The Impact of Company Financial Performance and Audit Fees on the Disclosure of Key Audit Matters (KAM)
Key Audit Matters (KAM), recently mandated by ISA 701, aim to enhance audit transparency by addressing critical audit areas. This study provides empirical evidence on the impact of financial performance and audit fees on KAM disclosures. Furthermore, it categorizes KAM into two risk levels: Entity-...
Saved in:
| Main Authors: | , |
|---|---|
| Format: | Article |
| Language: | Indonesian |
| Published: |
Petra Christian University
2025-05-01
|
| Series: | Jurnal Akuntansi dan Keuangan |
| Subjects: | |
| Online Access: | https://jurnalakuntansi.petra.ac.id/index.php/aku/article/view/29565 |
| Tags: |
Add Tag
No Tags, Be the first to tag this record!
|
| _version_ | 1849237434890452992 |
|---|---|
| author | Novia Gita Rhamadhani Dina Heriyati |
| author_facet | Novia Gita Rhamadhani Dina Heriyati |
| author_sort | Novia Gita Rhamadhani |
| collection | DOAJ |
| description |
Key Audit Matters (KAM), recently mandated by ISA 701, aim to enhance audit transparency by addressing critical audit areas. This study provides empirical evidence on the impact of financial performance and audit fees on KAM disclosures. Furthermore, it categorizes KAM into two risk levels: Entity-Level Risk (ELRKAM) and Account-Level Risk (ALRKAM). The data analyzed consist of 1,080 firm observations listed on the Indonesia Stock Exchange (IDX) for the period 2022-2023. The researchers conducted panel data regression analysis using EViews 12.0. The findings reveal that financial performance has no significant impact on the overall KAM or ELRKAM disclosures but does affect ALRKAM. This indicates that auditors focus more on specific risk areas rather than on overall financial performance. On the other hand, we find that audit fees positively influence the disclosure of overall KAM and ELRKAM, but they have no effect on ALRKAM. These results suggest that higher audit fees contribute to enhanced transparency regarding overall risks but do not necessarily affect the disclosure of specific account-level risks.
|
| format | Article |
| id | doaj-art-d9d24e753b1e414faffa1de6672d87f8 |
| institution | Kabale University |
| issn | 1411-0288 2338-8137 |
| language | Indonesian |
| publishDate | 2025-05-01 |
| publisher | Petra Christian University |
| record_format | Article |
| series | Jurnal Akuntansi dan Keuangan |
| spelling | doaj-art-d9d24e753b1e414faffa1de6672d87f82025-08-20T04:01:57ZindPetra Christian UniversityJurnal Akuntansi dan Keuangan1411-02882338-81372025-05-0127110.9744/jak.27.1.35-49The Impact of Company Financial Performance and Audit Fees on the Disclosure of Key Audit Matters (KAM)Novia Gita Rhamadhani0Dina Heriyati1Universitas AirlanggaUniversitas Airlangga Key Audit Matters (KAM), recently mandated by ISA 701, aim to enhance audit transparency by addressing critical audit areas. This study provides empirical evidence on the impact of financial performance and audit fees on KAM disclosures. Furthermore, it categorizes KAM into two risk levels: Entity-Level Risk (ELRKAM) and Account-Level Risk (ALRKAM). The data analyzed consist of 1,080 firm observations listed on the Indonesia Stock Exchange (IDX) for the period 2022-2023. The researchers conducted panel data regression analysis using EViews 12.0. The findings reveal that financial performance has no significant impact on the overall KAM or ELRKAM disclosures but does affect ALRKAM. This indicates that auditors focus more on specific risk areas rather than on overall financial performance. On the other hand, we find that audit fees positively influence the disclosure of overall KAM and ELRKAM, but they have no effect on ALRKAM. These results suggest that higher audit fees contribute to enhanced transparency regarding overall risks but do not necessarily affect the disclosure of specific account-level risks. https://jurnalakuntansi.petra.ac.id/index.php/aku/article/view/29565Financial PerformanceAudit FeeKey Audit Matter |
| spellingShingle | Novia Gita Rhamadhani Dina Heriyati The Impact of Company Financial Performance and Audit Fees on the Disclosure of Key Audit Matters (KAM) Jurnal Akuntansi dan Keuangan Financial Performance Audit Fee Key Audit Matter |
| title | The Impact of Company Financial Performance and Audit Fees on the Disclosure of Key Audit Matters (KAM) |
| title_full | The Impact of Company Financial Performance and Audit Fees on the Disclosure of Key Audit Matters (KAM) |
| title_fullStr | The Impact of Company Financial Performance and Audit Fees on the Disclosure of Key Audit Matters (KAM) |
| title_full_unstemmed | The Impact of Company Financial Performance and Audit Fees on the Disclosure of Key Audit Matters (KAM) |
| title_short | The Impact of Company Financial Performance and Audit Fees on the Disclosure of Key Audit Matters (KAM) |
| title_sort | impact of company financial performance and audit fees on the disclosure of key audit matters kam |
| topic | Financial Performance Audit Fee Key Audit Matter |
| url | https://jurnalakuntansi.petra.ac.id/index.php/aku/article/view/29565 |
| work_keys_str_mv | AT noviagitarhamadhani theimpactofcompanyfinancialperformanceandauditfeesonthedisclosureofkeyauditmatterskam AT dinaheriyati theimpactofcompanyfinancialperformanceandauditfeesonthedisclosureofkeyauditmatterskam AT noviagitarhamadhani impactofcompanyfinancialperformanceandauditfeesonthedisclosureofkeyauditmatterskam AT dinaheriyati impactofcompanyfinancialperformanceandauditfeesonthedisclosureofkeyauditmatterskam |