The effect of profitability, solvency and audit opinion on audit delay

Abstract

The objectives of this research is to analyze the effect of profitability, solvency and audit opinion on audit delays in food and beverage financial companies listed on the Indonesian Stock Exchange (IDX) during 2017-2019. The sampling approach used was the method of purposeful sampling and a sample of 11 firms was collected. Secondary data, namely the financial statements of companies listed on the Indonesian Stock Exchange in 2017-2019, is the data used. The descriptive mathematical, classical assumption test, namely the multicollinearity test and hypothesis test using logistic regression analysis, was the data analysis technique used. The results of the research show that Profitability has a negative and substantial impact on the delay of the audit; this is shown by a significant value of 0.048 <0.05. It means that companies with a high delay in the audit of profitability would have shorter time, a quicker delay in the audit. The impact of solvency on audit delays is positive and significant; this is demonstrated by a significant value of 0.039 <0.05. The greater the Debt of Asset Ratio (DAR) of the company, the longer the audit delay, meaning that audit results appear to be slow to release or communicate to the public and investors. The opinion of the audit has a negative and substantial impact on the delay of the audit; this is illustrated by a significant value of 0.036 <0.05. The higher the audit opinion (Unqualified Opinion), the lower the delay in issuing the financial statements, the lower the audit delay