Study On The Determinants Ofaudit Opinion At The Era After Share-split Improvement

With the rapid development of the domestic stock market, the concerns of various outsiders has extended to any information of the capital market, which makes the audit opinion be paid more and more attention by the supervisor, investor etc. The corporate governance achievement represents the company's comprehensive strength and the future development, also it will affect certified public accountant in writing up audit opinion. In China, corporate governance structures have witnessed great changes with the share-split improvement by the Commission in April 29, 2005. The core purpose of the reform is to improve the corporate governance structure through institutional innovations, thereby to improve the company's achievements. According to China Securities Regulatory Commission requirements, all listed companies on the end of 2006 largely completed the share-split improvement, and the corporate governance structure has been further improved. However, with the completion of the share-split improvement and the profound changes of the capital markets in rules of operation, at the era after share-split improvement, medium and small shareholders of listed companies, large shareholders, senior executives will change, following new behavior trends, which makes the corporate governance facing new challenges. And the domestic scholars through the empirical analysis show that the companies completing the share-split improvement have earning management in stock performance effects of reform, corporate governance issues will not be completely resolved with tradable shares. This triggers a thought on this article: Follow-up analysis using panel data is to study the 2006-2008 determinants of audit opinion at the era after share-split improvement. In the background after share-split improvement, study whether the extent of corporate governance and performance impacting the audit changes, in order to see the changes in the audit concerns. And through the view of audit as external supervisor, look at the degree of perfection of corporate governance, as well as whether the audit have the attention they deserve facing the new challenges at the era after share-split improvement.Theoretical study and empirical study are both used in this paper. First, this paper makes analysis and sum-up on the former study through review of the literature. Then, study the influence that share-split improvement affects the corporate governance and performance, and the relationship between corporate governance, performance and the audit opinion. Thus conclude the main factors, which is the groundwork of the empirical research for the share-split improvement impacting the audit opinion that year. Then, in the case of control variables not be taken into account, analyze statistically the change in the audit opinion before and after reform. This gives rise to the following empirical studies to track the determinants of audit opinion at the era after share-split improvement. With 2006-2008 panel data of listed companies in Shenzhen for the study sample, using descriptive statistics and logistic regression analysis to study after the completion of the reform, the listed companies whether have the correlation between the quality of governance, performance and audit opinion. Finally, according to the problems and results of research, post the policy recommendations how to monitor the listed company after share-split improvement, and propose the risk prevention measures of the audit.Empirical research results show that: the constituent elements of company internal governance mechanisms and the type of audit opinion have a different effect. There is a significant positive impact of the level of executive incentive compensation, the setting of Audit Committee, the management equity ratio, the quality of information disclosure on the clean audit opinion; There is a significant negative effect of the board size on the clean audit opinion; There is little significant impact of the largest shareholder equity ratio, the proportion of independent directors, the size of supervisors on the audit opinion. On the whole of internal governance mechanisms, the higher comprehensive evaluation of the company's internal governance, the higher likelihood of the clean audit opinions issued by auditors. Meanwhile, there is a positive correlation between return on equity and the clean audit opinion. Net assets debts ratio is negatively correlated with the clean audit opinions; There is little significant impact of asset size on the audit opinion. From the view of the control variable, it reflects the strengthening of corporate governance at the era after share-split improvement. The audit concerns the company's continued viability and potential audit risk, but also more in line with the requirements of risk-based audit model. However, combining the new challenges at the era after share-split improvement, not be ruled out because of laws and regulations to improve and the cost of illegal or irregular to increase. The occupation of major shareholders seizing the interests of listed companies will be more subtle tactics, by way of related-party transactions, methods will be more diverse, and methods of false disclosure of listed companies will be more subtle, etc, which result in increased difficulties of the auditor exposing to the quality of corporate governance.There is some theoretical research value to combine share-split improvement, corporate governance with risk-based audit together, and make up separate defects of the current discussion. At the same time, it is useful for listed companies, firms, and regulatory authorities to take measures at the era after share-split improvement, it is conducive to further improve listed companies supporting measures, follow-up to the government regulatory agencies, and there is some guiding significance for the audit to adopt audit procedures and concerns in the risk-based audit model.