Internal Auditing Outsourcing, Nonaudit Services and Audit Fees
This study examines the relationship between outsourced internal audits, nonaudit services and audit fees. We use Malaysian data to show that client firms that outsource their internal auditing function (IAF) are associated with lower external audit fees than those with in-house IAF. Moreover, th...
| Main Authors: | , , , |
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| Format: | Journal Article |
| Published: |
American Accounting Association
2021
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| Subjects: | |
| Online Access: | http://hdl.handle.net/20.500.11937/82350 |
| _version_ | 1848764492644614144 |
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| author | Abdul Wahab, Effiezal Gist, Willie E Gul, Ferdinand A Mat Zain, Mazlina |
| author_facet | Abdul Wahab, Effiezal Gist, Willie E Gul, Ferdinand A Mat Zain, Mazlina |
| author_sort | Abdul Wahab, Effiezal |
| building | Curtin Institutional Repository |
| collection | Online Access |
| description | This study examines the relationship between outsourced internal audits, nonaudit services
and audit fees. We use Malaysian data to show that client firms that outsource their internal
auditing function (IAF) are associated with lower external audit fees than those with in-house
IAF. Moreover, this negative relationship is significantly stronger for firms that purchase
greater amounts of nonaudit services (NAS) from the auditor. The results suggest that an
auditor who provides NAS to a client and thus earns additional overall revenue is willing to
accept lower audit fees provided a high audit quality can be achieved through reliance on
outsourced IAFs. |
| first_indexed | 2025-11-14T11:20:13Z |
| format | Journal Article |
| id | curtin-20.500.11937-82350 |
| institution | Curtin University Malaysia |
| institution_category | Local University |
| last_indexed | 2025-11-14T11:20:13Z |
| publishDate | 2021 |
| publisher | American Accounting Association |
| recordtype | eprints |
| repository_type | Digital Repository |
| spelling | curtin-20.500.11937-823502021-03-02T03:14:32Z Internal Auditing Outsourcing, Nonaudit Services and Audit Fees Abdul Wahab, Effiezal Gist, Willie E Gul, Ferdinand A Mat Zain, Mazlina 1501 - Accounting, Auditing and Accountability This study examines the relationship between outsourced internal audits, nonaudit services and audit fees. We use Malaysian data to show that client firms that outsource their internal auditing function (IAF) are associated with lower external audit fees than those with in-house IAF. Moreover, this negative relationship is significantly stronger for firms that purchase greater amounts of nonaudit services (NAS) from the auditor. The results suggest that an auditor who provides NAS to a client and thus earns additional overall revenue is willing to accept lower audit fees provided a high audit quality can be achieved through reliance on outsourced IAFs. 2021 Journal Article http://hdl.handle.net/20.500.11937/82350 10.2308/AJPT-17-044 American Accounting Association fulltext |
| spellingShingle | 1501 - Accounting, Auditing and Accountability Abdul Wahab, Effiezal Gist, Willie E Gul, Ferdinand A Mat Zain, Mazlina Internal Auditing Outsourcing, Nonaudit Services and Audit Fees |
| title | Internal Auditing Outsourcing, Nonaudit Services and Audit Fees |
| title_full | Internal Auditing Outsourcing, Nonaudit Services and Audit Fees |
| title_fullStr | Internal Auditing Outsourcing, Nonaudit Services and Audit Fees |
| title_full_unstemmed | Internal Auditing Outsourcing, Nonaudit Services and Audit Fees |
| title_short | Internal Auditing Outsourcing, Nonaudit Services and Audit Fees |
| title_sort | internal auditing outsourcing, nonaudit services and audit fees |
| topic | 1501 - Accounting, Auditing and Accountability |
| url | http://hdl.handle.net/20.500.11937/82350 |