IDX Food and Beverage Companies Financial Reporting Timelines: Do Profitability, Auditor Opinion, and Company Size Play a Role?
Abstract
This study aims to analyze the effect of profitability, auditor's opinion, and company size on the timeliness of financial report submissions in companies listed on the Indonesia Stock Exchange (IDX) from 2021-2023. The financial report submission timeline is one of the important components in information disclosure that can influence investment decisions and market confidence. Profitability is measured using Return on Assets (ROA), the auditor's opinion is seen based on the type of audit opinion given, and company size is measured from total assets. This study uses a quantitative method with a multiple regression approach. The research sample consisted of 12 Food and Beverage companies listed on the IDX during the period studied, which were selected using a purposive sampling technique. Secondary data from financial reports and company audit opinions were taken from the official IDX website and the company's annual report. The results of the study indicate that profitability and company size have a positive and significant effect on financial report submission timeliness, while the auditor's opinion does not have a significant effect. This finding indicates that larger and more profitable companies tend to be timelier in reporting their finances, while the type of auditor's opinion is not a determining factor in terms of timeliness. This study contributes to the literature on financial reporting in the Indonesian capital market and provides recommendations for companies and regulators to pay more attention to internal factors that influence financial report timeliness.
Downloads
References
Abideen, Z. U., Ahmed, Z., Qiu, H., & Zhao, Y. (2023). Do Behavioral Biases Affect Investors’ Investment Decision Making? Evidence from the Pakistani Equity Market. Risks, 11(6), 109. https://doi.org/10.3390/risks11060109
Afify, H.A.E. (2009), Determinants of audit report lag: Does implementing corporate governance have any impact? Empirical evidence from Egypt, Journal of Applied Accounting Research, Vol. 10 No. 1, pp. 56-86. https://doi.org/10.1108/09675420910963397
Aksoy, M., Yilmaz, M.K., Topcu, N. and Uysal, Ö. (2021), "The impact of ownership structure, board attributes and XBRL mandate on timeliness of financial reporting: evidence from Turkey", Journal of Applied Accounting Research, Vol. 22 No. 4, pp. 706-731. https://doi.org/10.1108/JAAR-07-2020-0127
Alduais, F. (2023). Unravelling the intertwined nexus of firm performance, ESG practices, and capital cost in the Chinese business landscape. Cogent Economics & Finance, 11(2). https://doi.org/10.1080/23322039.2023.2254589
Almasria, N. A. (2022). Corporate Governance and the Quality of Audit Process: An Exploratory Analysis Considering Internal Audit, Audit Committee and Board of Directors. European Journal of Business and Management Research, 7(1), 78–99. https://doi.org/10.24018/ejbmr.2022.7.1.1210
Budiwitjaksono, G. S., Munari, M., & Suryaningrum, D. H. (2024). Critical Review of XBRL Financial Reporting: Perspective Pancasila as One of Indonesia’s National Defense Values. JASF: Journal of Accounting and Strategic Finance, 7(1), 181–199. https://doi.org/10.33005/jasf.v7i1.511
Changwony, F. K., & Kyiu, A. K. (2024). Business strategies and corruption in small- and medium-sized enterprises: The impact of business group affiliation, external auditing, and international standards certification. Business Strategy and the Environment, 33(1), 95–121. https://doi.org/10.1002/bse.3333
Chen, C. -L., Lin, Y. -C., Chen, W. -H., Chao, C. -F., & Pandia, H. (2021). Role of Government to Enhance Digital Transformation in Small Service Business. Sustainability, 13(3), 1028. https://doi.org/10.3390/su13031028
Christensen, H.B., Hail, L. & Leuz, C. (2021), Mandatory CSR and sustainability reporting: economic analysis and literature review. Rev Account Stud 26, 1176–1248. https://doi.org/10.1007/s11142-021-09609-5
Fajaria, A. Z., & Isnalita, I. (2018). The Effect of Profitability, Liquidity, Leverage and Firm Growth of Firm Value with its Dividend Policy as a Moderating Variable. International Journal of Managerial Studies and Research, 6(10), 55–69. https://doi.org/10.20431/2349-0349.0610005
Febriana, D. A. & Setiawati, E. (2023), The Effect of Profitability, Company Size, Operating Complexity and Leverage on the Timely Submission of Financial Reports in Manufacturing Companies in the Various Industrial Sectors Listed on IDX In 2018-2021, International Journal of Scientific and Research Publications (IJSRP) 13(02). http://dx.doi.org/10.29322/IJSRP.13.02.2023.p13403
