Research On The Influence Of CPA Industry Specialization On Audit Quality

As an important part of the Certified Public Accountants' professional competence,industry specialization is having a significant impact on audit quality.This paper analyzed the status of Certified Public Accountants industry specialization and the effection of industry specialization on audit quality.Builded suitable regression models and provided references for our accounting firms to improve audit quality,which are very important.Related research at home and abroad are introduced,meanings of the accounting firm industry specialization and audit quality are described,and the impact of industry specialization on audit quality is analyzed.A-share listed companies in manufacturing are selected from Shanghai Stock Exchange and Shenzhen Stock Exchange from year 2009 to year 2014 and study samples are drawn after the screening.Audit fees and discretionary accruals are used seperately to measure audit quality in empirical models,in an attempt to reduce the deviation caused by a single measure.CPA industry specialization is measured with industry market share of continuity,aiming to eliminate personal subjective judgment on the reseach caused by dummy variable threshold.Four models were established in this research: audit quality was measured by audit fees in model number one and audit quality was measured by discretionary accruals in model number two.These two models studied the effection of CPAindustry specialization on audit quality.As an important explanatory variable,CPA industry specialization multiplied by economic dependence was introduced to modle number one and modle number two,thus forming modle number three and modle number four,in an attempt to find out when under the influence of economic dependence,how CPA industry specialization influence audit quality.In order to analyze and verify the accuracy of the variables and models,SPSS was uesd to conduct a descriptive statistical analysis,correlation analysis,multiple regression analysis and robust test.Descriptive statistical analysis focused on the statistical analysis such as max value,min value,the mean,median and standard deviation on CPA industry specialization,audit quality and other variables.Correlation and significance test showed that models do not exist multicollinearity,CPA industry specialization and audit quality significantly correlated,most of the control variables significantly explained audit quality.Based on the results of the regression analysis,multiple regressions analized effections of CPA industry specialization on audit quality.Robustness test demonstrated the robustness of the models and conclusions by changing the basis of industry-specific measurement.Finally,recommendations are made to improve audit quality by implementing CPA industry specialization.The results show that there is a significant positive correlation between CPA industry specialization and audit quality.With respect to the weak economic dependence,strong economic dependency promotes industry specialized CPA to improve more audit quality.The level of our CPA' industry specialization is uneven,but shows an increasing trend generally,thus considers industry specialization as a development trend that can be encouraged to our CPA implementation.