Final answer:
Increased regulation in the auditing industry requires auditors to provide enhanced assurance while trying to minimize audit fees. Auditors need to balance regulatory compliance costs against competitive pricing, often using technology and process improvements to maintain or reduce fees.
Step-by-step explanation:
The question addresses the impact of increased regulation on the auditing industry. Auditors are now required to provide enhanced assurance while simultaneously attempting to minimize audit fees.
This situation poses a significant challenge for auditing firms as they need to balance the cost of additional regulatory requirements with the competitiveness of their pricing. Increased regulations often mean more time and effort is needed to ensure compliance, which naturally could increase the cost of an audit.
However, due to market pressures and the need to maintain clients, auditors must find ways to absorb these costs or improve their efficiency to avoid passing these costs onto the client. Technological advancements, innovative audit techniques, and streamlined processes are some strategies used to maintain or reduce audit fees while still adhering to stringent regulatory standards.