Institutional Change,Internal Control Audit Fee And Audit Quality

The early 21 st century,Eron,WorldCom and a series of financial fraud incidents caused the public's attention about quality problems of financial information.In July,2002,the United States published the ?Sarbanes-Oxley Act? which requires enterprises to enforce internal control audits to further ensure the reliability of financial information quality.The audit ing standards AS2 and AS5 were enacted after that,which cleared the standards of internal control audit,made the audit of internal control in the United States become mature,and provided reference for other countries to carry out internal control audit.In China,the information disclosure of internal control is facing a transition from voluntary to compulsory.In 2010,China passed ?Enterprise Internal Control Audit Guidelines?,which required the implementat ion of internal control audit ing within the scope of listed companies since 2011,In August 2012,the ministry of finance decide to implement the internal control system in batches.As of 2014,China's main board of listed companies should fully implement the internal control audit.This means that China's internal control audit changed from the stage of voluntary disclosure to the stage of mandatory disclosure.?Enterprise Internal Control Audit Guidelines? regulated the process of internal control audit to ensure the quality of internal control audit practice.With the listed companies in China began to enforce the internal control audit,the effect of internal control audit becomes a problem which is worthy of studying.This paper collects the data of public listed companies in Shenzhen and Shanghai Stock Exchange and the collection of the data about carrying out internal control audit and the internal control audit fee was supplemented by manual.This paper combines theory with empirical evidence to analyze the connection of internal control audit and financial statement audit quality,internal control audit fee and financial statement audit quality,internal control audit fee and financial statement audit opinion.The conclusions of this paper were that:(1)The implementat ion of internal control audit can significant ly improve the quality of financial statements audit of listed companies;(2)The financial audit quality of listed company is more poor when auditor charge more internal audit fee;(3)Higher internal control audit fees make the financial statement audit opinion much better than lower internal control audit fee.