- Journal menu
Determinants of audit fees in developing countries: Evidence from EgyptDownload This Article
This work is licensed under a Creative Commons Attribution 4.0 International License.
The aim of this study is to examine the perceived level of importance with respect to each pre-suggested determinant of audit fees in Egypt. In particular, the perceptions about auditor related attributes and client-related attributes according to external auditors and client’s representatives (auditee).
This study is based on the results of a survey conducted in Egypt. A questionnaire is designed to request the opinions of external auditors and client representatives about 28 audit fees determinant. The questionnaire was sent to 150 participants out of whom 63 responses are found usable. Data is analyzed using SPSS program and Mann-Whitney U test is performed.
The results reveal that the perception of all attributes is greater than 3, implying that all pre-suggested determinants are perceived as relatively important, important or highly important. The most three important attributes are: the good reputation of the audit firm, the fact of being one of the Big Four and the level of complexity of the auditee. Furthermore, the results show that there is no significant difference in perceptions of both group of participants regarding the importance of each audit fees determinant. It is also evident that auditor-related attributes are perceived to be of higher importance than client-related attributes.
This is the first study conducted in Egypt examining the determinants of audit fees, knowing that audit fees figures are neither available nor publically disclosed. Moreover, the study takes into account the Egyptian revolution which started in 2011 by adding two new determinants to the questionnaire; economic and political stability. This is in order to cope with the country’s situation and to check the extent of such environmental attributes’ effect on audit pricing.
Keywords: Audit Fees, External Auditor, Big Four, Determinants, Developing Countries, Egypt
Authors’ individual contribution: Conceptualization – W.E.; Methodology – M.G.; Validation – W.E. and M.G.; Formal Analysis – M.G.; Writing – Original Draft – M.G.; Writing – Review & Editing – W.E.; Visualization – W.E and M.G.; Supervision – W.E.; Project Administration – W.E.
JEL Classification: M42
Published online: 10.02.2020
How to cite this paper: ElGammal, W., & Gharzeddine, M. (2020). Determinants of audit fees in developing countries: Evidence from Egypt. Corporate Ownership & Control, 17(2), 142-156. http://doi.org/10.22495/cocv17i2art12