Volume 7, Issue 4, July 2019, Page: 107-115
Theoretical Annotation of China's National Audit System Change
Kangli Liao, Accounting College, Jiujiang University, Jiujiang City, China
Feng Wang, Accounting College, Jiujiang University, Jiujiang City, China
Received: Jul. 4, 2019;       Accepted: Jul. 26, 2019;       Published: Aug. 13, 2019
DOI: 10.11648/j.jfa.20190704.11      View  49      Downloads  19
Economic interests (economic rationality) and political interests (political rationality) are the dual goals pursued by political state in promoting structural reform. Improving the independence of the national audit as the premise in the national audit system reform, simultaneously not challenging the existing political system, in this paper we construct Pareto Optimality Model with “independence” and “political control ability” as the basic variables and “political state-economic society” as the basic stakeholders with dichotomy, draw Pareto Optimality interval of “political control ability” under the condition of considering transaction costs. Based on stakeholders formed by the national audit system reform in the past 30 years, we further decompose and integrate the stakeholders with dichotomy, and construct a dynamic model of the national audit system reform with the central government, local interest groups and the public as stakeholders, thus to explain theoretically the reform course of national audit system. As fundamental reform in the national audit system that exceeds the constraints of political system and historical tradition is unlikely to occur in a short time, in this paper we put forward promoting the internal optimization of national audit system under the existing political system framework to realize the interaction between good governance of the state and good performance of the national audit.
National Audit, National Audit System, Pareto Optimality, National Governance, Institutional Change
To cite this article
Kangli Liao, Feng Wang, Theoretical Annotation of China's National Audit System Change, Journal of Finance and Accounting. Vol. 7, No. 4, 2019, pp. 107-115. doi: 10.11648/j.jfa.20190704.11
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