The Main Reason for HIH Insurance Limited Collapsing

There is little surprise in insurance, but they almost always bring bad news when they arrive. This is the end of HIH Insurance Co., Ltd. (HIH). For many policyholders, this is surprising (for many people) and very bad news. This is the biggest failure in Australia's business history. The Royal Committee was appointed to investigate the reissue of the HIH insurance company and the estimated liability was A $ 5.3 billion. The reason behind the collapse of the enterprise was a failure of management, a failure of a strategic team, a specific failure of accounting anomalies, a management team's own interests, and a specific failure of business risk.

HIH has more than 250 companies in liquidation (2003 (including 2003), including HIH property and casualty insurance, FAI nonlife insurance company limited (FAI), CIC insurance limited (CIC), World Marine and General Insurance Limited (WMG) Our main business). Various types of insurance are offered in Australia, USA, UK such as general insurance, insurance underwriting, investment fund management. On the other hand, special insurance includes general insurance, workers compensation compensation, public responsibility and professional compensation insurance. , General & Commercial Insurance (Kehlnd)

HIH insurance was temporarily liquidated on March 15, 2001 (Peursem et al., 2007), since the debt was between approximately $ 3.6 billion and $ 5.3 billion. The collapse of the HIH insurance business is considered to be the biggest company failure in Australian corporate history. Later, due to this crash, the Royal Committee was established, "The actions of employees, directors, auditors, consultants and actuaries appointed by the Australian federal government have brought involvement in HIH failure or inappropriate business practices "(Mirshekary, Yaftian & Cross, 2004). Because HIH Insurance is a major Australian insurance company, its collapse has had widespread impact on society (Leung & Cooper, 2003). The purpose of this report is to analyze the audit problem caused by the collapse of the HIH insurance business. A brief introduction of the HIH profile before the audit analysis of the crash accident of HIH insurance

In Australia, the collapse of HIH Insurance Company was regarded as the beginning of the role of Outside Corporate Auditor. HIH is one of Australia's largest insurance companies, consisting of government-approved independent insurance companies such as HIH Casualty & General Insurance Ltd, FAI General Insurance Ltd, CIC Insurance Ltd, World Marine & General Insurance. Temporary insurance company liquidation loss A $ 800 million (Peursem, Zhou, Flood & Buttimore, 2007)