英文摘要 |
Before 2009, the Taiwanese disclosure regulations with regard to audit fees required listed companies to disclose their auditor fees if they met any of the following criteria: (1) pay abnormally high nonaudit fees to their auditors; (2) change their audit firms along with a decrease in audit fees; (3) firms’ audit fees decrease dramatically. This implies that regulators in Taiwan were more concerned with decreases in audit fees than increases. This study uses listed companies during the period 2002 to 2011 to explore the determinants of audit fee decreases from the perspective of corporate governance in Taiwan. First, the empirical results are consistent with the supply-side perspective, which claims that both the proportion of independent directors on the board and the degree of foreign institutional ownership are significantly and positively associated with the probability of audit fees decreasing. Moreover, Big 4 audit firms are more likely to use the audit-quality differentiation strategy to resist pressure from their clients who want lower audit fees. The probability of reducing audit fees is higher when the company changes audit firm, implying that the practice of low-balling occurs in this context. Finally, the empirical results are robust after taking into account the sample of financially distressed companies, self-selection of auditors, the measurement of core agency problems, credit risk, accounting risk, global financial crisis, outliers, and partner-level tenure. |