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This dissertation was written as part of the MSc in International Accounting, Auditing and Financial Management, at the International Hellenic University. In a competitive audit market, audit fees paid by firms to their auditors are used to measure auditor’s effort. Audit fees should reflect the predictable cost of audit hours and the perceived business risk. More focus is given to the client risk and the factors that determine the total audit fees, by using a large sample of publicly traded US firms for the period 2000-2019. Client size, auditee profitability, auditee risk, complexity of the client, auditor size and industry type are considered as the explanatory variables in our baseline audit fee model. Our results are in line with prior literature, supporting that the higher is the client risk, the more audit fees are paid. However this study examines not only the external view of the business risk, the market side, but also pays attention to the auditor’s and manager’s view. To be more precise, it is examined the influence of earnings volatility and the internal management inefficiencies on the level of total audit fees. Both variables have a positive relationship with our dependent variable (total audit fees) and their linkage is in compliance with prior studies. These findings are robust to a variety of additional tests and several alternative design specifications.