The Research Of The Relationship Between The Audit Committee Characteristics And Audit Quality

Established in the listed corporations of China for more then ten years, the audit committee system plays an important part in improving the corporate governance, preventing the financial fraud, ensuring that the information of financial accounting is true and reliable and so on. In the new historical period, how to further improve the audit committee system to give full play to audit committee function, to promote the listed corporation governance system and management ability to be modernization, to improve audit quality level, is an important issue to be highly valued, study and solve.This paper uses the method of combining normative and empirical research to systematically reviewed the relevant literature both at home and abroad,to describe the related concepts of the audit committee and audit quality and to analyze the relationship between audit committee and audit quality.And then, this paper further summarizes the audit committee’s three main characteristics and nine detailed features. Three main characteristics are audit structure, audit committee behavior and the chairman of the audit committee.Nine detailed features are audit committee size, the proportion of independent directors, the proportion of financial experts, time from audit committee being established, the number of meetings, as well as director of the audit committee of the age, gender, education level, weather has the government background.This paper selects1735corporations from2009to2013in Shanghai and Shenzhen A listed corporations of China as samples, whose financial report disclosure the information of audit committee in detail. The paper studies the relationship between audit committee characteristics and audit quality.At the same time, the paper separately discusses the impacts of the audit committee on audit quality in the case of accounting firms changing or not. In order to make contribution to improving the audit committee system and the audit quality level, the paper puts forward relevant policy suggestions.The research results show that there is a significant positive correlation between the time of audit committee has established and audit quality; the age of the audit committee’s chairman is positively correlated with audit quality, as well as the education level of the audit committee’s chairman and audit quality. The proportion of financial experts has a significant negative correlation with the audit quality, as well as the audit committee’s chairman having the government background or not. Audit committee size is positively correlated with audit quality, so as to the number of audit committee meeting; The proportion of independent directors is negatively correlated with audit quality, so as to the gender of the audit committee’s chairman. But, they are not significant. At the same time,the results also indicate that, regardless of whether the accounting firm change or not, the time of audit committee has established is positively correlated with audit quality, the audit committee’s chairman having the government background or not is negatively correlated with audit quality. But two correlation is not significant. In view of this, the author suggests, we should take some measures, such as improving the independence of audit committee, consummating the legal environment which could make audit committee run effectively, establishing and perfecting information disclosure and evaluation mechanism and so on, in order to promote the audit committee system, improve the audit quality, and ensure that financial accounting information is true and reliable.