External audit in the National Health Service in England and Wales: A study of an oversight body’s control of auditor remuneration

Basioudis, Ilias G.; Ellwood, Sheila

doi:10.1016/j.jaccpubpol.2005.03.003

Cited by 15 publications

(41 citation statements)

References 61 publications

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“…Using the methodology outlined in Crasswell et al (1995, p. 307) the coefficient on BIG4 implies a premium of 23.7% on audit fees relative to mid‐tier auditors. This contrasts with the recent findings of Basioudis and Ellwood (2005a) who reported no significant difference in the fees charged by Big 5 and mid‐tier auditors in the NHS trust sector.…”

Section: Resultscontrasting

confidence: 99%

Audit Fee Determinants in the Uk University Sector

2007

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Section: Resultscontrasting

confidence: 99%

Audit Fee Determinants in the Uk University Sector

2007

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“…This is very similar to findings from the private sector probably because US public organizations operate in competitive markets for the supply of audit services and compete with private firms in capital raising (US municipalities issue bonds which are rated; see Ward et al., ). Subsequent research in Australia (Boon et al., ), Canada (Bandyopadhyay and Kao, ), the UK (Clatworthy et al., ; Basioudis and Ellwood, ; Basioudis and Ellwood, ; and Giroux and Jones, ) and Finland and Norway (Johnsen et al., ) tend to provide broadly similar directions although specific variables differ both in operationalization and magnitude, probably due to the different institutional characteristics.…”

Section: Prior Literaturementioning

confidence: 96%

An Empirical Investigation of Audit Pricing in the Public Sector: The Case of Greek LGOs

Cohen

Leventis²

2013

Financ Acc Manag

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This paper investigates the associations between audit pricing and multidimensional characteristics of local governments by using a sample of Greek municipalities. The Greek institutional setting is interesting because it is politically pluralistic. Moreover, independent auditors appointed through a bid process exclusively perform the audits. Our results suggest a considerable variation on audit fees which is mainly driven by politically related factors indicating the importance of relevant theoretical anticipations in audit pricing in the public sector. Agency costs appear strong enough to explain audit pricing. We also confirm prior findings on the significance of audit complexity and size. Results also suggest that audit fees are reduced when an internal team dedicated to accrual accounting is appointed. Therefore, our conclusions offer practical implications for policy setters and regulators in the public sector in relation to audit quality.

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“…Consequently, audit relationships may be substantially different and our understanding of important regulatory and efficiency relationships may be incomplete. In the UK, we have now seen research (for example, Clatworthy et al, 2002;Basioudis and Ellwood, 2005) on that other area of the Audit Commission's ambit, namely the National Health Service (NHS), but local authorities are fundamentally different bodies from those in the NHS because of the central role played by directly-elected local politicians in local government.…”

Section: Downloaded By [University Of Cambridge] At 22:49 30 Novembermentioning

confidence: 99%

“…It is the commission that buys the brand, and appoints the auditor.' However, Basioudis and Ellwood (2005) found a BIG 4 premium for NHS entities, where auditors also are selected by the Audit Commission. eroskedasticity.…”

Section: Ols Regression Analysismentioning

confidence: 99%

Investigating the audit fee structure of local authorities in England and Wales

Giroux¹,

Jones²

2007

Accounting and Business Research

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The purpose of this paper is to model and test the audit fee structure of local authorities in England and Wales, with particular interest in fees charged by the Big 4 and other private sector auditors. The Audit Commission, a national public body under Parliament, regulates local government audits in England and Wales. The Audit Commission sets audit standards, appoints the auditors, and establishes a formula to determine standard audit fees. Constrained by the standard audit fees, each local authority and its auditor negotiate the actual audit fees. The majority of audits are conducted by district auditors (public sector employees under the Audit Commission), although about 25% of local authorities are audited by one of six private auditors (including three of the Big 4). Regression results for financial year 2000/01 have high explanatory power and work well to explain fee differences. Model relationships are somewhat different from US counterparts (which is the context of most of the audit economics literature) and type of authority partially explains fee differences. OLS regression results indicate a Big 4 discount for local authority audits. Because of expected self-selection bias, the Heckman procedure is used to analyse the differences between private sector and public sector auditors, which indicates no selection bias for Big 4 firms, although bias is present for private firms as a whole and district auditors in some models. When fees are size-adjusted, results continue to show a Big 4 discount. The Big 4 discount was robust to other follow-up tests.

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External audit in the National Health Service in England and Wales: A study of an oversight body’s control of auditor remuneration

Cited by 15 publications

References 61 publications

Audit Fee Determinants in the Uk University Sector

Audit Fee Determinants in the Uk University Sector

An Empirical Investigation of Audit Pricing in the Public Sector: The Case of Greek LGOs

Investigating the audit fee structure of local authorities in England and Wales

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