ANALISIS PENGARUH KARAKTERISTIK KUALITAS AUDITOR TERHADAP COST OF DEBT FINANCING: PENGUJIAN DUAL ROLES AUDITOR PADA PASAR OBLIGASI DI INDONESIA
This study aims to examine the effect of auditor quality characteristics, which is proxied by the auditor size and spesialization as well as auditor tenur to the cost of debt financing. The focus of the study was to test the dual role of auditors in the bond market in Indonesia. Samples that used in...
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| Main Authors: | , |
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| Format: | Theses and Dissertations NonPeerReviewed |
| Published: |
[Yogyakarta] : Universitas Gadjah Mada
2013
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| Subjects: | |
| Online Access: | https://repository.ugm.ac.id/120610/ http://etd.ugm.ac.id/index.php?mod=penelitian_detail&sub=PenelitianDetail&act=view&typ=html&buku_id=60648 |
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| Institution: | Universitas Gadjah Mada |
| Summary: | This study aims to examine the effect of auditor quality characteristics, which is
proxied by the auditor size and spesialization as well as auditor tenur to the cost of
debt financing. The focus of the study was to test the dual role of auditors in the
bond market in Indonesia.
Samples that used in this study were 554 observation with the 2006-2010
period. The results showed that investors in Indonesia evaluate the dual role of
auditors, the information role and insurance role that are included in auditor size
and specialization, although in different magnitude (more evaluating the insurance
role than the information role). These results imply that they are not only
assessing the reputation of "brand name" of the big auditors (Big-4), but also the
expertise of auditor specialization.
Overall, the results of this study provide empirical evidences that the
auditor quality characteristics, namely auditor size and specialization are matter
for bond market participants in Indonesia. Auditor tenure has negative impact on
cost of debt financing, implying that the results are in line with government
regulations concerning the obligation of rotation for Publict Accounting Firms and
Publict Accountant.
The results provide evidence of the validity of agency theory. Through its
dual roles, that are information role and insurance role, auditor size and
specialization can reduce agency conflicts between management and investors.
These results have methodological implications that auditor size measurement, not
only of the large auditor and the small auditor as previous studies but medium
auditor must also be considered. The results are useful for regulators to draft
Financial Reporting Act and to reinforce rules on rotation Publict Accounting
Firms and Publict Accountant in Indonesia. |
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