Study On Competitive Factor Of Accountant Practices Based On Game Theory

From the birth of certified accountant to now, there are about three hundreds years of developing history for international accountant practices, and their audit technology and management level has reached to mature stage. However, there are only twenty years of history for certified accountant profession development in our country. With opening to world and joining WTO, Chinese accountant practices have been facing great challenge in the audit market. Therefore, how to improve the competitive superiority is the most attention of the practices. This paper introduces mathematical models which simulate the audit market and research the strategies for improving the competitive superiority of practices.Applying a mathematical model which bases on probability, This paper simulates interest relation between the accountant office and its client in the audit market. Assuming offices being rationale, the optimum audit quality is obtained for the lowest audit cost and the highest value of net audit value is obtained in order to improve the competitive superiority of the practices. In analyzing process of the models, the relation audit quality, audit cost and net audit value is discussed to get the three important competitive factors, public image, audit efficiency and compensable capital ratio.Subsequently, this paper researches all kinds of management methods and strategies to improve the competitive superiority of the practices in three fields, public image, audit efficiency and riskful capital management.In the public image management, this paper discusses the management methods: the internal control management and culture building.In the audit efficiency management, this essay quantitatively researches profit-sharing coefficient of the practices by applying game theory. The game contains two players taking action in one period. Whenever the game isNon-cooperation game or Stackelberg game, we obtain the optimum profit-sharing coefficient.In the compensable capital ratio management, this paper researches how to adjust efficiently the compensable capital.