The Empirical Research On Factors Influencing Audit Fee Of Listed Companies In China

Audit fee is not only a crucial aspect of the application of CPA audit, but also it is an essential link of the demand and supply in the audit market. Audit fee is a key factor of the quality of audit and also affects the sustainable development of the security market. If audit fee is not transparent, it is easy to make the companies purchase audit opinion and then to impair auditor's independence and objectiveness. The excessively low audit fee may cause the abbreviation of partial essential procedures, the arrangement of auditors with low level professional skills and so on, and thus causes the reduction of the audit quality. But the high audit fee will increase the shareholder's unnecessary burden. So studying audit fee is significant. We can become familiar with the audit industry and the audit market. Meanwhile, the supervision department can know well with the competition of audit market and illegal activities, so as to supervise effectively to prevent accounting firms from competing at low price. Go further, they can draw up scientific and reasonable fee standards to promote our audit industry's development and create good image of CPA.This article begins with theoretical principle and document review, looks back the research achievement at home and broad, knows the status quo of audit fee and draws on existing research methods. By researching the status quo of our audit market, problems such as lacking unified audit fee standard in audit market, collecting audit fee at low price, competing malignantly at low price between accounting firms, lacking normative mechanism for information disclosure. Reasons are listed from four aspects. One is that the audit authorizing pattern in China is deficient. Another is that audit market lacks efficient demand. The third is that the practice environment of CPA is becoming worse. The fourth is that the legal system is not sound and the punishment for the illegal activities is not stern. After mastering the background of audit fee in China, this paper analyses a few influence factors to audit fee such as the company's asset scale, complexity, audit risk, earnings management, board independence, the company's other characteristics, the accounting firm's scale and the pattern of audit opinion. Then this article puts forward corresponding hypothesis. This article chooses data that comes from Shanghai and Shenzhen stock markets in 2009 and 2010 as proofs. The data separately scatters at manufacturing industry, the real estate industry, the retail industry, the IT industry and the water-electricity-gas industry. Most data is adopted from JuChao information website and CSMAR database. Sorted data is analyzed by spss16.0 from descriptive statistics and multiple linear regression. And then this article gets empirical results. According to the authentic proof, this paper identifies problems and then puts forward corresponding policy and advice.The conclusion of this paper is as follows:the company's asset scale, the number of subsidiary company and the accounting firm's scale are the most important factors that affect audit fee. The risk variable of asset-liability ratio only affects audit fee in some samples and the significance is not definite, as well as the dummy variable loss; while the risk variable current ratio dose not influence audit fee significantly. Otherwise, the company's earnings management only affects audit fee significantly in some samples, as well as the board independence and the dummy variable the public of new shares, the change of accounting firms and the pattern of audit opinion.