Title

Effectiveness, efficiency, and fee premiums in audits led by industry specialist partners

Document Type

Article

Publication Date

9-1-2021

Subject Area

ARRAY(0x56094aea3e30)

Abstract

We use engagement-level data from a Big 4 firm to examine whether industry specialist partners are associated with audit effectiveness, audit efficiency and fee premiums. First, we examine the relation of partner industry specialisation to audit effectiveness ratings made by the firm’s internal quality inspectors and find a positive association. Next, in tests using the effective audits subsample, we find that audits led by industry specialist partners have lower audit hours (i.e., audits are more efficient), higher total audit fees and audit fees per hour, and that both fee measures increase as efficiency increases.

Publication Title

Accounting and Finance

Volume

61

Issue

3

First Page

4513

Last Page

4572

Digital Object Identifier (DOI)

10.1111/acfi.12739

ISSN

08105391

E-ISSN

1467629X

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