Effect of earnings quality and board independence on audit fees: The case of the Amman Stock Exchange

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Abstract

The impact of earnings management and audit independence on audit fees for businesses listed on the Amman Stock Exchange (ASE) is analyzed in-depth in this research. The institutional framework with severe earnings management and inadequate corporate governance tools served as the technique for this test. The findings, which are based on a sample of 50 companies during the years 2018–2022, demonstrate a favorable correlation between auditing fees and board independence. Additionally, the results show that for small-sized enterprises, audit fees, and earnings management have a favorable link. All of the findings point to a possible strong correlation between audit fees and earnings management as well as a relationship between higher demand for audit services and successful governance.

Keywords: Corporate Governance, Board of Directors, Audit, Earnings Management

Authors’ individual contributions: The Author is responsible for all the contributions to the paper according to CRediT (Contributor Roles Taxonomy) standards.

Declaration of conflicting interests: The Author declares that there is no conflict of interest.

JEL Classification: M41, M42, M48

Received: 21.03.2024
Accepted: 11.11.2024
Published online: 15.11.2024

How to cite this paper: Alrabba, H. M. (2024). Effect of earnings quality and board independence on audit fees: The case of the Amman Stock Exchange. Corporate Board: Role, Duties and Composition, 20(3), 85–90. https://doi.org/10.22495/cbv20i3art8