THE IMPACT OF AUDIT FEE AND AUDIT TENURE ON EARNINGS MANAGEMENT WITH AUDIT QUALITY AS A MODERATING VARIABLE

Abstract

This study examines the impact of audit fees and audit tenure on earnings management, with audit quality serving as a moderating variable, in food and beverage firms listed on the Indonesia Stock Exchange from 2019 to 2023. The research employs a quantitative methodology utilizing an explanatory research design on 18 companies chosen through purposive sampling. Data analysis uses panel regression with the Fixed Effect Model and Moderated Regression Analysis. The findings indicate that audit fees do not significantly influence earnings management, whereas audit tenure has a significant positive impact on earnings management. Audit quality does not moderate the relationship between audit fees and earnings management, nor the relationship between audit tenure and earnings management. The limitations of this study encompass its concentration on a singular industry sector, specifically food and beverages, a relatively small sample size, a limited five-year research period, reliance on audit quality proxies solely on Big Four affiliation, and the exclusion of other variables, such as corporate governance or other company characteristics that could affect the relationship of the variables examined in this study.