Internal corporate governance mechanisms and earning quality in Indonesia: external audit quality as a moderator

Earnings quality reflects the integrity and quality of financial reporting which minimises the information asymmetry and agency conflicts amongst the management and shareholders. The issue of earnings quality has become a concern, especially in respect to corporate governance as an internal and exte...

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Main Author:	Surbakti, Lidya Primta
Format:	Thesis
Language:	eng eng eng eng
Published:	2020
Subjects:	HF5667 Professional Ethics Auditors.
Online Access:	https://etd.uum.edu.my/9382/1/Depositpermission-not%20allow_s90061.pdf https://etd.uum.edu.my/9382/2/s900061_01.pdf https://etd.uum.edu.my/9382/3/s900061_02.pdf https://etd.uum.edu.my/9382/4/s900061_references.docx
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id	my-uum-etd.9382
record_format	uketd_dc
spelling	my-uum-etd.93822022-05-22T01:14:03Z Internal corporate governance mechanisms and earning quality in Indonesia: external audit quality as a moderator 2020 Surbakti, Lidya Primta Shaari, Hasnah Bamahros, Hasan Mohammed Ahmed Tunku Puteri Intan Safinaz School of Accountancy (TISSA) Tunku Puteri Intan Safinaz School of Accountancy (TISSA) HF5667 Professional Ethics. Auditors. Earnings quality reflects the integrity and quality of financial reporting which minimises the information asymmetry and agency conflicts amongst the management and shareholders. The issue of earnings quality has become a concern, especially in respect to corporate governance as an internal and external monitoring mechanism to ensure the financial reporting quality. The objective of the study is to examine the relationships amongst the internal corporate governance mechanisms, namely, board of commissioners, audit committee, and earnings quality based on the agency theory and resource dependence theory. Furthermore, this study has examined the moderating effect of external audit quality on the relationships between the internal corporate governance mechanisms and earnings quality. The fixed effects regression was used to analyse the data. The sample of the study was 864 firm-year observations of the non-financial companies in the Indonesian Stock Exchange for the period of 2013 to 2016. Real earnings management models were used to measure earnings quality. This study has revealed that board size, audit committee independence and audit committee tenure increased the quality of the earnings. In contrast, audit committee duality role reduced the earnings quality. In further analysis, external audit quality is found to be significantly moderate the relationship between the board size, audit committee independence, audit committee meetings and audit committee duality role with earnings quality. The results of this study have implications for regulators, investors, and market participants. Policy makers might use the findings regarding earnings quality to recognise the important roles played by the board of commissioners, audit committee, and external audit in enhancing the earnings quality in Indonesian companies. 2020 Thesis https://etd.uum.edu.my/9382/ https://etd.uum.edu.my/9382/1/Depositpermission-not%20allow_s90061.pdf text eng staffonly https://etd.uum.edu.my/9382/2/s900061_01.pdf text eng staffonly https://etd.uum.edu.my/9382/3/s900061_02.pdf text eng staffonly https://etd.uum.edu.my/9382/4/s900061_references.docx text eng staffonly other doctoral Universiti Utara Malaysia
institution	Universiti Utara Malaysia
collection	UUM ETD
language	eng eng eng eng
advisor	Shaari, Hasnah Bamahros, Hasan Mohammed Ahmed
topic	HF5667 Professional Ethics Auditors.
spellingShingle	HF5667 Professional Ethics Auditors. Surbakti, Lidya Primta Internal corporate governance mechanisms and earning quality in Indonesia: external audit quality as a moderator
description	Earnings quality reflects the integrity and quality of financial reporting which minimises the information asymmetry and agency conflicts amongst the management and shareholders. The issue of earnings quality has become a concern, especially in respect to corporate governance as an internal and external monitoring mechanism to ensure the financial reporting quality. The objective of the study is to examine the relationships amongst the internal corporate governance mechanisms, namely, board of commissioners, audit committee, and earnings quality based on the agency theory and resource dependence theory. Furthermore, this study has examined the moderating effect of external audit quality on the relationships between the internal corporate governance mechanisms and earnings quality. The fixed effects regression was used to analyse the data. The sample of the study was 864 firm-year observations of the non-financial companies in the Indonesian Stock Exchange for the period of 2013 to 2016. Real earnings management models were used to measure earnings quality. This study has revealed that board size, audit committee independence and audit committee tenure increased the quality of the earnings. In contrast, audit committee duality role reduced the earnings quality. In further analysis, external audit quality is found to be significantly moderate the relationship between the board size, audit committee independence, audit committee meetings and audit committee duality role with earnings quality. The results of this study have implications for regulators, investors, and market participants. Policy makers might use the findings regarding earnings quality to recognise the important roles played by the board of commissioners, audit committee, and external audit in enhancing the earnings quality in Indonesian companies.
format	Thesis
qualification_name	other
qualification_level	Doctorate
author	Surbakti, Lidya Primta
author_facet	Surbakti, Lidya Primta
author_sort	Surbakti, Lidya Primta
title	Internal corporate governance mechanisms and earning quality in Indonesia: external audit quality as a moderator
title_short	Internal corporate governance mechanisms and earning quality in Indonesia: external audit quality as a moderator
title_full	Internal corporate governance mechanisms and earning quality in Indonesia: external audit quality as a moderator
title_fullStr	Internal corporate governance mechanisms and earning quality in Indonesia: external audit quality as a moderator
title_full_unstemmed	Internal corporate governance mechanisms and earning quality in Indonesia: external audit quality as a moderator
title_sort	internal corporate governance mechanisms and earning quality in indonesia: external audit quality as a moderator
granting_institution	Universiti Utara Malaysia
granting_department	Tunku Puteri Intan Safinaz School of Accountancy (TISSA)
publishDate	2020
url	https://etd.uum.edu.my/9382/1/Depositpermission-not%20allow_s90061.pdf https://etd.uum.edu.my/9382/2/s900061_01.pdf https://etd.uum.edu.my/9382/3/s900061_02.pdf https://etd.uum.edu.my/9382/4/s900061_references.docx
_version_	1747828586102915072

Internal corporate governance mechanisms and earning quality in Indonesia: external audit quality as a moderator

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