Journal article
Auditee Religiosity, External Monitoring, and the Pricing of Audit Services
Journal of Business Ethics, Vol.152(2), pp.409-436
2018
Abstract
Based on prior studies which show that firms headquartered in high religiosity counties exhibit high level of business ethics, this study examines whether these firms are associated with low audit risk, and therefore low audit fees. In investigating this relationship, we draw a distinction between intrinsic and extrinsic religiosity of auditees. Using a sample of 25,872 U.S. observations from 2003 to 2012, we find that intrinsic religiosity of the auditees is associated with low audit fees after controlling for auditee extrinsic religiosity, social capital, firm-specific characteristics, and county-specific characteristics. Furthermore, we find that external monitoring (institutional ownership and leverage) weakens the negative relationship between auditee intrinsic religiosity and audit fees. Finally, we conclude that the effect of auditor religiosity on audit fees is a regional effect that may affect the relationship between audit fees and auditee intrinsic religiosity.
Details
- Title
- Auditee Religiosity, External Monitoring, and the Pricing of Audit Services
- Authors
- Ferdinand A. Gul (Author) - Deakin UniversityAnthony C. Ng (Corresponding Author) - Monash Univ, 900 Dandenong Rd, Caulfield, Vic 3145, Australia
- Publication details
- Journal of Business Ethics, Vol.152(2), pp.409-436
- Publisher
- Springer Netherlands
- DOI
- 10.1007/s10551-016-3284-6
- ISSN
- 1573-0697
- Organisation Unit
- University of the Sunshine Coast, Queensland; School of Business and Creative Industries
- Language
- English
- Record Identifier
- 99679191402621
- Output Type
- Journal article
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