Articles

The Effectiveness of Good Corporate Governance in Reducing the Risk of Fraudulent Financial Reporting

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This study aims to examine the effectiveness of good corporate governance as proxied by the independent board, audit committee, managerial ownership, and institutional ownership in reducing the risk of fraudulent financial reporting in banking companies listed on the Indonesia Stock Exchange from 2020 to 2024. The analysis was conducted on 39 companies that met the research criteria, resulting in a total of 195 samples. Hypothesis testing was performed using multiple linear regression analysis with the assistance of the Eviews 12 software. The results indicate that the independent board has a negative and significant effect on the risk of fraudulent financial reporting, while managerial ownership has a positive and significant effect. In contrast, the audit committee and institutional ownership do not have a significant effect. Furthermore, the F-test shows that the independent variables simultaneously have a significant effect on the dependent variable. Based on the coefficient of determination (R2), 36.43% of the variation in the dependent variables can be explained by the independent variables.

The Effect of Liquidity, Leverage, and Profitability on Financial Distress with Audit Committee as a Moderating Variable

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This study examines the effect of liquidity, leverage, and profitability on financial distress with the audit committee as a moderating variable. This study used secondary data from the annual reports of manufacturing companies listed on the Indonesia Stock Exchange (IDX) from 2016 to 2019. The research sample was selected using purposive sampling, and 33 companies were obtained as the study samples. The data were then analyzed using the logistic linear regression method with SPSS ver 26 software. The study results found that liquidity and profitability had a negative effect on financial distress, whereas leverage had a positive effect on financial distress. In addition, the study also found that the audit committee enhanced the effect of liquidity and profitability on financial distress. In contrast, the audit committee reduced the effect of leverage on financial distress.