Study On Economies Of Scale Of Accounting Firms’ Mergers

Shanghai accounting firm was founded in1981, since then Chinese accounting firms had gone through a long hard times. They experienced the planned economy period and the State-owned government-run period, they experienced integration and scale expansion property after joining the WTO. It was difficult for them to survive. Our audit services industry has gradually achieved the goal of being open. In the top one hundred CPA firms of2013published by the AICPA, local firms changed the monopoly of the "big four". The top one hundred CPA firms of2013had changed a lot as the merger of the accounting firms.In the21st century, the local accounting firms set off a wave of consolidation for three times. Government urged firms merge at first; the firm began to take the initiative to merge in these years as they got benefit from the consolidations. In this paper, we research the effect of the merge by the standardized methods and use empirical methods to make deeper exploration. Firstly, we discuss the process of Chinese large-scale local accounting firm; secondly, we analyze the influencing factors from two aspects——premium brand and industry-specific; thirdly, we analyze the economic effect of the scale by using the data in recent years. Chapter Five summarizes findings of the research and points out the research’s shortage and follow-up research.The main contribution of this paper is that we analysis the effect of the merge comprehensive and systematic. This paper focuses on the domestic firms so that we could compare the local firms with the "big four" conveniently. This article highlights the characteristics of the domestic firms. This paper conducts empirical analysis with empirical data of audit market and tests the effect of the policy that domestic accounting firms promote the development of audit market, which also provides some guiding significance and reference for the development of our own accounting firms. The article also introduces in the economies of scale economics theory, synergy theory and industrial organization theory, in terms of analyzing the effect of the merger between the accounting firms.