Cpa Audit Independence Of Research

Independence is the essence of CPA auditing, is the soul of CPA auditing, and is also the basic conditions for the existence and development of the CPA as a profession. In recent years, with the huge frauds of the listed companies exposed one after another, more and more accounting firms were found cheated in auditing which makes the public suspicious of the independence of CPA. The objective of audit independence is set up from the financial reports users' perspective rather than from the inner motive of individual CPA. The different objective between the users and CPA thus lead to contradiction of the two parts. The audit independence will be affected by the hiring system and the competition among different CPAs.This paper first deals with CPA individual option under specific engagement of different hiring system. That is to begin with an analysis of the principle-agent theory, studying what influence the hiring systems may have on CPA's individual option. In this part, this paper makes its research about any individual CPA, and uses an analysis approach. The purpose is to reveal different mechanisms of hiring system under the individual choice of the formation of driving forces.However, in reality, social audit market is still not a fully competitive market, the existence of many CPA as a group who do audit work is likely to bring about a certain synergy, but fierce competition has led to a difference between the CPA's collective behavior and personal choice. At the face of this phenomenon, this paper has further discussed the impact that price competition, the audit period, non-audit services, audit reputation may have on the independence of the auditing. Game Model results are disappointingly balanced, a CPA in the threat and inducement situation is more easily to give up the independence of auditing. To avoid this situation, we need a force acts incentive to both sides, such incentives should be able to change both sides' cost comparison, so that they could reach a new balance. The CPA should shoulder industry responsibilities of auditing for the public. And the solutions to changes in the original game model of the balance of forces are looked for. At this stage in China against the independence of the auditing market, seeking strength of checks and balances to enhance China's CPA audit independence is necessary. At last, the paper also talks about a number of recommendations for improvement on the analysis of the influencing factors on the basis of audit independence.