Auditors continue to lament escalating costs, low audit fees and consequential squeezed margins in the audit practice. These factors, along with manpower crunch issue, have been identified as impediments to audit quality.
Well-meaning parties would advise the audit practitioners to push their audit fees up to a fair level. This is of course a logical and decent thing to do but certain practitioners, especially those from the SMP sector, would tell you that competition among audit firms is so intense that even a mere mention of fee increase may send their clients shopping for alternatives. But the ugly truth is that continuing to succumb to client pressure to cap the fee level is not economically viable or unsustainable in the long run.