Our study examines fees paid to auditors for audit and non-audit services during the period 2000 to 2003. We document a statistically significant positive association between audit fees and the absolute value of performance-adjusted discretionary accruals over all years. We also identify a...

Purpose – The paper aims to examine the relation between fees paid to auditors and audit quality during the period of 2000‐2003. Design/methodology/approach – The paper constructs a measure of auditor profitability that is used as a proxy for auditor independence. The methodology is...