Female Auditor and Accrual Earnings Management in Indonesia

Objective: This research aims to examine the effect of female auditor on accruals earnings management. Theoretical Framework: Agency theory states that corporate executives either efficiently report accurate financial information to stakeholders or that they opportunistically manipulate reported earnings for personal gain, thereby misleading users of financial statements. In this case, the main role of external auditors is to ensure the integrity of the company's financial reporting process. Method: Research sample includes 556 manufacturing companies listed on the Indonesian Stock Exchange 2019-2022. Data analysis uses regression with companies and years fixed-effects. Results and Discussion: Based on analysis data, female auditors tend to be able to mitigate the company's earnings management. So, it can be concluded that female auditors are more risk averse and have higher moral values, thereby increasing the quality of audits and financial reporting. Research Implications: This research implies companies to choose more on female auditor. Originality/Value: This research confirms the agency theory in the context of the auditor gender.