Study On The Evaluation Of CPA Audit Quality

The new managing measures to public offering shares which was issued by CSRCin 2001 suggests that the IPO system has changed. Under the new IPO system, CSRC put alot of emphasis on compulsory information disclosure and the listed company's financialstatements before and after IPO are audited by CPAS, which is good for investor to makedecision. To execute the new IPO system effectively depends on CPAs' high quality auditingand proper audit opinion. However, the reality of long-period low audit quality is harmful tothis. So the most urgent problem to solve is how to improve the audit quality. To improve thelisted companies' information disclosure and CPAs' securities audit quality, CSRC has made anew measure "A shares supplementary auditing". In fact, high securities audit quality decidesin a good system. One choice is to establish the audit quality evaluation system and a perfectaudit quality control system, which can instruct investors to make rational decisions. In thisstudy, a theoretical framework of Audit quality evaluation system is presented including twoparts: Appraising standards system of accounting firms' audit quality and evaluation system ofspecific audit engagement's audit quality, followed by the empirical analysis of the auditquality based on the listed companies'2004 year financial statements. In order to improveeffectively audit quality, some relevant suggestion and means are provided.