Unofficial Auditor Team And The Implementation Effect Of The Policy Of Mandatory Auditor Rotation

Since ancient times,in China,"communicating circle" has always been an extremely important cultural phenomenon.The essence of "communicative circles"is a structural or functional manifestation of informal organizations in the Chinese context."Communicative circle" is a group where individuals with the same interests or the same components spontaneously combine due to similar interests,benefits or goals.Members depend on each other and share resources,and will gradually reach ideas as the relationship is stabilized.Consensus with behavior to form a certain culture or rule specific to the "communicating circle".With the increasing emotional and resource dependence of the members of the firm in the process of direct or indirect cooperation,the firm has gradually evolved a special structure based on the informal relationship of the members-the "communicating circle" of auditors.Different from the traditional audit project team,the"communicating circle" of auditors is a collection of auditors in the same firm that have direct and indirect associations through cooperative practice.China has formally implemented the mandatory rotation policy of signed auditors since 2004.Most of the research on the implementation effect of the mandatory rotation policy of signed auditors is a simple comparison of the audit quality before and after the mandatory rotation,to find out whether the mandatory rotation system can significantly improve the audit quality.The conclusion of quality,but whether the signed auditor 's mandatory rotation system can improve audit quality is influenced by many factors.Although studies have found that a long-term relationship between the rotated auditor and the client will affect the effectiveness of the mandatory rotation system,there has been no research.Pay attention to whether the successor auditor and the forced rotation auditor are in the same unofficial audit team,that is,the influence of the same auditor's "communicating circle" on the implementation of the mandatory rotation policy.Therefore,this article uses a combination of theoretical analysis and empirical testing to discuss whether the unofficial auditor team——auditors' "communicative circle" will affect the implementation of the mandatory rotation policy of signed auditors,and further investigate the impact of the size of the accounting firm on the relationship between the two.The study found that when the successor auditor and the rotated auditor do not belong to the same unofficial auditor team,when the successor auditor and the rotated auditor belong to the same unofficial auditor team,the level of accountability of the client's accounting rotation is lower,And this conclusion mainly exists in the " not top ten " accounting firms.Further research found that in the sample where the successor auditor and the forced rotation auditor belong to the same unofficial auditor team,the closeness of the unofficial auditor team in the year of forced rotation is inversely related to the client's accounting robustness level.This conclusion mainly exists in the " not top ten " accounting firm;Compared with when the successor auditor and the rotating auditor do not belong to the same unofficial auditor team,when they belong to the same unofficial auditor team,the mandatory rotation of the customer's accounting robustness level is lower in the second year.This conclusion mainly exists in within the " top ten "accounting firm;Successive auditors and rotated auditors belong to the same unofficial auditor team than those who do not belong to the same unofficial auditor team,the audit fees for the year of mandatory rotation are lower.This conclusion mainly exists in the "top ten" accounting firms.This article examines the impact of the unofficial auditor team on the implementation of the mandatory rotation policy of signature auditors,which helps to further explore the potential influencing factors of the effectiveness of the mandatory rotation system of signature auditors and promotes the improvement of the mandatory rotation system of signature auditors.The full text consists of 6 chapters,of which Chapter 1 is an introduction.This part briefly introduces the research background and significance,research purpose and content,research methods and framework of this article and the innovation of this article;Chapter 2 is a literature review,this part reviewed in recent years the relationship between audit tenure and audit quality and the relationship between mandatory auditor rotation and audit quality have been sorted out and summarized.Chapter 3 is related concepts and theoretical basis.This part briefly introduces the unofficial auditor team and the degree of closeness of unofficial auditor team,the core auditors,the meaning of audit quality,and the theoretical basis of China's mandatory auditor rotation system and social network theory,information asymmetry theory and social identity theory;Chapter 4 is research hypothesis and research design,this part While analyzing the theory,put forward corresponding research hypotheses,and conduct research design based on the proposed research hypotheses;Chapter 5 is empirical testing and analysis.This part uses the constructed multiple linear regression model to check whether the unofficial auditor team has signed the Empirical testing of the effects of auditors 'mandatory rotation policy implementation and whether the size of the firm will have an impact on the relationship between the unofficial auditor team and the mandatory rotation policy implementation effect,and analyze the results of empirical testing;Chapter 6 In order to research conclusions and policy recommendations,this section summarizes the results of empirical testing and analysis,puts forward policy recommendations on the mandatory rotation system of signature auditors,explains the deficiencies of this article,and puts forward feasible research in the future direction.