Evidence about the relation between earnings management and voluntary audits is scarce, and there is no research about the effectiveness of mandatory audits to improve earnings quality. Using a sample of Spanish SMEs, where some companies are mandatorily audited and some are exempt from audit,...

Purpose: Despite the extensive research on the determinants of audit pricing in both public and private settings, there is a lack of research about the differences in audit fees between voluntary audits and mandatory audits. The purpose of this paper is to address this gap....

Evidence about the effect of voluntary audits on the cost of debt is mixed, and there is no research about the effects of mandatory audits and the non-compliance with the audit requirement. Using a sample of Spanish SMEs, where some companies are exempt from audit and some are mandatorily...