The determinants of audit pricing in the Alternative Investment Market (AIM)
The determinants of audit pricing in the Alternative Investment Market (AIM)
The Alternative Investment Market (AIM) was established in 1995 by the London Stock Exchange as a market for small and medium-sized companies to raise new capital, to allow their shares to be traded widely and to allow owner/managers to liquidate some of their shareholdings. The more relaxed admission rules and reduced regulation has proved attractive with in excess of 1,000 companies currently listed on AIM making it a very significant part of the UK quoted company sector. Despite AIM’s growing importance relatively little academic attention has focused on AIM companies. This study seeks to address this gap by investigating the determinants of audit fees for 402 companies listed on AIM. Our principal findings are that audit fees for AIM companies are positively influenced by auditee size, a number of complexity and audit risk variables, auditor location, the length of time between the financial year-end and the signing of the audit report and the joint provision of non-audit services. We also find that audit fees paid by AIM companies are negatively influenced by firm performance. Finally, we find that auditor size is a key determinant of audit fees on AIM with big 4 auditors charging a fee premium and smaller auditors charging significantly lower fees.
Xue, Bai
975f8125-7cf4-42b2-87fe-e5cb5a4da2e1
O'Sullivan, Noel
2b3991cb-0489-4110-8763-8e716a3fb702
Xue, Bai
975f8125-7cf4-42b2-87fe-e5cb5a4da2e1
O'Sullivan, Noel
2b3991cb-0489-4110-8763-8e716a3fb702
Xue, Bai and O'Sullivan, Noel
(2013)
The determinants of audit pricing in the Alternative Investment Market (AIM).
International Conference: 21st Century Corporate Governance: Fit for purpose?, Henley on Thames, United Kingdom.
25 - 26 Sep 2013.
Record type:
Conference or Workshop Item
(Paper)
Abstract
The Alternative Investment Market (AIM) was established in 1995 by the London Stock Exchange as a market for small and medium-sized companies to raise new capital, to allow their shares to be traded widely and to allow owner/managers to liquidate some of their shareholdings. The more relaxed admission rules and reduced regulation has proved attractive with in excess of 1,000 companies currently listed on AIM making it a very significant part of the UK quoted company sector. Despite AIM’s growing importance relatively little academic attention has focused on AIM companies. This study seeks to address this gap by investigating the determinants of audit fees for 402 companies listed on AIM. Our principal findings are that audit fees for AIM companies are positively influenced by auditee size, a number of complexity and audit risk variables, auditor location, the length of time between the financial year-end and the signing of the audit report and the joint provision of non-audit services. We also find that audit fees paid by AIM companies are negatively influenced by firm performance. Finally, we find that auditor size is a key determinant of audit fees on AIM with big 4 auditors charging a fee premium and smaller auditors charging significantly lower fees.
Text
Abstract of Henley Conference Paper - Xue and O'Sullivan.pdf
- Other
More information
e-pub ahead of print date: September 2013
Venue - Dates:
International Conference: 21st Century Corporate Governance: Fit for purpose?, Henley on Thames, United Kingdom, 2013-09-25 - 2013-09-26
Organisations:
Southampton Business School
Identifiers
Local EPrints ID: 405685
URI: http://eprints.soton.ac.uk/id/eprint/405685
PURE UUID: 58de3a86-1b8e-45f6-a8ac-a071c0841c33
Catalogue record
Date deposited: 10 Feb 2017 15:13
Last modified: 20 Apr 2024 01:54
Export record
Contributors
Author:
Bai Xue
Author:
Noel O'Sullivan
Download statistics
Downloads from ePrints over the past year. Other digital versions may also be available to download e.g. from the publisher's website.
View more statistics