THE EFFECT OF CORPORATE GOVERNANCE MECHANISMS ON EXTERNAL AUDITOR’S SELECTION (Empirical Study on Manufacturing Company Listed on BEI Year 2014-2016)

Abstract

This study aims to examine the effect of corporate governance mechanism on external auditors selection at manufacturing companies listed on the Stock Exchange in 2014-2016. The purpose of this study is to examine the effect of majority shareholders on external auditors selection. The size of the board of commissioners against external auditors selection. Audit committee size against the selection of external auditors. Level of leverage to external auditors selection. The population in this study is manufacturing companies listed on Indonesian Stock Exchange in 2014-2016. Data analysis Methods using statistical analysis of Multiple Regression with Eviews. This study results show that majority shareholder has significant effect, the size of board of commissioner has significant effect, audit committee has no effect and leverage have significant effect.

Keywords: majority shareholder, board size, audit committee, and leverage to external auditors selection