The Effect Of The Transform Of Accounting Firms On The Performance Of Audit——Based On DID Model

By the end of 2013, all the 40 certified public accounting firms who have the qualification of auditing the public companies have transformed the limited liability system to the special general partner system. Formally, reforming the organization of accounting firms expresses CPAs’ good faith of abiding by the professional ethics to maintain the industry credibility and the determination of supervising companies to report the real and fair information to the market to protect investors. Meanwhile, the transformation makes our accounting firms taking a big step towards internationalization. However, essentially, whether the reforming can raise the performance of the audit, in other words, if it is beneficial to the improvement of audit quality in the macroscopic, and if it is beneficial to the improvement of the firms’ operating efficiency, is a problem worthy of extensively studying and discussing.For the special audit environment in our country, the change of organization form is more similar to a policy behavior, so we select the difference in difference model (DID) to analyze the transformation’s influence on the performance of audit. The DID model can well eliminate prior differences between treatment group and control group, inspect the cross-section data and time-series data’s differences at the same time to identify the net effect of public policy.In the DID model for analyzing the reform’s influence on the quality of audit, we found there is serious multicollinearity between the economic variables, to reduce multicollinearity’s disturbance, we use ridge regression method to estimate the coefficient of the model, the results show that the special ordinary partnership is conducive to the improvement of audit quality, and this effect will be more obvious in the following year after transforming.In dealing with the impact on the firms’ operating efficiency, firstly, we use data envelopment analysis (DEA) computing the relative efficiency of the accounting firms, and then seen it as a interpreted variable apply DID model, due to be explained variable values between 0 and 1, using ordinary least squares (OLS) easy to produce deviation, this paper select TOBIT regression to estimate the coefficient of the model, the result shows that due to taking on more risks,the accounting firms increase costs, transformed to the special ordinary partnership but reduceing the operating efficiency.Finally, this paper gives the policy suggestions from the aspects of the government and the accounting firms, hoping the government to speed up perfecting related laws and regulations, at the same time, incentiving more accounting firms transforming to the special ordinary partnership to provide a fairer competitive environment, maximizing the advantages of special ordinary partnership organization form.