Research On Government Management In Cpa Industry

It has been more than two hundred years since the CPA industry was founded in foreign countries, butin china it just has been over thirty years since it was restored. China’s CPA profession is developing fastbecause of China’s booming economic growth. However, many problems will appear if the industry is notin accordance with law of development. The main problem of China’s CPA industry is that the supply anddemand of independent audit market come form government and the State policy driven rather than marketdriven; the managing authority of CPA is mainly grasped by government; the profession itself does notform the motivation of development. Based on this, we choose American CPA profession as the researchobject of comparison because its market started earlier and developed much more mature; and we researchthe origin of public audit market, the role of government in CPA’s development, and the arrangement ofmanagement power between government and profession organization. The article applies the institutionchange theory, the auditing demand theory and the public choice theory to discuss the development and itsmotive of CPA industry, to analyze the relationship between government and profession organization ofChina’s CPA in the future, and to put forward how to strengthen the motive force of self-development ofChina’s CPA and make it benign development by reforming the management system of CPA profession.The main body of the thesis is divided into five chapters. First of all, we review the related theoriesand literatures in first chapter. Secondly, we conclude in the Chapter2that American audit market developsnaturally and the government manages and supervises it indirectly because of its mature market mechanismand powerful strength of American CPA profession. On the third part of paper we mainly analyze anddiscuss the development of China ’s CPA profession from restoration and construction till now, the historyand current status about arrangement of management power between government and profession organization in China, and organizational form in accounting firms for mandatory changes; and it isconcluded that Chinese government promoted the establishment and development of independent auditmarket in the past years, but the government-driven mode cannot last and it will hamper the developmentinto a certain stage. In chapter4, we comparatively analyze the reasons and the government roles ofdifferent management styles of CPA profession between American government and Chinese government byapplying the new institutional economics theories and the auditing relevant theories. On the five part ofpaper, it points out the necessity and the resistance of the changes of direct management mode of traditionalgovernment, and proposes that government should transform the ideology, limit the administrationauthority and promote constant perfection of independent audit market during the changes of governmentfunction.