Firm characteristics, demand for external auditing services and financial performance: an empirical study on cooperative enterprises in East Java, Indonesia / Oyong Lisa, Grahita Chandrarin and Edi Subiyantoro
The purpose of this study is to examine the effects of firm characteristics (consisting of members, cooperative scale and liabilities) on the demand for external auditing services and their implications on financial performance. This study uses secondary data collected from the Department of Small...
| Main Authors: | , , |
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| Format: | Article |
| Language: | English |
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Faculty of Accountancy
2014
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| Subjects: | |
| Online Access: | https://ir.uitm.edu.my/id/eprint/12342/ |
| _version_ | 1848803133434626048 |
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| author | Oyong, Lisa Chandrarin, Grahita Subiyantoro, Edi |
| author_facet | Oyong, Lisa Chandrarin, Grahita Subiyantoro, Edi |
| author_sort | Oyong, Lisa |
| building | UiTM Institutional Repository |
| collection | Online Access |
| description | The purpose of this study is to examine the effects of firm characteristics (consisting of members, cooperative scale and liabilities) on the demand for external auditing services and their implications on financial performance.
This study uses secondary data collected from the Department of Small and Medium Enterprises and Cooperatives in East Java Province and then analysed using path analysis. Results showed that the effect of firm characteristics consisting only of members and cooperative scale is statistically significant on requests for external audit services. They also showed that the effect of firm characteristics in terms of liabilities and the demand for external auditing services is statistically significant on financial performance, indicating that the number of cooperative members determines the voluntary requests for external audit services. Cooperatives with large numbers of members tend to request for external auditing services.
Large-scale cooperatives will increase the volume of transactions, which may cause errors in financial data and statements that will lead to requests for external auditing services. These requests are done to obtain accurate information. The agency theory indicates that cooperation with great amounts of liabilities has to show better performance because activities are monitored by stakeholders. In this case, financial reports are important in forming business decisions. |
| first_indexed | 2025-11-14T21:34:24Z |
| format | Article |
| id | uitm-12342 |
| institution | Universiti Teknologi MARA |
| institution_category | Local University |
| language | English |
| last_indexed | 2025-11-14T21:34:24Z |
| publishDate | 2014 |
| publisher | Faculty of Accountancy |
| recordtype | eprints |
| repository_type | Digital Repository |
| spelling | uitm-123422022-07-05T04:52:50Z https://ir.uitm.edu.my/id/eprint/12342/ Firm characteristics, demand for external auditing services and financial performance: an empirical study on cooperative enterprises in East Java, Indonesia / Oyong Lisa, Grahita Chandrarin and Edi Subiyantoro apmaj Oyong, Lisa Chandrarin, Grahita Subiyantoro, Edi Auditing. Auditors Financial management. Business finance. Corporation finance The purpose of this study is to examine the effects of firm characteristics (consisting of members, cooperative scale and liabilities) on the demand for external auditing services and their implications on financial performance. This study uses secondary data collected from the Department of Small and Medium Enterprises and Cooperatives in East Java Province and then analysed using path analysis. Results showed that the effect of firm characteristics consisting only of members and cooperative scale is statistically significant on requests for external audit services. They also showed that the effect of firm characteristics in terms of liabilities and the demand for external auditing services is statistically significant on financial performance, indicating that the number of cooperative members determines the voluntary requests for external audit services. Cooperatives with large numbers of members tend to request for external auditing services. Large-scale cooperatives will increase the volume of transactions, which may cause errors in financial data and statements that will lead to requests for external auditing services. These requests are done to obtain accurate information. The agency theory indicates that cooperation with great amounts of liabilities has to show better performance because activities are monitored by stakeholders. In this case, financial reports are important in forming business decisions. Faculty of Accountancy 2014-12 Article PeerReviewed text en https://ir.uitm.edu.my/id/eprint/12342/1/AJ_OYONG%20LISA%20APMAJ%2014.pdf Oyong, Lisa and Chandrarin, Grahita and Subiyantoro, Edi (2014) Firm characteristics, demand for external auditing services and financial performance: an empirical study on cooperative enterprises in East Java, Indonesia / Oyong Lisa, Grahita Chandrarin and Edi Subiyantoro. (2014) Asia-Pacific Management Accounting Journal (APMAJ) <https://ir.uitm.edu.my/view/publication/Asia-Pacific_Management_Accounting_Journal_=28APMAJ=29.html>, 9 (2). pp. 141-163. ISSN 1675-3194 https://apmaj.uitm.edu.my/ |
| spellingShingle | Auditing. Auditors Financial management. Business finance. Corporation finance Oyong, Lisa Chandrarin, Grahita Subiyantoro, Edi Firm characteristics, demand for external auditing services and financial performance: an empirical study on cooperative enterprises in East Java, Indonesia / Oyong Lisa, Grahita Chandrarin and Edi Subiyantoro |
| title | Firm characteristics, demand for external auditing services and financial performance: an empirical study on cooperative enterprises in East Java, Indonesia / Oyong Lisa, Grahita Chandrarin and Edi Subiyantoro |
| title_full | Firm characteristics, demand for external auditing services and financial performance: an empirical study on cooperative enterprises in East Java, Indonesia / Oyong Lisa, Grahita Chandrarin and Edi Subiyantoro |
| title_fullStr | Firm characteristics, demand for external auditing services and financial performance: an empirical study on cooperative enterprises in East Java, Indonesia / Oyong Lisa, Grahita Chandrarin and Edi Subiyantoro |
| title_full_unstemmed | Firm characteristics, demand for external auditing services and financial performance: an empirical study on cooperative enterprises in East Java, Indonesia / Oyong Lisa, Grahita Chandrarin and Edi Subiyantoro |
| title_short | Firm characteristics, demand for external auditing services and financial performance: an empirical study on cooperative enterprises in East Java, Indonesia / Oyong Lisa, Grahita Chandrarin and Edi Subiyantoro |
| title_sort | firm characteristics, demand for external auditing services and financial performance: an empirical study on cooperative enterprises in east java, indonesia / oyong lisa, grahita chandrarin and edi subiyantoro |
| topic | Auditing. Auditors Financial management. Business finance. Corporation finance |
| url | https://ir.uitm.edu.my/id/eprint/12342/ https://ir.uitm.edu.my/id/eprint/12342/ |