Internal mechanisms of corporate governance and the likelihood of financial statements fraud: A study from Indonesian public listed companies

Zainal, A. and Muhamad, R. (2014) Internal mechanisms of corporate governance and the likelihood of financial statements fraud: A study from Indonesian public listed companies. In: International Conference on Business, Information and Cultural Creative Industry 2014, 06-08 Aug 2014, Taipei, Taiwan. (Submitted)

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Abstract

This study investigates the impact of internal mechanisms of corporate governance and the likelihood of financial statements in Indonesian public listed companies (PLCs). The findings resulted from a logit regression analysis on a matched pair sample of 47 fraud companies and 47 no-fraud companies from 2007-2012 indicate that fraud is more likely occur in a company having CEO and BOD members bound by a family relationship. In contrary, these results suggest that the likelihood of financial statements is lower when there is at least one financial/accounting/auditing expert in audit committee (AC) member. It also suggests that when number of independent AC member increases, the likelihood of financial statements decreases. These results provide direct implications in further strengthening the internal structure of corporate governance in this emerging market country.

Item Type: Conference or Workshop Item (Paper)
Uncontrolled Keywords: Internal Mechanisms, Corporate Governance, the Likelihood of Financial Statement Fraud, Public Listed Companies, Indonesia
Subjects: H Social Sciences > HG Finance
Depositing User: Mr. Mohd Samsul Ismail
Date Deposited: 31 Mar 2015 00:54
Last Modified: 31 Mar 2015 00:55
URI: http://eprints.um.edu.my/id/eprint/13139

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