Outline various factors that are considered by an Auditor for deciding the audit fee. What precaution the auditor should keep in this regard ?

Audit fee which is to be charged by the auditor depends on several factors, which includes: Size of the organization; Nature of business; Internal Controls systems & Technology adopted; Scope of audit; Frequency of audit etc. Auditors should not accept a very low level of fee as a result of competing for business. Also not to enter in to price competition and deplored in the profession, as it could impair the auditors' independence and deteriorate the quality of the auditing service. However, charging a lower fee than has previously been charged by another auditor for similar work is not restricted in any law.