Empirical Research Of How The External Audit Quality Affect The Listed Companies’ External Financing Costs

Globalization led to the rapid development of the national economy.The development of the listed corporations need more money than before. So the money pressure force the corpora tions choosing external funding to raising money than internal.Then the external funding beca me the main way of raising money and the important part of the business of the corporate. Th e listing corporation financing cost include equity financing cost and debt financing cost. Ther e are many studies about corporation financing cost abroad and more of them pay attention to the in formation disclosure、operating conditions and management structure of the company. Many of The research about the affecting factors of the external financing cost only pay atten tion to one aspect of the financing cost.There are not many research about the relationship bet ween th e audit quality and external financing cost.So this article choose two aspects-equity financing cost and debt financing cost to explore the influence given to the external financing cost.This article choose ten accounting firms before to respect high quality of the audit work, and contr ol the indicators as the company size(final total assets)、asset-liability ratio、return on equit y.The equity financing cost is based on CAMP,the debt financing cost is based on int erest exp ense proportion. At the last of this article gives much advice on how to reducing the external financing cost in perspective of audit.The research on the equity financing cost,we choose the dates in shenzhen and shanghai in 2010-2011 and reserve 88 dates after eliminating strange and lacking ones.Then we use geo metric average method to get the finial dates.There are 19 dates of the ten audit firm and 69 dates of not the ten before.The research on the debt financing,we chose the dates in shenzhen and shanghai in five times as in January, march, June, September and December in 2010 – 2012.At last choose 147 dates including 46 dates of the ten audit firm and 101 dates of not the ten before.Then we conduct the study on the descriptive statistics with the finial dates to get intuitive graphical.At the last of the empirical research,we use spss software to discuss the the relevance of our listing corporation debt financing cost and its audit quality.The final conclusi on is,equity financing cost and debt financing cost have the negative phase with the audit qual ity of the listing corporation under the significant test of 5%.