The Legal Responsibility of Certified Public Accountants in terms of Corporate Governance in Taiwan

• Main Authors: Cheng Fa-chuan, 鄭發全
• Other Authors: 洪秀芬
• Format: Others
• Language: zh-TW
• Published: 2014
• Online Access: http://ndltd.ncl.edu.tw/handle/95044247540886237573

碩士 === 東吳大學 === 法律學系 === 102 === Corporate Governance is an issue with highly attention from a long time ago. Since 1995, the cases of certified public accountants’ (CPAs) auditing failures have grown up in large scale such as Enron in America or Rebar in Taiwan, which causes negative evaluations toward the CPAs’ role in the society. On July 30, 2002, US President Bush signed Sarbanes-Oxley Act of 2002 into law. In the act, for improvement and governance of accountancy, independency is the main spirit. The Certified Public Accountant Act in Taiwan was also revised on December 26, 2007, e.g. adding a corporate CPA firm system and emphasizing the certification liability of CPAs. In terms of corporate governance, the CPAs play an important role as a bridge between the internal governance and external governance. The internal governance includes Board of Directors, Shareholders' Meeting, Supervisors, Management, etc, and the external governance includes government authorities, provision of law, financial institutions, money and capital market, upstream and downstream firms, Raw materials market, investors, stock market, M & A market, reputation agent, etc. The CPA is supposed to be independent both in fact and appearance in order to protect the interests of the general public. However, the masses usually misunderstand the CPAs’ auditing responsibility and confuse the responsibility of compiling with of auditing financial statements. The misunderstanding usually comes from not realizing the nature of auditing and takes CPA’s audit report as a guarantee of sustainable development. Auditors should be responsible for the independence which mainly concerned by the Certified Public Accountant Act and the breach of other laws such as Civil Code, Criminal Code of the Republic of China, Company Act, Securities and Exchange Act, etc. In this thesis, the basic legal principles are discussed from three points of view which are the perspective of civil, criminal and administrative responsibility, and the recent judgments are cited as case studies discussed in depth. On the one hand, the legal commentators and courts diverse on the CPAs’ subjective element of civil liability: some of them claim that the subjective element is intent, some of them declare that it is gross negligence and others state that it is negligence. On the other hand, the main provisions of civil liability system in Taiwan are in the Securities and Exchange Act section 20-1 (proportionate liability) and section 32 (joint and several liability), but the methods of calculating the amount of compensation in the recent judgments are different. The civil liability system and calculation of the amount of compensation affect the CPAs’ risk. Moreover, the predictability of the risk will affect the development of CPAs’ liability insurance system in the future. Finally, the thesis recommends that CPAs should apply to the proportionate liability system in Securities and Exchange Act section 20-1 and section 32. Meanwhile, it suggests that the Legislature should consider about the CPAs’ relevant legal system carefully before making a decision or reaching a conclusion. In addition, the Legislature should also revise the provisions of laws which are blurred and inconsistent between legislative purposes and provisions with stricter standard.