Audit pricing puzzle: Do audit firm industry specialization and audit report lag matter?
AbstractThis study examines whether audit firm industry specialization and audit report time lag (ARL) matter in the audit fees puzzle. Specifically, we examine the moderating effect of audit time lag on the audit firm industry specialization and audit fees nexus. We use dataset from 100 quoted and...
| Main Authors: | , , |
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| Format: | Article |
| Language: | English |
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Taylor & Francis Group
2023-12-01
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| Series: | Cogent Business & Management |
| Subjects: | |
| Online Access: | https://www.tandfonline.com/doi/10.1080/23311975.2023.2172013 |
| _version_ | 1827891091645399040 |
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| author | Ebenezer Nana Yeboah Bismark Addai Kingsley Opoku Appiah |
| author_facet | Ebenezer Nana Yeboah Bismark Addai Kingsley Opoku Appiah |
| author_sort | Ebenezer Nana Yeboah |
| collection | DOAJ |
| description | AbstractThis study examines whether audit firm industry specialization and audit report time lag (ARL) matter in the audit fees puzzle. Specifically, we examine the moderating effect of audit time lag on the audit firm industry specialization and audit fees nexus. We use dataset from 100 quoted and unquoted Ghanaian firms from 2008 to 2018. We find that audit firm industry specialization exhibits a significant positive impact on audit fees and a significant negative effect on ARL. The results of the interaction between audit firm industry specialization and ARL also display a negative association with audit fee, signifying that specialization significantly reduces audit fee premium paid provided these experts produce the financial report in a short time. Further analysis on large and small companies, state-owned and private companies, weak and strong internal controls also indicate the significance of audit firm industry specialization and reporting time lag in explaining audit pricing puzzle. The novelty aspect of this study is the analysis of the moderation effect of audit timeliness on the audit firm industry specialization and audit fees nexus in the context of a lax enforcement of Generally Accepted Accounting Principles environment. |
| first_indexed | 2024-03-12T21:20:58Z |
| format | Article |
| id | doaj.art-7bbd79cbafa94ce8907ab5b04566f5f0 |
| institution | Directory Open Access Journal |
| issn | 2331-1975 |
| language | English |
| last_indexed | 2024-03-12T21:20:58Z |
| publishDate | 2023-12-01 |
| publisher | Taylor & Francis Group |
| record_format | Article |
| series | Cogent Business & Management |
| spelling | doaj.art-7bbd79cbafa94ce8907ab5b04566f5f02023-07-28T20:55:15ZengTaylor & Francis GroupCogent Business & Management2331-19752023-12-0110110.1080/23311975.2023.2172013Audit pricing puzzle: Do audit firm industry specialization and audit report lag matter?Ebenezer Nana Yeboah0Bismark Addai1Kingsley Opoku Appiah2Export Oriented Management, Hainan Tropical Ocean University, Sanya, P.R. ChinaSchool of Economics and Management, Changsha University of Science and Technology, Changsha, P.R. ChinaSchool of Business, Kwame Nkrumah University of Science and Technology, Kumasi, GhanaAbstractThis study examines whether audit firm industry specialization and audit report time lag (ARL) matter in the audit fees puzzle. Specifically, we examine the moderating effect of audit time lag on the audit firm industry specialization and audit fees nexus. We use dataset from 100 quoted and unquoted Ghanaian firms from 2008 to 2018. We find that audit firm industry specialization exhibits a significant positive impact on audit fees and a significant negative effect on ARL. The results of the interaction between audit firm industry specialization and ARL also display a negative association with audit fee, signifying that specialization significantly reduces audit fee premium paid provided these experts produce the financial report in a short time. Further analysis on large and small companies, state-owned and private companies, weak and strong internal controls also indicate the significance of audit firm industry specialization and reporting time lag in explaining audit pricing puzzle. The novelty aspect of this study is the analysis of the moderation effect of audit timeliness on the audit firm industry specialization and audit fees nexus in the context of a lax enforcement of Generally Accepted Accounting Principles environment.https://www.tandfonline.com/doi/10.1080/23311975.2023.2172013audit market concentrationaudit feesaudit report time lagindustry knowledgeindustry experience |
| spellingShingle | Ebenezer Nana Yeboah Bismark Addai Kingsley Opoku Appiah Audit pricing puzzle: Do audit firm industry specialization and audit report lag matter? Cogent Business & Management audit market concentration audit fees audit report time lag industry knowledge industry experience |
| title | Audit pricing puzzle: Do audit firm industry specialization and audit report lag matter? |
| title_full | Audit pricing puzzle: Do audit firm industry specialization and audit report lag matter? |
| title_fullStr | Audit pricing puzzle: Do audit firm industry specialization and audit report lag matter? |
| title_full_unstemmed | Audit pricing puzzle: Do audit firm industry specialization and audit report lag matter? |
| title_short | Audit pricing puzzle: Do audit firm industry specialization and audit report lag matter? |
| title_sort | audit pricing puzzle do audit firm industry specialization and audit report lag matter |
| topic | audit market concentration audit fees audit report time lag industry knowledge industry experience |
| url | https://www.tandfonline.com/doi/10.1080/23311975.2023.2172013 |
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