Research On The External Audit Independence Of Accounting Firms Based On The Perspective Of Discretionary Accruals

The internal control quality of listed enterprises in China is generally poor, the possibility of listed enterprises control and transmit the real and effective internal information is low, and the China's external supervision system starts late and is not perfect. Therefore, the listed enterprises have strong ability to manipulate the information quality, resulting in the external audit independence of the accounting firm is threatened. In addition, the listed enterprises can influence the external audit function of the accounting firm through the control of the internal information of the enterprise, and then realize the control of the accrued profits.This dissertation adopts the discretionary accruals as the proxy for the external audit independence of the accounting firm and uses the two tier stochastic frontier model to decompose the discretionary accruals from two perspectives: the enterprise and the accounting firm. The study finds that the external audit independence of the accounting firm is generally controlled and influenced by the enterprise, and indicates that the external audit function of the accounting firm can not be fully played. From the total sample, the external audit independence of the accounting firm is affected by the enterprise and can not fully play the role of external audit. In the enterprise and the accounting firm characteristics group, it found that the accounting firm which issued a standard unqualified opinion has a strong external audit independence, and can effectively influence the discretionary accruals manipulation of listed enterprises. The external audit independence of the big four accounting firms is slightly higher compare with the external audit independence of the non big four accounting firms, and can effectively inhibit the enterprise's discretionary accruals manipulation space. From the perspective of property rights, compared with state-owned enterprises, the non state-owned enterprises have stronger control ability to manipulate the discretionary accrual, and the external audit independence of the accounting firm is strongly affected. Therefore, this dissertation believes that the external audit independence of accounting firms can not be fully played, and there is universal phenomenon.Therefore, this dissertation proposal from the management construction and external supervision to enhance the angle to improve the external audit independence of the accounting firm, through the effective construction of the enterprise's management and the external supervision to restrict the enterprise to manipulate the accounting information.