The Research Of Demand For Audit In Private Firms

With the deep development in the reform and opening-up, thenon-governmental enterprises become a more important force in China’snational economics. However, the supervision systems do not match with thedevelopment of the private firms, especially the independent audit service. Asthe only relatively complete supervision besides the government, there arestill some problems in the independent audit for private firms in the theoriesas well as in the practices. Starting from the previous studies at home andabroad, the thesis analyzed the practical situations in the private firms in thecountry, and found the reasons which result in the demand for the audit.Basing on the reasons, the survey was designed and implemented in the30private firms to find the factors which will affect the demand for the audit.The administrations from the government and the development of theprivate firms themselves result in the demand for the audit. The governmentsdo not require all the private firms to be audited, but some ones in some special industries or under some special conditions do need the statutoryaudit. With the development and the expedition of the private firms, thefinancial requirements, the existence of the external owners andmanagements, and the advanced managerial come to be the impact reasons inthe demand for audit.The empirical dates show that the existence of the external owners andmanagements do have some affects, but in a kindly way with an ascendingtrends. The size of the private firms, the financial needs from the venturesand banks, the attitudes and the experiences of the managers, however, is thedeterminants in the demand for the audits of the private firms in today’sChina. And the cost of the audit always to be the key factors in the decisionsof the audits, but with the decentralization of the ownerships, the sensitivitiesbecome weak.