Analysis of extensive game model for auditing collusions.
Hui Xu · Economic & Trade Update · 2007
An extensive game model with complete information is developed in this paper to analyze how CPA and manager determine audit fees,and the conditions under which the collusions between CPA and manager are formed.Some suggestions,such as strengthening regulation and improving serf-discipline of the audit fees etc.,to forbid these two parts to profit from the pseudo financial information are presented through finding measures to break the collusions.