Do Auditors Adjust Audit Fees in Accordance with Audit Risks?

• In Event: Auditing I

Abstract

Prior studies report relationships between audit effort and various risk factors. This study provide empirical evidence on the validity of the audit risk model by investigating whether auditors adjust audit effort in accordance with changes in other risk factors in the audit risk model. To the extent that audit fees, internal control deficiency and firms’ complexity are proxies for audit effort, control risk, and inherent risk respectively. The results indicate that auditors alter detection risk level in accordance with level of control risk and inherent risk to maintain acceptable audit risk level.

Author

• Nontawan Yomchinda, Thammasat University