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Determinants of Audit Quality in Indonesia Supreme Audit Institution: A Conceptual Study

Author

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  • Fahmi Givari Akbar
  • Khoirul Aswar
  • Noegrahini Lastiningsih

Abstract

This research is based on the problem of poor audit practices by the Big Four audit firms and the mid-tier audit firms in UK in 2018/2019 cycle, which is indicated as audit failure. This resulted in sanctions and fines that increased significantly from the previous year. Problems related to audit quality are also experienced by government internal auditors in Indonesia. This is due to several factors such as the quality of government internal auditor resources that are still below the lowest service standards as a public institution, lack of available apparatus and low competency, and limited budget. The purposes of this study are to determine the extent of audit quality produced by government internal auditors at the Principal Inspectorate of Indonesia’s Supreme Audit Institution. Based on attribution theory, this study has several objectives, namely to determine the effect of competence, independence, and motivation on audit quality. Therefore, the contribution of this research can be the object of consideration and evaluation for Indonesia’s Supreme Audit Institution auditors regarding the audit process and audit results in the public or government sector, an information for Principal Inspectorate of Indonesia’s Supreme Audit Institution as an effort to maintain and improve the quality of government internal audits, and an information for the public in overseeing the audit quality of the management and responsibility of state finances.

Suggested Citation

  • Fahmi Givari Akbar & Khoirul Aswar & Noegrahini Lastiningsih, 2020. "Determinants of Audit Quality in Indonesia Supreme Audit Institution: A Conceptual Study," Information Management and Business Review, AMH International, vol. 12(2), pages 38-41.
    • Handle: RePEc:rnd:arimbr:v:12:y:2020:i:2:p:38-41
    DOI: 10.22610/imbr.v12i2(I).3075
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    References listed on IDEAS

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    1. Nofiati Hikmayah & Khoirul Aswar, 2019. "The Impact of Factors on the Audit Quality in Indonesia: The Moderating Effect of Professional Commitments," International Journal of Academic Research in Accounting, Finance and Management Sciences, Human Resource Management Academic Research Society, International Journal of Academic Research in Accounting, Finance and Management Sciences, vol. 9(4), pages 285-293, October.
    2. Aida Hazlin Ismail & Natasha binti Muhammad Merejok & Muhamad Ridhuan Mat Dangi & Shukriah Saad, 2019. "Does Audit Quality Matters in Malaysian Public Sector Auditing?," International Journal of Financial Research, International Journal of Financial Research, Sciedu Press, vol. 10(3), pages 203-215, May.
    3. Yahn-Shir Chen & Joseph Hsu & Mei-Ting Huang & Ping-Sen Yang, 2013. "Quality, Size and Performance of Audit Firms," The International Journal of Business and Finance Research, The Institute for Business and Finance Research, vol. 7(5), pages 89-105.
    4. Khoirul Aswar & Ermawati & Meilda Wiguna & Eka Hariyani, 2020. "A Conceptual Framework on the Audit Quality in the Government Internal Audit in Indonesia," Information Management and Business Review, AMH International, vol. 12(1), pages 22-26.
    5. DeFond, Mark & Zhang, Jieying, 2014. "A review of archival auditing research," Journal of Accounting and Economics, Elsevier, vol. 58(2), pages 275-326.
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