THE EFFECT OF PROFITABILITY, CLIENT SIZE, AND AUDIT FEE ON AUDITOR SWITCHING OF STATE-OWNED ENTERPRISES (SOE) LISTED ON INDONESIA STOCK EXCHANGE (IDX)

Abstract

Auditors who have long-term relationships with clients can affect the lack of auditor independencewhich indirectly affects the audit report. Purpose: This research aims to determine audit quality andmaintain auditor independence, one solution is to auditor switching. This study is a quantitative studythat aims to determine the effect of profitability, client size, and audit fee on auditor switching. Thisstudy uses financial statement data on SOE listed on the IDX for the period 2017 to 2021. Methods:The selection of sample criteria is carried out using purposive sampling method with predeterminedcriteria. The sample used amounted to 13 companies in a span of 5 years, so that the research dataanalyzed amounted to 65 data. Measurement of the auditor switching variable uses a dummy andfocuses on Public Accountants without distinguishing between mandatory and voluntarycharacteristics. For the measurement of the dependent variable, namely profitability using Return OnEquity (ROE), Client size using the Ln formula (Total Assets), and audit fee using the Ln formula(Professional Fee). Analysis data: The hypothesis in this study was tested using logistic regressionanalysis with the IBM Statistical Package for The Social Science (SPSS) version 26 program. Resultand discussions: The results of this study indicate that profitability has a negative significant effect onauditor switching with an alpha level of 5%, client size has a positive significant effect on auditorswitching with an alpha level of 10%, and audit fee has no significant effect on auditor switching.