Board Characteristics, Audit Committee Characteristics, and Audit Fees: Evidence from Jordan

Hassan Yahia Kikhia

doi:10.5539/ibr.v7n12p98

Abstract

The current study aims to examine the influence of characteristics of board of director (board independence, expertise, and size) and characteristics of audit committee (independence, expertise, and meeting frequency) on audit fees in Jordan, by using the sample of 112 non-financial companies which listed on Amman Stock Exchange (ASE) that meet the selection criteria and have the relevant financial data obtainable from 2010 until 2012 (336 observation). The results reveal significant and positive relationship between external audit fees and board independence, expertise and size, and these findings support ''demand side

Highlights

In the past few years increasing at attention has been given to the auditing services providing by the accounting profession
The ordinary least squares (OLS) regression model is used as the method of data analysis
It can be concluded that greatest part of the Jordanian listed firms follow to the guidelines of corporate governance with respect to the financial expertise which indicated that the member of the board of directors should be qualified and enjoys adequate knowledge and experience in finance and administrative affairs

Summary

Introduction

In the past few years increasing at attention has been given to the auditing services providing by the accounting profession. One area of concern has been the rapidly rising costs of the external audit. With this rapid rise in audit fees some researchers are openly questioning the value for money of an audit. Whereas at the same time, spreading to a consideration of other research questions applying the generally accepted auditing fee model. According to previous studies, the determinants of audit fees can be generally classified into three major groups: Client characteristics, auditor characteristics and corporate governance characteristics Numerous studies have been managed on both the auditee and auditors characteristics and their relationship with audit fees, but few studies have addressed the issue of the relationship between corporate governance and audit fees

Methods

Results

Conclusion