Audit Fees, Nonaudit Fees, and Auditor Quality: An Analysis from the Indian Perspective

15 Pages Posted: 13 Mar 2012 Last revised: 10 Apr 2014

See all articles by Renu Desai

Renu Desai

Florida International University

Vikram Desai

Nova Southeastern University

Meghna Singhvi

Loyola Marymount University - Department of Accounting

Vishal Munsif

California State University, San Bernardino

Date Written: March 12, 2012

Abstract

The purpose of this paper is to extend the work done by Simon et al. (1995) in two ways: (1) To determine whether there is a Big Four audit fee premium in the audit market in India; and (2) To determine whether there is significant association between audit fees and nonaudit fees in India. This study has important implications for audit markets in developing countries. The results are consistent with our expectations and prior research. Consistent with prior research, we find a positive association between nonaudit services and audit services due to possible knowledge spillovers from one to the other. Local Indian audit firms might want to think of pricing strategies to either maintain or increase their market share in the audit market. They might also consider increasing the scope of nonaudit services offered to their present clients to take advantage of the knowledge spillover effect; evidenced in the present study.

Keywords: audit fees, nonaudit fees, auditor quality, India

JEL Classification: K22, L5, M4, O53

Suggested Citation

Desai, Renu and Desai, Vikram and Singhvi, Meghna and Munsif, Vishal, Audit Fees, Nonaudit Fees, and Auditor Quality: An Analysis from the Indian Perspective (March 12, 2012). Journal of Accounting, Ethics and Public Policy, Vol. 13, No. 2, pp. 151-165, 2012, Available at SSRN: https://ssrn.com/abstract=2020316

Renu Desai (Contact Author)

Florida International University ( email )

University Park
11200 SW 8th Street
Miami, FL 33199
United States

Vikram Desai

Nova Southeastern University ( email )

Meghna Singhvi

Loyola Marymount University - Department of Accounting ( email )

One LMU Dr.
Hilton 317
Los Angeles, CA 90045
United States

Vishal Munsif

California State University, San Bernardino ( email )

5500 University Parkway
San Bernardino, CA 92407
United States

Do you have a job opening that you would like to promote on SSRN?

Paper statistics

Downloads
449
Abstract Views
2,321
rank
75,165
PlumX Metrics