The Moderating Role of Firm Size on the Relationship between Professional Ethics and Audit Quality: An Empirical Study of Big Four and Non-Big Four Public Accounting Firms
Keywords:
Professional Ethics, Audit Quality, Public Accounting Firm SizeAbstract
This study aims to provide empirical evidence of the influence of professional ethics on the quality of audits, specifically examining how this relationship is influenced by the size of the public accounting company. The study focuses on the impact of Professional Ethics, as the sole independent variable, on audit quality in both Big Four and Non-Big Four Public Accounting Firms in 2017. The population being examined consists of Public Accounting Firms, including both those designated as Big Four and those designated as Non-Big Four. By employing purposive sampling, a total of 115 questionnaires were obtained, and 113 of these were successfully disseminated to the intended participants. The chosen data analysis method is Structural Equation Modelling (SEM), specifically utilising the Partial Least Square (PLS) methodology. The study's findings provide strong evidence that professional ethics have a beneficial impact on the quality of audits. Furthermore, the analysis of the moderating impact of the size of public accounting firms demonstrates a statistically significant reduction in the correlation between professional ethics and audit quality. These findings emphasise the complex interactions within the field of auditing, emphasising the subtle influence of professional ethics and the size of the firm on the outcomes of audit quality. This study provides significant findings about professional ethics and audit quality in the setting of public accounting firms. The study enhances our understanding of the various elements that influence audit quality results by examining how company size affects these outcomes. This knowledge may be applied to both theoretical frameworks and practical implementations in the auditing profession.
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