top of page
Asian Institute of Research, Journal Publication, Journal Academics, Education Journal, Asian Institute
Asian Institute of Research, Journal Publication, Journal Academics, Education Journal, Asian Institute

Economics and Business

Quarterly Reviews

ISSN 2775-9237 (Online)

asian institute research, jeb, journal of economics and business, economics journal, accunting journal, business journal, managemet journal
asian institute research, jeb, journal of economics and business, economics journal, accunting journal, business journal, managemet journal
asian institute research, jeb, journal of economics and business, economics journal, accunting journal, business journal, managemet journal
asian institute research, jeb, journal of economics and business, economics journal, accunting journal, business journal, managemet journal
crossref
doi
open access

Published: 15 December 2024

Factors Influencing the Integrity of Financial Statements

Lailah Fujianti, Nurainun Bangun, Eka Putri Wahyuningtias

Universitas Pancasila, Universitas Tarumanegara

asian institute research, jeb, journal of economics and business, economics journal, accunting journal, business journal, management journal

Download Full-Text Pdf

doi

10.31014/aior.1992.06.04.547

Pages: 200-213

Keywords: Integrity of Financial Statements, Independent Commissioners, Managerial Ownership, Institutional Ownership, Audit Committee

Abstract

This research was aimed to determine the effects of independent commissioners, managerial ownership, institutional ownership, and audit committee, on the integrity of financial statements in manufacturing companies listed on the Indonesian stock exchange. The analysis model used is panel data regression analysis and data processing using Eviews9. The sample in this research is 33 manufacturing companies in various industry sectors and the consumer goods industry sector in the 2017-2019 research year. The type of data in this study is secondary data with a sample selection method that is purposive sampling method. The results of this study indicate that the variables of independent commissioners, institutional ownership, and audit committee affect the integrity of financial statements, while managerial ownership variables do not affect the integrity of financial statements.

References

  1. Abbas, D. S., Ismail, T., Taqi, M., & Yazid, H. (2021). The influence of independent commissioners, audit committee and company size on the integrity of financial statements. Studies of Applied Economics, 39(10).

  2. Abbas, D.S., Siregar, I.G., Basuki (2021) Integrity Of Financial Statements And The Factors. Journal of accounting science. Vol 5 (2) :17-28

  3. Abed, I. A., Hussin, N., Haddad, H., Almubaydeen, T. H., & Ali, M. A. (2022). Creative accounting determination and financial reporting quality: the integration of transparency and disclosure. Journal of Open Innovation: Technology, Market, and Complexity, 8(1), 38.

  4. Anah, S., Rizky Mustika Anggraeni, & Abdul Rahmat. (2023). The Effect of The Board of Directors, Audit Committee, and Company Size on The Integrity of Financial Statements (Empirical Study on State-Owned Enterpriseslisted on The Indonesia Stock Exchange 2016-2020 Period). Journal of Accounting and Finance Management, 4(2), 168-179.

  5. Aswar, K., Fahmi Givari, A., Wiguna, M., & Hariyani, E. (2021). Determinants of audit quality: Role of time budget pressure. Problems and Perspectives in Management, 19(2), 308-319.

  6. Ati, M., Paramita, R.W.D., , Yatminiwati, M., (2020) Managerial Ownership, Company Size, And Audit Quality Financial Report Integrity. Progress Conference, Vol. 3 (1): 219-224

  7. Denziana, A. (2015). The effect of audit committee quality and internal auditor objectivity on the prevention of fraudulent financial reporting and the impact on financial reporting quality (a survey on state-owned company in Indonesia). International Journal of Monetary Economics and Finance, 8, 213-227.

  8. Duppati, G., Rao, N. V., Matlani, N., Scrimgeour, F., & Patnaik, D. (2020). Gender diversity and firm performance: evidence from India and Singapore. Applied Economics, 52(14), 1553-1565.

  9. Fikri, M., & Suryani, E. (2020). Pengaruh Good Corporate Governance terhadap Integritas Laporan Keuangan (Studi pada Perusahaan BUMN yang terdaftar di BEI Periode 2014 sd 2018) [The Influence of Good Corporate Governance on the Integrity of Financial Reports (Study of BUMN Companies listed on the IDX for the 2014 to 2018 Period)]. Jurnal Akuntansi (Media Riset Akuntansi & Keuangan), 8(2).

