Abstract
This study discusses the effect of auditor independence and ethics on audit quality with audit fees as a moderating variable. This analysis used two independent variables: independence and auditor ethics. Audit quality was the dependent variable, while audit fees were the moderating variable. This research was conducted in 4 Public Accounting Firms (KAP) in the Medan City area, using 70 auditors from 21 Public Accounting Firms (KAP). A quantitative method was employed in this research. The sampling technique used was simple random sampling. In this study, data was collected by surveys or the distribution of questionnaires. Primary data was used as a source. The statistical method employed Partial Least Square Analysis with partial statistical test hypothesis testing (t) in the coefficient of determination (R2 ). SmartPls program was used in this research. The results of this study indicate that independence has a significant effect on audit quality, partially. Meanwhile, auditor ethics has no significant effect on audit quality, and audit fees cannot be a moderating variable on the effect of independence and auditor ethics on audit quality.
Highlights
Companies require the services of public accountants and associated parties to examine the fairness of the financial statemen ts
The results of the examination will produce a public accountant's opinion which is used by users of the company's external an d internal financial statements to measure whether the company's financial management has been running well and following applicable standards.DeAngelo (1981) in Tandiontong (2016:79), audit quality is defined as the market-value probability that the financial statements include material errors that the auditor will discover and disclose
Based on the results of research and discussion that have been presented in the preceding chapter, the following conclusions can be drawn in this study: 1. Independence affects audit quality in public accounting firms in Medan
Summary
Companies require the services of public accountants and associated parties to examine the fairness of the financial statemen ts. The results of the examination will produce a public accountant's opinion which is used by users of the company's external an d internal financial statements to measure whether the company's financial management has been running well and following applicable standards.DeAngelo (1981) in Tandiontong (2016:79), audit quality is defined as the market-value probability that the financial statements include material errors that the auditor will discover and disclose. Knechel et al (2012) in Tandiontong (2016: 242), audit quality is defined as the market-value probability that the financial statements include material errors that the auditor will discover and disclose. According to Fachruddin (2017:147), an audit fee is a type of remuneration paid by the auditor to the client as compensation for the amount of loss incurred during the audit
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