Key Audit Matters Disclosure Characteristics And Audit Quality

Standard audit reports have long been widely questioned by regulatory agencies,investors and academia.Because too little information is provided,it is no longer possible to meet the needs of users of financial statements for decision-making useful information in the context of globalized operations and increasingly complex accounting information.In December 2016,the Ministry of Finance of China issued China Auditing Standards for Certified Public Accountants No.1504,requiring auditors to add key audit matters in the audit report to further enhance the information content of the audit report and maintain China's audit standards and international standards To meet the demand for high-quality accounting information in the reform and development of the capital market.The disclosure of key audit matters has increased the use of professional judgment and the level of hard work of the auditors,enhanced the transparency of the audit work,and thereby improved the quality of audits and the information content of financial reports.This article takes 2016-2018 A-share listed companies as the research object,manually collects key audit matters,adopts standard analysis and empirical research methods,and analyzes from various aspects such as industry distribution,firm distribution,disclosure types,confirmation reasons,and audit response procedures.Key audit matters were statistically summarized.Then,from the four dimensions of the number of disclosures,the content of the disclosure,the reasons for confirmation,and the response to the audit,the empirical test of the impact of the disclosure characteristics of key audit issues on audit quality.The research found that the more key audit matters communicated by the CPA in the audit report,the higher the quality of the audit;the more the number of key audit matters that are of the same quality as the previous year,the higher the quality of the audit;The lower the audit quality,the higher the audit quality of the key audit matters disclosed by the CPA has no significant relationship with the audit quality.It was further found that,among the reasons for the confirmation of key audit matters,the less important matters involving management's judgment and the matters that have significant impact on the financial statements,the higher the audit quality.Compared with nonstate-owned enterprises,the implementation of control tests in state-owned enterprises can significantly improve the audit quality;compared with non-big four,the big four accounting firms use the work of experts to significantly improve the audit quality.This study further enriched the relevant literature on key audit matters and audit quality,and provided a certain empirical basis for the implementation of the audit report standards reform effect.It also helps to improve the key audit matter standards for certified accountants and users of financial statement information(CAS1504).This reminds CPAs to maintain substantial independence in the audit process,and hopes to provide some reference for further improving the quality of audits and the information content of financial reports.