Journal of Finance and Banking Review The Effect of Integrating Reporting on Earnings Quality: A Study of Family Firms in Indonesia (original) (raw)
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The Effect of Integrating Reporting on Earnings Quality: A Study of Family Firms in Indonesia
Journal of Finance and Banking Review Vol. 3 (3) Jul-Sep 2018, 2018
Objective - The implementation of integrated reporting (IR), which is a composite of financial and non-financial information, in one single report makes financial reporting more comprehensive and more transparent. Transparent information in IR gives annual reporting of family firms a higher earnings quality. Methodology/Technique - This research aims to examine the effect of IR on earnings quality of family firms in the mining industry on the Indonesian Stock Exchange between 2014 and 2017. Findings - The results of this study indicate that there is a positive and significant relationship between integrating reporting and earnings quality. These results confirm that firms that use integrated reporting tend to show higher earnings quality. The study also finds that larger sized companies and larger leverage amounts equals a higher volume of information disclosed. Novelty – The motivation of this research is to examine IR issues that are relatively new. Type of Paper - Empirical. Keyw...
Journal of Accounting Research, Organization and Economics, 2020
Objective – This study aims to investigate the impact of firm characteristics, namely leverage, profitability, and firm size, on financial reporting quality as measured by discretionary accruals.Design/methodology – This sample of this study is Property and Real Estate companies listed in the Indonesian Stock Exchange (IDX) for the period of 2015 to 2017. In total, there are 36 firms chosen as the samples for this study or 108 observations. The data was analyzed using the multiple regression method.Results – This study demonstrates that the leverage and profitability have significant impact on financial reporting quality, while firm size has no significant impact on financial reporting quality.
2017
The International Financial Reporting Standards (IFRS) initiated by International Accounting Standard Board are principle-based standard that require extensive disclosure of financial statements and accounting information as compared to prior standard that is the generally accepted accounting principles to better reflect the overall quality of company's performance. Therefore, the IFRS convergence is expected to improve the reliability of financial reporting by limiting opportunistic managerial discretion. The conjecture is the mandatory adoption of IFRS will reduce the managerial discretionary behaviors to engage in earnings management practices, thus improving earnings quality and value relevance of accounting quality information. High quality of accounting information in terms of earnings quality and value relevance can stimulate investors' behavior in the stock market exchange. This study utilises a sample of 110 manufacturing sector companies for the years 2009-2014, to...
International Journal of Engineering and Advanced Technology, 2019
The intent of this research is to scrutinize the consequence of information asymmetry and audit quality on earnings management using institutional ownership as a moderating variable. The sample of this study consists of 28 mining companies listed on the Indonesia Stock Exchange (IDX) for 5 years of observation in 2012-2016, with total sample used were 140 data. Moderated Regression Analysis is used to test the hypothesis with the results that audit quality has a significant and negative influence on earnings management. While institutional ownership is accepted as a moderating variable that weakens the influence of information asymmetry on earnings management. In contrast, information asymmetry does not affect earnings management and institutional ownership does not strengthen the influence of audit quality on earnings management.
2018
This research is conducted to know the current situation of Indonesia’s corporate governance and accounting information quality. Good corporate governance is one of the aspects that should be considered to obtain accounting information quality. Good corporate governance was measured by using corporate governance perception index (CGPI) while accounting information quality was measured using discretionary accruals (Jones Model). The result showed that good corporate governance has a significant effect on accounting information quality. Companies that practice good governance will eventually produce accounting information with quality.
Determinants of financial reporting quality: Evidence from Indonesia
Journal of International Studies
This research aims to investigate the determinants of financial reporting quality, which is a very complex issue in the manufacturing industry and a significant contributor to a company's finance. This research is therefore aimed to examine the effect of litigation risk, investor's distrust, and legal expertise of the audit committee. The data were obtained from the annual reports of the manufacturing companies listed at the Indonesia Stock Exchange during 2015-2018. The research sample consists of 287 public companies, with moderated regression analysis used to examine the hypotheses. The results show that the risk of investor distrust affects financial reporting quality, while legal expertise of the audit committee is a moderating variable that strengthens the relationship between the risk of investor distrust and financial reporting quality.
