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The conduct of this research represents part of an effort to modify audit risk model (ARM) as an implementation of corporate social responsibility (CSR) by certified public accounting (CPA) firms. It is intended to make clear the phenomena about the relationship between audit risk (AR), implementation of business ethics principles (IBEP) and corporate governance risk (CGR).

The method used was hypothesis testing. Unit of analysis was individual (i.e. Indonesian CPA), and the gathering of data was cross‐sectional. The sample was determined by purposive sampling. Data were collected using questionnaires, and data analysis was conducted by structural equation modeling (SEM).

According to Indonesian CPAs' perception, the AR is affected by the client's CGR, whereas the client's IBEP does not affect AR, but clients' CGR and IBEP both significantly affect AR. It is suggested: first, that the next researcher should study audit risk related to business ethics. Second, that the management should strengthen the implementation of business ethics in running a business; and finally that the Bapepam (Capital Market Oversight Board) should oversee both public company and public accountant in the implementation of governance.

This research noted some implications, including: nature and intensity of gathering data, restricted respondent (CPA‐CMAF), and restricted variables of corporate governance (BoD, and Audit Committee).

This research suggests the necessity to modify ARM by dividing inherent risk into errors risk and fraud risk as bases for accumulating audit evidence.