Empirical analysis of determinants of audit fees in China Essay

Empirical analysis of determinants of audit fees in China - Essay ExampleHowever, financial information about approximately of the listed companies was absentminded for which the Chinese database RESSET was used as the supplementary source. Apart from this, annual report of some of the companies was also checked. The data that are considered for the study are of 2011. For the analysis of the sedate data SPSS, statistical software has been used. The first role is based on the analysis of the whole data set that comprises of data of the listed companies of both Shenzhen and Shanghai. The second section analyses the data of the two cities separately. 4.2 Descriptive Statistics of whole sample The Table 1 given below shows the statistics for the audit fees with respect to the other variables. As the table shows that the negligible audit fees is ?1.00 million, whereas the maximum is ?3.51 million. This reveals that there is a considerable difference between the audit fees of the two cities. However, the average audit fees in these two cities are ?3.51 million. This huge difference can be due to the factors like characteristics of the area and financial position of the company, which are located at the various places of the two cities. ... The nominal stock certificate balance is 0 while the maximum is .94. The average inventory ratio is 0.18. The inventory ratio depicts a huge difference between the maximum and token(prenominal) levels. Some of the organizations are seen to have no inventories at all while some other companies are having a high level of inventory with them. This ratio helps in determining the fact whether the organization is making optimum utilization of resources. Therefore, a high inventory ratio is not good for the organization (Barthwal, 2007 Anupindi et al., 2008). Accounts receivables is the rent that is paid in cash and in exchange for the product and services that are provided by the company. The position of answer fors receivabl e in comparison to the total assets of the pissed is shown by the accounts receivable ratio. It signifies the complexity of the organization (Jiambalvo, 2009 2007 Weil, 2012). The table 1 shows that the accounts receivable ratio ranges between the nominal value of 00 and the maximum value of 0.60. The average account receivable ratio is 0.93. The intangibles ratio of the firm is another factor, which is considered to affect the auditors fees. When the intangible assets are compared to the total asset, it is seen that the ratio is at a minimum level of 00 and the maximum level of 0.67. The average intangible ratio is 0.05. This reveals that some of the companies do not have any type of intangible assets while some others have. The current ratio is another factor that may affect the audit fees. The current ratio is calculated by dividing the current assets by the current liabilities (Lasher, 2013 Pratt, 2010 Gibson, 2012). The minimum current ratio is 0.11 and the maximum is 204.74. This signifies that there exists a huge