On China's Listed Companies Audit Commissioned Research

The independence is the essential attribute which chartered accountant audit owns, is chartered accountant's soul, is most basic condition which makes this occupation of chartered accountant survive and develop.Along with a series of financial scandal cases such as Anron,Silver Guangsha and so on exposed, a series of domestic and foreign audit defeat events which occured also floated the water surface along with it. This causes chartered accountant to be discredited, the independence of chartered accountant audit was questioned.Basic reasons for these audit defeats are because chartered accountant lose the independence,the basic reason which caused chartered accountant to lose the independence is that audit commission style exists flaw.The paper has analyzed the questions the audit commission style exists, and made analysis of the question and seeked the reasons for it .State-owned equity have comparative advantage in the Chinese listed company. This phenomenon and the absence of owners lead to serious "insider control"in these companies. This reflection in the mode of auditing appointment right results in the audit consigner and the audited company integrating with each other. That made the audit relationship of listed companies changes from the triangle relation to the straight-line relation.The market of audit is a buyer's market, and CPAs are unable to choose audited companies. The problem in the mode of auditing appointment right becomes more serious and damages audit independence. Only when audit consigner 's localization was standarded ,can the questions which social audit commission style exists be settled thoroughly.Audit consigner's localization method has nothing but two big kinds: First, the audit commission power is carried out by the company interior organization; Second,an appropriate organization outside the company is seeked to execute audit commission power.Learning from the governing structure of listed companies, the audit consigner of the listed company is allowed to have following four kind of localizations: shareholder meeting, board of directors, board of supervisors, audit committee. Shareholders auditing trust is just a theoretical assumption. Under the condition of insiders' control, no matter what directors' board auditing trust, or supervisors' board auditing trust, or independent directors auditing committee, they cannot lessen the insider control phenomenon. If the present condition that directors' board and independent directors dominate the auditing trust don't change, even if the state-owned stocks retreat from the listed companies and make the equity structure polycentric, the ineffectiveness of the auditing trust won't change. Obviously, company's interior organization cann't be competent for the post. In view of flaws which the present audit commission style exits, the paper proposed some suggestion on the characteristic of new audit commission style should own .So, it is necessary to seek appropriate organization which is called "the Independent Fourth Aspect" outside of the company to carry out the audit commission power. The different choice for "the Independent Fourth Aspect" forms the audit commission styles which have advantages and disadvantages respectively.The paper combine the actual situation in China and put forward a new theory that the Negotiable Securities Supervisory Committee of China should set up a new audit management committee style which can substitute the present one to manage statistical reports from the listed companies and to gather audit expense to pay the accounting firm by setting up a new audit commission.The paper makes analysis of the necessity and the feasibility of the new pattern and proposed the mentality of the new pattern constructed.