Economic Analysis of External Supervisors of Accounting Fraud in Listed Companies

The main users of accounting information of listed companies are shareholders and other stakeholders. The quality of accounting information of listed companies plays an important role in the development of a country's capital market, and certified public accountants have an unshirkable regulatory responsibility to ensure the quality of accounting information of listed companies. Theoretically speaking. Certified public accountants shall accept the entrustment of property owners, follow the principles of independence, objectivity and impartiality, review the performance of operators of listed companies and issue audit reports. However, in China's listed companies, due to the imperfect governance structure, the appointment right of accounting firms is actually in the hands of the main operators of listed companies. That is, the agent of the company operator, as the principal, hires a certified public accountant to audit the accounting statements prepared by himself, and decides to renew the appointment of the certified public accountant and pay the audit fee. Listed companies usually proceed from their own interests, in order to maximize their own interests, through various means to pressure registered accountants or lure them into submission, in order to achieve the purpose of purchasing audit opinions.

Certified public accountants are in an obvious passive position in the audit process. When certified public accountants take the risk of being fired for exposing clients' fraud, they are likely to succumb to listed companies, issue false audit reports for them, and even lose their professional ethics to help listed companies cheat. 200 1 year. The Audit Commission conducted an audit inspection on the quality of audit services completed by 16 accounting firms qualified to audit the annual accounting statements of listed companies in 2006. 5438+0 * * 32 audit reports were inspected, and the listed companies involved in 2 1 audit reports were further investigated. The inspection results show that 14 accounting firms have issued 23 seriously untrue audit reports, with false financial accounting information involving 71430,000 yuan and * * * involving 4 1 certified public accountants. Relevant research data show that from 1994 to 2002, China Securities Regulatory Commission inspected 63 accounting firms in charge of auditing or evaluation of listed companies, accounting for 50%. Whether certified public accountants collude with the audited entity depends on the level of audit fees and the risks and penalties of collusion. If the state strengthens the supervision of CPA audit, it can reduce the collusion between CPA and listed companies.

At present, the supervision and punishment of CPA audit in China are relatively light. On the one hand, due to the existence of information asymmetry, the probability of collusion of certified public accountants is relatively low. On the other hand, even if found, it is generally limited to administrative punishment. Therefore, the income of collusion between certified public accountants and the management authorities of listed companies is usually greater than the cost, which is also the fundamental reason for the continuous occurrence of accounting fraud cases in listed companies.