The Research Of Duplicate Auditing In Chinese B-Share Market

This September, the CSRC abolishes the compulsion of Duplicate Auditing in Chinese B-share market which was put into effect in 1996. So there is a need to summarize the development of Duplicate Auditing during the last 11 years. All issues in single-auditor setting exist in duplicate auditing arrangement and there are some special issues only exist in duplicate auditing arrangement. That is my motivation to make some research on it. This paper is mainly about the relationship among the list company, the two auditors in duplicate auditing arrangement, auditor A and auditor B. And how it influence the demand of high quality auditor and the auditor choice. In the result aspect, after empirically analyzing 3 years'(2004-2006) sample data of B-share company and control the fact such as the size of the company, financial risk, auditing opinion, the research finds that the ownership of foreign shareholder demonstrates a reverse U-shaped relation with high quality B-share auditor demand .After the company choosing the high quality A-share auditor they don't demand high quality B-share auditor, and it is the same result when paying A-share auditor costly. We also find that in B-share market the high quality domestic audit firms love to become a member of an auditing internal corporation. In the last, we examine the relationship between high quality auditor choice and audit fees.The thesis is divided into five chapters. The first chapter is introduction. The second chapter mainly describes the development of the Duplicate Auditing in Chinese B-share market and the auditing market structure under it. In the same chapter we also describe the development of the Duplicate Auditing in Chinese A-share market. And next we point out the difference between these two Duplicate Auditing models. In the same chapter we conduct analysis on the conditions of abolishing the Duplicate Auditing compulsorily. Then we explain the consequence of abolishing the compulsion of Duplicate Auditing. The third and fourth chapters are experimental studies. The third chapter describes the demand of high quality auditor in Chinese B-share market and the auditor choice. The fourth chapter is about the relationship between auditing fee and the high quality auditor.The last chapter summarizes the major finding of the thesis, and some suggestions about the Duplicate Auditing.