ANALYSIS OF THE ROLE OF THE INDEPENDENT AUDITOR ON REDUCING TIME LAGS IN FINANCIAL REPORTING AND EARNINGS MANAGEMENT
DOI:
https://doi.org/10.22159/ijss.2022.v10i6.46384Keywords:
Auditor Quality, Audit Delay, Earnings ManagementAbstract
This study aims to analyze differences in the timeliness of financial reporting and earnings management in terms of auditor quality in manufacturing companies on the Indonesia Stock Exchange. The research design of this research is an event study. The population in this study are companies on the Indonesia Stock Exchange. The sampling technique used purposive sampling and obtained a sample of 37 companies so that during the 3 years of observation, the data processed were 111. The hypothesis was tested using a different independent samples test. The results showed that there was no difference in the level of audit delay between companies audited by Big Four and non-Big Four auditors. This shows that the role of independent auditors in reducing audit delay has not been successful. While the second result shows that there are differences in the level of earnings management between companies audited by the Big Four or non-Big Four. This shows that the role of independent auditors in reducing earnings management is successful. This research has implications for corporate governance theory about the importance of good corporate governance to ensure that financial statements are presented fairly.
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