| As an independent third party,auditors guarantee the truth and fairness of financial statements.In order to better guarantee the independence of accounting firms,relevant government departments and the Institute of Certified Public Accountants supervise accounting firms and give corresponding treatment and punishment to their violations of laws and regulations,among which the administrative punishment of China Securities Regulatory Commission has a significant impact.Under the guidance of relevant laws and regulations,China Securities Regulatory Commission has continuously improved its regulatory capacity.In 2020,the new Securities Law was issued.Under the strict regulatory environment of "zero tolerance",China Securities Regulatory Commission has significantly improved its investigation and punishment of financial fraud of listed companies and its timeliness.However,the fraud of listed companies and the audit failure of accounting firms have not disappeared,and the administrative penalty cases of China Securities Regulatory Commission are common.Some well-known accounting firms even received several administrative penalty decisions of China Securities Regulatory Commission in a year,and the number of cases reached a new high in 2021.The scandal in the audit market has seriously weakened the public’s trust in the audit industry and affected the benign and orderly development of the securities market.Therefore,it is imperative for China Securities Regulatory Commission to strengthen supervision on accounting firms and improve supervision efficiency.In order to further understand whether the administrative punishment of CSRC achieves the expected goal in the regulatory practice,this paper takes accounting firms as the main body and explores the changes of accounting firms before and after the administrative punishment from the two aspects of audit client selection and audit quality.First of all,this paper sorts out the institutional background of CSRC administrative penalty and audit client change,summarizes the basic situation of CSRC administrative penalty and audit client change of accounting firms in the past five years,and on this basis summarizes the law of their development and observes their characteristics,which lays the foundation for the case analysis in the following paper.Then,this paper takes Shu Lun Pan accounting firm,which has the largest number of audit clients in China and received the most administrative punishment in the past five years,as a case study.From the two dimensions of customer inflow and outflow,it compares and analyzes the changes of audit clients after Shu Lun Pan accounting firm’s administrative punishment from China Securities Regulatory Commission,and discusses the changes of audit quality under such audit clients’ preferences.The credibility of this analysis is enhanced by the test of reputation mechanism.Finally,this paper summarizes the relevant conclusions and puts forward suggestions to the regulators and accounting firms respectively.The research in this paper found that after receiving the administrative penalty from CSRC,Shu Lun Pan accounting firm lowered the standard of customer selection and the quality of new customers received decreased,but it was more sensitive to customer risks.When the impact of administrative punishment is relatively small,Shu Lun Pan accounting firm will choose to reduce the number of clients resigned by other firms,and improve the quality of new clients by accepting clients transferred from larger firms with better reputation and IPO derivative clients.At the same time,its tolerance of client risks will be increased.Further research shows that CSRC administrative punishment is beneficial to improve audit quality of firms.In this paper,there are some innovations in the perspective of research.In the perspective of research,the change behavior of accounting firms is analyzed from the perspective of accounting firms.In terms of the research content,this paper explores the characteristics of audit client selection of punished firms and the changes of audit quality,in order to provide some useful exploration for the research on the effect of CSRC administrative punishment,the customer selection behavior of accounting firms and the improvement of audit quality. |
