Audit and Non-Audit Fees in Germany – The Impact of Audit Market Characteristics
Schmalenbach Business Review, Vol. 64, October 2012, pp. 281-307
27 Pages Posted: 1 Dec 2012
Date Written: 2012
We investigate the impact of three German audit market characteristics on audit and non-audit fees for the years 2005-2007. We find no relation between audit and non-audit fees, which suggests that audit and non-audit fee determination in Germany does not indicate any particular impairment of auditor independence. Further, we find that fee-cutting for initial audit engagements depends significantly on client size. We find no evidence of network-related fee reporting bias due to the ambiguous phrasing of German fee disclosure requirements, which implies that German fee data are internationally comparable.
Keywords: Auditor Change, Audit Fees, Auditor Independence, Audit Market Segment, Non-Audit Fees
JEL Classification: C30, L11, M42
Suggested Citation: Suggested Citation