The auditing system of government financial reports with Chinese characteristics is still being perfected, and some key problems need to be solved urgently. Based on the legal and institutional environment of China, according to the main line of “who should audit - what audit - how audit”, the paper discusses the auditing subject and its independence, auditing content, auditing ideas and methods of government financial reports. The research holds that the status of auditing subject of national audit institutions should not be changed because there is no change in the movement process of financial fund, and the purchase of social audit should limit the scope of auditing objects, innovate the payment of auditing fees and strengthen the control of auditing quality. It is necessary to set up national, provincial, municipal and county audit committees, which are elected by the National People’s Congress and Local People’s Congresses at all levels, audit institutions at all levels can serve as the decision-making executive agencies of auditing committees at the same level, no longer accountable to the people’s governments at the same level, operate independently of the government system, and then be removed from the government sequence when the time is right. Not to audit the medium and long-term sustainability of finance for the time being, first audit the two core financial statements, focus on the completeness of basic information, the adequacy of offsetting and the accuracy of adjustment, and whether there is any behavior of manipulating earnings by using offset threshold, after the system of government accounting standards is complete, then audit the government's financial management and other matters. It is necessary to combine the use of statistical sampling and judgment sampling methods to promote the big data audit of government financial reports, and realize the correlation of accounting data between upper and lower levels of finance and between finance and budget units at the same level.