Font Size: a A A

Low Price Competition And Solution In Certified Public Accountants Trade

Posted on:2005-10-30Degree:MasterType:Thesis
Country:ChinaCandidate:L M ChengFull Text:PDF
GTID:2156360122998549Subject:Political economy
Abstract/Summary:PDF Full Text Request
As an agency fee, auditing charge usually form in the asymmetric information between property client and agent. In a situation which the information is asymmetric, the clients are unable observe the agents' working course and diligent degree. Therefore they engage the Certified Public Accountant audit in order to confirm the truth of accounting information. So the auditing charge is the price of service product which offered by the Certified Public Accountant.Because audit is a kind of attestation business, the auditor and the accounting firm has great responsibility. The accounting firm must consider its risk while charging. So auditing charge generally consists of three parts: products expense, the risk cost and normal profit of the accounting firm. As one of the components of auditing charge, the product expenses is not only influenced by the factor about the enterprise in audit, such as the scales of unit, business complexity and regional characteristic, but also influenced by the factor about the accounting firm, such as audit team, accounting firms" shift cost, etc. Not only macroscopic but also the microcosmic factor play an important part in the risk cost. The macroscopic factor refers the working environment mainly and the microcosmic factor consists of the organization form and scale of accounting firm, risk psychological expectancy, etc. In addition, the role that the market play in the price determine, competition degree and the pricing tactics of accounting firm all play a role in audit profit in varying degrees. At the same time, the price of auditing product is affectedby the market's supply and demand, accounting firm's prestige and government's behavior mainly.The price deviation in our auditing market is shown as the low price competition between the accounting firms mainly. The lacks of autonomous demand for auditor's high quality serve, too much supply of small-scale accounting firms, the lack of prestige evaluating mechanism in Certified Public Accountants trade, all these are reasons that low price competition exists in our auditing market. Therefore, it is necessary for us to perfect our securities market system, promote the pressure and power of autonomous supply of high quality serve and standardize the government management behavior, etc. Thus, the problem of price deviating in auditing market will be solved in a measure.
Keywords/Search Tags:auditing charge, the Certified Public Accountant, low price competition
PDF Full Text Request
Related items