The Research Of Audit Industry’s Behavior "Low Balling"

"Low Balling" behavior of CPA profession has always been a hot issue. With the completion of the Reorganization of Certified Public Accountants, regulation of accounting firms are increasingly standardized. Audit services went to a growing market, the relevant regulatory authorities in response to the audit fee to make a market standard pricing guide. Back in the <Intermediary Service Charge Management Approach>(1999) China promulgated the proposed guidance requires some principled, but with little success. Because China is in the early development of the audit market, the numbers of CPA in the market is many, and it was mixed,"Low Balling" phenomenon have occurred, in order to prevent this phenomenon, Chinese CPA Association implemented a strict price regulation, the "Low Balling" phenomenon seen as acts of unfair competition. NDRC and the Ministry of Finance on January27,2010jointly issued<CPA service charge management approach> is the first service charges related to the CPA profession’s national normative documents management. The rules review of corporate financial statements issued audit reports to the government guided pricing, no matter what form of participation in the competition, audit fees must follow government guidance pricing, bid price can not be less than the lower limit of the government guidance price.<No public offering of securities of the Company Content and Format of Information Disclosure Standards2-annual report content and format (revised2001)>, Securities Regulatory Commission issued in December2001and the <Public offering of securities of information&disclosure Standards No.6-CPA remuneration paid its disclosure>requires listed companies to disclose since2001compensation paid to the accounting firm, this empirical study provides us with a possibility.This paper reviews the theoretical and empirical research on the "Low Balling" at home and abroad, and related literature were reviewed, Dean introduced DeAngelo、 Shapiro、Chi-Wen Jevons Lee Li and Zhaoyang Gu et al "Low Balling" theory research, on this basis, the use of the methods of collecting empirical analysis of China’s A-share market listed companies in2010-2012data on "Low Balling" the problem in three steps more comprehensive empirical analysis. First, with all sample analysis, the results indicate the existence of a "Low Balling" phenomenon. Second, we put into large international accounting firms and large domestic as were the two categories validate discount found that only exists in China, listed companies are audited by an international big discount phenomenon does not exist. The third step, we performed regression analysis by the accounting firm’s office, the accounting firm to analyze the recovery of the discount period. By analyzing these three aspects, hoping to provide the latest empirical evidence for the "Low Balling" behavior, and the ability to enrich related research achievements, promote the development of research audit fees.