Investigating the Effect of Quadruple Variables of Client Characteristics on Audit Fees

The purpose of this study is to investigate the effect of comparability of financial statements, financing constraints, cash holdings and debt-based capital structure as characteristics of the employer (firm) on audit fees.The research period is from 2011 to 2021 and the statistical sample consists of 119 companies listed on the Tehran Stock Exchange. The findings showed that the comparability of financial statements, financing constraints, capital structure based on Debt and cash holding with statistics are significantly negatively, positively, positively and positively related to audit fee, respectively.The results of the study indicate that by increasing the comparability of financial statements, the costs of obtaining and reviewing information and the need to make adjustments in information are reduced and lead to a reduction in audit fees. Financing constraints prevent companies from providing resources for desirable investments, and such a deterrent increases the risk of the client company, leading to more auditor effort and ultimately higher audit costs. The reason why the cash is kept requires a high degree of transparency, which all stakeholders in companies want to clarify. Therefore, this increases the workload of the auditor and increases the cost. The higher the ratio of debt-based capital structure, the greater the control of external creditors and suppliers over owners. Therefore, by increasing this ratio, outsiders demand more transparency, accuracy and seriousness of audit work, which will lead to an increase in auditors' fees.