PENGARUH KARAKTERISTIK KOMITE AUDIT TERHADAP KINERJA PERUSAHAAN THE EFFECT OF COMMITTEE AUDIT CHARACTERISTICS ON FIRM PERFORMANCE
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Jul 25, 2023
Keywords:
Committee Audit Characteristics, Firm Performance, Committee Audit Size
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Abstract
This study empirically examines the impact of audit committee size variables, financial expertise and frequency of audit committee meetings and company performance. Population of this sudy was firms listed in Bursa Efek Indonesia (BEI) and The sample was company from Basic and Chemical Industry from 2014-2020 with 295 total observation. The company's performance uses TobinsQ measurements. Regression analysis using panel data and stata 17 application identified that the size of the audit committee and the financial expertise of the audit committee had a significant positive effect on the company's performance. On the other hand, the frequency of audit committee meetings that are routinely held every year was found to have a positive insignificant effect on the company's performance. This research contributes to the company's performance. First, it shows the extent of the performance of basic industrial and chemical companies listed on the Indonesia Stock Exchange. Second, the study adds to the existing literature on the impact of audit committee attributes on company performance by using a focus of one measurement of company performance and specifically audit committees that were previously not specific. Third, this study is expected to provide feedback to regulators of basic and chemical industry companies on the current regulations on the requirements of being an audit committee in basic and chemical industrial enterprises. Finally, this study raises some issues of interest to other researchers who are or will be conducting research in this field.
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Perangin-Angin, C. P., Khoiriyah, M., Satriawan, R. A., & Afifah, U. (2023). PENGARUH KARAKTERISTIK KOMITE AUDIT TERHADAP KINERJA PERUSAHAAN: THE EFFECT OF COMMITTEE AUDIT CHARACTERISTICS ON FIRM PERFORMANCE. CURRENT: Jurnal Kajian Akuntansi Dan Bisnis Terkini, 4(2), 343-355. https://doi.org/10.31258/current.4.2.343-355
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This work is licensed under a Creative Commons Attribution 4.0 International License.
This work is licensed under a Creative Commons Attribution 4.0 International License.
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References
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Aldamen, H., Duncan, K., Kelly, S., & McNamara, R. (2020). Corporate governance and family firm performance during the Global Financial Crisis. Accounting and Finance, 60(2), 1673–1701. https://doi.org/10.1111/acfi.12508
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Connelly, J. T., Limpaphayom, P., Nguyen, H. T., & Tran, T. D. (2017). A tale of two cities: Economic development, corporate governance and firm value in Vietnam. Research in International Business and Finance,
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Ghozali, I. (2018). Aplikasi Analisis Multivariate Dengan Program SPSS. Ba& Penerbit Universitas Diponegoro.
Jesuka, D., & Peixoto, F. M. (2022). Corporate governance and firm performance: does sovereign rating matter? Corporate Governance (Bingley), 22(2), 243–256. https://doi.org/10.1108/CG-08-2020-0369
Jouber, H. (2021). Is the effect of board diversity on CSR diverse? New insights from one-tier vs two-tier corporate board models. Corporate Governance (Bingley), 21(1), 23–61. https://doi.org/10.1108/CG-07-2020-0277
Kabir, R., & Thai, H. M. (2017). Does corporate governance shape the relationship between corporate social responsibility and financial performance? Pacific Accounting Review, 29(2), 227–258. https://doi.org/10.1108/par-10-2016-0091
Meah, M. R., Sen, K. K., & Ali, M. H. (2021). Audit Characteristics, Gender Diversity and Firm Performance: Evidence from a Developing Economy. Indian Journal of Corporate Governance, 14(1), 48–70. https://doi.org/10.1177/09746862211007244
Napitupulu, I. H., Situngkir, A., Basuki, F. H., & Nugroho, W. (2020). Optimizing good Corporate Governance Mechanism to Improve Performance: Case in Indonesia’s Manufacturing Companies. Global Business Review, 46. https://doi.org/10.1177/0972150920919875
Nini, N., Patrisia, D., & Nurofik, A. (2020). The Effect of Capital Structure on Company Financial Performance. Jurnal Economia, 16(2), 173–183. https://doi.org/10.21831/economia.v16i2.30661
Oana Pintea, M., Pop, A. M., & Gavriletea, M., & Sechel, I. C. (2020). Corporate governance and financial performance: evidence from Romania. Journal of Economic Studies, 48(8), 1573–1590. https://doi.org/10.1108/JES-07-2020-0319
Puni, A., & Anlesinya, A. (2020). Corporate governance mechanisms and firm performance in a developing country. International Journal of Law and Management, 62(2), 147–169. https://doi.org/10.1108/IJLMA-03-2019-0076
Qu, C. T. (2020). Board Members With Style: The Effect of Audit Committee Members and Their Personal Styles on Financial Reporting Choices. Journal of Accounting, Auditing and Finance, 35(3), 530–557. https://doi.org/10.1177/0148558X17752804
Rahmawati, N. B., & Handayani, R. S. (2017). Analisis Pengaruh Karakteristik Corporate Governance terhadap Kinerja Perusahaan. Diponegoro Journal of Accounting, 6(3), 1–12.
