Empirical Analysis Of The Audit Fee Of Chinese Listed Companies

Audit fees are the economic link between CPA and auditees. Since SEC required the listed companies to disclose external audit fees at the beginning of 1980s, foreign scholars have studied different questions about audit fee in securities market. Their studies discussed supervision and state of public audit from the point of audit fee. In 2001, Chinese listed companies were required to disclose their audit fees for the fist time. Pay to CPA went from secret to open. This paper established two models after reviewing literature and thinking development, demand, quality and carrying risk of public audit in Chinese securities market. Model 1 discusses the determinats of audit fee, model 2 discusses the relation between audit fee and audit quality. The data of 384 companies used in the models are selected from the listed companies that have disclosed their audit fees and other finance informations of 2001. After demonstration we can get the main conclusions: there are notable positive relativity between audit fee and audtee's total assetses or subsidiaries ,and auditor's scale; while the audit opnion is not clean , audit fees are higher, but audit quality aren't increased that suggestes that independentance in Chinese public audit market is negative.; when auditors give special audit or consultations, they may demand more audit fees and their auditees may buy audit opinions; there is pricing-cutting when CPA audit listed companies that need middle audit or special audit or consultations for the first time; there is also a unprompted price bottom line in Chinese public audit market, but audit quality isn't improved for it.