The effects of auditor reputation, financial condition, and potential intensive economy on artificial auditor rotation  

Oleh:

Junaidi ; Hartadi, Bambang ; Yurianto, Priyo Sajarwo ; Nurdiono

Jenis: Article from Journal - ilmiah nasional - terakreditasi DIKTI
Dalam koleksi: Journal of Economics, Business, & Accountancy: ventura vol. 18 no. 2 (2015), page 291-300.
Topik: Rotation; Artificial; Audit; Quality; Independence; Financial
Fulltext: 455-1011-1-SM.pdf (266.13KB)

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Perpustakaan Pusat (Semanggi) Nomor Panggil: VV5 Non-tandon: 1 (dapat dipinjam: 0) Tandon: tidak ada

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This research empirically re-tests the effects of auditor reputation, client’s financial condition, and potential intensive economy on artificial auditor rotation. The issue of audit quality is still interesting for the researchers to empirically. Auditors are de-manded to execute their profession independently. To maintain their being indepen-dent, this profession is regulated in the Decree by the Minister of Finance No. 17/PMK.01/2008 on public accountant service. It is mandatory for auditor rotation in that regulation and this is interesting to study more profoundly because in Indonesia this phenomenon of artificial rotation is found. Artificial auditor rotation indicates a condition in which, conceptually, there has been a change of the auditor but substan-tially the relationship between the auditor and the client is still going on. This research uses sample of companies listed in Indonesia Stock Exchange in 2002-2011, by purpo-sive sampling technique. The analysis of the research was done using logistic regres-sion. The results of the research show that auditor reputation affects auditor rotation. Yet, company’s financial condition and potential incentive economy do not affect auditor rotation. This research is expected to deepen the concept of audit quality, whe-reas in practice it is expected to provide inputs for regulating auditor rotation. Audi-tors are expected to show real auditor rotation.

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