Factors influencing the audit fee, part four

Factors influencing the audit fee, part four

The audit fee of the fourth part, which we want to express in several parts.

Can auditors prepare various types of audit reports based on their knowledge of the capital market and business owners?

so that if the consumer of audit services “the owners of the contractors referred to them”,

Present these ready reports to them?

And is it basically possible to prepare the audit report at the same time even if the audit service is purchased?

Or should we extract one from the report accumulation warehouse and give it to the “buyer” business owner?!

The answer is definitely negative because an auditor, a doctor or a lawyer can sometimes offer their services.

that there is a patient, client, or employer who is a “service purchaser”.

For this reason, in the best case, special services such as auditing are similar to custom products, which are made and prepared for specific buyers upon receiving an advance payment, and nothing else.

For this reason, in the description of service, they say that service requires cooperation in creation and production (Co-creation / Co-production).

Scrutiny and deepening in this category indicates that the demand for audit services and the valuable features of the final product of the audit process from the point of view of information users is based on “review and risk assessment”.

which has been less discussed so far.

Common economic analyzes to describe the nature of the supply of a good or service usually begin with the identification of the production function of that good or service.

Each production function determines the volume of the produced product by considering production factors such as capital and labor.

In the production function, the existence of technical efficiency and the selection of the best combination of data by the management to produce a certain volume of product are the basic assumptions.

While in reviewing audit services, paying attention to the data of the audit process and its results,

The consequences of asymmetric information and potential barriers to entering the supply of auditing services are examined and analyzed.

From the point of view of potential and actual buyers of audit and accreditation services, the audit report is very valuable due to the review of the data contained in the audit report, and this value is a function of increasing the probability of discovering important mistakes and cases of non-compliance with accepted accounting principles and the amount of insurance coverage created. It is for individuals and groups of buyers who are known as beneficiaries.

This new attitude confirms that in the implementation of audit techniques, the main factors of production (capital, labor and management) are also used in different combinations to produce the audit report.