Firm Replacement Ant Audit Fees Of Financial Statement

Audit market is now a buyer’s market in our country.Accounting firms are affected by cost effect and competition effect,existing low price competition behavior.Our country has continuously introduced numbers of related policies of audit fees,in order to maintain audit market order and strengthen supervision,and government regulations play a leading role.This paper summarized the domestic and foreign theoretical research and empirical research related to audit fees,the related literatures were reviewed.Based on the policy background,cost effect and competition effect in the audit market effect were analyzed.From the perspective of fim replacement,taking total assets of listed companies,complexity of listed companies,liquidity ratio,the big four firm auditing,nearly three years of losses,the proportion of equity in total assets,the proportion of tradable shares in the total equity and the industry as control variables and collecting the data of listed companies in Chinese A-share market in 2010-2015,the audit market price competition issues were analyzed by using an empirical analysis of the multiple linear regression,achieving 11117 samples.Seen from the empirical results,audit market competition was intense in 2010,and there was a low-balling phenomenon,and then in 2010,the government introduced ’Measures for the Administration of Accounting Firm Service and Charge’,leading a very obvious effect,and in 2011 and 2012,the data showed price competition were not significant.At the end of July 2010,the government issued Interim Provisions about ’Driving Large and Medium-Sized Accounting Firms to Use the Form of Special Ordinary Partnership’,with the passage of time,after the conversion of the firm the costs reduced.However in 2013,it began to appear the phenomenon of low price competition,so ’Notice of Opinion on Releasing Part of the Service Price’ was issued at the right moment,promoting the benign competition of audit market in 2015.In this paper,the study found that in order to survive in the fierce market competition,accounting firms used a low price competition,while government regulation run through it to promote the healthy development of audit market.