The market for audit services in the Netherlands

Abstract

Many studies have been conducted on the market for audit services in the Anglo-Saxon countries, but to date very few have focussed on continental Europe. This paper studies the audit services market in the Netherlands. The findings indicate similarities with respect to determining factors for the audit fee in the market for audit services in the Netherlands and countries previously studied. However, we have also found differences. Contrary to most of the other studies there is no fee premium for the Big Six as a group. Within the Big Six KMPG does earn a fee premium. With respect to intra-Big Six audit fee differences, it seems that some accounting firms do receive a fee premium in some countries. This could mean that the reputation of Big Six firms is typically country-related, rather than global. In addition to the existing literature we constructed a slightly different model for the financial services industry. None of the Big Six firms received a fee premium in this industry. This suggests that industry specialists in the financial services industry in the Netherlands do not earn a higher fee than non-specialists.