Research To The Development Strategy Of Accounting Firms In Chinese Subordinate Cities

Accounting firms are working as the most important third party organization of connecting, coordinating and communicating between the government and the market economy. Moreover, it also has indispensable effect on protecting the reform of Chinese economic system and the healthy development of the socialist market economy. After the reform and opening up, Chinese has joined the world trade organization, and the every industry has been also gradually opened to foreign countries. As a result, a large number of well-known accounting firms rushed into the domestic market and quickly occupied large shares of the market. At the same time, the government has implemented the establishment policies more flexibly to the public accounting firms:from the examination and approval system changed to the authorizing system, which accelerate the development of the CPA industry. Meanwhile, it also greatly accelerated the competition pressure of the industry, especially for the development of the small and medium-sized accounting firms.Currently, small and medium-sized accounting firms has occupied a large market shares of the total amount; the contribution of these companies is crucial regarding to the guide and supervision provided for the financial works of SMEs, and to create lots of vacancies, which are important to the stability of the harmonious society. However, the service capacity of the personnel is relatively low, business related field is not wide, practicing ability is poor, the internal management structure is not rational, and market positioning and development ability is insufficient, which restricts the development of small and medium-sized accounting firms, especially the subordinate cities which are struggled in the small cracks for survival in long time. The prospect for development is not bright.This research paper take XZ Accounting Firm as an example, based on the theory of strategic management, to conduct a research of the current developing situation of the small and medium sized accounting firms in subordinate cities, and propose a development strategy regarding to the particularity of themselves. Researcher hope that can not only provide a solution for the future development of XZ but also effectively guide more development in the small and medium-sized accounting firms in subordinate cities but even the whole CPA industry.