INDEPENDENCE, CORPORATE GOVERNANCE AND AUDIT QUALITY ON THE INTEGRITY OF FINANCIAL STATEMENTS

Publication Date : 01/01/2019


Author(s) :

SAHIDAH.


Volume/Issue :
Volume 4
,
Issue 1
(01 - 2019)



Abstract :

This study aims to determine whether independence, corporate governance mechanisms, and audit quality affect the integrity of financial statements in manufacturing companies listed on the Indonesia Stock Exchange. Data collection uses secondary data obtained through the official website IDX www.idx.co, using purposive sampling technique. The population is all manufacturing companies listed on the Indonesia Stock Exchange period totaling 148 companies, while the samples taken amounted to 31 companies and obtained data in the form of audited annual financial statements. The results showed that institutional ownership and audit quality had an effect on the integrity of financial statements while independence, managerial ownership, independent commissioners and audit committees did not affect the integrity of financial statements. external auditor able to bridge the opinion and the agency in managing the finances of the company. The auditor will ratify the agency's accountability report to the principal by providing an independent and professional assessment of the reliability and fairness of the company's financial statements. Agency theory explains that an auditor with high quality audits will have the ability to detect earnings management practices conducted by the management company.


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