Integrated Reporting’s Impact on Corporate Governance: Study in Asean Capital Market
Assets: Jurnal Akuntansi dan Pendidikan
ABSTRACTIntegrated reporting (IR) that merges the firm's financial and non-financial information into one single reporting is the latest evolution of corporate financial reporting today. This study purposes to examine the impact of the implementation of IR on corporate governance, especially family business in the mining industry listed on the ASEAN capital market in the 2014-2017 period. The results of the study based on the Stata 14.2 statistical program concluded that the implementation of IR has a positive impact on corporate governance in the ASEAN capital market, i.e. the implementation of IR drivers changes in behavior and perceptions in corporate governance (reporting driven behavior), thus making corporate governance more effective.ABSTRACTPelaporan terintegrasi (IR) yang menyatukan informasi keuangan dan non-keuangan perusahaaan ke dalam satu pelaporan tunggal merupakan evolusi pelaporan keuangan perusahaan terbaru saat ini. Penelitian ini bertujuan untuk meneliti damp...
DergiPark (Istanbul University), 2017
The International Financial Reporting Standards (IFRS) initiated by International Accounting Standard Board are principle-based standard that require extensive disclosure of financial statements and accounting information as compared to prior standard that is the generally accepted accounting principles to better reflect the overall quality of company's performance. Therefore, the IFRS convergence is expected to improve the reliability of financial reporting by limiting opportunistic managerial discretion. The conjecture is the mandatory adoption of IFRS will reduce the managerial discretionary behaviors to engage in earnings management practices, thus improving earnings quality and value relevance of accounting quality information. High quality of accounting information in terms of earnings quality and value relevance can stimulate investors' behavior in the stock market exchange. This study utilises a sample of 110 manufacturing sector companies for the years 2009-2014, to include pre-IFRS (2009-2011) and post-IFRS period (2012-2014). The data is analyzed using multiple regression technique by using the pooled least square mesthod. The results of earnings management model of the study indicate that there are significantly positive relationship between size and leverage on earnings management. Whereas, the level of gross fixed assets is found to have a significant negative effect on earnings management. While, value relevance model the result shows there are significantly positive relationship between earnings per share, book value per share and size. Whereas, the leverage is shows significantly negative effect to earnings management. Overall, this study provides evidence of effect of IFRS convergence on the quality of accounting information is increase in term of value relevance but decrease in term of earning management.
How do we assess the quality of corporate financial reporting? A methodological issue
AESTIMATIO, 2015
The purpose of this study is to show a new way of assessing the quality of corporate financial reporting. We assess the quality of corporate financial reporting in Bangladesh, a country where the family predominates and the business environment is virtually unregulated, with managerial incentives rather than regulatory influence more likely to induce disclosures and to influence other reporting issues. Both quantitative and qualitative measures are taken into consideration to account for various aspects of financial reporting, as a single proxy does not cover multiple aspects. The overall disclosure index (proxy 1) and corporate accruals (proxy 2) are taken as quantitative measures, while external users' perceptions about financial reporting (proxy 3) are taken as a qualitative measure. Lower disclosure index values, higher corporate accruals, and users' negative impressions result from lower quality financial reports. This study provides a new way of measuring the quality of financial reporting and contributes two new proxies (proxy 1 and proxy 3) to the existing literature on assessing the quality of financial reporting.
Determinant of Earnings Quality
International Journal of Finance & Banking Studies (2147-4486)
The quality of earnings indicates the current or future capability of the company to support the decisions made by managing board and other stakeholders. This research have to goal to examine the determinant of earnings quality in Indonesia, including: IFRS convergence, accounting disclosures, and audit committees. Data were acquired from official website in period of 2016-2018 and number of data was 212 observation data. Method of analysis involved regression test and classical assumption test. Result of research showed that the audit committee had a positive effect on earnings quality, while the convergence of IFRS and accounting disclosure cannot affect earnings quality. Research model was tested using control variables, respectively leverage, liquidity and company size. The test found that leverage is the only control variable that affects earnings quality. Information in financial statements is not the most important information to investors. Audit committee and creditor contri...