Abstract: To promote the transformation of accounting firms into the special general partnership is an important measure to promote China’s CPA profession to be “bigger and stronger”. After the transformation, the firms will face increasing legal risks, and it would be an effective way for the listed companies to increase their accounting conservatism so as to reduce their legal risks. This paper takes the transformed accounting firms during the period of 2012- 2013 as the research objects and classifies the samples to analyze the impact of the transformation and legal environment on the accounting conservatism of the listed companies. The results show that the transformation of accounting firms into special general partnership can significantly increase the accounting conservatism of the listed companies. In the areas with poor legal environment, the transformation of accounting firms has an even more obvious impact on the increment of accounting conservatism of the listed companies. Compared with big companies, the impact on small companies is more significant.

Key words: transformation of accounting firms; legal environment; accounting conservatism