RESEARCHERS INVESTIGATE THE EFFECTS OF REGULATIONS,
MONOPOLY AND MONOPSONY ON AUDIT FEES
For the past 20 years, researchers have viewed the pricing of audit services as a function of supply and demand, much like other commodities or services traded in the marketplace. The audit-pricing model, originally proposed by Dan Simunic (1980), has been used to explore various aspects of auditing, such as the determinants of auditor changes, low-- balling of audit fees and implications of litigation against audit firms. Simunic and Stein provided a comprehensive summary of relevant research literature in these areas in an article titled "The auditing marketplace: exploring the …
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