Research On The Correlation Between Human Capital And Audit Quality Of Accounting Firms

The audit quality of the accounting firms directly affects the quality of financial information of listed companies,affects the investors' investment decision-making and the reasonable disposition of market resources.Audit quality improvement is an important guarantee for improving the efficiency of resource allocation in the capital market.Auditing personnel conducting audit activities and publishing audit opinions are fundamental factors affecting the quality of auditing.Moreover,auditing,as an intelligence-intensive knowledge service industry,its work quality is closely related to the auditing entity�the accounting firm's human capital.Therefore,study the relationship between the accounting firm's human capital and audit quality has important theoretical and practical significance.To study the relationship between the accounting firm's human capital and audit quality,firstly,through the normative research,summarizes the domestic and foreign scholars' analysis of audit quality surrogate indicators,audit quality influencing factors and the impact of human capital on audit quality,defines the related concepts of audit quality and human capital and analyzes the impact on audit quality casued by CPA qualifications,education,age,and the number of employees in turn.Secondly,based on this,four research hypotheses are proposed and empirical research is carried out.The data of the 2018 Shanghai-Shenzhen listed company was obtained from the database of Guotai An.The accounting firm's human capital information was collected and compiled manually from the website of the Chinese Institute of Certified Public Accountants according to the name of the firm displayed in the annual report of the listed company.Then,by using the modified Jones model to obtain the absolute value of the accrued profits of listed companies as an indicator to measure the audit quality,and using the qualification structure,education structure,age structure,and number of employees as the variables of human capital to establish a multivariate regression model to empirical research the specific relationship between the firm's human capital characteristics and audit quality.Finally,draw the conclusions and propose recommendations for optimizing human capital allocation to improve audit quality.The overall human capital of the firm is positively related to the quality of the audit.Among them,the proportion of CPAs,age structure and academic structure of the accounting firm and the number of employees in the accounting firm has a significant impact on audit quality and is positively correlated with audit quality.Moreover,compared with state-owned enterprises,the impact of firm's human capital on audit quality of non-state-owned enterprises is more significant.According to the research conclusions,accounting firms' rational allocation of human capital has great significance to improve the quality of audit work.In terms of human capital acquisition,the accounting firm should regard the education level and CPA qualification as important evaluation indicators for selecting talents,pay attention to the combination of the accounting firms' age structure,recruit employees by considering the talent gap in all ages to ensure the quality and structure of the human capital can guarantee to realize of the company's future goals.In the use of human capital,the accounting firm should comprehensively consider the qualifications,education,age and other factors to rationally allocate various types of personnel,make the talents in all aspects complement with each other and develop their respective strengths,so that improve the effective use of human capital within the accounting firms,thus to improve the audit work quality.In the maintenance of human capital,the accounting firm should revise education,training and incentive mechanisms to enhance the level of experience and knowledge of employees.Through reasonable performance,salary and promotion system to stimulate employees' enthusiasm and responsibility,cultivate employees' sense of ownership,retain talents,maintain the stability of human capital within the company,and thus improve audit quality.The education,training and incentives of the Ministry of Finance,the Ministry of Finance,the Chinese Institute of Certified Public Accountants and higher education institutions are conducive to improve the quality of human capital and are also of great significance for improving the quality of audit work.The industry supervision departments such as the Ministry of Finance,the China Securities Regulatory Commission,and the Institute of Certified Public Accountants should improve the personnel training mechanism and strengthen the guidance of the firm's human capital allocation.Listed companies must place human capital factors at an important position when selecting an evaluation firm.