Special interviews
Author: Zhan Yongyu
2021-03-24 07:05
Last update date: 2021-03-24 07:05
Stepping into the peak period of performance, retail investors receive the score sheet distributed by the listed company. Apart from concern about profit loss and dividend payout, they certainly hope that the performance report will be "flawless". Once the auditor has a "reserved opinion", it means that some content is not available. "Receipt".
Take Convoy Global (1019), which was caught in an equity dispute as an example, suspended trading for a long time and finally announced its three-year financial report. However, the auditors had a total of 25 "reserved opinions". The incident caused a high-profile investigation by the Financial and Exchange Bureau.
A simple sentence of "reserved opinions", how to explain the ripples?
The Chairman of the Financial and Remittance Bureau, Dr. Huang Tianyou, stated clearly that he did not want to see the abuse of "reserved opinions" by auditors. He shared the reasons behind it with "Hong Kong 01".
In terms of auditing standards, if there are no answers or evidence in many accounts, the auditor should not give an opinion.
(Photo by Zhang Haowei)
Last month, the Bureau of Finance and Remittance made a rare public statement to investigate Convoy’s 2017-2019 financial report audit, and said that the auditor appointed by Convoy, Zhonghui, issued a "qualified opinion" on the accounts, which was not sufficient to reflect the company’s situation. Severity.
The incident also caused the term "reserved opinions" to suddenly become a concern.
According to the definition of the Stock Exchange, when the auditor has sufficient and appropriate audit evidence, or is unable to obtain sufficient and appropriate audit evidence as the basis for his opinion, he will issue a statement when he believes that a listed company’s financial report contains material but not extensive misrepresentation. "Reserved opinions".
Huang Tianyou explained that in terms of auditing standards, "reserved opinions" are all types of opinions. If many accounts have no answers or evidence, auditors should not give opinions.
He explained that when general investors look up the annual report, they only look at income, profit, etc. No one will look at the audit opinion. "The public is not a professional investor. As long as you give an opinion, (even if it is a reserved opinion), the public will If you have an idea, it means that there is no problem when you have an opinion."
When asked about Convoy’s disclosures, Huang Tianyou stated that it was already in the investigation stage and it was inconvenient to disclose too many details.
(Profile picture)
Issuing reservations is difficult to quantify but there are guidelines
When asked about Convoy’s disclosures, Huang Tianyou stated that it was already in the investigation stage and it was inconvenient to disclose too many details.
But as to whether there are criteria for reservations, he said that there are definitely some, although it is difficult to quantitate (quantitative), "If I have 8 disclaimers, I can’t make a reservation, and 5 is just right. That’s not the case, yes. It depends on what your disclaimer is."
He gave, for example, a loan of 20,000 yuan, but the debt was lost. The director unilaterally confirmed that the loan was lent to his wife, but the auditor was unable to find his wife to verify it.
For a 20 billion company, this situation does not even require a disclaimer, because this number can be described as "immaterial".
However, when both parties have completely opposite opinions on an account, and the auditor believes that the auditing standards cannot be passed, a disclaimer is required.
For example, when recognizing 10 billion yuan in revenue, 2 billion yuan cannot be recognized. If there is a chance that profits and assets are reduced, a qualified opinion is required.
Huang Tianyou used the analogy of auditing work by "watching a girl". If 90% of her looks are not visible, how can she tell that she is a beautiful woman?
(Photo by Zhang Haowei)
Taking pictures of beautiful women as "miao metaphors", no reservations should be made if the accounts are unknown
He again emphasized that if a company has many unclear accounts, the auditor should not express any opinions.
"If you are from my family, you shouldn’t have an opinion. For example, if you have a photo of a beautiful woman at home, and you say a beautiful woman, I have reservations, because there are so many people who can’t see it, but it should be a beautiful woman. . Can you come to this conclusion? You should tell me if I can’t come to this relationship, so you can’t come to an opinion!”
Huang Tianyou added that the auditor's opinion is very important. Investors will look at the annual report sales, bank loans, and so on.
If only 5% of the beauty photos are invisible, you can issue a disclaimer. I have reservations about whether this position is beautiful, but the remaining 95% reflect that it is a beauty.
As to whether issuing a "reserved opinion" is equivalent to "wearing a helmet", when a company goes wrong, can the relationship be clarified?
Huang Tianyou frankly said that as long as the "reserved opinions" part of the incident, the auditor is not responsible, because a disclaimer has been issued.
However, if something other than the "qualified opinion" is wrong, you must be held responsible, because this part represents the auditor's unqualified opinion on the accounts.
Experienced auditors must have sufficient understanding of the industry and professional knowledge to do audit work.
(VCG)
Audit is responsible for catching "falsification"
Currently, there are more than 2,500 companies listed on the Hong Kong Stock Exchange and GEM, covering 11 major industries, 30 major business categories and 86 business sub-categories.
The auditor's clients come from different industries. Do they have certain professional knowledge to "catching fakes" in each industry?
Huang Tianyou pointed out that experienced auditors must have sufficient understanding of the industry and professional knowledge to do audit work. If the provision is less than 100 million yuan, there is a chance of loss and reconciliation. Therefore, the audit process is like doing it. Detectives generally say, "Ask how much money the bank will lend to the company this year. If the bank does not want to lend money to this industry this year, we must be more cautious in its provision and should not just let him allocate very little."
He used the analogy of a professional auditor in a bank. Hong Kong licensed banks cannot say to the public after they have bad debts, "Sorry, I loaned to this industry this year, but it turns out that the industry is fake and we don’t have it. For our loan experience in this industry, we used to only lend to real estate companies and were not familiar with the new industry.”
He asked back, is the bank courageous enough to say this?
The same principle applies to auditors.
Huang Tianyou emphasized that auditors are a professional industry, and they have higher-level responsibilities outside the law. "There must be public responsibilities after two meals. The experience is another matter, but they have a certain sense of mission and professionalism. Ethics and experience. Ask questions when you should. Otherwise, you’ll have to be a bookkeeper. It’s a bookkeeper, you’re an auditor, and when it comes to auditing, it’s really exciting!”
Interview｜Finance and Remittance Bureau's three major "provincial signatures" Huang Tianyou: professional auditors will be able to detect fraud
Report from the Bureau of Finance and Remittance: Hong Kong's auditing market is highly concentrated and accounted for more than 80% of the market
The China Securities Regulatory Commission and the Financial and Remittance Bureau sign a memorandum of understanding to strengthen the supervision of the capital market
Convoy Convoy Storm
