Analysis of Factors Influencing Corporate Audit Fee Determination Considering Price Discrimination Between Private and Public Sector Clients

Document Type : Original Article

Authors
behrouz janatifar 1
Artin Beytari 2
Mahmoud Hematfar 3
Mohammadreza Ghorbanian 4
1 PhD Student, Department of Accounting, Science and Research Branch, Islamic Azad University, Tehran, Iran.
2 Assistant Professor, Department of Accounting, Shahr-e-Qods Branch, Islamic Azad University, Tehran, Iran.
3 Associate Professor, Department of Accounting, Broojerd Branch, Islamic Azad University, Broojerd, Iran
4 Assistant Professor, Department of management, Shahr-e-Qods Branch, Islamic Azad University, Tehran, Iran.
10.22034/jmaak.2026.24085
Abstract
Abstract
The determination of audit fees for services provided to private and public sector clients is a key topic in contemporary audit literature. Some studies highlight differences in sales volume and contract size between companies operating in the public and private sectors, while others emphasize the characteristics of audit firms as primary determinants of audit costs. This study aims to analyze the factors influencing audit fee determination by examining the role of audit firm attributes, with a particular focus on contract type. Data from 105 publicly traded companies on the Tehran Stock Exchange for the period 2017–2022 were collected, and hypotheses were tested using a static panel data analysis approach. The results indicate a significant difference in audit fees between public and private sector contracts. Furthermore, attributes such as auditor expertise and audit firm size were found to reduce audit fees in public sector contracts, whereas auditor change led to an increase in audit fees in these contracts. The findings of this research can contribute to the enhancement of audit fee determination policies and the improvement of financial transparency.
Keywords: Audit fee, public sector contract, private sector contract, auditor expertise, auditor change, audit firm size.
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