  10. Fujianti, L. (2019). The Role of Legal Compliance and Good Corporate Governance on Reducing Audit Delay on Publicly Listed Companies in Indonesia. Research in World Economy, 10(3), 359-365.

  11. Fujianti, L., 2023. The Role of Good Corporate Governance and Financial Conditions in Encouraging Dividend Policy in Indonesian and Malaysian Companies. Journal of Economics, Finance and Management Studies. Vol 6 (6): 2918-2925

  12. Fujianti, Lailah., Nelyumna., Shahimi, Shahida., Natalia, Sonya Kristina, (2023) Syariah Governance and Disclosure Islamic Corporate Social Responsibility: A Comparative Study of Indonesian and Malaysian Islamic Banking. Economics and Business Quarterly Reviews, Vol.6 No.2: 11-19,

  13. Hernawati, E. (2021). Corporate Governance, Earnings Management and Integrity of Financial Statements: The Role of Audit Quality and Evidence from Indonesia. Review of International Geographical Education Online, 11(3).

  14. Hidayah, E., & Saptarini, G. D. (2019). Pentagon fraud analysis in detecting potential financial statement fraud of banking companies in Indonesia. Proceeding Uii-Icabe, 89-102.

  15. Inayati, N.I., dan Azizah, S.N. (2021) The Effect of Audit Quality, Managerial Ownership, And Audit Committee On The Integrity Of Financial Statements (Empirical Study on Manufacturing Companies listed on the IDX 2015-2019). Jurnal Akuntansi dan Pajak, 22(01), pp. 151-159

  16. Inayati,N.I., Azizah, S.N. 2021. The Effect of Audit Quality, Managerial Ownership, And Audit Committee on The Integrity of Financial Statements (Empirical Study on Manufacturing Companies Listed on The IDX 2015-2019). Jurnal Akuntansi dan Pajak, 22(01): 151-159

  17. Junus, I., Harymawan, I., Nasih, M.,  Anshori, M., Politically Connected Independent Commissioners and Independent Directors on the Cost of Debt. International. Journal Financial Studies. 2022, 10(2), 41: 13-21

  18. Kaawaase, T.K., Nairuba, C., Akankunda, B. and Bananuka, J. (2021), Corporate governance, internal audit quality and financial reporting quality of financial institutions", Asian Journal of Accounting Research, Vol. 6 No. 3, pp. 348-366. https://doi.org/10.1108/AJAR-11-2020-0117

  19. Kassem, R. (2019). Understanding financial reporting fraud in Egypt: evidence from the audit field. Third world quarterly, 40(11), 1996-2015.

  20. Khatib, S. F., & Nour, A. (2021). The impact of corporate governance on firm performance during the COVID-19 pandemic: Evidence from Malaysia. Journal of Asian Finance, Economics and Business, 8(2), 0943-0952.

  21. Kim, H., Kwak, B., Lim, Y., & Yu, J. (2017). Audit committee accounting expertise, CEO power, and audit pricing. Asia-Pacific Journal of Accounting & Economics, 24, 421 - 439.

  22. Namakavarani, O.M., Daryaei, A.A., Askarany, D., & Askary, S. (2021). Audit Committee Characteristics and Quality of Financial Information: The Role of the Internal Information Environment and Political Connections. The University of Auckland Business School Research Paper Series.

  23. Nurbaiti, A., & Elisabet, C. (2023). The Integrity Of Financial Statements: Firm Size, Independent Commissioners, And Auditor Industry Specializations. Jurnal Akuntansi, 27(1), 1-18.

  24. Oktaviana, H., & Paramitha, M. (2021). The Effect of Ownership Structure, Audit Committee, Company Size, and Audit Quality on the Integrity of Financial Statements on Manufacturing Companies Listed on IDX. Journal La Bisecoman, 2(4), 15-29.

  25. Parinduri, A. Z., Pratiwi, R. K., & Purwaningtyas, O. I. (2019). Analysis of corporate governance, leverage and company size on the integrity of financial statements. Indonesian Management and Accounting Research, 17(1), 18-35.

  26. Payne, G. T., & Petrenko, O. V. (2019). Agency theory in business and management research. In Oxford Research Encyclopedia of Business and Management.

  27. Pramana, Y., Suprasto, H. B., Putri, I. G. A. M. D., & Budiasih, I. G. A. N. (2019). Fraud factors of financial statements on construction industry in Indonesia stock exchange. International Journal of Social Sciences and Humanities, 3(2), 187-196.

