This analysis reveals significant associations of audit firm size with audit fees in insurance firms, suggesting implications for corporate audit standards.
Key Points
Audit firm size significantly determines audit fees, emphasizing the importance of choosing larger firms for quality.
The study found that client firm size, complexity, and profitability did not significantly impact audit fees.
Panel data from ten insurance companies over five years was analyzed using the Swamy Arora regression technique.
These findings highlight the need for fair negotiation of audit fees within the insurance industry to promote audit quality.