Proposed model for determining the external audit fees in the Libyan context

دراسة ميدانية على المراجعين الخارجيين

Abstract

This research aims to assess the impact of client factors and the Auditor factors on the audit fees charged in the Libyan context, and providing a proposed model for determining the audit fees. In order to achieve the study objectives, descriptive and analytical approaches were used, and the data obtained by questionnaires distributed on External Auditors in Tripoli. The questionnaires were analyzed using appropriate statistical methods to describe the opinions of the sample and to test the hypotheses of the study. The study presented a proposed model for determining the audit fees based on an assessment of twenty factors and their relationship with the audit fees.  

The study concluded that the impact of these factors, especially those related to the auditor, on determining audit fees were clear. Moreover, the study provided a model for determining these fees based on seven factors affecting on the audit fees namely; the consultancy services, the audit firm specialization, the hours required for audit process, the client’s industry specialization, the effectiveness of the client's internal control system, the professional experience of the audit firm, and the client’s size. The study also pointed out that the audit fees were not affected by the following factors: the importance of audit services to the client, the client’s risk, and the cooperation between the internal and external auditors