Determination of Factors Causing Auditor Switching: Evidence from Listed Manufacturing Companies in Indonesia

Abstract

This study aims to determine whether audit opinion, public accounting firm reputation, audit delay, and financial distress as moderating variables have an influence on auditor switching. The data used are companies in the manufacturing sector listed on the Indonesia Stock Exchange (IDX) in 2018-2020. The data obtained are in the form of financial statements, the sample selection process is carried out using purposive sampling, hypothesis testing in this study uses smart PLS. The results of the study indicate that audit opinion has a positive effect on auditor switching, while the audit delay variable, the reputation of a public accounting firm does not show an effect on auditor switching. Financial distress as a moderating variable is able to strengthen the relationship between audit opinion and auditor switching but is not able to moderate the relationship between audit delay and the reputation of public accounting firms to auditor switching. The contribution generated from this research is that the results of this research can increase public knowledge about the factors that cause auditor switching in manufacturing sector companies.