Research On The Influence Of The Administrative Punishment Of CSRC On The Audit Quality

Certified public accountants play an important role in enhancing the credibility of financial information,ensuring the quality of financial report information and reducing information risk.However,in recent years,a series of audit failures and financial fraud cases have been exposed,which shows that there is a serious lack of integrity in the audit market.In order to solve these problems,the government needs to strengthen the supervision of the audit market,but whether the administrative punishment of accounting firms can improve the audit quality needs further study.The data range adopted by the existing literature on the effect of administrative punishment in China 's audit market does not consider the impact of the new accounting standards in 2007.Moreover,most of the current literature only considers the administrative penalty itself,and almost does not consider the factors that affect the effect of administrative penalty.This paper takes the administrative penalty imposed by China Securities Regulatory Commission on accounting firms in 2009-2016 as the research object,measures the audit quality by using the controllable accrued profit,and compares the audit quality of accounting firms in three years before and after the administrative penalty by using the empirical research method to study the impact of administrative penalty on the audit quality of accounting firms.In addition,three factors that may affect the effect of administrative punishment,namely,the way of punishment,the scale of accounting firm and the organizational form of accounting firm,are tested in groups,so as to reveal the true effect of administrative punishment more comprehensively and objectively.From the empirical results of this paper,we can see that the administrative punishment of CSRC can significantly improve the audit quality of accounting firms,which provides more empirical evidence for the effectiveness of the administrative punishment of CSRC.The test results of grouping the factors that affect the effect of administrative punishment show that,the way of punishment affects the effect of administrative punishment.Compared with the way of punishing only the signing certified public accountant,the way of punishing the signing certified public accountants and its accounting firm at the same time can improve the audit quality more.The scale of accounting firms also affects the effect of administrative punishment.After receiving administrative punishment,the audit quality of large-scale accounting firms is improved more obviously than that of small-scale accounting firms.In addition,compared with the limited liability accounting firm,the audit quality of the special general partnership accounting firm is improved more obviously after receiving administrative punishment,which confirms the necessity and correctness of the transformation of accounting firms in China.The empirical results provide useful empirical evidence for the CSRC,China Institute of certified public accountants and other regulatory departments.It provides a reference for the relevant departments to improve the punishment regulations.It also provides some suggestions for further improving audit quality.First,improve the civil liability mechanism.Second,the regulatory authorities prudently adopt the punishment method of "attaching importance to accountant rather than institutions",and mostly adopt the method of punishing the signed certified public accountants and its accounting firm at the same time.Third,CICPA should further promote the accounting firm to be bigger and stronger.Fourth,the regulatory authorities should improve the efficiency of the administrative supervision of the audit industry.