Audit Firm Reputation Crucial for Quality Assurance, Study Reveals
This study looked at how the length of time an audit firm works for a company, whether they change auditors regularly, and the reputation of the audit firm affects the quality of audits done for manufacturing companies in Indonesia. The researchers used financial data from these companies between 2015 and 2018. They tested if these factors influence audit quality by using a statistical method called multiple linear regression analysis. The findings indicate that together, the length of the audit, changing audit firms, and the reputation of the audit firm did not significantly impact audit quality. However, individually, only the reputation of the audit firm had a significant effect on audit quality. This means that how well an audit firm is known can make a difference in the quality of audits performed.