Research On The Relation Between Audit Committee's Construction And The Quality Of Accounting Information

Accounting information as the main basis for investment decisions, it's quality plays an important role in market Supervision and investing. Because of Accounting Frauds Listed company fraud continue to emerge. Authorities have taken many kinds of actions to decline or prevent this act. So the China Securities Regulatory Commission and China Economic and Trade Commission Promulgated < The Govern Standard of Listed companies> (draft) on Sep. 2001,which includes Non-mandatory requirement for listed companies to establish an audit committee. In fact The Board's motives and objectives are very clear: based on protecting the interests of foreign investors, improving the CPA's audit independence, strengthening the monitoring of accounting information, consequently enhance audit quality and the quality of financial information. Now < The Govern Standard of Listed companies> (draft) have been promulgated for 4 years, and what's the effective of setting audit committee. This paper offers Quantitative Study on the relation of Audit committee's setting and characteristics and the quality of Accounting information, in order to play a good role in researching on audit committee in future.This paper falls into four parts:The first part is focused on summary of audit committee system, including: definition, initiation and development, setting model.The second part is a theoretical framework that analysis audit committee based on Institutional Economics. That further in-depth understanding the nature of audit committee system by analyzing the duties of audit committee to determine the direction of research.The third part is Empirical Analysis. Based on many research achievements all of the world, this paper use part of a listed company data samples and establish regression model for finding the relation of Audit committee's setting and characteristics and the quality of Accounting information.On the basis of theoretical and empirical analysis, this paper comes to a conclusion. And this paper point out some advices that could effectively perfect the system of audit committee of Chinese listed companies.