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An Empirical Study On The Correlation Between Earnings Management And Auditing Opinion In Chinese A-Share Firms

Posted on:2006-05-24Degree:MasterType:Thesis
Country:ChinaCandidate:Z N RenFull Text:PDF
GTID:2156360152470211Subject:Accounting
Abstract/Summary:PDF Full Text Request
Ministry of Finance has launched continuous spot check concerning enterprises' accounting information quality in recent years, which has shown many issues. At the same time, a series of fraud companies have been exposed, including the cases of the three old fraud companies and the three new ones. In these events, many relevant accounting firms have involved in it ,which has caused bad social influence and pushes the audit market to a very dangerous position where there is no credibility at all. People begin to doubt about the independence of CPAs as well as the quality of their service. Can CPAs still be the watchdog of capital market? Is the professional quality of CPAs in China in the low level as people criticize for? Can't independent audit find various questions in the financial statements? Why caused the current situation of independent audit in China?The paper examines the relationship between audit opinions and earnings management. In this study we review and commend some existing research, and analyze deeply the theory origin, precondition and background of earnings management, as well as the change of supervisory system, the type of auditing opinion, and the relationship between earnings management and audit opinions. According to the feature of A-share stock market, we adopt cross-sectional Jones model to check up earnings management and regard the whole A stock market as the research object, through examining whether the CPAs' auditing opinions reveal the earnings management behavior, this paper appraise the audit quality level of CPAs in China and examined how influencial on the CPAs' audit quality which regard to the scale of offices and supervision factor. Finally, we carry on economic analysis to independent audit and put forward a series of valuable policies and system suggestions that will change the present situation of independent audit.
Keywords/Search Tags:Earnings management, Audit opinions, Independent audit quality, Empirical study
PDF Full Text Request
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