Islamic Religious Atmosphere and Audit Pricing

Evidence from Iran

Bibliographic Data

ID21259843
AuthorsMehdi Khodakarami (0000-0002-3301-2636, University of Tehran), Zabihollah Rezaee (0000-0001-9889-9699, University of Memphis), Reza Hesarzadeh (0000-0002-5118-022X, Ferdowsi University of Mashhad, corresponding author)
Year2021
Volume30
Issue4
Pages716-737
Publication date2021-10-01
Open AccessYes
TypeARTICLE
VenueBusiness Ethics, the Environment & Responsibility (JOURNAL)
Journal identifiersISSN: 2694-6416 • E-ISSN: 2694-6424
PublisherWiley (PUBLISHER • GB)
DOI10.1111/beer.12364
OpenAlexW3182729629
LanguageEN
Citations received3
References cited71

This study examines whether the Islamic religious atmosphere of local communities influences audit pricing. We use a comprehensive survey conducted by Iran's Ministry of Culture and Islamic Guidance to measure the Islamic religious atmosphere. Using a sample of 1,204 observations from firms listed in Iran's capital market, we find that firms located in regions with a strong Islamic religious atmosphere pay significantly lower audit fees. Furthermore, the study reveals that family ownership (auditor size) strengthens (weakens) the aforementioned relationship. However, we did not find a significant moderating role for the local community's social capital. We contribute to the ethics literature by providing a better understanding of the economic consequences of the religious atmosphere and offering policy, practical, and educational implications

Audit · Business · Christian ministry · Geography · Islam · Political science · Auditing, Earnings Management, Governance · Corporate Finance and Governance · Islamic Finance and Banking Studies · Law · Accounting

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