Overview

Original Research

IMPLEMENTATION OF EXTENSIBLE BUSINESS REPORTING LANGUAGE INCREASES THE ACCURACY OF CORPORATE FINANCE REPORTING IN INDONESIA

ZAINUDDIN 1, SITY AVISHA CAHYANI 2, and AMIN DARA 3.

Vol 17, No 08 ( 2022 )   |  DOI: 10.5281/zenodo.6969076   |   Author Affiliation: Accounting Department, Faculty of Economic and Business, Universitas Khairun, Ternate, Indonesia 1,2,3.   |   Licensing: CC 4.0   |   Pg no: 404-415   |   To cite: ZAINUDDIN, et al., (2022). IMPLEMENTATION OF EXTENSIBLE BUSINESS REPORTING LANGUAGE INCREASES THE ACCURACY OF CORPORATE FINANCE REPORTING IN INDONESIA. 17(08), 404–415. https://doi.org/10.5281/zenodo.6969076   |   Published on: 06-08-2022

Abstract

This study aims to examine the effectiveness of the Extensible Business Reporting Language (XBRL) on the accuracy of financial reporting for LQ45 companies listed on the Indonesia Stock Exchange between 2016 and 2020. This research utilizes logistic regression models with control variables including returns on assets, debt-to-equity ratio, and current ratio. The findings of the hypothesis test showed that the implementation of XBRL improved the accuracy of financial reporting. The findings of the logistic regression test with return on assets, debt to equity ratio, and current ratio as control variables indicate that these three variables have no effect on the accuracy of a company's financial reporting. This study provides evidence that the application of XBRL can expedite the financial reporting process to improve the financial reporting accuracy of a company, as the XBRL format can be converted to a variety of other financial statement formats, thus also reducing the time required to disseminate financial information.

Keywords

Extensible Business Reporting Language, Return On Assets, Debt to Equity Ratio, Current Ratio, Financial Reporting Accuracy.