Audit Effectiveness: A Case Study of PT OPQ Conducted by Public Accounting Firm XYZ

Abstract

Purpose: The purpose of this study is to examine and understand the audit procedures applied to cash and cash equivalents at PT OPQ by Public Accounting Firm XYZ. This research specifically focuses on how cash and cash equivalent audit procedures are implemented, particularly in relation to exchange rate differences, and whether they align with applicable accounting standards.

Method: This research adopts a qualitative descriptive approach to provide a deeper understanding of the audit practices under study. The sample consists of audit procedure documents related to cash and cash equivalents. Data collection was carried out through documentation, including literature sources such as books and journals, as well as internal documents from KAP XYZ outlining standard operating procedures for auditing cash and cash equivalents. This method allows the researcher to capture both theoretical perspectives and practical applications.

Findings: The findings reveal that PT OPQ has not fully implemented PSAK 10, which governs the treatment of foreign exchange differences. This partial compliance indicates gaps in the application of audit procedures, particularly in ensuring that cash and cash equivalents are reported in accordance with established accounting standards. The results highlight the need for improvements in the company’s adherence to audit guidelines to strengthen financial reporting reliability.

Implications: The implications of this study are significant for both practitioners and stakeholders. For auditors, the findings emphasize the importance of ensuring compliance with PSAK 10 to maintain audit quality and credibility. For PT OPQ, the study underscores the necessity of refining internal processes to align with accounting standards, thereby enhancing transparency and stakeholder trust. More broadly, the research contributes to discussions on the role of audit procedures in safeguarding financial integrity.

Originality: This study is focusing on the specific case of PT OPQ and its audit procedures for cash and cash equivalents, an area often overlooked in broader audit research. By examining the practical implementation of PSAK 10, the research provides unique insights into the challenges faced by companies in adhering to audit standards. It contributes to the literature by bridging theoretical frameworks with practical realities in Indonesian auditing practices.