Rethinking audit quality: evidence from audit fees, tenure, and rotation in Indonesian infrastructure firms

Abstract

Purpose: to examine the effect of audit fee, audit tenure, and audit rotation on audit quality in infrastructure companies listed on the Indonesia Stock Exchange during the 2020–2023 period.

Method: this study uses a quantitative approach and secondary data from the annual reports of 15 infrastructure companies listed on the Indonesia Stock Exchange during 2020–2023, resulting in 60 firm-year observations selected through purposive sampling. Data were analyzed using binary logistic regression in SPSS.

Findings: audit fee, audit tenure, and audit rotation do not significantly affect audit quality, either individually or simultaneously. These findings suggest that these three audit-related factors do not significantly determine audit quality in Indonesian infrastructure companies.

Implications: companies, auditors, and regulators should not rely solely on audit fees, audit tenure, and audit rotation to improve audit quality, but should also strengthen auditor competence, independence, professional skepticism, and audit oversight.

Originality: lies in providing sector-specific evidence on audit quality by simultaneously examining audit fees, audit tenure, and audit rotation in Indonesian infrastructure companies during the 2020–2023 period.