Many auditing failures have occurred in recent years, especially those associated with Procomp, Rebar and the Chinese Bank. These well-known accounting scandals resulted in auditors being disciplined and led lack of investor confidence in the auditing profession. The effect of disciplining a CPA on subsequent auditing behavior is an interesting issue far investigation. Specifically, this study examines the impact of auditor conservatism after an audit failure. The empirical results show that after auditors were disciplined and/arced to transfer their clients to other auditors, client firms largely decreased their discretionary accruals. However, when audited by an auditor simply given a warning, clients do not significantly change their discretionary accruals. This analytical finding indicates that successor auditors become more conservative than disciplined auditors, and the degree of punishment affects the level of conservatism in subsequent audits. Moreover, successor auditors' conservatism may exist during the first yea. At the second year, the discretionary accruals of clients' earnings management would significantly increase, but it may be the result of accruals reverse. Additional analysis shows that successor auditors become more conservative for clients from disciplined events than those from non-disciplined ones.