The Research Of The Effects Of Media Supervision On Audit Risk

As an informal external governance mechanism,the media is playing an increasingly powerful role in supervising and managing the economic society.At present,domestic and foreign scholars research on what factors have an effects on audit risk,mainly from the view of two aspects,the accounting firms and the audited unit.Some scholars study how the third party factors such as he external environment influence the audit risk,but mainly from the view of law and regulations,government supervision and inspections.Scholars sedolmly stduy what impact of medias give on audit risk.However,a large number of market signals indicate that media coverage will have a significant impact on accounting firms and auditors.Therefore,this article starts from the perspective of media supervision,studies its impact on audit risk,and combines the factors of the reputation of the accounting firms and the coporate nature to study the influence.This study has very important theoretical and practical significance.On the one hand,it breaks the limitations of the existing research on audit risk factors and introduces the informal external environment mechanism,medias,which enriches audit risk researchs and enables audit firms and auditors to consider media coverage when inspecting companies.The report of a listed company is a factor that will reduce audit risk and facilitates the development of an independent auditing industry.On the other hand,it will broaden the scope of media supervision and extended it to the field of independent auditing.Firstly,this paper introduces the background,significance,content,framework,methods,and major innovations of the research.Then it reviews the related literature of media supervision,audit risk,media supervision and the impact of audit risk.Secondly,after defining the related concepts of media supervision and audit risk,the theory of agenda setting and paving effect,the spiral theory of silence,media biased reporting theory,and audit insurance theory are used as a theoretical basis to examine how media supervision influences audit risk.The mechanism is analyzed,and then the research hypothesis of this paper is put forward based on the theoretical basis.In this paper,we select 1283 listed companies of A shares of main board from 2014 to2016 as research samples,designs research variables and constructs multiple regression models,and then uses descriptive statistics and Pearson correlation analysis to test the hypothesis,and then do linear regression analysis and robustness test,and gets the following research conclusions:(1)Media coverage can reduce the auditing risk of accounting firms and auditors;(2)Reputation of accounting firms can influence the relationship between media supervision and audit risk.The effect of media supervision on audit risk has no significant difference among accounting firms with different reputations;(3)For companies with different coportate natures,there is no significant difference in the effect of media supervision on audit risk.Thirdly,based on the empirical analysis,the paper concludes the research conclusions and puts forward corresponding suggestions:(1)Guarantee the media's rights to supervise listed companies and public opinions in the legal and institutional aspects;(2)Strengthen the reputation rating of the accounting firms,and to improve the market shares and market response abilities of PwC,DTT,KPMG and EY in China.(3)Improve the transparency of media coverage of state-owned enterprises,and reduce the impact of special political resources of state-owned enterprises.Finally,it points out the research limitations and future research directions.