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Auditor Retention: Auditor and Auditee Factors

Majidah ()
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Majidah: Accounting Department, School of Economics and Business, Telkom University, Indonesia Author-2-Name: Dedik Nur Triyanto Author-2-Workplace-Name: Telkom University, Jl. Telekomunikasi, 40257, Bandung, Indonesia Author-3-Name: Erika Vivi Andriyani Author-3-Workplace-Name: Telkom University, Jl. Telekomunikasi, 40257, Bandung, Indonesia Author-4-Name: Author-4-Workplace-Name: Author-5-Name: Author-5-Workplace-Name: Author-6-Name: Author-6-Workplace-Name: Author-7-Name: Author-7-Workplace-Name: Author-8-Name: Author-8-Workplace-Name:

GATR Journals from Global Academy of Training and Research (GATR) Enterprise

Abstract: Objective - This study aims to examine the influence of auditor and auditee factors on auditor retention. Methodology/Technique - The analysis unit of this research is manufacturing firms that were listed on the Indonesian Stock Exchange between 2010 and 2014. Using purposive sampling, 54 companies, or 270 observations, were obtained. This research uses a logistic regression; there are 12 outliers in the data that disturb the regression model, hence, the final research data set was 258. Findings - The result of the logistic regression analysis shows that auditee and auditor factors can simultaneously explain auditor retention by up to 4%. This partial effect shows that only audit quality affects auditor retention by 57.2%, at a level of significance of less than a = 5%. Meanwhile, firm size affects auditor retention by 14.8%, at a significance level of less than a = 10%. Novelty – This research is unique because auditor retention and proxy of audit quality has never been investigated in previous studies.

Keywords: Auditee Factors; Auditor Factors; Auditor Retention, Indonesia. (search for similar items in EconPapers)
JEL-codes: M4 M42 M49 (search for similar items in EconPapers)
New Economics Papers: this item is included in nep-acc and nep-sea
Date: 2018-12-10
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Published in Journal of Finance and Banking Review, Volume 3, Issue 4

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