Research On The Effect Of Internal Control And External Audit On Accounting Comparability

Accounting information plays an important role in promoting the stable development of capital market,comparability is the important feature of the quality of accounting information and can help users of accounting information identify similarities and differences in different financial reports.Internal control and external audit supervision mechanism are designed to solve the principal-agent issues,alleviate the contradiction and conflict between the principal and agent,improve the transparency of the information of the listed enterprises,guarantee the accounting information to reflect the operating conditions and the performance of the agent faithfully.Internal control,as an effective way to prevent accounting information distortion,can improve the quality of the accounting information,and enhance the reliability of the financial report of the company.External audit,through the screening of the company's accounting information,aims to increase the value of accounting information and improve the usefulness of accounting information for information users.First,this paper analyse the three dimensions of the existing literature review and summary from the accounting comparability,internal control and external audit.Second,from the theory of the relationship between internal control and accounting comparability,the quality of external audit affect the accounting comparability,on this basis,the relationship between internal control and external audit in the impact of the accounting comparability is further analyzed by introducing the interactive item of internal control and external audit(IC*BIG4).Next,for a research sample based on the panel data of Chinese(ShangHai and ShenZhen)A-shares listed enterprises for period of 2012 to 2015,by using the fixed effects regression model,try to choose an accounting comparability at the firm level and makes an empirical test on the assumptions one by one.The research results show that internal control is significantly positively associated with accounting comparability;the quality of external audit is significantly positively associated with accounting comparability;and there is an alternative relationship between internal control and external audit in improving the accounting comparability.Last,according to the empirical results,this paper put forward countermeasures and suggestions from improving the institutional system at company level,specification external audit service quality,maintenance of accounting information system environment.To improve the quality of enterprise internal control,strengthen the construction of internal control system;give full play to the role of accounting firms,improve the overall quality of the audit industry;improve relevant legal systems and optimize the external audit service environment.By improving the internal control quality,standardizing external audit services,improving the accounting comparability of listed enterprises,the capital market of China will be improved.