Research On China's Auditing Rent-Seeking In Capital Market

The disadvantageous economical consequence which The finance frauds and auditing failures caused becomes central issues that Politicians and scholars pay close attention to. The premise which t he finance frauds and auditing failures Causes is the auditing rent-seeking of the listed companies and the auditors as the market main body. The system environment and the system arrangement which China's capital market depends have caused the rent existence. The listed companies and the auditors, as the main body of the capital market, their rent-seeking activities not only affected the resources disposition of the capital market efficiency, but also caused the entire social welfare loss and the financial information distortion and the audit failure. From the reality of the capital market point of view, how to effectively audit and contain auditing rent-seeking behavior at home and abroad has become the focus of attention and the practical problems for major efforts to solve, so this study is of great practical significance. Basing on the research foundation, the use of property rights theory and game theory, this dissertation analyses the supply and demand mechanism of auditing rent-seeking behaviors of the auditors and listed companies, and Put forward policy recommendations for the effective control of the auditing rent-seeking.First of all, this dissertation applies rent-seeking theory, property rights theory and game theory to the research of special property rights background and the non-cooperative game of the auditing rent-seeking in China's capital market. This dissertation studies the evolution of the meaning of rent, rent-seeking and the meaning of the main point of view of rent-seeking theory. Combined with the modern property rights theory, on the perspective the protection of property rights, this dissertation dialectically analyses the public domain, which is formed by the disclosure of accounting information, definition of property rights and fuzzy property rights, and the need which auditors define the property rights of accounting information. From the system transition of property rights and listed companies arrangements for the system of property rights point of view, the special property right background, which listed companies have a fuzzy definition of property rights and non-tradable state-owned shares is too high proportion, is in-depth analysis of the system. In addition, based on game theory, the dynamic model of auditing rent-seeking game among the auditors, listed companies and regulators is established, thus not only overcoming the shortcoming of existing researches due to their single- perspective of the theoretical study, but also providing a theoretical basis for a more comprehensive understanding for the auditing rent-seeking.Second, this dissertation studies the basic issues of auditing rent-seeking of China's capital market Rent-seeking. On basis of the rent-seeking theory this dissertation clearly defines auditing rent-seeking, the bodies of auditing rent-seeking, and the main object of rent-seeking, and auditing rent-seeking costs. According to the government-led character of China's securities market, government regulation, audit commission by the appointment of Mechanisms and accounting system features such as dual-track system, this dissertation analyses the external conditions of auditing rent-seeking, and the serious social consequences which auditing rent-seeking caused in the audit cost-benefit analysis on the basis of cost-benefit analysis for auditing rent-seeking.Third, the practical problems of auditing rent-seeking of China's capital market are studied in this dissertation. The paper makes it clear that regulation for accounting information in China's capital market is revealed through the control of the main accounting and auditing standard-setting control and control for accounting information disclosure to achieve. The mechanism which regulation rent is produced is revealed in this dissertation. This paper discusses rent-seeking mechanism of supply and demand; on the one hand, the demand mechanism is generated by the composition of the institution rent-seeking, the special arrangements for the property rights system and transition characteristics of auditing standards, on the other hand, the fierce competition in the audit market, the legal system deficiencies and lack of professional ethics of audit constitute the supply mechanism of auditing rent-seeking.Finally, the influence factors of auditing rent-seeking in China's capital markets are tested from the demand and supply. An empirical study of demand for auditing rent-seeking is practiced from the market regulation, ownership structure and characteristics of the Board of Directors. It is found from the test that there is a significant relationship between auditing rent-seeking and the listed company's accounting regulation. Listed companies, as the body of auditing rent-seeking, have a strong rent-seeking sense of to avoid loss, issue additional shares and maintain listed qualification. There is a significant relationship between auditing rent-seeking and ownership Structure. Concentration of ownership, ownership arrangement and auditing rent-seeking has a significant relationship. The higher the first shareholder hold, the smaller the Motivation of auditing rent-seeking is. Because the degree of supervision for state-controlled listed companies than the non-state-controlled listed companies from SEC and the public is stronger, the motivation of auditing rent-seeking of ultimate state-controlled listed companies is weaker than non-state-controlled listed companies. However, the test results don't found the significant influence of interest balance on the auditing rent-seeking. The test results don't found the significant influence of our current board of directors system on the auditing rent-seeking, so the question which independent director of corporate is just corporate governance "decorations" cannot be changed.An empirical study of demand for auditing rent-seeking is practiced from the size of the accounting firm and unusual auditing fee. The results show that the supply factors as the size of the firm's and auditing fees has a significant impact on auditing rent-seeking. The larger the size of accounting firms is, the lower the supply motivation of auditing rent-seeking is. It implies that the firm size plays a significant inhibition on the auditing rent-seeking. The test results indicate that the negative abnormal auditing fee plays a significant inhibition on the auditing rent-seeking.Based on above research, this dissertation believes that auditing rent-seeking in China's capital market should be appropriately controlled, through increasing auditing rent-seeking costs, reducing the demand and supply of auditing rent-seeking. This dissertation proposes policy recommendations to moderate control auditing rent-seeking. On the one hand, the auditing rent-seeking costs should be increased to improve laws and regulations and civil compensation mechanism and reduce the cost of supervision; on the other hand, the demands for auditing rent-seeking should be decrease to lower the demand for auditing rent-seeking, finally, the supplies for auditing rent-seeking should be decrease through forming a rational auditing structure.