Audit Credibility and the Audit Fees: A Theory and an Experimental Investigation

Tatsuhiko Kato
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Tatsuhiko Kato: Meiji University

A chapter in Developments on Experimental Economics, 2007, pp 227-232 from Springer

Abstract: Abstract The audit fees have been recently at issue in Japan. They are too low compared with other developed countries and bring Japanese audit firms to financial difficulties. Despite of concerns, most public companies in Japan give the cold shoulder, since they want to spare any cost other than operating ones. Some people fear that this may compromise the credibility of auditing in Japan. The aim of this paper is to examine how the different audit fees influence the behavior of investors and managers.

Keywords: Audit Firm; Strict Liability; Audit Report; Incentive Compatibility Constraint; Account Review (search for similar items in EconPapers)
Date: 2007
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Persistent link: https://EconPapers.repec.org/RePEc:spr:lnechp:978-3-540-68660-6_24

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DOI: 10.1007/978-3-540-68660-6_24

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