Audit Tenure, Company Size, and Financial Distress on Audit Report Lag through Auditor Switching: A Literature Review
DOI:
https://doi.org/10.61656/gcmqaa28Keywords:
Audit Report Lag, Audit Tenure, Auditor Switching, Company Size, Financial Distress, Literature ReviewAbstract
This study synthesizes the literature on audit tenure, company size, and financial distress as determinants of audit report lag, both directly and through the mediating mechanism of auditor switching. Using a qualitative literature review / document analysis method (Bowen, 2009), theoretical and empirical sources published between 1966 and 2022 were analyzed, framed by information asymmetry theory (Eisenhardt, 1989; Scott, 2015) and motivated by an unpublished undergraduate thesis proposal examining property, housing, and building construction companies listed on the Indonesia Stock Exchange for 2019-2021 (Nabila, 2023). The review indicates that company size is consistently reported as reducing audit report lag and audit tenure as the most consistent predictor of auditor switching, while the direction of audit tenure’s and financial distress’s direct relationships with audit report lag varies across studies. Six research propositions are advanced, and a conceptual framework linking audit tenure, company size, and financial distress to audit report lag, both directly and through auditor switching, is proposed to guide future empirical validation, particularly in capital-intensive, project-based sectors exposed to elevated financial-distress risk.
Downloads
References
Altman, E. I. (1968). Financial ratios, discriminant analysis and the prediction of corporate bankruptcy. The Journal of Finance, 23(4), 589–609. https://doi.org/10.1111/j.1540-6261.1968.tb00843.x
Arianti, B. F. (2021). Company size, financial distress and audit complexity against audit report lag. Gorontalo Accounting Journal, 4(1), 41–49. https://doi.org/10.32662/GAJ.V4I1.1253
Ashton, R. H., Willingham, J. J., & Elliott, R. K. (1987). An empirical analysis of audit delay. Journal of Accounting Research, 25(2), 275–292. https://raw.rutgers.edu/docs/Elliott/22An%20Empirical%20Analysis%20of%20Audit%20Delay.pdf
Bapepam dan LK. (2012). Peraturan Bapepam dan LK Nomor Kep-431/BL/2012 tentang Penyampaian Laporan Tahunan Emiten atau Perusahaan Publik. Kementerian Keuangan Republik Indonesia. https://www.ojk.go.id/id/regulasi/Documents/Pages/BAPEPAM-XK6-tentang-Penyampaian-Laporan-Tahunan-Emiten-atau-Perusahaan-Publik/X.K.6.pdf
Beaver, W. H. (1966). Financial ratios as predictors of failure. Journal of Accounting Research, 4, 71–111. https://ideas.repec.org/a/bla/joares/v4y1966ip71-111.html
Bowen, G. A. (2009). Document analysis as a qualitative research method. Qualitative Research Journal, 9(2), 27–40. https://doi.org/10.3316/QRJ0902027
Brigham, E. F., & Houston, J. F. (2001). Manajemen keuangan (Edisi Indonesia). Erlangga.
Dewi, N. P. S., Febriyanti, N. L. P. T. V., & Rustiarini, N. W. (2021). Audit opinion and audit characteristic: Study of voluntary auditor switching. EQUITY, 24(1), 35–46. https://doi.org/10.34209/equ.v24i1.2323
Dyer, J. C., & McHugh, A. J. (1975). The timeliness of Australian annual reports. Journal of Accounting Research, 13(2), 204–219. https://econpapers.repec.org/article/blajoares/v_3a13_3ay_3a1975_3ai_3a2_3ap_3a204-219.htm
Eisenhardt, K. M. (1989). Agency theory: An assessment and review. Academy of Management Review, 14(1), 57–74. https://doi.org/10.5465/amr.1989.4279003
Hamdani, D., & Hartati, S. N. (2019). Pengaruh tenure audit, tingkat pertumbuhan perusahaan, ukuran KAP, ukuran perusahaan dan financial distress terhadap auditor switching (Studi pada perusahaan manufaktur yang terdaftar di Bursa Efek Indonesia periode tahun 2010-2016). Jurnal Indonesia Membangun, 18(2), 15–29. https://jurnal.inaba.ac.id/index.php/JIM/article/view/146
Johnson, V. E., Khurana, I. K., & Reynolds, J. K. (2002). Audit-firm tenure and the quality of financial reports. Contemporary Accounting Research, 19(4), 637–660. https://doi.org/10.1506/LLTH-JXQV-8CEW-8MXD
Mulyadi. (2014). Auditing (Edisi 6, Buku 1). Salemba Empat.
