Research On The Audit Quality Of Accounting Firms

Accounting firms provide audit,tax and consulting services for different kinds of enterprises,government agencies and other entities.As an independent third party of auditing,they have to conduct audit with an objective attitude and expressing faithful opinion on the financial report,which will win the public trust by the useful information they provide.However,with the sustained increase of accounting firms and CPAs,audit quality has shown many problems.This paper researched the audit quality investigation conducted by The Ministry of Finance,China Securities Regulatory Commission(CSRC)and The Chinese Institute of Certified Public Accountants(CICPA).In the annual inspect of audit quality of accounting firms,most firms can obey the auditing rules,the development of the whole industry has improved while there are still several problems.These achievements including: Most firms can follow Audit quality control standards,Auditing standards,and China Code of Ethics for Certified Public Accountants.The awareness of audit failure has improved a lot.The process of auditing has been more perfect and standardized,and audit quality has improved gradually.However,there are still many problems of audit quality mainly as follows: there are many problems in the audit quality control of domestic small and medium-sized firms,and many CPAs cannot perform these procedures effectively,the review of audit quality procedure only become a mere formality form,causing some audit execution against rules,did not obtain sufficient and reasonable audit evidence,further leading auditor cannot make professional judgment reasonably,thus affecting the audit opinion.Furthermore,some firms still exist the phenomenon of one-sided audit procedures instead of professional judgment;unfair competition behavior is still repeated.In addition,large and medium-sized firms,such as RuiHua,Shu Lun Pan Accounting Company,Pan-China Certified Public etc.,occasionally punished by regulators,especially in the most typical REANDA fined several times.The audit problems exposed by the firms once again aroused public concern.How to improve the audit quality and improve the regulatory mechanism has become a topic of common concern.Based on the inspection results exposed by the supervision department,this paper will further research audit quality problems of domestic accounting firms as follows: The design and implementation of the quality control system;the control of defects of branch insufficiency;Certified Public Accountants lack professional competence;unfair competition.Finally,combined with the specific case analysis,and to improve the audit quality in our country and put forward some suggestions that firms should strengthen internal quality control system construction,the supervision departments should improve relevant mechanisms.