Do Western Hegemony Exist in the Selection of Independent Auditors?

Wijaya, Riesanti Edie and Kurniawan, Sally (2020) Do Western Hegemony Exist in the Selection of Independent Auditors? In: The 1st International Conference on Management, Accounting, and Economy (ICMAE 2020): Sustainable Business in the Digital Era, 13th – 14th February 2020, Jakarta.

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Most business people perceive that big four affiliated public accounting firms have better quality than others. We use the mixing method to uncover the phenomena of internationalization among the auditor selections. This study only explores the empirical aspects of western hegemony in auditor selection but also present. Those Charged with Governance's subjective perceptions of the Westernization in auditing practice. This study uses a sample of companies in the non-financial sector listed on the Indonesia Stock Exchange during 2016-2018. Preliminary analysis results show that institutional and individual ownership are more inclined to choose affiliated big-four auditors than the local ones. Whereas when compared to the non-big four affiliated accounting firms, institutional ownership is consistently more interested in the big four affiliated. In further analysis, local institutional ownership seems to prefer international affiliated accounting firms. Foreign institutional ownership always shows a preference for the big four affiliated accounting firms. Regarding individual ownership, researchers divide ownership into an independent, board of the director and management. The analysis proves that only management ownership has a role in choosing auditors. The ownership management tends to choose international affiliated accounting firms. Based on the subjective perception, one of the audit committees revealed that there were crucial differences in audit quality between the local and the international affiliated public accounting firms. Affiliated auditors are indeed far more thorough than local. Using Gidden's global modernity theory, we conclude that globally affiliated auditors can create new expertise needed by their users that is different from the past.

Item Type: Conference or Workshop Item (Paper)
Uncontrolled Keywords: institutional ownership, government, management, affiliated accounting firm, Gidden
Subjects: H Social Sciences > HF Commerce > HF5601 Accounting
H Social Sciences > HG Finance
Divisions: Faculty of Business and Economic > Department of Accounting
Depositing User: Ester Sri W. 196039
Date Deposited: 21 Sep 2020 04:57
Last Modified: 22 Sep 2020 05:28

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