UNVEILING THE DETERMINANTS OF AUDIT DELAY: AN EMPIRICAL STUDY OF BANKS LISTED ON THE INDONESIA STOCK EXCHANGE

Abstract

Audit delay is a critical issue in the banking industry as it directly relates to the timeliness of financial reporting, which can affect transparency, investor confidence, and overall market stability. This study aims to analyze the impact of firm size, leverage, profitability, and Non-Performing Loans (NPL) on audit delay among banking companies listed on the Indonesia Stock Exchange during the 2018–2022 period. A quantitative approach was employed using panel data regression analysis. The research sample consisted of 27 banks selected through purposive sampling. Data were obtained from annual financial statements and analyzed using a series of statistical tests, including classical assumption tests and hypothesis testing. The findings reveal that firm size, leverage, and profitability have a significant influence on audit delay. Specifically, larger firms and those with higher leverage or profitability tend to experience longer audit durations due to increased complexity in financial reporting and heightened procedural requirements. On the other hand, NPL was found to have no significant effect on audit delay, as auditors tend to focus more on risk indicators that directly affect going concern assumptions and the overall reliability of financial statements. These findings underscore the importance of specific financial characteristics in managing audit delays within the banking sector.