Impact of audit fees on IDLC’s market performance

Akter, Khudeza (2025) Impact of audit fees on IDLC’s market performance. International Journal of Science and Research Archive, 15 (1). pp. 510-522. ISSN 2582-8185

This study investigates how audit fees influence IDLC Finance PLC’s stock returns and return on assets (ROA). The findings indicate that higher audit fees are associated with declines in both ROA and stock performance. This outcome supports existing research that suggests investors may view rising audit costs as a burden, potentially prompting some to shift their investments to other firms perceived as more profitable. Therefore, the observed drops in ROA and stock returns are understandable. Additionally, the study explores whether increased audit fees impact overall trading volume but finds no statistically significant relationship. The research carries important implications for market participants. Financial institutions generally strive to meet several objectives, such as generating sufficient profits to pay dividends, delivering a satisfactory return to shareholders, and reinvesting in the business through employee motivation, customer satisfaction, and enhanced community reputation. To meet these aims, effective use of financial resources is crucial. Based on the analysis, the study provides evidence that IDLC Finance PLC endeavors to achieve these objectives by strategically utilizing all available resources.