Signing auditors’ foreign experience and audit pricing

Hou, Fei; Jie, Liu; Pang, Tingyun; Xiong, Hao

doi:10.1016/j.econmod.2020.06.014

Cited by 15 publications

(1 citation statement)

References 54 publications

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“…Many factors affect how much an auditor charges for their services. These include KAP size (Yulianti et al, 2019;Tat & Murdiawati, 2020), auditor's practice experience (Ding, 2019), KAP reputation as measured in the Top 8 (Ding, 2019) and Big 4 (Duan et al, 2021), the number of industry expertise specifications (Ding, 2019), the large number of signatures in audit reports (Ding, 2019), the origin of accounting education from abroad (Hou et al, 2020), and membership in the Public Company Accounting Oversight Board (PCAOB) (Mohapatra et al, 2022). On the other hand, the determinants of audit fees are influenced by various external factors.…”

Section: External Audit Feementioning

confidence: 99%

Do others comprehensive income, profit, and equity attributable impact external audit fee?

Kusuma,

Luayyi

2024

JAI

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Research aims: Fair value accounting, fairness, and transparency are the basis for other comprehensive income (OCI), profit, and equity attributable. This research aims to analyze the impact of adding this information on external audit fees, considering that the content of financial reports becomes more extensive with a longer format.Design/Methodology/Approach: This study tested the influence of aggregate OCI, OCI to be reclassified, profit and equity attributable, and control variables (size, ROA, leverage, period, type of industry) on audit fees in 238 companies registered on IDX in all business sectors for the 2015-2021 period with data 1,666 observations.Research findings: Additional information on OCI, profits, and equity attributable has been proven to influence external audit fees because the inherent properties of OCI, such as the level of management subjectivity, sensitivity to externals, high volatility and exposure, as well as the complexity of the holding company reflecting the attribution value, could increase audit work and audit risk in assessing the fairness of OCI presentation and attribution.Theoretical contribution/ Originality: This study provides empirical evidence in Indonesia on how OCI disaggregation (reclassification), profit, and equity attributable affect external audit fees.Practitioner/Policy implication: For management, it can be an input in predicting the amount of audit fees, and for external auditors, it can be a consideration in determining the amount of audit fees by taking into account additional audit procedures due to OCI and profit attribution.Research limitation/Implication: The limitation of this research is that in measuring OCI reclassification, it only included the holding company, while OCI in subsidiaries and associations was not involved.

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