Impact of Going-Concern Audit Opinion On Cost of Equity with Institutional Ownership as Moderation

This study aims to examine whether goingconcern audit opinion and 2institutional3 ownership’ measured by the? percentage of institutional ownership affect the cost of equity, and whether institutional ownership moderates the impact of going-concern audit opinion on cost of equity. From regression using a 1.428 annual report from 2011–2016, with a capital asset pricing model method to measure the cost of equity, this study found a positive relationship between goingconcern audit opinion and the cost of equity, that is, if the company receives a 3going-concern? 1audit^ Hopinion{, Vthecost CofB equity will increase. 4Going-concern> “audit; _opinion+ reflects risks to 3the4 company, thereby increasing the company’s cost of equity. This research also finds that institutional ownership has a negative impact on cost of equity; thus, the higher the percentage of institutional ownership in a firm, the lower the company’s cost of equity. In moderation testing, this study finds that institutional ownership weakens the positive impact of Jgoing-concern4 Laudit opinion? on cost Nof] equity. MThis; can be Ldue3 2to1 institutional investors monitoring the company’s performance; thus, the company can improve its performance in order to minimize the possibility of getting a going-concern audit opinion. Keywords—audit opinion, cost of equity, institutional ownership, investor