Rashid, M. M. (2020). “Ownership structure and firm performance: the mediating role of board characteristics.” Corporate Governance (Bingley), 20(4), 719–737. https://doi.org/10.1108/CG-02-2019-0056
Raweh, N. A. M., Abdullah, A. A. H., Kamardin, H., & Malek, M. (2021). Industry expertise on audit committee and audit report timeliness. Cogent Business and Management, 8(1). https://doi.org/10.1080/23311975.2021.1920113
Sadiq, M., & Gebba, T. R. A. (2021). Financial performance, firm value, transparency and corporate governance. Evidences from family-owned business in UAE. Transnational Corporations Review, 0(0), 1–11. https://doi.org/10.1080/19186444.2021.1938496
Sarpal, S. (2017). Analyzing Performance Implications of Selected Audit Committee Characteristics: A Study of Indian Corporate Sector. Business Perspectives and Research, 5(2), 137–150. https://doi.org/10.1177/2278533717692915
Suhadak, Kurniaty, Handayani, S. R., & Rahayu, S. M. (2019). Stock return and financial performance as moderation variable in influence of good corporate governance towards corporate value. Asian Journal of Accounting Research, 4(1), 18–34. https://doi.org/10.1108/AJAR-07-2018-0021
Tosun, O. K. (2021). International Review of Financial Analysis Changes in corporate governance : Externally dictated vs voluntarily determined. International Review of Financial Analysis, 73(June 2020), 101608.
Xiang, Y., & Birt, J. L. (2020). Internet reporting, social media strategy and firm characteristics – an Australian study. Accounting Research Journal, 34(1), 43–75. https://doi.org/10.1108/ARJ-09-2018-0154
Yu, E. P. yi, Luu, B. Van, & Chen, C. H. (2020). Greenwashing in environmental, social and governance disclosures. Research in International Business and Finance, 52(January), 101192. https://doi.org/10.1016/j.ribaf.2020.101192
Yuliusman, Y., & Safelia, N. (2023). Independensi Dewan, Frekuensi Rapat, Kepemilikan Institusional Dan Kinerja Perusahaan: Board Independence, Board Meeting Frequency, Institutional Ownership And Company PerformancE. CURRENT: Jurnal Kajian Akuntansi Dan Bisnis Terkini, 4(1), 133-145. https://doi.org/10.31258/current.4.1.133-145
Al-Gamrh, B., Al-Dhamari, R., Jalan, A., & Afshar Jahanshahi, A. (2020). The impact of board independence and foreign ownership on financial and social performance of firms: evidence from the UAE. Journal of Applied Accounting Research, 21(2), 201–229. https://doi.org/10.1108/JAAR-09-2018-0147
Al-Okaily, J., & BenYoussef, N. (2020). Audit committee effectiveness and non-audit service fees: Evidence from UK family firms. Journal of International Accounting, Auditing and Taxation, 41, 100356. https://doi.org/10.1016/j.intaccaudtax.2020.100356.
