The Relationship between State Ownership and Audit Size and Audit Fees

Pricing audit services is one of the most interesting subjects of the audit researchers, and many studies have been done on this issue so far. Although the used research methods in these researches are to some extend different from one another, most of them follow a major target which is recognizing the effective factors on audit pricing.

The main objective of this research is to study the relationship between State Ownership and Audit Size and Audit Fees s in companies listed in Tehran Stock Exchange. Study sample consisted of 72 firms listed in Tehran Stock Exchange which their data for a period of 5 years (2007 to 2011) were collected and analyzed.

Overall, the findings show that State ownership does not have a significant relationship with audit pricing. However, there is significant and direct relationship between audit firm size and audit pricing. It seems that firms with larger size, due to higher quality services or authentication and the fame, have received higher fees to handle the financial statements of the sample companies. Also, according to the findings, State ownership has a negative impact on the relationship between audit firm size and audit fees.