Audit Fee Stickiness and Audit Error

Document Type : Original Article

Authors

1 Associate Professor. Accounting and Financial Management Department, College of Farabi, University of Tehran, Qom, Iran.

2 MSc.of Accounting, Department of Accounting, College of Farabi, University of Tehran, Qom, Iran

3 Associate Professor, College of Farabi, University of Tehran, Qom, Iran

4 MSc.of Accounting, Department of Accounting, University of Tehran, Qom, Iran

Abstract

The purpose of this study is to investigate the relationship between audit fee stickiness and audit error. For this purpose, a sample of 274 companies listed on the Tehran Stock Exchange and OTC, for a period of 9 years 2012-2020 (1455 companies-year) and selected as an unbalanced panel have been selected. The hypotheses were also tested using multivariate regression. The results showed that with increasing adhesion in the upward correction as well as adhesion in the downward correction, the error of the second type of audit will not change significantly. However, less stickiness in the upward correction leads to a reduction in the conditional audit report and an increase in the quality of the audit. Less stickiness in downward correction is also positively associated with restatement of financial statements.However, less stickiness in the upward correction leads to a reduction in the conditional audit report and an increase in the quality of the audit. Less stickiness in downward correction is also positively associated with restatement of financial statements.

Keywords

Main Subjects


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