Research On The Relationship Between Related Party Transaction,Internal Control Quality And Audit Fees

With the rapid development of the world economy,the increasingly mature capital market has spawned related party transactions.With its transparent information barrier and low transaction cost,related party transaction has become an important means for listed companies to develop business.However,due to its inherent concealment and complexity,related party transactions often become a tool for controlling shareholders to "hollow out" listed companies or management to manipulate profits.Audit fee,as the legal reward of audit business,not only reflects the related cost of audit work,but also reflects the risk premium brought by audit business.So do related-party transactions,which are often used as a cloak for fraud,increase audit risk and,with it,fees? This will be the focus of this article.Secondly,as one of the products of the development of modern enterprises,the internal control system has made institutional requirements for the compliance and legitimacy of enterprise operation,and also reduces the business risk of enterprises.Therefore,this paper discusses the regulating effect of the quality of internal control on the correlation between related party transactions and audit fees.Therefore,this paper will discuss the relationship between related party transactions,internal control system and audit fees,and ensure the reliability of the conclusion through the relevant robustness test.This paper takes the data of 3,393 A-share listed companies in Shanghai and Shenzhen from 2015 to 2020 as samples.Through principal-agent theory,fraud triangle theory,deep pocket theory and audit fee pricing theory,this paper provides theoretical support for the discussion of the interaction mechanism between the transaction motivation of related parties,internal control quality,financial information quality and audit fees.OLS empirical analysis was used to study the influence of related party transactions on audit fees,and the moderating effect of internal control quality under different property rights on the influence of related party transactions on audit fees.Finally,referring to the mediating effect test method used by Wen Zhonglin,earnings management is included in the study as a mediating variable to discuss the mediating effect of this variable in the process of related party transactions on audit fees.