The Effect of Audit Tenure, Firm Size, and Audit Fee on Audit Quality in Healthcare Sector Companies

Abstract

Financial“statements serve as an essential tool for management accountability and decision-making by investors, creditors, and regulators. To ensure the reliability of financial information, independent audits are required, with Audit Quality playing a crucial role in detecting material misstatements and enhancing stakeholder confidence. Cases of financial reporting irregularities, such as those involving PT Kimia Farma Tbk., highlight the importance of maintaining high Audit Quality to protect public trust and support transparent financial reporting. This study aims to examine the effect of Audit Tenure, Firm Size, and Audit Fee on Audit Quality in healthcare sector companies listed on the Indonesia Stock Exchange (IDX) during the 2021–2024 period. Using a causal quantitative approach and purposive sampling technique, the study analyzes secondary data obtained from the IDX and company websites through multiple linear regression. The sample consists of healthcare companies that consistently published annual financial statements, reported in Indonesian rupiah, and maintained a fiscal year ending on December 31 throughout the observation period. The findings indicate that Audit Tenure has no significant effect on Audit Quality, suggesting that auditors maintain professional independence and comply with applicable regulations regardless of engagement length. Meanwhile, Firm Size and Audit Fee positively affect Audit Quality, indicating that larger companies and adequate audit compensation contribute to more effective audit procedures and higher-quality audit outcomes.”