The Association Between Audit Risk And Audit Fee

Based on China has implemented new accounting and auditing standards in recent years, and CPA's legal liability has also continued strengthening. This dissertation explores whether CPA and accounting firms have concerned audit risk from the view of audit fee charging, and try to find the existence of "risk premium" in china's auditing market. Through in-depth theoretical and empirical research, this paper received some significant conclusions:This study found that in china's law and judicial practice, CPA's legal liability gradually spread from criminal responsibility and administrative responsibility to the civil liability, and from capital verification service to audit service. Many controversial issues also have been resolved about CPA's tort liability to the third party because of the false audit reports. Overall, accounting firm and CPA's legal liability has been continuously strengthened. Considering SFC's punishment decision to CPA, we choose earnings quality, major disclosures, violation motive indicators of listed companies to measure risks in audit service. We also made audit fee influencing factors regression analysis. From Big4, Nation8, small and medium-sized sample's regression results, as well as 04～06,07～09 annual range sample regression results. We found CPA and accounting firms in different types and different periods, the focus and extent of audit risks are different. At the same time, we introduce audit hours data to provide new evidence of the measure "risk premium" in audit fee.