Competition and Big-Six Brand Name Reputation: Evidence from the Ontario Municipal Audit Market

Contemporary Accounting Research, Volume 18, Issue 1, pages 27–64, Spring 2001

University of Alberta School of Business Research Paper No. 2013-668

Posted: 2 Jul 2013

Multiple version iconThere are 3 versions of this paper

Date Written: January 6, 2000

Abstract

The 1991 amendment to the auditor appointment requirement of Section 86 of the Ontario Municipal Act removes certain barriers to entry into the Ontario municipal audit market. The purpose of this study is to provide evidence that the amendment has enhanced competition in this market. The results indicate that there is a general reduction in the real municipal audit fees, compared to the pre-amendment levels. However, notwithstanding the heightened competition, the Big-Six audit firms continue to command audit fee premiums over the non Big-Six audit firms. This suggests that Big-Six audit fee premiums possibly reflect brand name reputation rather than monopoly/oligopoly rents.

JEL Classification: M41, M49, H72

Suggested Citation

Bandyopadhyay, Sati P. and Kao, Jennifer L., Competition and Big-Six Brand Name Reputation: Evidence from the Ontario Municipal Audit Market (January 6, 2000). Contemporary Accounting Research, Volume 18, Issue 1, pages 27–64, Spring 2001, University of Alberta School of Business Research Paper No. 2013-668, Available at SSRN: https://ssrn.com/abstract=2288091

Sati P. Bandyopadhyay (Contact Author)

University of Waterloo ( email )

School of Accountancy
Waterloo, Ontario N2L 3G1
Canada
519-888-4567, ext. 2533 (Phone)
519-888-7562 (Fax)

Jennifer L. Kao

Independent

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