With the rapid development of society, economic activities have become more complex and diverse, and the scope and environment of audit are constantly expanding and changing. The complexity of external environment and internal supervision, coupled with the limitations of audit, the audit industry is facing increasing pressure. In recent years, audit failure cases have occurred from time to time, the audit industry has been troubled, and the audit risk is getting bigger and bigger. In this situation, relevant departments and personnel pay more and more attention to the study of audit risk.

As an inevitable problem in audit work, audit risk is inevitable in theory, but the probability of occurrence can be reduced through human efforts. This paper introduces the connotation, categories and causes of audit risk, and analyzes in detail the causes of audit failure in the case of "three new materials" financial fraud. Finally, it tries to put forward specific measures to avoid and prevent audit risks. Avoiding and preventing audit risks, improving audit quality and developing economic activities are of great significance to social and economic development.