The Empirical Study Of Auditor Industry Expertise Influence On Audit Quality

The effect of industry expertise on audit quality has always been the focus of the audit scholars and the general public discussion questions.The related research starts relatively early and it has been made fruitful results at abroad.Compared with the studies at abroad,the discussion of industry expertise influents audit quality in the existing research literature at home is relatively less,and the differences of the choice of the research methods and sample interval make different conclusions.In addition,the early studies researched audit quality and industry expertise in national level in China,but in actual situation,auditors with industry expertise at the national level may not with industry expertise in some areas.If inspecting industry expertise only from the national level,we will probably underestimate even unable to observe its effects on audit quality.Based on the specific audit environment in our country,and under the certified public accountants auditor vocational moral standards and the same conditions of law degree,this paper use the data of audit market in our country to identify auditors with industry expertise at the national and regional level respectively to research the effects of industry expertise on audit quality.This paper regard a-share listed companies in Shanghai and Shenzhen from 2010 to 2014 as research samples,selecting certified public accountants industry market share in national level and regional level as proxy variable of auditor industry expertise,using discretionary accruals to measure audit quality,and build a multiple regression model respectively to investigate the influence of auditor industry expertise on audit quality empirically.The results of the study show that both at the national level and regional level,the auditor industry expertise and audit quality has significant positive correlation,in other words,the higher of the level of auditor industry specialty,the more relevant professional knowledge and experience they can master,and the higher of the level of the auditor's professional ability,so it can greatly improve the auditor vocational skeptical and cautions,they found that the higher of the probability of earnings management behavior in enterprises,which can monitor and constraint the surplus management behavior of enterprise effectively,ultimately achieve the purpose of the audit quality and its competition ability.This paper revolves “the effect of auditor industry expertise on audit quality” on the detailed discussion,It can enrich the related literature of auditor industry expertise,and add the literature of the effect of industry expertise on audit quality;To a certain extent,it will be helpful to cause the attention of certified public accountants to provide different auditing services,and it can makes certified public accountants realize cultivation industry expertise is the basis of improving the audit quality,and the advantage can increase its market share and improve the social reputation and industry competitiveness,thus increasing the input to the development of industry expertise,so as to ensure and improve audit quality of auditing services.At the same time,the paper also exist some disadvantages: there are more than one method to measure auditor industry expertise proxy,this paper only choose the customer business income proportion to measure the auditor's industry market share,the result of the empirical of this paper may be biased.This will be a very worthwhile direction for future research.