The Effect of Audit Expertise, Independence, and Competence on Audit Opinion: Evidence from Public Accounting Firms

Abstrak

This study examines the effect of audit expertise, independence, and competence on audit opinion among auditors at public accounting firms in Surabaya, Indonesia, and identifies which of the three variables has the most dominant effect. Primary data were collected through a questionnaire administered to a sample of 42 auditors from 8 public accounting firms, selected through simple random sampling, and analyzed using multiple linear regression. All instruments were valid and reliable, and the classical assumption tests indicated the regression model was free of multicollinearity and heteroscedasticity, with normally distributed data. The results show that audit expertise, independence, and competence jointly and individually have a significant effect on audit opinion, explaining about 50.2 percent of its variance. Competence emerged as the most dominant variable, followed by independence and audit expertise. Audit expertise and competence were positively associated with audit opinion, while independence was significant but negatively associated with audit opinion, a counter theoretical result discussed in relation to the additional latitude greater independence gives an auditor in forming a judgment. These findings suggest that strengthening auditor competence offers the most direct path to more fair and objective audit opinions, and that efforts to build auditor independence should be paired with review mechanisms that help catch errors an independent auditor's own judgment might otherwise miss.