【正文】 more than 7000 accounting firms are all over the country. However, most of those are small and mediumsizedAccounting firm is not an ordinary coowned enterprises, but “colabor” and“comental”business on the basis of “cocapital”. Institute of Certified Public Accountants is to determine the survival and development of its most important human capital factors. But, at present, China39。s small and mediumsized accounting firms are faced with a serious loss of Certified Public Accountants. In the current petitive market situation, the majority of small and mediumsized accounting firms in a hard situation of struggle and have the risk of being eliminated any time. How to integrate re sources, gather personnel, set up a good brand image, and make small and mediumsized accounting firms bigger and stronger, is an important subject which small and mediumsized accounting firms will be faced with.As a consequence, working out the countermeasures to the reason of the loss of Certified Public Accountants in the small and mediumsized accounting firms, is crucial to help these firms meet the requirements of the accounting service‘s marketability, even to be more expansive and stronger.2 Analysis on Existing Incentive Model of SmallMedium Accounting Firms in ChinaTaking their small scale and less business into consideration, most small and medium Accounting firms in China adopt the distribution style of basic wages plus business lift, which means different employees‘ wages are determined by their work contents:(1) PartnersTheir wages consist of manager‘s basic wage and dividend payment. Though the managers are only responsible for ad ministration and don‘t take part in detailed jobs, they receive the largest payments.(2) Highlevel techniciansHighlevel technicians mainly include chief accountants, department managers, department vice managers and senior project managers. They are so good at business deals and public relations that make them the key persons and core petitive force. Their wages are posed of basic wages, business lift, business labor wages and special contribution bonus.(3) Ordinary techniciansOrdinary technicians, such as project managers, audit assistants and midshipmen, are main workers and are responsible for providing clients with resources. They have the largest amount of labor and get a pay of basic wages, business lift and business labor wages(4) Logistic service staffAll indirect participants in audit like ordinary managers and financial workers are logistic service staff. Their work includes daily business, file sorting, reception, providing clients with resources and so on. Their wages mainly consist of logistic basic wage and business lift [2].So one can see all the staff on different levels except partners have a pay from business lift, that is to say, all level of staff can accept business. Therefore, the business quality can not be guaranteed, and the Accounting firms are to have relatively high audit risks .3 Analysis on the Problems of Existing Incentive Model of SmallMedium Accounting Firms The contradiction between business charging system and salary incentive modeThe accounting firms have two methods in business charging. One is cost plus method, the another is the market value. At first, costplus method is to calculate costs, coupled with the expected return, and that is the price. This is a cost to the price of homeopathy pricing. Market price method is based on market prices for their products, this is the price to the cost of the reverse pricing. The two pricing are mainly determined by the position of the supplyside, that is, when the supplyside39。t have department or personnel to take charge of operations especially. On the contrary, every member of the firm has the right and obligation to undertake the business. This means that business and business to undertake the implementation is not the same person. The product of the implementation of the oute is much larger than the undertaking. But they don‘t take business themselves which led to the deduction wage higher than the practitioners39。 employees focus on Mining and the pursuit of business in order to pursue their own interests, so that results in lower service quality and larger audit risk, because they make light of implement and control the business. Contradiction of the residual claim between partner and nonpartnerAccounting firms is essentially a knowledge of employment of capital. As long as they have practical and related professionals, they will be able to conduct business. However, a considerable portion of the accounting firms39。ll give you wages. The distribution system too much inclines to partners or investors, the majority of shares is grasped in the hands of several partners. Other nonpartners (investor) ,for example, certified public accountants ,they does not have the right to share residual ine or participate in management . They are only allowed to participate in the distribution of wages, can not possess of the remainder according to their distribution. Even if the individual makes a significan