Study Of Audit Quality Differences Of Tianjin Teda Co., Ltd

The boom of capital market improves the importance of public auditings. However, in recent years, the report of public companies’financial fraud scandal made audit reports lose their credibility gradually. People begin to consider:Why auditors can’t supervise these scandals and failed in their duties? What factors influence audit qualities and how does then work?Scholars at home and abroad have made great contribution through empirical researches. But these researches mostly concentrate on one or several areas in one study, made the study lack comprehensive vision, which is important in practical analysis. In order to solve this problem, this article choose case study, stand on a comprehensive vision to consider which factors influence audit qualities. We choose a case in which one public company’s financial report is audited twice because of the replacement of accounting firms. Through this case we have some findings.1. Now our principles about the independence of certified public accountants (CPA) are not enough to guarantee CPA to be substantial independent. We should propose more rules to improve their independence, including separate clients and the people who paid, put more supervision to the projects that occupy an important status in CPA’s income.2. Low audit fees will reduce audit qualities. Though empirical studies have many argues about this problem, in this case we can directly find low audit fees cause low inputs in projects, which finally caused low audit qualities.3. Senior executives’changing not always lead to lower audit qualities. From this case we can see, the alteration of chairman and the chairman of the Supervisory Board improve audit qualities, which is different from what has been found.4. Internal controls of accounting firms especially their implementations play an important role in audit qualities, especially their implementation efficiency.5. Large scale accounting firms have higher audit qualities. Although previous scholars have different views about this problem, we found large scale accounting firms have obvious advantages in employers’attraction, employers’ holding, business expansion and quarrel negotiation.