Digital Intensity and Audit Pricing: A Moderated Analysis

College of International Business, Shenyang Normal University, Shenyang, China

^* Corresponding author: This email address is being protected from spambots. You need JavaScript enabled to view it.

Abstract

In this way, the object of the research will be A-share listed companies in Shanghai and Shenzhen in 2013-2022, and this paper will work with the two-way fixed effects model and have an empirical research on the impact of corporate digital transformation on audit fees. The results of the study prove that the connection between digital transformation and audit fees is positive i.e. the more company is digitized the higher the audit costs. This can mainly be attributed to the fact that digitalization has provided the new avenues of earning management in the business and brought in better efficiency and due to the lack of technical ability of auditors and low internal controls practices by businesses, audit fees are inverted. The moderate effect analysis proves that quality of internal controls and larger enterprise are important weakening factors that increase the positive effect of the digital transformation on audit fees which is the effective negative moderating factor. The study can provide some experience and source to the businesses that can prompt digital transformation and contribute to the active growth of digital economy.