  28. Prena, G. D. (2020). The Influence Of Audit Tenure, Independent Commissioner, Audit Committee, And Audit Quality On Integrity Of Financial Statements. Jurnal Ilmiah Econosains, 18(1), 39-49.

  29. Purwantiningsih, A., & Anggaeni, D. (2021). Analisis Pengaruh Corporate Governance dan Kualitas Audit terhadap Integritas Laporan Keuangan pada Perusahaan Manufaktur Sub Sektor Otomotif dan Komponen yang Terdaftar di Bursa Efek Indonesia Periode 2012-2017. Studi Akuntansi, Keuangan, dan Manajemen, 1(1), 33-43.

  30. Rahmadi, Z. T., Wahyudi, M. A., Nurdiana, D., & Hasibuan, A. N. (2022). The Influence Of Independent Commissioners, Audit Committees And Profitability On The Integrity Of Lq-45 Indexed Companies’ Financial Report . Jurnal Ekonomi, 11(03), 612–622.

  31. Saputra, W., & Bakri, B. (2023). The Influence of Quality of Financial Statements of Waqf Institutions on Stakeholder Trust. Al-Buhuts, 19(1), 75-92.

  32. Shahid, M. S., & Abbas, M. (2019). Does corporate governance play any role in investor confidence, corporate investment decisions relationship? Evidence from Pakistan and India. Journal of Economics and Business, 105, 105839.

  33. Simamora, J. M. D., & Setiyawati, H. (2023). Analysis of The Effect of Good Corporate Governance Structure on The Integrity of Financial Statements and Their Impact on The Quality of Financial Statements. Journal Of Humanities And Social Studies), 7(2), 355-358.

  34. Srikandhi, M., & Suryandari, D. (2020). Audit Quality Moderates the Effect of Independent Commissioners, Audit Committee, and Whistleblowing System on the Integrity of Financial Statement. Accounting Analysis Journal, 9(3), 186-192.

  35. Sudjono, A. C. (2023). Do Good Corporate Governance and Whistleblowing Systems in Bank Industry Effectively Support Fraud Detection and Prevention? Asia Pacific Fraud Journal, 8(1), 155-168.

  36. Sunaryo, K., Kusumawardhani, I., & Astuti, S. H. (2023). Analysis of Internal Control System and Standard Operating Procedures Upn Yogyakarta Cooperatives to Support Good Corporate Governance. CENTRAL ASIAN JOURNAL OF SOCIAL SCIENCES AND HISTORY, 4(9), 76-86.

  37. Susandrya, A.A.P.G. B.A., Suryandari, N.N.A. 2023. The effect of Good Corporate Governance, Company Size and Leverage on the Integrity of financial Statement. Jurnal Ekonomi Teknologi dan Bisnis. Vol 2 (3) : 310-324

  38. Ulfa, A.M., Challen, A.E., . Good Corporate Governance on Integrity of Financial Statements. Advances in Social Science, Education and Humanities Research, volume 439 : 40-45.

  39. Wardhani, W. K., & Samrotun, Y. C. (2020). Pengaruh kepemilikan institusional, kepemilikan manajerial, ukuran perusahaan dan leverage terhadap integritas laporan keuangan [The influence of institutional ownership, managerial ownership, company size and leverage on the integrity of financial statements]. Jurnal Ilmiah Universitas Batanghari Jambi, 20(2), 475-481.

  40. Winoto, A., Salim, G., & Purnomo, A. (2023). Factors affecting the integrity of financial statements. Corporate Governance and Organizational Behavior Review, 7(3), 211-227.

  41. Yudiawan, I. N., & Kepramareni, P. (2022). Pengaruh Komisaris Independen, Komite Audit, Kepemilikan Institusional, Leverage Dan Ukuran Perusahaan Terhadap Integritas Laporan Keuangan Pada Perusahaan Manufaktur Yang Terdaftar Di Bursa Efek Indonesia Periode 2018-2020 [The Influence of Independent Commissioners, Audit Committees, Institutional Ownership, Leverage and Company Size on the Integrity of Financial Reports in Manufacturing Companies Listed on the Indonesian Stock Exchange for the 2018-2020 Period]. Kumpulan Hasil Riset Mahasiswa Akuntansi (KHARISMA), 4(3), 302-311.

bottom of page