Study On The Relationship Between Ownership Characteristics And Audit Fees

Audit Quality has always been the focus of public concern of the regulators and the community. In recent years, cases of accounting fraud are continuously exposured at home and abroad. It makes the audit profession and the independence of trust to have been widespread concerned by the community. In this context, many scholars at home and abroad detected the solutions from the direction of Certified Public Accountants and the perspective of their own solutions, calling for the strengthening of audit professional ethics and legal control, improving their own quality of Certified Public Accountants. In recent years, looking at the series failure cases, imperfect system of professional norms the institute of Certified Public Accountants and relatively backward technology audit is one of the factors that audit quality is lower. But we restrict that auditors should act in the institutional environment to explore their roots, to improve corporate governance, in order to solve the problem fundamentally. However, ownership structure as a new component of the of corporate governance mechanisms, it has an important influence the operation of the company. In this paper, we will carry out the relationship in terms of empirical studies of the performance of audit quality from one form of the audit costs, to provide a reference with a view to the formulation of government policy, as well as the improvement of audit quality.There are many manifestations about advantages and disadvantages of audit quality, the audit costs is also one of those. In order to find the empirical evidence about the structure of audit quality of the impact of different options, in this paper, we will start with the audit costs and its influencing factors, using Shanghai Stock Exchange and Shenzheng Stock Exchange 733 A-share listed companies publicing the disclosures in 2007 annual report, taking the public disclosure of the annual report of the data for samples, By employing a cross-sectional least squares regression analysis for a sample of firms audited, (i.e., having less than 3% individual shareholding) and audit fees, and a significantly negative relationship between institutional blockholder ownership (i.e., having 3% or more individual shareholding ) and audit fees. Finally, we document that managerial stock ownership is negatively associated with audit fees. We do not, however, find evidence of any relationship between noninstitutional blockholder ownership (with at least 3% individual stock ownership) and audit fees. The study's main results hold in various specification tests including when the effects of board-related and audit committee variables are factored in the analysis. Based on the observed relationship between the ownership variables and audit fees, we suggest that the ownership characteristics of a firm as a part of its governance mechanism constitute an important determinant of audit fees.To an Empirical Study of the above conclusions, in this paper, we proposed to enhance the relationship of the institutional investors and the authenticity of accounting information of listed companies to be disclosed. Norms of institutional investors to participate in the legitimacy of shareholder meeting from laws and regulations, to guarantee the normal exercise of their powers, to improve shareholders system, to absorpt the foreign advanced learning system for shareholders, to formulate and suitable for the shareholders of China's market economy system.