An Empirical Study About The Determinants Of The Modified Opinion

Since October of 1992, our CPA's audit has developed more than ten years. Audit opinion, identification about the quality of financial information made by the CPA, attracts investors' great attention in the investment. Especial, modified audit opinions are paid more and more attention by supervision departments, academy and vast investors. And I am interested in those companies which CPA provides modified audit opinions. What factors cause these? Is CPA holding their independence? And that is what the author will discuss in this paper.Firstly, on base of the principal-agent theory, information asymmetry and agency cost theory, this paper develop its hypotheses; Then, by making use of listed companies' publicly available financial data, adopting empirically research method by employed logistic regression, the author start this researches. This paper researches the determinants of the modified opinion from two aspects that are audit supplier and audit demander.The results show that the fee dependence, earning management, the size of audit are significantly influencing the modified opinion. But regression consequence demonstrates that the variables about corporate governance almost have not significantly influencing audit opinion.At last, according to the empirical research results, combining the present Chinese market environment, this paper gives some suggestions.