Public Company Accounting Oversight Effectiveness

In recent years, a series of accounting frauds have emerged in public companies both at home and abroad. This problem has seriously disturbed the normal and steady development of public companies and stock markets in China, indicating that accounting regulation in China has not run effectively. Therefore, studying the effectiveness of accounting regulation has a great theoretical value and practical significance to the normal operation of public companies and the effective implementation of accounting regulation in China. Directing at accounting frauds, through raising, analyzing and solving problems systematically, this thesis aims to improve the accounting regulation of public companies and to achieve the goal of protecting investors' interests, so that the standard and effective operation of stock markets in China is to be guaranteed. This thesis is divided mainly into six chapters:The first chapter is an introduction. This part explains the background and the significance of the present study, as well as the most recent achievements in this academic field.The second chapter is the theoretical framework of the study of accounting regulation. This part first introduces some well-known scholars' understanding of such notions as regulation and accounting regulation system, based on which the definition of accounting regulation of public companies in China is produced. Then the necessity of accounting regulation is explained and analyzed, including the feature of accounting information as public goods, the feature of external economy of accounting information supply, and the asymmetry of accounting information, in order to provide a theoretical support for the study of accounting regulation of public companies in China.The third chapter analyzes the strong points and weak points of accounting regulation of public companies abroad and the implications to public companies in China. First, this part introduces two typical modes of accounting regulation in the world: institute self-regulation and governmental regulation, and then analyzes the strengths and weaknesses of each mode. Second, a detailed and systematic comparison and analysis is offered of the modes of the accounting regulation of the United States and the United Kingdom. Finally, this part points out the experience and lessons which the practice of accounting regulation of public companies in China should use for reference.The fourth chapter points out the main problems of accounting regulation of public companies in China. This part first introduces the current situation of accounting regulation of public companies in China from the aspects of the standard and operation of accounting regulation. Second, this part analyzes the main problems existing in governmental regulation and institution regulation.The fifth chapter presents the strategies to strengthen the accounting regulation of public companies in China. Directing at the actual problems mentioned in the previous chapter, this part proposes some specific measures to establish and perfect accounting regulation system from two aspects. (1) The level of governmental regulation: setting up an accounting regulation group under the leadership of the State Council to improve the organization of a regulation body; strengthening relevant laws and rules to reinforce executive system; people should bear legal responsibility for the dereliction of duty; coordinating the activities of governmental regulation, institution regulation and internal regulation to bring them into full play. (2) The level of institute regulation: reforming the audit entrusting system of accounting firms; restricting or prohibiting the consulting services of accounting firms; timely revising auditing standard from the perspective of scientific development; strengthening the regulation of certified public accountants and maintaining the reputation of public credibility; stressing the cultivation of a well-known brand and expanding the services of accounting firms.The sixth chapter is a conclusion. This part summarizes the main points of the thesis, draws a conclusion, points out the limitations of the present study, and offers some constructive suggestions for future research.