Institutional Investor's Shareholding,Audit Committee Professionalism And Audit Fees

The rapid development of the economy and the continuous expansion of the company have gradually separated the ownership and control of the company,the resulting principal-agent relationship has ultimately brought about modern corporate governance issues.As the company's owner,the company's shareholders are bound to play a key role in corporate governance.Institutional investors are also shareholders of the company,and there are obviously incentives to participate in corporate governance.with the continuous improvement of China's market economic system and financial securities market,the status of institutional investors in China's securities market has been continuously improved in the past decade.Institutional investors have gradually developed into important participants in the governance of listed companies in China.Therefore,it is meaningful to study the influence of institutional investors' shareholdings on the governance of listed companies.The requirement for listed companies to set up an audit committee will help improve the management level of listed companies.This explains to a certain extent that the audit committee has important corporate governance functions and plays an important role in corporate governance.After the Sarbanes-Oxley Act,the status of the audit committee in corporate governance has been further improved,and the audit committee has been gradually positioned to the highest level of corporate governance.However,in China until the end of the 1990 s,the audit committee gradually became a hot spot in the field of corporate governance.The construction of the audit committee system and the improvement of the corporate governance structure in China have gained in-depth development.Through the review and collation of relevant literature on the influence of institutional investors on listed companies,the current academic research on relevant aspects mainly focuses on the types of motivations for institutional investors to participate in corporate management;Differences in the influence of different types of institutional investors on the governance of shareholding companies;the impact of institutional investors on the performance of holding companies;the impact of institutional investors on holding companies under different legal backgrounds.There are still relatively few studies on the specific path of institutional investors' participation in the management of listed companies.In fact,the specific path of how institutional investors participate in corporate governance has not been fully studied.Therefore,Therefore,this paper intends to use this field as a research direction.Using internal control as an intermediary variable to study the relationship between institutional investor holdings and audit fees,and then proves whether institutional investors play an active role in corporate governance and reveals part of the path of institutional investors' participation in corporate governance.At the same time,it can also enrich the relevant literature on the factors affecting audit fees.The audit committee is also an important force in corporate governance.The relevant existing literature mainly focuses on the impact of the audit committee on corporate governance.For example,Whether the establishment of the audit committee has a positive corporate governance role,the impact of the professional nature of the audit committee on the company's internal control,information disclosure,earnings management,and financial report restatement.After analyzing and arranging,institutional investors as the company's owners,as their shareholding ratio increases,they have stronger corporate governance needs for the companies they hold,and the audit committee is set up to improve the company's governance level.With the function of improving corporate governance,the impact of the professional nature of the audit committee on the relationship between institutional investor shareholdings and audit fees can reveal whether the professionalism of the audit committee can help improve the company's management level.At the same time,it can more deeply analyze the interrelationship between institutional investors,audit committees,external audits and corporate governance.Based on the theory of property rights,principal-agent theory and information asymmetry,this paper uses these theories as the logical support of this paper to better study the impact of institutional investors' shareholding on audit fees.The research process is carried out in two main lines: the first main line is the impact of research institutional investor shareholding on audit fees.Firstly,the paper analyzes and analyzes the impact of institutional investors' shareholding on the governance of listed companies and the influencing factors of audit fees.To show whether institutional investors' shareholdings will indirectly affect audit fees by promoting the management level of listed companies;the second main line is to study the impact of the professionalism of the audit committee on the relationship between institutional investors' shareholdings and audit fees.Through the compilation and analysis of the literature on the internal control and financial reporting quality of listed companies on the professionalism of the audit committee,understand the impact of institutional investors' shareholding on the internal control and financial reporting quality of listed companies,and clarify institutional investors' shareholdings and audit committees.The interaction between professionalism and audit fees details the impact of the professionalism of the audit committee on their relationship.Based on the normative research,the empirical research part of this paper takes the 2008-2017 China A-share listed company as a sample for data analysis.After the combination of the two methods,the conclusion of this paper is finally determined.The conclusions of this paper include:(1)Institutional investor shareholdings can reduce the audit fees of listed companies,and institutional investors can improve the management of listed companies to a certain extent.The audit fees paid by listed companies with high proportion of institutional investors are relatively low.Institutional investors can indirectly reduce the audit fees by promoting the management level of listed companies.(2)The impact of institutional investor shareholdings on the audit fees paid by listed companies is reflected in corporate governance effects.The effectiveness of internal control plays an intermediary role between institutional investor shareholdings and audit fees,indicating that institutional investors have reduced the audit fees paid by the company by improving internal control.(3)The professionalism of the audit committee can also effectively play the role of corporate governance.When studying the relationship between the professionalism of the audit committee and the relationship between institutional investor shareholdings and audit fees,the empirical results show that the professionalism of the audit committee can promote the negative correlation between institutional investor shareholdings and audit fees,indicating that the professionalism of the audit committee can be enhanced.Better play the role of corporate governance.This paper mainly contributes to the following points:(1)Based on the influence of institutional investors on the management level of holding companies,and then further study the impact of institutional investors' shareholding on the audit fees of listed companies,and explore the institutions.The path of investor shareholding affects the audit fees of listed companies.This aspect has deepened the research literature of institutional investors on the management level of shareholding companies;on the other hand,it has further enriched and extended the relevant literature affecting audit fees.(2)Study the influence of internal governance mechanism on the relationship between institutional investors' shareholding and audit fees,introduce the professional nature of audit committee as an intermediary variable,analyze the impact of audit committee professionalism on audit fees and the professionalism of audit committee and both.(3)Classified research on the impact of institutional investor shareholdings on audit fees in state-owned enterprises and non-state-owned enterprises.The empirical results show that the increase in the proportion of institutional investors in state-owned enterprises obviously contributes to the improvement of corporate governance,which is a strong support the reform of the mixed state-owned enterprise.