Nabila, A. A. (2023). Pengaruh audit tenure, ukuran perusahaan dan financial distress terhadap audit report lag melalui auditor switching (Studi kasus perusahaan properti, perumahan dan konstruksi bangunan yang terdaftar di BEI tahun 2019–2021) [Unpublished undergraduate thesis]. Universitas Pembangunan Nasional “Veteran” Jawa Timur. https://repository.upnjatim.ac.id/view/creators/Nabila=3AAnisa_Amirotun=3A=3A.html
Nova, G. D. A., Azwardi, & Wahyudi, T. (2019). The effects of bankruptcy probability, auditor switching and company size toward audit delay. Journal of Economics and Business, 2(1), 147–162. https://www.asianinstituteofresearch.org/JEBarchives/2-1
OJK. (2022). Peraturan Otoritas Jasa Keuangan Nomor 14/POJK.04/2022 tentang Penyampaian Laporan Keuangan Berkala Emiten atau Perusahaan Publik. Otoritas Jasa Keuangan. https://www.ojk.go.id/id/regulasi/Documents/Pages/Penyampaian-Laporan-Keuangan-Berkala-Emiten-atau-Perusahaan-Publik/POJK%2014%20-%2004%20-%202022.pdf
Parahyta, C. H., & Herawaty, V. (2020). Pengaruh financial distress, profitabilitas, dan audit tenure terhadap audit report lag dengan ukuran perusahaan sebagai variabel moderasi. KOCENIN Serial Konferensi, 1(1), 1–9. https://publikasi.kocenin.com/index.php/pakar/article/view/85
Pemerintah RI. (2015). Peraturan Pemerintah Nomor 20 Tahun 2015 tentang Praktik Akuntan Publik. https://jdih.kemenkeu.go.id/fullText/2015/20TAHUN2015PP.pdf
Platt, H. D., & Platt, M. B. (2002). Predicting corporate financial distress: Reflections on choice-based sample bias. Journal of Economics and Finance, 26(2), 184–199. https://doi.org/10.1007/BF02755985
Pratiwi, I. D. A. A., & Muliartha RM, K. (2019). Pengaruh financial distress, ukuran perusahaan, dan audit delay terhadap pergantian auditor. E-Jurnal Akuntansi Universitas Udayana, 26(2), 1048–1074. https://doi.org/10.24843/eja.2019.v26.i02.p08
Riyanto, B. (2010). Dasar-dasar pembelanjaan perusahaan (Edisi 4). BPFE-Yogyakarta.
Scott, W. R. (2015). Financial accounting theory (7th ed.). Pearson Canada Inc.
Soenarso, S. A. (2021). Berpotensi delisting, RIMO: Untuk bayar karyawan saja ngos-ngosan. Kontan.co.id. https://investasi.kontan.co.id/news/berpotensi-delisting-rimo-international-mengaku-sulit-untuk-buyback
Sun, J., Li, H., Huang, Q.-H., & He, K.-Y. (2014). Predicting financial distress and corporate failure: A review from the state-of-the-art definitions, modeling, sampling, and featuring approaches. Knowledge-Based Systems, 57, 41–56. https://doi.org/10.1016/j.knosys.2013.12.006
Zusraeni, N., & Hermi. (2020). Pengaruh struktur kepemilikan saham, audit tenure, reputasi auditor dan audit fee terhadap audit delay. Jurnal Ekonomi Trisakti, 2(2), 999–1010. https://doi.org/10.25105/jet.v2i2.14492
Downloads
Published
Issue
Section
License
Copyright (c) 2019 Anisa Amirotun Nabila, Saiful Anwar
This work is licensed under a Creative Commons Attribution 4.0 International License.
