Research On The Economic Impact Of Administrative Punishment Of Accounting Firms

Under the background of the separation of enterprise management right and ownership,enterprise managers not only assume obligations to owners,but also enjoy the right to manage and operate enterprises.With the advancement of separation of powers,the problem of information asymmetry between managers and owners is becoming more and more serious.Financial fraud and audit failure cases occur frequently,which largely destroy the order of capital market and endanger the interests of investors.Such as "Yin Guangxia","Green Earth","Wanfu Shengke" and other cases occur successively,sounding the alarm bell to the securities market.What degree of punishment should accounting firms,as audit service institutions,bear in these incidents? What economic impact will it have on the follow-up operation of the firm after receiving the penalty?This paper takes Lixin Accounting Firm as the case study object,through four administrative penalties imposed by the CSRC on Lixin in recent years,and takes the number of customers,audit fees,audit revenue and audit quality as the evaluation indicators,analyses the economic impact of Lixin Accounting Firm after being subjected to administrative penalties by the CSRC,and on this basis,puts forward countermeasures and suggestions from two aspects.That is,industry supervision and firm self-discipline.Based on the analysis of the changes in the number of clients,audit quality,audit fees and audit revenue of Lixin Accounting Firm from 2010 to 2019,this paper finds that after the first administrative penalty,Lixin has not declined significantly in the number of customers,audit fees and audit revenue,but has increased according to the overall market situation of audit market.At the same time,the audit quality has not been improved,but continues to deteriorate,which to some extent reflects that the initial administrative penalty has not had a negative impact on the credit business,nor has it improved its audit behavior.After being subjected to the second administrative penalty,the number of clients,audit fees and audit revenue will decline to a certain extent,but there is no obvious fluctuation,and the audit quality will be improved to a certain extent.This shows that many administrative penalties will have a certain negative impact on accounting firms,but the impact is limited.Therefore,the administrative penalties imposed by the CSRC on accounting firms,whether for the first time or for subsequent multiple penalties,have little substantive impact on the audit behavior of accounting firms,which is difficult to correct,and can not bring about significant improvement in the audit quality of accounting firms.As regulators,government departments need to strengthen supervision,enrich supervision means and improve the effectiveness of supervision;as audit service providers,accounting firms need to strengthen industry self-discipline,improve quality control and improve audit quality.The healthy development of audit market in China has a long way to go.