The Role of the Reputable Auditor in Audit Report Lag and Firm Value: Empirical Evidence from Indonesia during the COVID-19 Pandemic

This study explores the role of a reputable auditor in audit report lag to understand the antecedents and consequences of the audit report lag model. Additionally, this study includes economic conditions represented the pre-pandemic era (2017 – 2018) versus the pandemic era (2019 - 2020) and risk business factors represented by the two different sectors that had extreme market performance for sound evidence about the reputable auditor. The study generates empirical evidence from emerging markets, but the factors seem to be global issues regarding audit report lag. Based on 249 samples, this study concludes that the reputable auditor who performs audits of a high-financial-performance company has less audit report lag compared to a low-financial-performance company. The research enriches agency theory by setting an audit report lag model. Consecutive factors to understand the antecedents and consequences of audit report lag provide evidence about the joint role of auditor and auditee. This study also enlarges the practice of the local auditors to enhance higher professionalism and reduce dependency on auditees, such as collaboration with reputable auditors.