Al-Okaily, J., & Naueihed, S. (2020). Audit committee effectiveness and family firms: impact on performance. Management Decision, 58(6), 1021–1034. https://doi.org/10.1108/MD-04-2018-0422
Al-Thuneibat, A. A., Al-Angari, H. A., & Al-Saad, S. A. (2016). The effect of corporate governance mechanisms on earnings management: Evidence from Saudi Arabia. Review of International Business and Strategy, 26(1), 2–32. https://doi.org/10.1108/RIBS-10-2013-0100
Al Farooque, O., Buachoom, W., & Sun, L. (2020). Board, audit committee, ownership and financial performance – emerging trends from Thailand. Pacific Accounting Review, 32(1), 54–81. https://doi.org/10.1108/PAR-10-2018-0079
Aldamen, H., Duncan, K., Kelly, S., & McNamara, R. (2020). Corporate governance and family firm performance during the Global Financial Crisis. Accounting and Finance, 60(2), 1673–1701. https://doi.org/10.1111/acfi.12508
Aldhamari, R., Mohamad Nor, M. N., Boudiab, M., & Mas’ud, A. (2020). The impact of political connection and risk committee on corporate financial performance: evidence from financial firms in Malaysia. Corporate Governance (Bingley), 20(7), 1281–1305. https://doi.org/10.1108/CG-04-2020-0122
Bhagat, S., & Bolton, B. (2019). Corporate governance and firm performance: The sequel. Journal of Corporate Finance, 58(January), 142–168. https://doi.org/10.1016/j.jcorpfin.2019.04.006
Bhatt, P. R., & Bhatt, R. R. (2017). Corporate governance and firm performance in Malaysia. Corporate Governance (Bingley), 17(5), 896–912. https://doi.org/10.1108/CG-03-2016-0054
Connelly, J. T., Limpaphayom, P., Nguyen, H. T., & Tran, T. D. (2017). A tale of two cities: Economic development, corporate governance and firm value in Vietnam. Research in International Business and Finance,
Detthamrong, U., Chancharat, N., & Vithessonthi, C. (2017a). Corporate governance, capital structure and firm performance: Evidence from Thailand. Research in International Business and Finance, 42(July), 689–709. https://doi.org/10.1016/j.ribaf.2017.07.011
Dzomira, S. (2020). Corporate Governance and Performance of Audit Committee and Internal Audit Functions in an Emerging Economy’s Public Sector. Indian Journal of Corporate Governance, 13(1), 85–98. https://doi.org/10.1177/0974686220923789
Fariha, R., Hossain, M. M., & Ghosh, R. (2022). Board characteristics, audit committee attributes and firm performance: empirical evidence from emerging economy. Asian Journal of Accounting Research, 7(1), 84–96. https://doi.org/10.1108/AJAR-11-2020-0115
Fayanni, Y., & Soetedjo, S. (n.d.). Stock Prices Affected by Good Corporate Governance and Financial Performance.
Gupta, N., & Mahakud, J. (2021). Audit committee characteristics and bank performance: evidence from India. Managerial Auditing Journal, 36(6), 813–855. https://doi.org/10.1108/MAJ-04-2020-2622
Ghozali, I. (2018). Aplikasi Analisis Multivariate Dengan Program SPSS. Ba& Penerbit Universitas Diponegoro.
