Abstract: Based on the mandatory disclosure background, this paper investigates how the audit fee responses to Corporate Social Responsibility (CSR) reports, using a propensity score matching and Difference-in-Differences (PSM-DID) model. We find that:(1) the auditor reduces audit price as a response to clients' issue of CSR reports; (2) the disclosure of CSR reports reduces audit pricing by inhibiting earnings management, which leads to a decrease in audit effort and audit risk; (3) the above effect is more pronounced in CSR reports with superior disclosure quality, and firms with stricter external monitors or stronger motivations to build reputation. Our findings not only enrich the literature related to audit fee, but also have important implications for further mandatory disclosure policies improvement.

Key words: corporate social responsibility report, audit fee, mandatory disclosure, PSM-DID model