Comparison of Audit Quality between Large and Small Public Accounting Firms: Implications for Audit Practice

Abstract

This study aims to analyze the significant differences between large Public Accounting Firms (KAP) and small Public Accounting Firms (KAP) in several important aspects, namely audit quality, level of independence, use of audit technology and methodology, and audit costs. The method used in this study is quantitative analysis with data collection through questionnaires distributed to 100 respondents consisting of 50 large KAP and 50 small KAP in Indonesia. The results of the hypothesis test using the T-Test showed that there were significant differences in all the variables tested, with large KAP having better audit quality, independence, and use of audit technology and methodology than small KAP. In addition, the audit fees charged by large KAP are also higher, reflecting a better quality of service. This research provides important insights for companies in selecting auditors and for regulators in setting policies related to audits. However, this study has limitations in sample size and geographical context, so it is recommended to conduct further research with a larger sample size and a more diverse approach.

Keywords: Public Accounting Firm, Large KAP, Small KAP, audit quality, independence, audit technology, audit fees