Exploration Disclosures of Internal Control as the Impact of Earnings Quality and Audit Committee

Abstract

Information disclosure carried out by management as an appointed agent is increasing in importance and hence, a source of concerns to users. It is widely believed that information received by the stakeholders should be appropriate and sufficient for useful decision making, especially in the era of the Fourth industrial revolution. An appropriate and sufficient disclosure in the Annual report indicates a reflection of the effective implementation of the company's operational, strategic, financial and compliance objectives that have been carried out by the management. This study employed secondary data obtained from the annual report for the banks listed in the Indonesia Stock Exchange (IDX). The data for internal control disclosure was observed through a content analysis approach by calculating the internal control system index obtained in the annual report. This study has shown that companies with high earnings quality report more openly convey the application of internal controls system disclosure. This study demonstrated that company with the high characteristics of the audit committee would significantly increase disclosure of internal controls system than a company without audit committee. Supervision, as one of the internal controls established by the management, enhances the performances of the audit committee in ensuring compliance through full disclosure of the financial statements. Thus, restoring users’ trust and confidence in making informed and useful decisions on information emanating from the management.

Quality Of Financial Statement And The Factors That Influence It

“…Applying an accounting standard relates to its importance in disclosing accounting information that describes financial performance in financial reporting. The application of accounting standards also aims to obtain good-quality financial reports (Pangaribuan et al, 2019). Previously (Ewert and Wagenhofer, 2016) say that although many have found that the use of accounting standards can increase disclosure and make information more symmetrical, the reality is that existing accounting standards tend to have the opposite effect.…”

Local Government Financial Reports: Utilisation of Information Technology and Implementation of Government Accounting Standards

“…The birth of GAS has changed the pattern of government financial management in Indonesia. Agbodjo et al, (2021); Miyauch & Sanada (2019) added that these standards serve as guidelines for preparing quality government and non-government financial reports (Pangaribuan et al, 2019) had an impact on increasing voluntary disclosure (Pangaribuan et al, 2022) and provided benefits to stakeholders (Dumisani, 2019). Anggadini et al, (2023); Pangaribuan et al, (2023) Supriyanto et al, (2023; Costa et al, (2022); Dahana & Purnomowati (2022) Yusrina et al, (2017) argued that the use of accounting standards significantly improve the quality of financial reports.…”

Essential internal control: evidence from the executive branch of the State of Ceará

“…The theoretical framework 2.1 Historical and legal landmarks of internal control Internal control integrates the scope of the control function and, within the organization, occupies a level of extreme importance that affects objectives, plans, information, processes, systems, activities, functions, projects and initiatives (Montenegro, Oliveira, & Lopes, 2017). The internal control system comprises a process that aims to achieve operational effectiveness and efficiency, reliability, criteria compliance and compliance with laws and regulations (Pangaribuan, Donni, Popoola, & Sihombing, 2019).…”