Astami, Emita, Pramono, Agus Joko, Rusmin, Rusmin, Cahaya, Fitra Roman and Soobaroyen, Teerooven (2024). Do family ownership and supervisory board characteristics influence audit report lag? A view from a two-tier board context. Journal of International Accounting, Auditing and Taxation, 56 ,
Abstract
This study investigates the impact of family ownership and supervisory board characteristics on audit report lag in Indonesia. The study relies on a balanced panel dataset and matched-pair sample of 124 listed non-financial firms (2017–2019) in a two-tier board context, drawing on Type II agency theory and the entrenchment/alignment implications of ownership concentration. First, we find a positive and significant association between family ownership and audit report lag. Second, we find evidence that the size of the supervisory board (locally referred to as the board of commissioners) and the frequency of meetings are negatively associated with audit report lag. Further analyses reveal that firms with a larger proportion of family members on the supervisory board experience longer reporting lag. This finding highlights the family’s entrenchment and their domination of the board of commissioners. Additional analysis considering the commissioners’ backgrounds reveals that audit report timeliness worsens when there is a larger proportion of community leadership. This suggests that some commissioner profiles could further lead to entrenchment behaviors. Our findings contribute to the literature and to policy by highlighting the potential and limits of a two-tier board policy on accounting outcomes, particularly in the context of dominant family structures in emerging economies.
Publication DOI: | https://doi.org/10.1016/j.intaccaudtax.2024.100638 |
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Divisions: | College of Business and Social Sciences > Aston Business School > Accounting |
Funding Information: | The authors are grateful to participants of the 22nd British Accounting and Finance Association (BAFA) \u2013 Accounting and Finance in Emerging Economies (AFEE) Workshop, Southampton, UK, 24 June 2022, for their most valuable feedback on an earlier versi |
Additional Information: | Copyright © 2024 The Author(s). Published by Elsevier Inc. This is an open access article under the CC BY license (https://creativecommons.org/licenses/by/4.0/). |
Uncontrolled Keywords: | Family ownership,corporate governance,audit report lag,Indonesia,Two-tier board structure,Emerging economies,Accounting,Finance |
Publication ISSN: | 1879-1603 |
Data Access Statement: | Data will be made available on request. |
Last Modified: | 06 Aug 2024 10:02 |
Date Deposited: | 01 Aug 2024 16:58 |
Full Text Link: | |
Related URLs: |
https://www.sci ... 061951824000442
(Publisher URL) http://www.scop ... tnerID=8YFLogxK (Scopus URL) |
PURE Output Type: | Article |
Published Date: | 2024-09 |
Published Online Date: | 2024-06-28 |
Accepted Date: | 2024-06-01 |
Authors: |
Astami, Emita
Pramono, Agus Joko Rusmin, Rusmin Cahaya, Fitra Roman Soobaroyen, Teerooven ( ![]() |