Title: Individual auditor competences and the pricing of audit services

Authors: Irina Alexeyeva

Addresses: Department of Accounting and Finance, Umeå School of Business, Economics and Statistics, Umeå University, Biblioteksgränd 6, 901 87 Umeå, Sweden

Abstract: This study examines whether partner special competencies, such as industry expertise, public company expertise and client-specific expertise, are associated with a fee premium. It further investigates whether the association between partner competencies and audit fees is dependent on gender. Using a sample of 225 public Swedish companies audited from 2006-2015 (1461 firm-years) by 182 (33 females and 149 males) partners affiliated to Big 4 audit firms, partner industry expertise and client-specific expertise are found to be associated with higher audit fees. A further finding is that partners with special competencies are predominantly men. However, male public company specialists receive significantly lower audit fees than their female counterparts. Taken together, the results indicate that partner special competence is valued by clients.

Keywords: audit fees; industry expertise; public company expertise; tenure; engagement partner; gender.

DOI: 10.1504/IJAAPE.2019.099147

International Journal of Accounting, Auditing and Performance Evaluation, 2019 Vol.15 No.2, pp.191 - 218

Received: 09 Jan 2018
Accepted: 28 Sep 2018
Published online: 16 Apr 2019 *

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