1 Introduction

The dual-audit and dual-reporting system (dual audit system) plays an important role in increasing auditor independence, improving corporate governance, and enhancing financial information quality. Accounting and auditing researchers pay constant attention to research topics about this audit system and its change. This study investigates the economic consequences of the deregulation of the mandatory dual audit system on the capital market and audit market. This chapter first introduces the practical and theoretical background of the study. Following, the research questions are put forward with the current situation in practice and the limitations of the existing literature as bases. The potential contributions and practical significance of this research are also elaborated. Finally, this chapter describes the research contents, methods and framework.