THE IMPACT OF NON-AUDIT SERVICE FEE DISCLOSURE REQUIREMENTS ON AUDIT FEE AND NON-AUDIT SERVICE FEE IN THE UNITED KINGDOM: AN EMPIRICAL ANALYSIS

✍ Scribed by Govind S Iyer; Venkataraman M Iyer; Birendra K Mishra

• Publisher: Elsevier Science
• Year: 2003
• Tongue: English
• Weight: 69 KB
• Volume: 20
• Category: Article
• ISSN: 0882-6110
• DOI: 10.1016/s0882-6110(03)20006-7

✦ Synopsis

Since the early 1990s the accounting profession has been in the midst of a debate about the deleterious effects of public accounting firms providing non-audit services to their audit clients. In response to increasing demand for regulation curbing the growth of non-audit services provided by auditing firms and to provide greater transparency of the auditor-client relationship, the SEC adopted rule amendments regarding auditor independence. One such rule requires public companies to disclose among other things, fees paid to auditors for rendering non-audit services. In the United Kingdom, the Companies Act 1989 (Disclosure of Remuneration for Non-Audit Work) 1991 Regulations required disclosure of non-audit service fees paid to the incumbent auditor for years ending on or after September 30th, 1992. The purpose of this study is to explore the effect of such disclosure requirement on audit fee and non-audit service fee.