Jesuka, D., & Peixoto, F. M. (2022). Corporate governance and firm performance: does sovereign rating matter? Corporate Governance (Bingley), 22(2), 243–256. https://doi.org/10.1108/CG-08-2020-0369
Jouber, H. (2021). Is the effect of board diversity on CSR diverse? New insights from one-tier vs two-tier corporate board models. Corporate Governance (Bingley), 21(1), 23–61. https://doi.org/10.1108/CG-07-2020-0277
Kabir, R., & Thai, H. M. (2017). Does corporate governance shape the relationship between corporate social responsibility and financial performance? Pacific Accounting Review, 29(2), 227–258. https://doi.org/10.1108/par-10-2016-0091
Meah, M. R., Sen, K. K., & Ali, M. H. (2021). Audit Characteristics, Gender Diversity and Firm Performance: Evidence from a Developing Economy. Indian Journal of Corporate Governance, 14(1), 48–70. https://doi.org/10.1177/09746862211007244
Napitupulu, I. H., Situngkir, A., Basuki, F. H., & Nugroho, W. (2020). Optimizing good Corporate Governance Mechanism to Improve Performance: Case in Indonesia’s Manufacturing Companies. Global Business Review, 46. https://doi.org/10.1177/0972150920919875
Nini, N., Patrisia, D., & Nurofik, A. (2020). The Effect of Capital Structure on Company Financial Performance. Jurnal Economia, 16(2), 173–183. https://doi.org/10.21831/economia.v16i2.30661
Oana Pintea, M., Pop, A. M., & Gavriletea, M., & Sechel, I. C. (2020). Corporate governance and financial performance: evidence from Romania. Journal of Economic Studies, 48(8), 1573–1590. https://doi.org/10.1108/JES-07-2020-0319
Puni, A., & Anlesinya, A. (2020). Corporate governance mechanisms and firm performance in a developing country. International Journal of Law and Management, 62(2), 147–169. https://doi.org/10.1108/IJLMA-03-2019-0076
Qu, C. T. (2020). Board Members With Style: The Effect of Audit Committee Members and Their Personal Styles on Financial Reporting Choices. Journal of Accounting, Auditing and Finance, 35(3), 530–557. https://doi.org/10.1177/0148558X17752804
Rahmawati, N. B., & Handayani, R. S. (2017). Analisis Pengaruh Karakteristik Corporate Governance terhadap Kinerja Perusahaan. Diponegoro Journal of Accounting, 6(3), 1–12.
Rashid, M. M. (2020). “Ownership structure and firm performance: the mediating role of board characteristics.” Corporate Governance (Bingley), 20(4), 719–737. https://doi.org/10.1108/CG-02-2019-0056
Raweh, N. A. M., Abdullah, A. A. H., Kamardin, H., & Malek, M. (2021). Industry expertise on audit committee and audit report timeliness. Cogent Business and Management, 8(1). https://doi.org/10.1080/23311975.2021.1920113
Sadiq, M., & Gebba, T. R. A. (2021). Financial performance, firm value, transparency and corporate governance. Evidences from family-owned business in UAE. Transnational Corporations Review, 0(0), 1–11. https://doi.org/10.1080/19186444.2021.1938496
Sarpal, S. (2017). Analyzing Performance Implications of Selected Audit Committee Characteristics: A Study of Indian Corporate Sector. Business Perspectives and Research, 5(2), 137–150. https://doi.org/10.1177/2278533717692915
Suhadak, Kurniaty, Handayani, S. R., & Rahayu, S. M. (2019). Stock return and financial performance as moderation variable in influence of good corporate governance towards corporate value. Asian Journal of Accounting Research, 4(1), 18–34. https://doi.org/10.1108/AJAR-07-2018-0021
Tosun, O. K. (2021). International Review of Financial Analysis Changes in corporate governance : Externally dictated vs voluntarily determined. International Review of Financial Analysis, 73(June 2020), 101608.
Xiang, Y., & Birt, J. L. (2020). Internet reporting, social media strategy and firm characteristics – an Australian study. Accounting Research Journal, 34(1), 43–75. https://doi.org/10.1108/ARJ-09-2018-0154
Yu, E. P. yi, Luu, B. Van, & Chen, C. H. (2020). Greenwashing in environmental, social and governance disclosures. Research in International Business and Finance, 52(January), 101192. https://doi.org/10.1016/j.ribaf.2020.101192
Yuliusman, Y., & Safelia, N. (2023). Independensi Dewan, Frekuensi Rapat, Kepemilikan Institusional Dan Kinerja Perusahaan: Board Independence, Board Meeting Frequency, Institutional Ownership And Company PerformancE. CURRENT: Jurnal Kajian Akuntansi Dan Bisnis Terkini, 4(1), 133-145. https://doi.org/10.31258/current.4.1.133-145