How Auditor Limitation and Corporate Tax Governance Effect on Audit Quality

Abstract

In the audit reporting process, there are important issues that are closely related to the results
of audit quality. Some determinants of audit quality are the audit limitation of auditor
independence. Also, the integrity of the auditee in reporting its financial statements to
stakeholders, especially the government, is related to corporate tax governance. Both aspects
can assist the auditor in estimating audit risk for audit quality. This study aims to determine the
effect of auditor limitation on audit quality, corporate tax governance on audit quality, and also
the impact of corporate tax governance, which moderates the relationship between auditor
limitation and audit quality. The research sample was 106 manufacturing companies listed on
the Indonesia Stock Exchange in 2017 and 2018. Data were analyzed using multiple linear
regression with e-views software. This study shows that auditor limits have no effect on audit
quality, corporate tax governance has an effect on audit quality, and corporate tax governance
moderates the effect of auditor limitation on audit quality.