What Truly Impacts External Audit Quality

Abstract

The purpose of this research is to identify the factors that can influence the quality of external audit. These factors include Auditor Competence and Time Budget Pressure. This research involved at least 24 Public Accounting Firms in Medan with 64 respondents (from a total population of 97 respondents initially). Saturation Sampling Technique and Likert scale are used for data collection through questionnaires. Through this research, it is hoped that the author can reveal the relationship between these two factors and the quality of external audits, which is crucial for ensuring the reliability of financial reporting and the integrity of the audited company's financial system. In this research, the analysis technique used was Structural Equation Model (SEM) with SmartPLS as the analysis tool. The findings indicate that both factors (namely Auditor Competence and Time Budget Pressure) significantly influence External Audit Quality. The implication of these findings is that they can assist Public Accounting Firms in determining service policies and provide insights for companies to consider these factors to achieve better External Audit Quality.

 

Keywords: Audit Quality, Competence, External Auditor, Individual Stress, Time Budget Pressure