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Likelihood of Auditor Switching: Evidence for Indonesia

Author

Listed:
  • Hadri Kusuma

    (Departement of Accounting, Islamic University of Indonesia, Yogyakarta, Indonesia)

  • Diana Farida

    (Departement of Accounting, Islamic University of Indonesia, Yogyakarta, Indonesia)

Abstract

This research aims to analyze factors determining the likelihood of auditor switching. The populations in this study were manufacturing companies listed on the Indonesia Stock Exchange (IDX) from 2015-2017. The type of data collected in this research was secondary data. The data analysis used in this research were 133 selected companies after applying purposive sampling method. The methods of data analysis were descriptive statistics, correlation tests, and generalized linear model (GLM). The results of this research indicated that the variables of financial distress, profitability, Certified Public Accountant (CPA) reputation and management change are significantly determinants of the likelihood of auditor switching. The paper further discusses and interprets the finding of the study. Key Words:Reputation, Financial Distress, Management Change, Audit Opinion, Profitability, Auditor Switching

Suggested Citation

  • Hadri Kusuma & Diana Farida, 2019. "Likelihood of Auditor Switching: Evidence for Indonesia," International Journal of Research in Business and Social Science (2147-4478), Center for the Strategic Studies in Business and Finance, vol. 8(2), pages 29-40, April.
    • Handle: RePEc:rbs:ijbrss:v:8:y:2019:i:2:p:29-40
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    References listed on IDEAS

    as
    1. Arnold Schneider, 2017. "Is commercial lending affected by knowledge of auditor switches from Big 4 firms to regional firms?," Accounting Research Journal, Emerald Group Publishing Limited, vol. 30(2), pages 153-164, July.
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