An Empirical Study On The Relevance Between Corporate Governance , External Supervision And Audit Opinion

With the continuous development of China's securities market,financial reports of listed companies,as a reflection of financial situation of production and operations,are received widespread concern and attention of investors and others. Type of audit opinion,as the independent certified public accountants'recognition towards the corporate financial reporting,agree or not agree,has the direct impacts on the assessment and judge of different subjects. Therefore,the focus of this study is the various factors which have impact on audit opinion.This paper combined empirical analysis and normative analysis together. Firstly,outline the theories of corporate governance and audit opinion,the paper recognized corporate governance's stakeholder theory. Therefore,we split corporate governance into two parts,internal mechanisms and external oversight mechanisms. Meanwhile,this paper introduced the corporate governance and earnings management,which related to audit opinion closely,as a variable. Next,this paper make an theoretically analysis of the relevance between internal mechanism,external oversight mechanisms of corporate governance,plus the DA,and audit opinion,then as the basis of the following study hypotheses. This paper selected 2001-2007's listed company data of Shanghai and Shenzhen,then do the relevant research of earnings management and audit opinion by univarity analysis. Following,introducing earnings management into the LOGISTIC regression which focus on the relationship of internal mechanisms,external oversight mechanisms and audit opinion.The empirical results show that the absolute value of the DA is negative correlation with the audit opinion significantly,the ownership concentration of internal mechanism is significantly positive related to audit opinion,and the accounting firm size and market information disclosure evaluation of external oversight mechanisms are also highly significant associated with audit opinions.The analysis shows:the internal and external mechanisms of listed companies'governance structure both have impact on the types of audit opinion; external oversight mechanism is more obvious than internal ones. However,strengthen the earnings management and standardize the internal mechanism of corporate governance is the best way of listed companies to avoid non-standard audit opinions.