Importance of Country Factors for Global Differences in Audit Pricing - New Empirical Evidence

International Journal of Auditing, forthcoming

52 Pages Posted: 17 Dec 2019 Last revised: 5 Aug 2021

See all articles by Brigitte Eierle

Brigitte Eierle

University of Bamberg

Sven Hartlieb

University of Bamberg

David Hay

University of Auckland Business School

Lasse Niemi

Aalto University - School of Business

Hannu Ojala

Tampere University; Aalto University - School of Business

Date Written: February 23, 2021

Abstract

In recent years, we have seen an increasing interest in the country-level differences in audit environments as they might have a pervasive impact on how financial statement audits are conducted around the world. We contribute to this emerging stream of research in three important ways. Firstly, we provide a comprehensive synthesis of country-level determinants that have been employed in previous multinational auditing research. Secondly, we document economically significant differences in the overall levels of audit pricing between countries, which we interpret as a compelling evidence that audits are conducted differently in different countries. Lastly, we explain these pricing differences between countries with a large set of country variables identified in our synthesis of prior multinational auditing research. We find not only that economic and regulatory characteristics explain the most of the differences in audit pricing between countries but also that differences attributable to sociological characteristics seem to be important in the conduct of audits. As auditing as a service and profession has become increasingly globalized, our study should be of
interest to a wide range of readers including researchers, practitioners and regulators.

Keywords: audit fees, auditing, country characteristics, cross-country research, international differences

JEL Classification: M40, M42

Suggested Citation

Eierle, Brigitte and Hartlieb, Sven and Hay, David and Niemi, Lasse and Ojala, Hannu, Importance of Country Factors for Global Differences in Audit Pricing - New Empirical Evidence (February 23, 2021). International Journal of Auditing, forthcoming, Available at SSRN: https://ssrn.com/abstract=3494511 or http://dx.doi.org/10.2139/ssrn.3494511

Brigitte Eierle

University of Bamberg ( email )

Feldkirchenstra├če 21
Bamberg, 96052
Germany
00499518632545 (Phone)

HOME PAGE: http://www.uni-bamberg.de/bwl-irwp/home/

Sven Hartlieb (Contact Author)

University of Bamberg ( email )

Kirschaeckerstrasse 39
Bamberg, 96045
Germany

David Hay

University of Auckland Business School ( email )

12 Grafton Rd
Private Bag 92019
Auckland, 1010
New Zealand

Lasse Niemi

Aalto University - School of Business ( email )

P.O. Box 21210
Helsinki, 00101
Finland

Hannu Ojala

Tampere University ( email )

Tampere, FIN-33101
Finland

Aalto University - School of Business ( email )

P.O. Box 21210
Helsinki, 00101
Finland

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