The purpose of this study is to explore the relationship between previous audit adjustments, audit fees, audit report delay and audit quality.
This research examines 103 companies listed on the Tehran Stock Exchange from 2013 to 2022 to test the hypotheses.
The results of this study reveal a direct and significant relationship between previous audit adjustments, the average of the past three years, audit fees, audit report delay and audit quality. Specifically, an increase in previous audit adjustments signals higher audit risk, leading to higher audit fees and longer delays in the audit report. Simultaneously, audit quality improves because of enhanced auditor oversight and better accruals quality.
To the best of the authors’ knowledge, this study is the first to investigate the impact of previous audit adjustments on audit fees, audit report delay and audit quality, shedding light on how these adjustments influence auditor pricing and performance.
