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Title: The influence of statutory audit fees on auditor changes in Malta : an analysis
Authors: Attard, Clarence
Keywords: Auditing -- Malta
Auditor and client
Issue Date: 2010
Abstract: This research analysed the extent to which audit fees charged affected the client's decision to change the statutory auditor, including establishing whether any patterns were evident in audit fee setting as well as ascertaining he degree of influence of such an expense on companies' decisions in the ensuing auditor selection process. An overview of pertinent literature is given, followed by the presentation and discussion of findings stemming from the 120 questionnaire responses, an analysis of published financial statements and a select sample of semi-structured interviews. Companies indicated that the audit fee is an extremely influential factor, particularly when changing auditors. The behavioural factor 'potentially good relationships with auditors' ranked highest. In selecting the auditor the audit fee was still considered as one of the most persuasive factors although the impression was given that it was not stated with the same conviction as that when changing auditors. As a result of the study, it is evident that a positive relationship exists between audit firms' size and audit fees charged, irrespective of client company size. This means that as larger audit firms are appointed the greater the audit fee charged and vice-versa. Branding tactics could possibly be present in practice and this requires further research to interpret the effect of such tactics on auditor selection processes. Moreover it is also important to point out that although the audit fee is an influential factor it is by no means the only one as untimely reporting, isagreements and appointing new audit staff on a yearly basis could easily rigger dt changes in auditors as well. Auditors stand to benefit from the conclusions and recommendations emanating from the study. Having the insight into the clients' perspective gives them the advantage. It was concluded that auditors should strive to focus on the udit package as a whole, addressing any issues clients may have as all factors could easily prompt a change in auditor.
Description: B. ACCTY. (HONS)
Appears in Collections:Dissertations - FacEma - 2010
Dissertations - FacEMAAcc - 2010

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