Previous Article
RESEARCH NOTES
Partner Familiarity and Audit Fees: Evidence from Former Andersen Clients
Thomas E. Vermeer, Dasaratha V. Rama, K. Raghunandan
SUMMARY: In this study we examine the audit fees for two types of former Andersen clients: those that followed their former Andersen partner to a new audit firm and those that did not. Using data from Public Accounting Report on the acquisition of Andersen offices, we find that about half of the Andersen clients in our sample followed the former partner to a new audit firm and that the “follower” clients paid, on average, about 16 percent lower audit fees than other clients. The results thus provide empirical evidence about the impact of partner-client familiarity on audit fees. The findings also suggest that studies examining former Andersen clients may need to distinguish between the “follower” clients and other clients.
Cited by
Paul Tanyi, K. Raghunandan, Abhijit Barua. (2010) Audit Report Lags after Voluntary and Involuntary Auditor Changes. Accounting Horizons 24:4, 671-688
Online publication date: 1-Dec-2010.
Abstract | Enhanced Abstract | PDF (142 KB)
Online publication date: 1-Dec-2010.
Abstract | Enhanced Abstract | PDF (142 KB)
Charles J. P. Chen, Xijia Su, Xi Wu. (2009) Forced Audit Firm Change, Continued Partner‐Client Relationship, and Financial Reporting Quality. AUDITING: A Journal of Practice & Theory 28:2, 227-246
Online publication date: 1-Nov-2009.
Abstract | Enhanced Abstract | PDF (240 KB)
Online publication date: 1-Nov-2009.
Abstract | Enhanced Abstract | PDF (240 KB)