Fidiana, F., & Retnani, E. D. (2023). Reliability of Audit Evidence during Pandemic Restrictions. JASF: Journal of Accounting and Strategic Finance, 6(1), 90–106. https://doi.org/10.33005/jasf.v6i1.393
García-Quevedo J, Jové-Llopis E, Martínez-Ros E. (2020), Barriers to the circular economy in European small and medium-sized firms. Bus Strat Env. 2020; 29: 2450–2464. https://doi.org/10.1002/bse.2513
Hendi, H., & Sitorus, R. (2023). An Empirical Research on Audit Report Timeliness. Jurnal Akuntansi dan Keuangan, 25(1), 39–53. https://doi.org/10.9744/jak.25.1.39-53
Herawaty, V., & Nugraha, M. A. (2023). Antecedents of Audit Report Lag with Audit Quality as a Moderator. JASF: Journal of Accounting and Strategic Finance, 6(2), 320–342. https://doi.org/10.33005/jasf.v6i2.477
Hwang, S., No, W. G., & Kim, J. (2020). XBRL Mandate and Timeliness of Financial Reporting: The Effect of Internal Control Problems. Journal of Accounting, Auditing & Finance, 36(3), 1–23. https://doi.org/https://journals.sagepub.com/doi/10.1177/0148558X20929854
Jensen, M. C., & Meckling, W. H. (1976). Theory of the firm: Managerial behavior, agency costs and ownership structure. Journal of Financial Economics, 3(4), 305–360. https://doi.org/10.1016/0304-405X(76)90026-X
Jihadi, M., Vilantika, E., Hashemi, S. M., Arifin, Z., Bachtiar, Y., & Sholichah, F. (2021). The Effect of Liquidity, Leverage, and Profitability on Firm Value: Empirical Evidence from Indonesia. Journal of Asian Finance, Economics and Business, 8(3), 0423–0431. https://doi.org/https://doi.org/10.13106/jafeb.2021.vol8.no3.0423
Johnston, A., Belinga, R., & Segrestin, B. (2021). Governing institutional investor engagement: from activism to stewardship to custodianship? Journal of Corporate Law Studies, 22(1), 45–82. https://doi.org/10.1080/14735970.2021.1965338
Kinyua, K.M., Changwony, F.K. & Campbell, K. (2024), Government procurement contracts, external audit certification, and financing of small- and medium-sized enterprises. Small Bus Econ (2024). https://doi.org/10.1007/s11187-024-00940-0
Lestari, T. U., & Musrady, R. A. F. (2023). The Impact of ERP and XBRL Implementation on the Accounting Information Quality. Jurnal Ilmiah Manajemen, Ekonomi, & Akuntansi (MEA), 7(2), 373–393. https://doi.org/10.31955/mea.v7i2.3019
Leventis, S., Weetman, P., & Caramanis, C. (2005). Determinants of audit report lag: Some evidence from the Athens Stock Exchange. International Journal of Auditing, 9(1), 45-58. https://doi.org/10.1111/j.1099-1123.2005.00101.x
Lieh-Ming L., Hui-Tzu L., Chia-Chou C., & Chih-Wei L. (2023), The relations of corporate risk, operating efficiency, and firm size to managerial compensation: Evidence from Taiwan stock market-listed companies, Asia Pacific Management Review, Volume 28, Issue 2, 194-203. https://doi.org/10.1016/j.apmrv.2022.09.001.
Lukason, O., & Camacho-Miñano, M. -d. -M. (2021). What Best Explains Reporting Delays? A SME Population Level Study of Different Factors. Sustainability, 13(9), 4663. https://doi.org/10.3390/su13094663
Mohammadi, S., & Nezhad, B. M. (2015). The role of disclosure and transparency in financial reporting. International Journal of Accounting and Economics Studies, 3(1), 60–62. https://doi.org/10.14419/ijaes.v3i1.4549
Momtaz, P. P. (2021). Initial coin offerings, asymmetric information, and loyal CEOs. Small Business Economics, 57(2), 975–997. https://doi.org/10.1007/s11187-020-00335-x
Owusu-Ansah, S. (2012). Timeliness of corporate financial reporting in emerging capital markets: Empirical evidence from the Zimbabwe Stock Exchange. Accounting and Business Research, 30(3), 241-254. https://doi.org/10.1080/00014788.2000.9728939
Şeker, Y., & Şengür, E. D. (2021). The Impact of Environmental, Social, and Governance (ESG) Performance on Financial Reporting Quality: International Evidence. Ekonomika, 100(2), 190–212. https://doi.org/10.15388/Ekon.2021.100.2.9
Singh, H., Sultana, N., Islam, A., & Singh, A. (2022), Busy auditors, financial reporting timeliness and quality, The British Accounting Review, Volume 54, Issue 3, 101080. https://doi.org/10.1016/j.bar.2022.101080.
Velte, P. (2023). The impact of external auditors on firms’ financial restatements: a review of archival studies and implications for future research. Manag Rev Q 73, 959–985 (2023). https://doi.org/10.1007/s11301-022-00264-x
Zhao, L., Liu, Z., Vuong, T. H. G., Nguyen, H. M., Radu, F., Tăbîrcă, A. I., & Wu, Y.-C. (2022). Determinants of Financial Sustainability in Chinese Firms: A Quantile Regression Approach. Sustainability, 14(3), 1555. https://doi.org/10.3390/su14031555
Copyright (c) 2024 Claudine de-Olivera
This work is licensed under a Creative Commons Attribution 4.0 International License.
