Journal ArticleDOI
Size Variables in Audit Fee Models: An Examination of the Effects of Alternative Mathematical Transformations
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In this paper, the authors consider the mathematical transformations used for assets of different valuation complexity in audit fee models and find that more complexly valued assets are less likely to follow the traditional log transformation.Abstract:
SUMMARY: We consider the mathematical transformations used for assets of different valuation complexity in audit fee models. These mathematical transformations (such as logs and square roots) relate to the non-linear relationship between client size and audit fees. We use closed-end mutual fund audits to examine this question because virtually all fund assets are reported at fair value. We find that more complexly valued assets are less likely to follow the traditional log transformation because the presence of these assets has a stronger relationship with audit fees that is not fully captured by the coefficient on the logged variable alone. The significance of non-size variables was also found to differ in audit fee models of both closed-end funds and a broad-based sample of public companies when the mathematical transformation of size variables was permitted to vary. These results suggest that the non-linear relationship between client size and audit fees may not always be sufficiently captured by a log...read more
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Journal ArticleDOI
Managerial Ability, Financial Distress, and Audit Fees
TL;DR: In this article, the authors examine whether the relationship between managerial ability and audit fees is conditional on financial distress and find that higher managerial ability increases audit fees in financially distressed firms and decreases audit fees for non-distressed firms.
Dissertation
Empirical essays on corporate governance and corporate outcomes in MENA countries
TL;DR: In this paper, the authors investigated the effect of board diversity on corporate outcomes in the Middle Eastern and North African (MENA) countries and found that board diversity is a significant determinant of corporate outcomes.
Journal ArticleDOI
Determinants of audit fees in developing countries: Evidence from Egypt
Walid ElGammal,Marwa Gharzeddine +1 more
TL;DR: In this paper, a substantial increase in the research field was noticed with regards to auditors roles in fraud detection and prevention, internal surveillance, and internal auditing, as well as an increased awareness about transparency, accountability and responsibility reached by all stakeholders of business firms.
Journal ArticleDOI
The impact of labor unionization on monitoring costs.
TL;DR: The authors analyzes the impact of labor unionization on monitoring costs and concludes that unionization increases the costs of monitoring agents, a burden which is amplified or mitigated depending on the structure of industrial relations.
Journal ArticleDOI
Audit quality and fees: Evidence from Spain
Isidoro Guzmán-Raja,Mariano González-Sánchez,Enrique Rúa-Alonso-De-Corrales,Juan Francisco Sánchez-García +3 more
TL;DR: In this paper, the authors used panel data methodology to find the main factors determining Spanish audit quality, such as the auditor size, the previous year's audit fees, the years with the same audit firm, the auditor opinion, auditor rotation, the concentration or dedication to the client and the client sector.
References
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Journal ArticleDOI
The pricing of audit services - theory and evidence
TL;DR: In this paper, the authors provide evidence from a test of the hypothesis that price competition prevails throughout the market for the audits of publicly held companies, irrespective of the share of a market segment which is serviced by the Big Eight firms.
Journal ArticleDOI
Auditor brand name reputations and industry specializations
TL;DR: In this paper, the authors found that industry expertise is a dimension of the demand for higher quality Big 8 audits and a basis for within Big 8 product differentiation, and that on average, industry specialist Big 8 auditors earn a 34% premium over nonspecialist Big Eight auditors.
Journal ArticleDOI
Audit Fees: A Meta-analysis of the Effect of Supply and Demand Attributes*
TL;DR: The authors evaluate and summarize the large body of audit fee research and use meta-analysis to test the combined effect of the most commonly used independent variables, such as loss by the client and leverage, which have become significant in comparatively recent studies.
Journal ArticleDOI
Do External Auditors Perform a Corporate Governance Role in Emerging Markets? Evidence from East Asia
Joseph P. H. Fan,T.J. Wong +1 more
TL;DR: In this article, the authors examined whether external independent auditors could be employed as monitors and as bonding mechanisms to alleviate the agency conflict in emerging markets and found that firms are more likely to employ Big Five auditors when they are more subject to the agency problem imbedded in their ultimate ownership structure.
Do external auditors perform a corporate governance role in emerging markets? Evidence from East Asia / Joseph P. H. Fan and T.J. Wong
Joseph P. H. Fan,T.J. Wong +1 more
TL;DR: In this paper, the authors examined whether external independent auditors could be employed as monitors and as bonding mechanisms to alleviate these agency conflicts using a broad sample of firms from eight East Asian economies and found that firms are more likely to employ Big Five auditors when they are subject to the agency problem imbedded in their ownership structure.