| The legal basis is the cornerstone of sustained and sound economic development.The Securities Law is the fundamental law for building an effective capital market.It has far-reaching significance for standardizing and guiding the behavior of participants in the capital market,improving the legal ecological environment of the capital market,and promoting the healthy,orderly,and high-quality development of the capital market.On December 28,2019,the New Securities Law(NSL)was promulgated,which is a milestone in regulatory legislation of the capital market,and the further improvement and innovation of the laws of the capital market based on summarizing the development experience of the capital market.The essence of the capital market is an information market.As a third-party market force,auditors can perform the basic function of information examination and verification with their professional skills,which plays an important role in reasonably guaranteeing the quality of corporate information disclosure,protecting the legitimate rights and interests of investors and other stakeholders,maintaining the order of the capital market,preventing systemic risks in the capital market,and improving the efficiency of the capital market.Therefore,the auditor is an important object of regulation in the Securities Law.Audit behavior is a set of audit-related activities of auditors to build contract relationship and fulfill fiduciary audit responsibility,which must also be carried out following the content of the Securities Law.NSL has changed some requirements and the environment of securities market audit.Will auditors adjust their audit behavior to comply with the NSL? How can the parties that supervise audit activities according to NSL promote the further optimization of the auditor’s behavior?It is worth studying.Studying this issue is of great value for clarifying the effect of the implementation of NSL on the development of the audit industry market,regulating the behavior of auditors,improving the performance quality of audit authentication responsibility,safeguarding the healthy market environment of the audit industry,protecting the legitimate rights and interests of investors and other market participants,and promoting the long-term,orderly and high-quality development of the capital market.To complete an audit business,the auditor needs to establish a business entrustment relationship with the client and implement professional audit procedures to provide reasonable verification for the authenticity of the disclosure of financial information and other information by the company.In the process of carrying out audit work,auditors should first screen clients and establish audit service objects by correctly selecting client target groups.At the same time,as a third-party service subject to profits,auditors should reasonably charge clients certain fees based on industry standards and in combination with their professional capabilities and client information,as a guarantee for carrying out professional services.The above audit client selection and audit fee belong to the customer relationship processing category of coordinating the contractual relationship with the client.Then,according to the requirements of the practice code,the auditor will formulate audit plans,implement independent audit procedures,and issue audit reports to provide reasonable and appropriate audit opinions and key audit matters.The above audit opinion selection and key audit matters report belong to the scope of a compilation of audit reports to realize the performance of contractual responsibilities.As these two links reflect the handling of the relationship between auditors and clients,audit report users,they have a direct "externality" impact on the audit service market and the capital market and are the focus of the Securities Law to regulate audit behavior.Under the background of the implementation of the new "Securities Law" and the further improvement of relevant legal infrastructure,the question of how auditors adjust behavior in the process of customer relationship handling and audit report preparation has become the focus of this paper’s study on the selection of audit behavior.For this purpose,the paper selects the A-share listed enterprises in Shanghai and Shenzhen from 2007 to 2021 as samples,from the perspective of customer relationship processing and audit report compilation,based on supply and demand theory,risk-oriented audit theory,reputation theory,audit pricing theory and "deep pocket" theory.This paper empirically studies the influence of the implementation of NSL on audit client selection,audit fee,audit opinion selection,and key audit matters reports by using multiple regression analysis methods.On this basis,from the perspective of audit market concentration and punishment risk,this paper discusses the path mechanism of the implementation of NSL affecting the selection of audit behavior,and further studies the synergistic mechanism of the implementation of NSL affecting the selection of audit behavior from the perspective of Stock Exchange inquiry,CICPA interview,and media attention.The findings are as follows:(1)The implementation of NSL reduces the concentration of the audit market and increases the risk of punishment,which makes auditors improve the matching of clients,and can effectively alleviate the mismatch of audit relationship.Further research shows that the implementation of NSL has a more significant effect on alleviating the mismatch of audit relations under the coordination of Stock Exchange inquiry,CICPA interview,and media attention.(2)The implementation of NSL reduces the concentration of the audit market and increases the risk of punishment so that the auditor raises the service fee level.The further study found that the implementation of NSL has a more significant effect on the level of audit fee under the coordination of Stock Exchange inquiry,CICPA interview,and media attention.(3)The implementation of NSL reduces the concentration of the audit market and increases the risk of punishment,which significantly increases the probability of auditors issuing non-standard audit opinions.Further research shows that the implementation of NSL has a more significant effect on enhancing the probability of auditors issuing non-standard audit opinions under Stock Exchange inquiry,CICPA interview,and media attention.(4)The implementation of NSL reduces the concentration of the audit market and increases the risk of punishment,which makes auditors improve the adequacy of reporting key audit matters.Further study found that the implementation of NSL has a more significant effect on the adequacy of auditors’ reporting of key audit matters under Stock Exchange inquiry,CICPA interview,and media attention.The theoretical contributions of this paper are as follows:(1)Taking the NSL as a milestone in the construction of legal infrastructure to study its impact on auditor behavior selection,enriching the relevant research on the consequences of the implementation of NSL,and supplementing the relevant literature on the factors influencing audit behavior selection.(2)Deeply studying the path mechanism of the impact of the implementation of NSL on audit behavior selection has deepened the understanding of the internal mechanism of how the implementation of NSL affects auditor behavior selection,and improved the depth of the research on the impact of the implementation of NSL on audit behavior selection.(3)Further exploring the synergy mechanism of the capital market law enforcement regulators on the implementation of NSL affecting the selection of audit behavior,improve the synergy theory system of NSL supervision subject,and enrich the relevant literature on the impact of the capital market supervision subject.The practical significances of this paper are as follows:(1)It tests the effectiveness of NSL in standardizing auditor behavior selection,and provides empirical evidence for earnestly implementing the NSL,standardizing auditor behavior,optimizing the order of audit service market,and improving the effectiveness of the capital market.(2)It provides a theoretical basis for auditors to effectively implement the NSL,properly handle the relationship with clients,improve the quality of audit report preparation,effectively prevent and control audit risks,and improve audit quality.(3)It provides evidence support for all parties of audit supervision to strengthen the supervision of auditor behavior selection,optimize audit behavior and improve the effectiveness of the capital market following the NSL.(4)It provides useful enlightenment for investors and other audit service objects to correctly judge the rationality of auditor behavior,accurately understand the meaning of audit report information,and effectively make investment decisions. |
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