Do professional risk funds affect audit quality?
利用中国审计事务所必须计提职业风险基金的特殊制度，研究发现职业风险基金越高，审计质量越好，因为事务所投入了更多审计努力，且对信息不对称高或治理弱的客户效果更明显。
In China, audit firms are required to maintain ‘professional risk funds’. These funds can be used only to pay civil compensation caused by deliberate or gross negligence in auditing activities. Using Chinese data from this peculiar regulatory characteristic, we investigate the impact of audit firms’ professional risk funds on audit quality. We find that the higher the audit firms’ professional risk funds, the lower the discretionary accruals. This finding is more pronounced for client firms with higher information asymmetry or weaker corporate governance. Further tests indicate that the higher the professional risk funds, the greater the audit effort invested in the auditing process, while audit fees do not change significantly. Our results suggest that higher professional risk funds ultimately improve audit quality by increasing audit effort.