a b s t r a c tThis study provides preliminary support for the notion that internal audit function assists in reducing external audit effort and fees. Data on internal audit characteristics and activities are obtained from survey respondents of Hong Kong companies and audit fee model data are acquired from their annual reports. The results of this study suggest that the external auditor of firms in Hong Kong rely on the internal audit function and subsequently charge a lower fee. Lower external audit fees are associated with a larger internal audit department and certain activities carried out by the internal audit. Specifically, lower external audit fees are associated with more internal audit effort spent on activities relating to financial statements, systems development and maintenance, operating efficiency and effectiveness, fraud investigations and unlimited access to internal auditors' working papers. The results of this study suggest that the contribution of the internal audit may substitute for some substantive external auditing processes and lower monitoring costs.

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If you would like to write for this, or any other Emerald publication, then please use our Emerald for Authors service information about how to choose which publication to write for and submission guidelines are available for all. Please visit www.emeraldinsight.com/authors for more information. About Emerald www.emeraldinsight.comEmerald is a global publisher linking research and practice to the benefit of society. The company manages a portfolio of more than 290 journals and over 2,350 books and book series volumes, as well as providing an extensive range of online products and additional customer resources and services.Emerald is both COUNTER 4 and TRANSFER compliant. The organization is a partner of the Committee on Publication Ethics (COPE) and also works with Portico and the LOCKSS initiative for digital archive preservation. ABSTRACTThis paper studies the audit fee structure in Hong Kong. By analysing data concerning a number of variables representing auditee size, auditee risk, complexity of audit, auditor identity, and the timing of audit, we develop a model of the determinants of audit fees which is applicable to the unique environment in Hong Kong. Using a more recent time period of 1992 and 1993, this study strongly confirms that most of the previous research findings are also applicable to the Hong Kong audit service market. We provide additional evidence relating to variables such as the Big Six (previously Big Eight) effects, auditee risk and auditee complexity which have been found to have inconclusive associations with the level of audit fees in previous research. Specifically, auditee size appears to have been the main determinant of audit fees, and the size measure is two-dimensional, both asset and turnover respectively add explanatory power to that provided by each other. Complexity of audit adds significantly to the cost of audit. There is also evidence of Big Six effects and low-balling. In addition, some evidence is found for the effects of auditee risk on audit fees. Finally, a longer audit delay, which reflects the possibility of inefficient audit time spent, entails higher audit fees. Future research should consider the importance of other issues such as non-audit services and the extent of market concentration.The authors wish to thank

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Individual animals behave differently from each other. This variability is a component of personality and arises even when genetics and environment are held constant. Discovering the biological mechanisms underlying behavioral variability depends on efficiently measuring individual behavioral bias, a requirement that is facilitated by automated, high-throughput experiments. We compiled a large data set of individual locomotor behavior measures, acquired from over 183,000 fruit flies walking in Y-shaped mazes. With this data set we first conducted a “computational ethology natural history” study to quantify the distribution of individual behavioral biases with unprecedented precision and examine correlations between behavioral measures with high power. We discovered a slight, but highly significant, left-bias in spontaneous locomotor decision-making. We then used the data to evaluate standing hypotheses about biological mechanisms affecting behavioral variability, specifically: the neuromodulator serotonin and its precursor transporter, heterogametic sex, and temperature. We found a variety of significant effects associated with each of these mechanisms that were behavior-dependent. This indicates that the relationship between biological mechanisms and behavioral variability may be highly context dependent. Going forward, automation of behavioral experiments will likely be essential in teasing out the complex causality of individuality.