The influence of profit, revenues and debt on audit prices in large companies: Insights from Slovenia

Tatjana Horvat; Urska Travner; Hazbo Skoko; Vito Bobek

doi:10.1080/1331677X.2021.1934057

The influence of profit, revenues and debt on audit prices in large companies: Insights from Slovenia

Tatjana Horvat, Urska Travner, Hazbo Skoko, Vito Bobek

Business

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Abstract

The paper presents the study of the influence of chosen factors on the price of the mandatory audits for large companies in Slovenia, in the period from 2010 to 2014. The final sample consists of 177 large companies in Slovenia for each year or all together 885 entities. The main observed factors have been taken from financial statements, these are operating revenues, profit (loss) and indebtedness of the company. Three hypotheses were tested by regression analysis, ANOVA and Independent-Samples Median Test. The average price for mandatory audits of a large company in the observed period amounted to EUR 21,182. In research we found out that statistically significant factors of the statutory price of audit are just operating revenues of the audited entity. The results of this research can offer large companies and auditing companies incentive for awareness and dialogue between them about the quality, professionalism and responsibility of work of certified auditors.

Original language	English
Pages (from-to)	1-21
Number of pages	21
Journal	Economic Research-Ekonomska Istrazivanja
DOIs	https://doi.org/10.1080/1331677X.2021.1934057
Publication status	E-pub ahead of print - 18 Jun 2021

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10.1080/1331677X.2021.1934057

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T1 - The influence of profit, revenues and debt on audit prices in large companies

T2 - Insights from Slovenia

AU - Horvat, Tatjana

AU - Travner, Urska

AU - Skoko, Hazbo

AU - Bobek, Vito

PY - 2021/6/18

Y1 - 2021/6/18

N2 - The paper presents the study of the influence of chosen factors on the price of the mandatory audits for large companies in Slovenia, in the period from 2010 to 2014. The final sample consists of 177 large companies in Slovenia for each year or all together 885 entities. The main observed factors have been taken from financial statements, these are operating revenues, profit (loss) and indebtedness of the company. Three hypotheses were tested by regression analysis, ANOVA and Independent-Samples Median Test. The average price for mandatory audits of a large company in the observed period amounted to EUR 21,182. In research we found out that statistically significant factors of the statutory price of audit are just operating revenues of the audited entity. The results of this research can offer large companies and auditing companies incentive for awareness and dialogue between them about the quality, professionalism and responsibility of work of certified auditors.

AB - The paper presents the study of the influence of chosen factors on the price of the mandatory audits for large companies in Slovenia, in the period from 2010 to 2014. The final sample consists of 177 large companies in Slovenia for each year or all together 885 entities. The main observed factors have been taken from financial statements, these are operating revenues, profit (loss) and indebtedness of the company. Three hypotheses were tested by regression analysis, ANOVA and Independent-Samples Median Test. The average price for mandatory audits of a large company in the observed period amounted to EUR 21,182. In research we found out that statistically significant factors of the statutory price of audit are just operating revenues of the audited entity. The results of this research can offer large companies and auditing companies incentive for awareness and dialogue between them about the quality, professionalism and responsibility of work of certified auditors.

KW - Auditing

KW - audit fees

KW - profit

KW - revenues

KW - debt

KW - indebtedness

KW - companies

KW - financial statements

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DO - 10.1080/1331677X.2021.1934057

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JO - Economic Research-Ekonomska Istrazivanja

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SN - 1331-677X

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The influence of profit, revenues and debt on audit prices in large companies: Insights from Slovenia

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