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The aim of this research is to find the impact of managerial ownership and independent board member toward independent audit committee. Furthermore, it aims to discover the impact of managerial ownership, the independent board member and independent audit committee on audit quality. The unit of analysis was done on banking companies listed on Indonesia stock exchange (IDX) during the period of 2010 to 2015. This research is an explanatory research that uses the partial least squared statistic for hypothesis testing. The results showed that the independent board member has a significant impact on independent audit committee. It is found that managerial ownership and the independent board member have impact on audit quality. It is necessary to conduct further research into the ideal level of managerial ownership and number of independent board member to produce a good audit quality on banks in Indonesia.

Keywords: managerial ownership, independent board member, independent audit committee, audit quality

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