ABSTRACT
History has shown that auditing has long been practised in China. However, internal political turmoil and the closed-door policy severely hindered the continuing practices of auditing. The audit emphasis was all the while on detecting fraud and irregularities, but the open-door policy in 1979 saw the country importing a large volume of foreign ideas and technology, including audit and accounting practices. To cope with this immediate change, China needs to reassess its traditional aims of auditing to meet the world challenge. The readiness and openness of the Chinese to foreign practices on the accounting perspective can be found in Aiken and Lu (1993). They note that:
The [accounting] method used by the Warlords government [in China] was taken from Japan; the system introduced by the Nationalist government was borrowed from Europe and America; while current government accounting practice was mainly influenced by the [then] Soviet Union.
(Aiken and Lu 1993: 124)