Study On The Conversion Of Organization Form Of Accounting Firms And Its Influence On Audit Market Performance

Since 1998,large number of the accounting firms adopted limited liability,while minority firms chose general partnership after deregulation reform.However,with Chinese audit market changing constantly,both drawbacks shew up gradually in recent years.In 2010,the Ministry of Finance promulgated a policy,named the interim provisions on promoting large-scale and medium-sized accounting firms to adopt the organization form of special general partnership.With the “big four”speeding up transformation,domestic firms also work at acquisition and transformation.Audit market performance,as a concept of performance,measures the efficiency of resource allocation in the audit market,such as the accounting firms,main body of the audit market,how to use its own resources to provide the most satisfying service efficiently under oligopolistic market structure.Audit market performance can reflect the policy effect of firm conversion,but it has subjectivity.My study of transformation can supply theoretical and practical foundation in order to hasten firm conversion from large-scale and medium-sized accounting firms to miniature ones.From the perspective of evolution process and responsibility risk of the accounting firms,there are some differences between Chinese special general partnership and foreign limited liability partnership.Our research on policy effects of transformation can't plagiarize conclusion of foreign scholars.My text concludes that special general partnership can enhance legal responsibility and audit risk of the accouting firms by contrasting special general partnership with limited liability and general partnership.Then the firms provide higher-quality and comprehensive audit service and optimize current situation of the audit market.However,combining goverment intervention theory and industrial organization theory,transformation achieves expected outcomes on earth under the monopoly market structure in our country because of the policy promotion.Then I examined the practical audit market performance.I chose the data of A-share listed companies audited by accounting firms qualified to audit securities and futures business activities in stock markets of Shanghai and Shenzhen.I also substituted audit market performance with types of audit opinion and audit fee.In horizontal comparative research,I surveyed the types of audit opinion and audit fee between limited liability and special general partnership in 2012.While in longitudinal comparative research,from 2010 to 2015,I surveyed the types of audit opinion and audit fee of firms that accomplished transformation in 2013.In my conclusion,no matter in horizontal comparative research or in longitudinal comparative research,types of audit opinion of the accounting firms has nothing to do with organization forms,while audit fee applies to organization forms.In addition,audit fee of special general partnership is higher than that of limited liability.It follows that firm transformation is able to realize effective audit market performance and play a positive role in current situation of audit market.My conclusion can take robustness examination.Eventually,in response to this phenomenon,my paper analyzed the cause and proposed the corresponding policy recommendations.It concluded with a list of the inadequacies and the outlook,which can be helpful for future research in this area.