ABSTRACT

This study aims to analyze whether the Big 4 Public Accounting Firms set higher audit fee than non-Big 4 Firms, and middle firms set higher audit fees than the small firms. This study used 345 observations from 115 public companies in Indonesia that were not in the financial sector during the period 2014–2016. The results of this study indicate that Big 4 sets a higher audit fee than Non-Big 4, and middle firms did not set higher audit fee than the small firms. This indicates the existence of premium audit fee received by Big 4. This study also suggests The Indonesian Institute of Certified Public Accountants (IAPI) to evaluate whether non-Big 4 accounting firms has set fair audit fees to prevent unhealthy competition among accounting firms and lower the audit quality.