the impact of the aggressive reporting approach on the relationship between managers' competence and audit fees

Document Type : Research Paper

Authors

1 Associate Prof. in accounting, Faculty of Economics and Administrative Sciences, Lorestan University , Iran

2 assistant prof. in accounting, Jahrom University

3 MSc. in accounting, Faculty of Management and Economic, Lorestan University, Iran

Abstract

Abstract

Purpose: Capable managers have the possibility to plan and change the company's financial operations in order to achieve their goals. The purpose of this study is to investigate the impact of aggressive reporting approach on the relationship between managers' competence and audit fees.

Method: In order to investigate the subject of the study from regression of combined data, in the period of 2015 to 2022, the data of 86 companies listed in the Tehran Stock Exchange were collected and used to test the research hypotheses.

Results: The results of the research show that the managers' competence has a significant effect on audit fees. Also, the results of the research show that the aggressive reporting approach does not have a significant effect on audit fee. Finally, the results of the research showed that the aggressive reporting approach has a significant effect on the relationship between managers' competence and audit fees.

Conclusion: Based on the findings of the research, the managers' competence leads to an increase in audit risk, and in order to control this risk at an acceptable level, institutions are forced to increase the effort and volume of investigations, which shows itself in the form of an increase in audit fees. In other words, in order to control opportunistic reporting and control the detection risk, auditors increase the requested audit fee.

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Journal of Accounting Advances
Volume 16, Issue 2
February 2024
Pages 155-182

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History

  • Receive Date: 03 October 2024
  • Revise Date: 21 March 2025
  • Accept Date: 13 April 2025

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