Does ownership concentration increase audit fees?
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Ownership concentration has a mixed effect on audit fees. In the context of concentrated ownership and poor investor protection, managerial ownership has a non-linear relationship with audit fees, with a pattern of "alignment-entrenchment-alignment" . In Sub-Saharan Africa, managerial ownership and concentrated ownership are negatively related to audit fees, while foreign ownership is positively related to audit fees . In China, there is a significant inverse relationship between managerial ownership and audit fees, while ownership concentration, equity restriction, and the rate of change in assets measured at fair value are positively related to audit fees . In a sample of non-financial Spanish listed firms, the amount involved in related party transactions (RPTs) has a negative effect on external audit fees, suggesting that audit fees are mainly affected by auditee needs rather than agency conflicts associated with RPTs . The impact of ownership concentration on audit fees in the Jordanian context is not explicitly mentioned in the abstracts provided.
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| Papers (4) | Insight |
|---|---|
| The paper states that ownership concentration is positively related to audit fees. Therefore, ownership concentration does increase audit fees. | |
| The answer is not provided in the paper. The paper discusses the effect of related party transactions (RPTs) on audit fees in a context of low investor protection, low litigation risk, and prevalent ownership concentration. | |
1 Citations | The paper states that ownership concentration is negatively related to audit fees, meaning that higher ownership concentration is associated with lower audit fees. |
| The paper states that there is a non-linear relationship between managerial ownership and audit fees, suggesting that ownership concentration may impact audit fees. |
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