Quality Of Independent Audit Study

In the 21st Century, our CPA circle has made a rapid development, but at the same time, it also emerges a series of serious problems. But with the exposure of momentous financial fraud, audit quality draws unprecedented concern of society. So it is very urgent to make a study on the audit quality.Based on the principal-agent and economic theory, this dissertation analyzes the mutual reaction between demand & supply of independent audit service and the inherent mechanism of audit quality. Secondly the author attempts to investigate the status quo of CPA audit quality on securities market from two aspects: the result of the audit quality inspection disclosed by the supervision departments, and the typical cases of audit failure that has been exposed. Thirdly, further analyses of the contributing factors for low audit quality are made from three perspectives : audit demands of listed companies, the supply of audit service, and the supervision on the CPA profession. In China, the imperfect corporate governance leads to inadequate voluntary demands for independent audit, and accordingly results in the lack of CPAs' economic motives for improving audit quality. On the other hand, the Present institutions fail to induce CPA to take the initiative in Providing high quality service. Meanwhile, the imperfect supervision system of the profession may encourage CPA to take the risk of issuing false audit reports. Finally, according to the research, the author makes some suggestions on our institutional arrangements to improve CPA audit quality of listed companies In our country.This thesis is divided into five chapters, the following is the main content included in each chapter:Chapter 1 discusses the research background, research significance and framework of this thesis, and the profile of current domestic and overseas researches on audit quality.Chapter 2 studied the "adverse selection" and "moral hazard" problems by analyzing the problems of principal-agent relationship and information asymmetry in the CPA audit service market, which offered the theory support for the study of CPA...