While audit fees have gone up substantially in the U.S. since 2002 in response to the Sarbanes-Oxley Act (SOX) and related regulations, it is unclear whether such reforms should have a major impact on audit markets in other countries. How have New Zealand audit firms fared in light of such regulatory initiatives? According to Professor Paul Griffin and his co-authors Yuan Sun and David Lont of the University of Otago, New Zealand, auditing firms reacted differently to the change by not raising their fees following the passage of SOX. The authors found that auditing fees rose later due to local rules for better governance, such as the New Zealand Stock Exchange requirements in 2004 and the early adoption of International Financial Accounting Standards (IFRS) by the New Zealand Accounting Standards Review Board in 2005. After controlling for company size, complexity and risk, Griffin and his co-authors discovered that the average New Zealand company’s audit fee rose modestly from 2003 to 2006 by 6.4 percent. According to the authors, this is a much smaller change than the double-digit increases experienced in the U.S. and similar countries. The study also found that auditing firms’ consulting fees decreased in the later years, which is consistent with the auditor independence provisions of the New Zealand governance rules eliminating or restricting certain kinds of non-audit work. Their findings are best explained by the New Zealand governance and accounting reforms implemented after SOX, and not by SOX itself or similar overseas governance regulations. The paper, “New Zealand Audit and Non-audit Fees: Have Fees Risen Since the Passage of SOX and the Introduction of IFRS?” can be downloaded from the Social Science Research Network here.