The Influence of Nature of Property Right and Auditor Industry Specialization on Audit Fees

This study examines the effect of nature of property right and auditor industry specialization on audit fees based on the samples of A-share listed companies from 2009 to 2015. Our results indicate that industry specialists charge higher fees when auditing state-owned enterprises, which is different from the results of examination of relationship between nature of property right and audit fees separately. Moreover, we discover that industry specialists charge lower fees when auditing state-owned enterprises with homogenous operations, and this is because auditors develop economies of scale through the transfer of audit processes across clients in homogenous industries.