The Composition of Independent Board of Commissioner and Number of Board of Commissioner Meeting Towards Fraudulence of Financial Report (Empirical Study at Public Company Listed at Indonesia Stock Exchange in 2011-2017)

Sudarman, Aniqotunnafiah and Masruri

International Journal of Financial Research, 2019, vol. 10, issue 4, 96-107

Abstract: This study aims to obtain empirical evidence about the effect of corporate governance mechanisms on fraudulent financial reporting. The variables of corporate governance used are independent board composition, frequency of board commissioner meetings, and external auditor quality as moderating variables between the influences of independent board composition, number of board of commissioners meetings against fraudulent financial reporting. The population of this study was public companies listed on the Indonesia Stock Exchange in 2011 - 2017. The total samples of this study were 76 companies, consist of 38 companies reported committing fraudulently financial statements and 38 companies that did not cheat financial statements. Data analysis was carried out by descriptive analysis, crosstab and hypothesis testing using the logistic regression method. The results of this study indicate the composition of the independent board of commissioners and the frequency of board of commissioners meetings has a significant and negative effect on the fraudulent financial report. Also, the quality of external auditors can strengthen the influence of the composition of the independent board of commissioners and the number of board of commissioners meetings on the fraudulent financial reporting.

Keywords: fraudulent financial report; independent commissioners; number of board of commissioners meetings; and the quality of external auditors (search for similar items in EconPapers)
Date: 2019
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Persistent link: https://EconPapers.repec.org/RePEc:jfr:ijfr11:v:10:y:2019:i:4:p:96-107

DOI: 10.5430/ijfr.v10n4p96

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