Research On The Correlation Between Expertise For Audit Firms And Auditing Market Performance

According to industrial organization structure framework, "SCP paradigm", market structure will influence on the enterprises'behavior and market operation efficiency. The expertise for Audit firms is an important aspects of audit market structure, therefore, it bring a profound influence. Audit quality and audit fee are indispensable factors to measure the audit market performance. Research about the correlation among audit quality, audit fee and the expertise for audit firms can reflect how they work on audit market perform. This paper will use the data from securities market 2008 to measure the level of audit expertise in China. The study found that our audit market exist audit expertise. The Big 4 audit firms in audit expertise occupy the leading position, but the domestic audit firm also appeared some potential competitive. According this empirical analysis, we found that expertise for audit firm and audit fees are positively correlated and expertise for audit firm and audit quality into reverse relations, and audit fee and audit quality and not in our audit market obvious relationship. Based on the analysis of the main reasons is that our audit market is still in the primary stage, lack of independence and perfect auditing employment mechanism, which enables certified public accountants industry expertise and not for audit quality forming positive influence. Finally, this paper improves some related suggestion about the audit market environment, establishing long-term development strategy, etc.