EconPapers    
Economics at your fingertips  
 

Indonesia’s Participation in ASEAN Audit Regulators Group (AARG): Efficiency-driven or Institutional Pressure?

Irma Tyasari (), Nor Zalina Mohamad Yusof and Ku Maisurah KU Bahador

International Journal of Academic Research in Accounting, Finance and Management Sciences, 2018, vol. 8, issue 3, 299-309

Abstract: This paper takes institutional theory perspective to discuss the efforts being undertaken by regulators and accounting profession in Indonesia to strengthen its audit quality (AQ). The question being asked is whether Indonesia’s participation in ASEAN Audit Regulators Group (AARG), whose aim is to strengthen AQ in ASEAN country, is purely part of the country’s on-going efforts on AQ or is it motivated by mimetic pressure to be similar to its neighbours. Using data obtained from various public sources, the paper shows that in comparison with its neighbouring countries Indonesia is behind in terms of few aspects concerning AQ including the number of accountants in the country. However, evidence also shows that the country was putting in various initiatives in relation to its AQ even prior to its joining the AARG in 2014. Although the number of accountants was small relative to its population, the country is in fact seeing significant increase in the number in the last three years prior to its joining the AARG. Indonesia’s participation in AARG suggests that the country aims to be at par with its neighbours in terms of AQ. Following its participation with AARG, the country has issued a draft of Audit Quality Indicators (AQIs) in 2016 as well as Code of Ethics in 2017 for accountants. Hence, although participation in AARG could initially be motivated by mimetic pressure, the evidence shows that the country is in positive direction in its quest to improve AQ.

Keywords: Audit quality; Institutional Theory; isomorphism; AARG; Indonesia; ASEAN (search for similar items in EconPapers)
Date: 2018
References: View references in EconPapers View complete reference list from CitEc
Citations: Track citations by RSS feed

Downloads: (external link)
http://hrmars.com/hrmars_papers/Indonesias_Partici ... utional_Pressure.pdf (application/pdf)
http://hrmars.com/hrmars_papers/Indonesias_Partici ... utional_Pressure.pdf (text/html)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:hur:ijaraf:v:8:y:2018:i:3:p:299-309

Access Statistics for this article

More articles in International Journal of Academic Research in Accounting, Finance and Management Sciences from Human Resource Management Academic Research Society, International Journal of Academic Research in Accounting, Finance and Management Sciences
Bibliographic data for series maintained by Hassan Danial Aslam ().

 
Page updated 2019-02-02
Handle: RePEc:hur:ijaraf:v:8:y:2018:i:3:p:299-309