Does gender diversity influence the relationship between financial reporting readability and audit fees? Evidence from an emerging market

Purpose This study aims to examine the relationship between financial report readability (FRR) and audit fees (AF) by bringing evidence from an emerging market. In addition, it reveals the moderating influence of board gender diversity (BGD) on such a relationship. Design/methodology/approach The authors analyzed data collected manually from the financial reports of Egyptian nonfinancial firms listed on the Egyptian Stock Exchange between 2016 and 2021 using Pooled OLS, Random effects, Fixed effects regressions. Findings The authors found a negative relationship between FRR and AF. Likewise, BGD is found to be negatively related to AF, and positively associated with FRR. In addition, the authors found that the negative association between FRR and AF is more pronounced in the case of BGD. Originality/value This paper contributes to previous research on the auditors’ reactions to the clarity of financial reporting as well as the role of board gender concerning the FRR-audit pricing relationship in emerging markets.