accounting firms (especially small and medium-sized firms) have to take great risks. Once they don't master it well, they may be sued. At present, the audit market is undoubtedly a buyer's market, and accounting firms can only move forward in such an environment.
For listed companies, the scale is large, the business is complex, the organizational structure is relatively standardized, and the social influence is huge. Therefore, the China Securities Regulatory Commission stipulates that only some qualified accounting firms are qualified to issue audit reports for listed companies. It should be said that issuing audit reports to listed companies has a large workload and high income, but at the same time, the risks are huge. At present, most listed companies in China are dominated by state-owned shares, and major shareholders can control the shareholders' meeting and participate in the management as shareholders, resulting in the distinction between management rights and ownership. Audit reports of listed companies are widely used, including investors, relevant state departments and potential investors. Among these users, minority shareholders are undoubtedly vulnerable groups, and their information is very limited. Accounting statements audited by accounting firms are one of the few carriers for them to understand the information of listed companies. However, few people rely on the audit report of certified public accountants to speculate in stocks, which shows that certified public accountants have not fully gained the trust of society.
Four, the reasons that affect the independence of certified public accountants
In the Guiding Opinions on Professional Ethics of Certified Public Accountants in China, the factors that may damage independence are described as economic interests, self-evaluation, relationships and external pressure.
The author believes that the above reasons are superficial rather than fundamental, and the fundamental reason lies in the audit entrustment system. As we all know, the triangle is the most stable in geometry. As can be seen from the above discussion, the reason why the audit triangle is destroyed is because the operator and the owner are not actually separated, so there is no way to talk about independence without solving the problem of the audit entrustment system.