Research On The Influence Of Stock Exchange Inquiry Letter On Audit Decision Of Dahua Accounting Firm

In recent years,the inquiry supervision of stock exchanges has become one of the most typical regulatory measures in the non punitive supervision with information disclosure as the core.Since 2014,the number of inquiry functions disclosed by Shanghai and Shenzhen Stock Exchanges has entered the explosive growth stage.Among them,the annual report inquiry.Among them,the annual report inquiry letter for listed companies’ annual report information disclosure is in compliance with the normative standards has increased significantly,and furthermore,the annual report inquiry letter has also gradually strengthened the supervision of accounting firms.The annual report inquiry letter not only requires the annual auditing accountant to reply on certain matters of listed companies,but also assumes the responsibility of auditing when listed companies reply to the annual report inquiry.Then will the inquiry supervision system have a substantial impact on the audit decision-making behavior of accounting firms?Under the institutional background of China,how should accounting firms deal with inquiry supervision?These problems deserve further study.In this context,this thesis focuses on the issue of the impact of inquiry supervision on the audit decision-making of accounting affairs,summarizes the relevant concepts and theories of inquiry supervision based on the existing domestic and foreign relevant literature,introduces the concepts of inquiry supervision and audit decision-making of stock exchanges,and expounds the theoretical basis of inquiry supervision.On this basis,the annual report inquiry letters received by listed companies audited by Dahua Certified Public Accountants from 2016 to 2020 were sorted out and counted,and the response strategies of Dahua Certified Public Accountants in response to the annual report inquiry letter,a strong regulatory signal and incremental risk information,were investigated from the aspects of audit costs,audit efficiency,key audit matters,audit opinions,etc,This thesis attempts to analyze the influence mechanism of stock exchange inquiry supervision on the audit decision of accounting firms.The research conclusion shows that China’s audit market is highly competitive,and accounting firms have strong independence.When faced with the inquiry and supervision of the exchange,they have taken positive measures to deal with the inquiry and supervision of the exchange.The main conclusions of this thesis are as follows:(1)The inquiry supervision committee has a significant impact on the audit decisions of accounting firms in the next year.After being inquired,the accounting firm will increase the audit fees of the inquired listed companies;(2)After the accounting firm was inquired,the audit efficiency decreased.In the process of auditing the inquired listed companies,the audit delay has increased,and the auditors will invest more time and energy in the process of auditing the inquired listed companies;(3)After the accounting firm was inquired,they increase the number and length of key audit matters disclosed by the listed company being questioned,and questioning regulation has a significant effect on the audit response to key audit matters;(4)Inquiries about the supervision will increase the probability that accounting firms will issue non-standard audit reports with unqualified audit opinions.Finally,this thesis puts forward relevant countermeasures and suggestions from the two levels of stock exchange supervision and accounting firms,including: stock exchanges should expand the scope of inquiry supervision,strengthen the inquiry supervision of accounting firms,improve the inquiry supervision system,strengthen the supervision of the annual report inquiry letter,further optimize the system convergence,and improve the coordination of supervision.At the same time,it is proposed that accounting firms should make full use of the annual report inquiry letter,Improve the disclosure effect of key audit matters,strengthen the attention of the annual report inquiry letter,and improve the auditor’s risk awareness.