Around the globe, corporate units are concerned about what informs the fees charged by audit firms for audit services. Many factors have been advanced by extant literatures but limited discussion exist on the relationship between “audit firm and client” characteristics especially in Nigerian corporate sector. The objective of this study is therefore to determine the influence of corporate socio-economic characteristics on audit fees charged by distributive firms listed on the Nigerian Stock Exchange. Panel analysis was adopted for this study. Secondary data, been extracts from Annual Reports and Accounts of sampled firms were employed for this work. Audit fee and corporate socio/economic characteristics proxies by firm size, leverage, firm type, board size, profitability and board independence were analyzed using Panel regression. The study found a positive significant effect of Firm Size (FS), Audit Firm Type (AUDTYPE), Board Independence (BDIND) and Profitability (PROFIT) (β = 17.2545; 7862.6861; 84246.5114, 0.0005, ρ > 0.0000) while Leverage (LEV) and Board Size (BDSIZE) had negative effect on Audit Fees (β = -19.5350, -2333.0214, ρ > 0.0000). The study recommended that audit clients of distributive firms should focus on the management of the relationship between Asset and Liability i.e. leverage such that the current profitability tempo could be maintained and offset audit fee without any significant negative effect on audit quality.
Keywords: Audit Fees, audit firm characteristics, corporate characteristics, corporate environment
