Audit Pricing in Private and Public Firms
نویسندگان
چکیده
Prior research has examined audit pricing for publicly held firms and provided some evidence of a Big 8 premium in pricing. We investigate audit pricing among private firms for the first time, and we compare audit pricing for private and public clients. We present evidence of a pricing premium, on average, for non-Big 5 auditors among large private clients after controlling for other effects. We argue that this finding is consistent with either, or both, diseconomies of scale to non-Big 5 auditors and product differentiation by smaller auditors.
منابع مشابه
Auditor Type and Earnings Quality in Tehran Stock Exchange
This study examines the association between auditor type (public versus private) and earnings quality as measured by the levels of discretionary accruals in Iran. This study hypothesize that there is no significant difference in discretionary accruals between public and private sector audit firms when there is low incentives for auditors to provide high-quality audits in Iran. Using a sample...
متن کاملSelf-Selection of Auditors and Audit Pricing in Private Firms
Prior research has examined audit pricing for publicly held firms and provided some evidence of a Big 8 premium in pricing. We investigate audit pricing among private firms, and provide evidence that private firms do not pay such a premium on average. The relatively greater degree of dispersion in auditor choice (between Big 5 and non-Big 5 auditors) in our large sample of privately held audit ...
متن کاملAudit Pricing in Private Firms
Prior research has examined audit pricing for publicly held firms and provided some evidence of a Big 8 premium in pricing. We investigate audit pricing among private firms for the first time, and we compare audit pricing for private and listed clients. The relatively great degree of dispersion in auditor choice (between Big 5 and non-Big 5 auditors) in our large sample of privately held audit ...
متن کاملThe Role of IRS Monitoring in Equity Pricing in Public Firms*
We analyze the importance of Internal Revenue Service (IRS) monitoring to equity pricing in U.S. public firms. Our strong, robust evidence from large samples implies that equity financing is cheaper when the threat of an IRS audit is higher, enabling investors to learn more about the firm. Reflecting its first-order economic impact, our coefficient estimates translate into the cost of equity ca...
متن کاملThe Type of Audit Firms Mergers in Iran: Formal or Real
Although increased mergers of audit firms in the Iranian audit market has attracted the attention of profession, regulatory bodies and researchers, little evidence is available on the motivations, barriers, processes, types, consequences and reasons for failures of audit firm’s mergers. Therefore, the present study is an attempt to open the black box of mergers of audit firms through in-depth i...
متن کامل