Reconceptualizing Audit Quality in Emerging Markets: An Institutional and Corporate Governance Perspective with Evidence from Indonesia

This study reconceptualizes audit quality as a governance outcome shaped by institutional capacity and digital transformation in emerging markets. While prior research predominantly conceptualizes audit quality as a function of firm-level attributes, such an approach offers limited explanatory power in contexts characterized by fragmented regulatory enforcement and evolving governance systems. Addressing this gap, this study adopts an institutional and corporate governance perspective to examine how audit quality is produced within complex governance environments. Drawing on a qualitative meta-synthesis of 54 Scopus-indexed empirical studies published between 2020 and 2025, this paper analyzes the Indonesian context as a critical case of an emerging market undergoing simultaneous regulatory reform and digital transformation. Guided by agency theory, institutional theory, and digital governance perspectives, the analysis identifies five interrelated domains influencing audit quality: auditor independence, audit firm capacity, audit tenure, institutional enforcement, and digital audit adoption. The findings reveal that traditional audit quality determinants remain relevant but operate conditionally within broader governance configurations. Institutional enforcement emerges as a central moderating mechanism, while digital audit technologies function as governance enablers that enhance transparency, risk detection, and procedural accountability. However, their effectiveness depends on the degree of institutional integration and regulatory support, highlighting the limits of technology-driven approaches in weak governance environments. By positioning audit quality as an institutional–digital governance system, this study contributes to the corporate governance and accountability literature in three ways. First, it advances a configurational understanding of audit quality beyond linear determinant models. Second, it integrates digital governance into the analysis of auditing as a core accountability mechanism. Third, it provides policy-relevant insights for regulators, professional bodies, and audit firms seeking to strengthen governance and assurance systems in emerging markets.