Moderating Effect of Press Highlights on The Effect of the Quality of Internal Control Systems on Disclosure in Local Government Financial Reports

DOI

10.2991/apbec-18.2019.67How to use a DOI?

Keywords

local government financial report, financial disclosure, internal control system quality, press highlight

Abstract

Many factors are believed to affect government’s financial voluntary disclosure. Among these are system endorsement and press coverage. The objective of this study is to investigate the effect of the quality of internal control systems on disclosure in the local government’s financial report and the moderating effect of press highlights on the relationship between the quality of such systems and disclosure. This study also analyses the effect of the differences in some local characteristics on this relationship. This study applies the two-step moderated regression analysis method to 1,310 firm-year samples of local government in Indonesia during the period 2010 - 2013. The empirical findings show that for different sizes of local government, the quality of the internal control system affects financial disclosure in different ways. However, overall, we find no evidence to show that the quality of internal control systems affects financial disclosure. This study’s findings also show that press highlights negatively moderate the relationship between the quality of internal control systems and financial disclosure. There are other studies that have investigated the direct effect of press on disclosure; thus, this study contributes to the existing literature by providing empirical evidence of the moderating effect of press highlights.

Copyright

© 2019, the Authors. Published by Atlantis Press.

Open Access

This is an open access article distributed under the CC BY-NC license (http://creativecommons.org/licenses/by-nc/4.0/).

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TY  - CONF
AU  - Farid Handoko
AU  - Bambang Pamungkas
AU  - Akhmad Syakhroza
AU  - Ancella A.  Hermawan
PY  - 2019/07
DA  - 2019/07
TI  - Moderating Effect of Press Highlights on The Effect of the Quality of Internal Control Systems on Disclosure in Local Government Financial Reports
BT  - Proceedings of the Asia Pacific Business and Economics Conference (APBEC 2018)
PB  - Atlantis Press
SP  - 476
EP  - 484
SN  - 2352-5428
UR  - https://doi.org/10.2991/apbec-18.2019.67
DO  - 10.2991/apbec-18.2019.67
ID  - Handoko2019/07
ER  -