The Pricing of Industry Specialisation by Auditors in New Zealand

Show simple item record Hay, David en Jeter, D en 2012-05-13T21:56:02Z en 2011 en
dc.identifier.citation Accounting and Business Research 41(2):171-195 2011 en
dc.identifier.issn 0001-4788 en
dc.identifier.uri en
dc.description.abstract A number of research papers present evidence of fee premiums paid to specialist auditors. In this paper, we explore for listed and unlisted New Zealand firms not only the question of whether such premiums exist, but perhaps more importantly why they exist. We find evidence of fee premiums for auditor specialisation defined at the city level but not at the national level. We extend testing to examine the issue of self-selection of auditors by clients; we examine several different industry classification schemes and a number of different specialisation measures; and we consider the issue of portfolio specialists. We find from these additional tests that self-selection does not account for the existence of specialisation premiums; various alternative classification schemes all result in premiums at the city level; and portfolio specialists also earn fee premiums when portfolio specialisation is measured at the city level. We find that these specialist premiums apply most consistently to larger client firms and to low-risk firms. We consider various explanations and conclude that this result is consistent with non-specialist auditors providing discounts to attract desirable clients. Desirable clients – those that are large or low risk – are not able to negotiate fees as successfully with auditors who have differentiated themselves via industry specialisation. en
dc.publisher Taylor & Francis (Routledge) en
dc.relation.ispartofseries Accounting and Business Research en
dc.rights Items in ResearchSpace are protected by copyright, with all rights reserved, unless otherwise indicated. Previously published items are made available in accordance with the copyright policy of the publisher. Details obtained from en
dc.rights.uri en
dc.title The Pricing of Industry Specialisation by Auditors in New Zealand en
dc.type Journal Article en
dc.identifier.doi 10.1080/00014788.2011.550744 en
pubs.issue 2 en
pubs.begin-page 171 en
pubs.volume 41 en
dc.rights.holder Copyright: Taylor & Francis (Routledge) en
pubs.end-page 195 en
dc.rights.accessrights en
pubs.subtype Article en
pubs.elements-id 177485 en Business and Economics en Accounting and Finance en
pubs.record-created-at-source-date 2010-11-19 en

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