Study On China Accounting Firm Size And Audit Quality

Promoting the accounting firm scale, enhancing our country’s accounting firm’scompetitiveness is the main problem of China certified public accountants. Bingdifferent from the Western independent accounting firm size, our accounting firmscaled is a policy-driving, In the coming new wave of accounting firm scale, ourcountry policy of pushing exactly how effective scale firm, and in our specialcircumstances, the scale of the audit firm whether can affect the quality is the purposeof this study, then for our country policy of pushing accounting firm scale providespolicy reference.In view of this, combined with the basic national conditions of China, on thebasis of study at home and abroad, we firstly to review and inspect the accountingfirm scale, secondly we analyzed the relationship between accounting firm scaleand the audit quality in theory,and this paper analyzes the theory of reputation and"deep pocket" theory of operation mechanism and the mode of the capability theory.On the basis of theoretical analysis, we went on to investigate the accounting firmscale and audit quality related longitudinal and transverse.in the horizontal expedition,we use the data from2007to2009public companies as a sample, we do thedescriptive analysis, single variable inspection, multivariable inspection. Inmultivariate inspection, company’s asset scale, solvency, performance of the company,cash flow ware used as the control variables to construct the accounting firm scale andaudit quality relationship, and we multiple regression analysis the divided year and theundivided year mixed samples.After examined of our country accountant firm the scale, the audit quality andthe relationship between them, we think that reputation mechanism and legal risks isinvalid in China.But the firm in the process of scale with the improvement of theexternal environment, including regulatory environment and the management theimprovement of the environment, and the auditor to enhance the ability of the joint influence, resulting in the accounting firm scale in China after the audit quality of yearby year overall ascension.Previous research mainly focused on firm scale to the influence on the quality ofaudit, Most of them are horizontal points scope is its audit quality, this paper mainlystudies the accounting firm scale and audit quality of relations, not only do thetransverse comparison also do longitudinal comparison, and our research conclusionis also the past more rich.