Research On The Impact Of The New Securities Law On The Audit Quality Of Listed Companies In China

Compared with the original securities law,a major reform of the new securities law is the "double filing system" for intermediary structure,which allows some accounting firms without securities business qualification to enter the audit of securities and futures business.At the same time,the new securities law also increases the supervision and punishment of accounting firms,increases the representative litigation system,and strengthens the information disclosure of relevant parties.This series of amendments has brought new development vitality and opportunities to the audit industry and also puts forward higher requirements for the practice of accounting firms and their auditors.Therefore,it is a new research with realistic background and research significance to analyze and test the impact of the new securities law on the audit industry and auditors’ practice behavior.The research is based on analyzing and testing the impact of the new securities law on the audit industry and auditors’ practice behavior.On the one hand,using the data of listed companies from 2018 to 2020,carry out empirical research through the audit quality model,analyze and test the overall impact of the revision of the Securities Law on the audit quality through reform,and analyze the impact mechanism by introducing legal responsibility and market competition;On the other hand,the paper also selects three firm cases,including Huaxing certified public accountants,Shine Wing certified public accountants and Guangdong Si Nong certified public accountants,to conduct a case analysis of the impact of the new securities law on practice,more intuitively show the reality and specific performance of the CPA industry affected by the new securities law,and further support the results of empirical research.The large sample study shows that:(1)after the implementation of the new securities law,the audit quality of listed companies has been significantly improved;(2)Legal liability promotes the improvement of audit quality of listed companies after the implementation of the new securities law;(3)Market competition also promotes the improvement of audit quality of listed companies after the implementation of the new securities law.Case level analysis support: at the firm case level,there are some improvement differences in audit quality between firms with different market competition pressure and listed companies with different legal responsibilities,which is consistent with the conclusion of large sample.In addition,it is also found that the market has a positive market response to the replacement of listed companies with newly filed accounting firms,Investors expect the audit quality of the newly filed accounting firm to be high.Overall,the research supports that the implementation of the new securities law does have a direct impact on the behavior of accounting firms and their auditors in the practice process,which is reflected in the significant improvement of audit quality.Moreover,the compaction of legal liability by the securities law and the introduction of stronger market competition pressure have promoted the improvement of the overall practice quality of the firm.In addition,the securities market also made a positive response to the change of listed companies to hire new accounting firms and their expected audit quality.The research examined the impact of the new securities law on the audit industry and auditors’ practice earlier and more novel,which can enrich the relevant literature.The empirical evidence provided by this can provide objective academic evidence for regulators to study and judge the implementation effect of the new securities law.