Audit tenure, auditor rotation, and audit quality: The case of Indonesia

Research output: Contribution to journalArticlepeer-review

17 Citations (Scopus)

Abstract

The Indonesian regulators have made it compulsory to rotate the appointments of public accountants every 3 years and the appointment of public accounting firms every 5 years, since the end of 2002. The purpose of this study is to investigate the effects of auditor rotation and audit tenure of the public accountant and the public accounting firm, on audit quality (before and after the implementation of the mandatory auditor regulation). The results do not support that mandatory auditor rotation increases audit quality or that a shorter audit tenure (both partner and firm level) increases audit quality. Regulators may need to consider revising the regulation (i.e. related to maximum years allowed for auditor to audit their client) and/or introduce other regulations to increase audit quality.

Original languageEnglish
Pages (from-to)55-74
Number of pages20
JournalAsian Journal of Business and Accounting
Volume5
Issue number1
Publication statusPublished - 25 Jun 2012

Keywords

  • Audit quality
  • Audit rotation
  • Audit tenure
  • Discretionary accrual

Fingerprint Dive into the research topics of 'Audit tenure, auditor rotation, and audit quality: The case of Indonesia'. Together they form a unique fingerprint.

Cite this