Does Moral Reasoning Moderate Audit Quality Determinants?

Abstract

The aim of this study is to analyse whether moral reasoning moderates the determinants of audit quality and examine the effects of competence, time budget pressure and moral reasoning on audit quality. The participants in this study were auditors of the Audit Board of Indonesia in Central Java. Using purposive sampling, 97 participants made up the entire studies. Data was analysed using partial least square (PLS). This study found that competence had a significant positive impact on audit quality. Time budget pressure had a negative impact on audit quality. Though, moral reasoning had no impact on audit quality. Furthermore, moral reasoning enhanced the impact of competence on audit quality. On the other hand, moral reasoning weakened the effect of time budget pressure on audit quality. The findings of this study are anticipated to advance the field of auditing science and offer guidance to Indonesia‘s Audit Board in order to assist its auditors in maintaining the calibre of their audit.