Blog 1 – Beginning of our Auditing Research

The title of our research is Audit Firm Industry Leader Location and Its Effect on Audit Fees and Quality. Our main goal of the project is to determine whether there is an association between the geographic location of an auditing firm’s industry leader and the audit fee and audit quality of that same auditing firm’s industry clients. Meanwhile, this is a great opportunity for me to get the initial exposure of research in auditing. We believe that this study would provide additional insight into the way that the auditor industry specialization construct works in practice. It also would provide an interesting insight into whether the way audit firms structure their industry leadership and their market share are related. Eventually, Professor Reidenbach and I would hope to present our results at the American Accounting Association’s Faculty-Student Collaborations in Accounting Conference in Chicago next summer.

Currently, I am focusing on collecting data from the top 10 accounting firms, such as national office locations, industry leaders and industry audit, tax and advisory services leaders. As we move further for the project, I am going to use Wharton Research Data Services (WRDS) to collect archival audit pricing, audit quality, financial data and analyze the factors influence industry audit fees and quality in national locations. I would like to find out all the influences drive the fluctuation of audit fees and qualities in different locations from studying this project.

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