Research On The Impact Of Lowballing On Auditing Quality

As a third party forensic business,the purpose of Financial audit is to improve the quality and content of the financial statements and to enhance the level of reliance on the financial statements of the financial statements.The audit of financial statements plays an important role in protecting the interests of small and medium investors and other financial reports,optimizing the allocation of capital market resources and maintaining the order of capital market.China's audit market competition is fierce,often the firm to take the lowballing way to undertake the audit business,this pricing strategy will affect the audit quality of certified public accountants,endangering the healthy development of the audit industry has been widespread concern at home and abroad.Although regulators have been concerned about the issue of low prices,but less empirical research specifically for the initial audit business to undertake the audit fees and the relationship between the quality of the audit,the existing literature about the relationship of lowballing and audit quality was also unanimous.Based on this,this paper adopts the combination of normative research and empirical research to study the relationship between lowballing and the quality of audit.First,it fully combs the domestic and foreign literatures related to this study,and then analyzes the present situation of lowballing in the audit market in China.The author analyzes the relationship between the low price and the quality of the audit,and puts forward the relevant policy suggestions by analyzing the relationship between the low price and the quality of the audit.At the same time,the paper analyzes the relationship between the low price and the quality of the audit.In this paper,A-share listed companies that have been audited by the auditors for more than four years from 2005 to 2015 as the study sample to audit whether the client can use the accrual accrual surplus to meet or exceed the analyst's earnings forecast as an alternative to the audit quality indicators,to study the initial audit business to undertake low-cost The relationship between the quality of the audit and the quality of the audit,and the introduction of the external environment and the company's own characteristics,namely the introduction of the market situation,the nature of property rights to study its impact on the relationship between the two.The results show that there is a positive correlation between lowballing and auditing clients to use the accrual accrual surplus to meet the analyst's earnings forecast,that is,low-cost Lanke reduces the quality of the audit;lower market performance in different market conditions to reduce the audit quality The results show that the decline in the audit quality of non-state-owned listed companies is significantly higher than that of state-owned listed companies in the case of lowballing in the bear market stage.The research results of this paper are in line with the long-term concern of the practice industry on the lowballing of the audit industry.The research of this paper is of great significance to strengthen the supervision of domestic audit fees,improve the quality of auditing and promote the healthy development of the audit industry.