The Implementation Of The New Environmental Protection Law And Audit Fees

Environmental protection has become one of the most concerned topics in Chinese society.The Environmental Protection Law of the People’s Republic of China passed at the eighth meeting of the Standing Committee of the Twelfth National People’s Congress in 2014 promotes the disclosure of environmental information and strengthens the communication among government,enterprises and the public,to promote the realization of the goal of "beautiful China".This paper mainly studies the impact of the implementation of the new Environmental Protection Law on the change of audit fees of heavy polluting enterprises and non-heavy polluting enterprises.Based on the listed companies in China as samples from year 2012 to 2016(excluding year 2014),using new Environmental Protection Law as "natural experiment",which came into effect on January 1,2015,and divide the whole samples into the experimental group and control group,according to the list of heavy pollution industry from the Environmental Information Disclosure Guidelines for Listed Companies(draft)issued by Ministry of Environmental Protection in 2010.This passage try to test whether the new Environmental Protection Law has impacted on audit fees by using a method called differences in differences.Furthermore,this paper finds that after the implementation of the new Environmental Protection Law,the audit fees of heavy polluting enterprises increase significantly,and this phenomenon is more significant in regions with good legal environment and strong environmental regulations.The contribution of this paper is to expand the academic research on the influence factors of audit fees and connect the influence of macroscopic law to the behavior of certified public accountants.At the same time,this paper expands the research scope of the intervention of laws and regulations,adding certified public accountants and finds the disciplinary function of audit fees.