The Effect Of Internal Control Weakness On Audit FEE

As the monitor, evaluator and auditors of the listed company financial information, Certified public accountants play an important role in the status audit supervision system. Audit pricing is the link between the accounting firms and clients, and the amount will affect the economic interests on both of them. This paper using both theoretical analysis and empirical research, deeply investigating the relationship between internal control weakness and audit fees. This paper based on the internal control attestation reports and related financial data of2011-2013disclosed by listed companies in Shanghai and Shenzhen Stock Exchange, sorted out the logical relationship between internal control weakness and audit fees.The paper is divided into five partsChapter1focuses introduction. In this part, the background, significance, briefly train of thought and framework of the paper are introduced. The innovation points are also put forward in this chapter.Chapter2introduces literature review. It is based on the dimension of audit fee, the influence on audit fee caused by internal control and internal control weakness.Chapter3introduces theory basis and hypothesizes. First of all, this paper introduces the institutional background of audit fees and internal control. Secondly, Basis theory related are introduced, such as internal control weakness, internal control risk and risk oriented auditingChapter4focuses on empirical research. It is the main body of this paper. This part is divided into three parts:The research on influence of internal control weakness on the audit fee. Special consideration on internal control weakness’s influence on audit fees two years subsequent to internal control weakness obscuredThe proposal of how to further regulate internal control disclosure is discussed as well. Secondly, this chapter points out the limitation of the paper and future research direction of this kind of research.