THE INFLUENCE OF FINANCIAL RISK DISCLOSURES: EVIDENCE ON INDONESIAN BANKING.
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THE INFLUENCE OF FINANCIAL RISK DICLOSURES:
EVIDENCE ON INDONESIAN BANKING
SKRIPSI
Submitted as Partial Fulfillment of Requirement for the Degree of Sarjana
Ekonomi (SE) at the Universitas Sebelas Maret
BY:
MERINTA BELLA PERMATASARI
F0310055
FACULTY OF ECONOMIC AND BUSINESS
SEBELAS MARET UNIVERSITY SURAKARTA
2014
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ABSTRACT
THE INFLUENCE OF FINANCIAL RISK DICLOSURE:
EVIDENCE ON INDONESIAN BANKING
Merinta Bella Permatasari
NIM F0310055
This research aim to investigate the impact of board of independence, foreign
ownership, and board of commissioner compositions (i.e. board directorship, board
nationality, and board with economic educational background) on financial risk
disclosure. Financial risk disclosures are proxies by the items within annual reports.
This research use a sample of 71 Regional Development Banks (BPD), 43 non-listed
banks, and 145 listed banks in Indonesia Stock Exchange over 2008-2012 measured
by the stepwise method.
This paper document has no significant effect between board of independence,
foreign ownership, and board of commissioner composition to financial risk
disclosure in Indonesia. In other hand, bank size as control variable has positive
significant effect to financial risk disclosure.
Keyword: Financial Risk Disclosure, Board of Independence, Foreign Ownership,
Board of Commissioner compositions, Bank Size.
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ABSTRAK
THE INFLUENCE OF FINANCIAL RISK DISCLOSURES:
EVIDENCE ON INDONESIAN BANKING
Merinta Bella Permatasari
NIM F0310055
Penelitian ini dilakukan untuk menguji apakah pengaruh dari komisaris
independen, kepemilikan asing, dan komposisi dewan komisaris (terdiri dari proporsi
directorship pada dewan komisaris, kebangsaan pada komisaris, dan dewan
komisaris dengan latar belakang pendidikan ekonomi). Tingkat pengungkapan risiko
keuangan diproksikan dengan item-item yang terdapat pada laporan tahunan
perusahaan. Sampel penelitian ini menggunakan 71 Bank Pembangunan Daerah
(BPD), 43 bank yang tidak listing, dan 145 bank yang listing di Bursa Efek Indonesia
selama periode 2008-2012.
Hasil penelitian ini menunjukkan bahwa tidak memiliki pengaruh signifikan
antara dewan komisaris, kepemilikan saham, dan komposisi dewan komisaris
terhadap pengungkapan resiko keuangan di Indonesia. Di sisi lain, ukuran bank
sebagai variabel kontrol memiliki pengaruh positif yang signifikan terhadap
pengungkapan risiko keuangan.
Kata Kunci: Pengungkapan Resiko Keuangan, Komisaris Independen, Kepemilikan
Asing, Komposisi Dewan Komisaris, Ukuran Bank.
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MOTTO
Nothing is impossible, the word itself says ‘I’m possible’!
(Audrey Hepburn)
Don’t even try to judge me Dude, You don’t know what the fuck I’ve been through
(Eminem)
Strive to be a success, but rather to be of value
(Albert Einstein)
The mind is everything. What you think you become
(Buddha)
Believe you can and you’re halfway there
(Theodore Roosevelt)
Fall seven times and stand up eight
(Japanese Proverb)
Happiness is not something readymade. It comes from your own actions
(Dalai Lama)
Challenges are what make life interesting and overcoming them is what makes life
meaningful
(Joshua J. Marine)
You can’t fall if you don’t climb. But there’s no joy in living your whole life on the
ground
(Unknown)
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DEDICATION
This skripsi and whatsoever success that I could achieve is dedicated to
My mom, my dad, my little brother and all my beloved big family.
My supervisor and all lecturer Faculty of Economic and Business UNS
My best friends
Thank you for the advices, support and pray every single day in reminding me to be
humble and useful for everybody surrounds me. Your love and care are the only
thing that keeping me strong during the hard time.
commit to user
viii
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ACKNOWLEDGEMENT
Researcher will be grateful to Allah SWT for all the mercy and bless so that I
was able to finish this research well.
This Skripsi is proposed to complete all the requirements of achieves the
degree of Sarjana Ekonomi of Accounting Department, Sebelas Maret University,
Surakarta.
Researcher realizes that she could not have finished this skripsi without the
supports and involvement of many parties both directly and indirectly. I owe a very
great debt and thanks to:
1. Allah SWT for endowing me for health, patience, strength and knowledge also
His blessing to complete this study.
2. Dr. Wisnu Untoro, M.S., as the Dean of Economics Department, Sebelas Maret
University, Surakarta.
3. Drs. Santoso M.Si., Ak., as the Head of Accounting Department, Sebelas Maret
University, Surakarta.
4. Drs. Muh Agung Prabowo, M.Si., Ph.D, Ak., as my supervisor. I wish to express
my deepest thanks to Mr. Agung for his considerable help to give advices and a
very closely improved result.
5. Agung Nur Probohudono, SE., M.Si., Ph.D., Ak and Irwan Trinugroho, SE.,
M.Sc. as my informal advisor. Thanks for inspire and help me through several
issues to finish my skripsi
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6. All lectures and staff in Faculty of Economics, Sebelas Maret University who
have provided knowledge, guidance, and service.
7. My father as my role model who always give me support, my mother as my
mood booster and angels for my heart and my little brother for the help and
support. Also my beloved aunties, auntie Ning, auntie Wiwit, auntie Ninik for the
pray and support who always keep me stronger.
8. My man and hero, Okfidsa Java Wilsandrilla for assist me, accompany me, listen
to me, hug me, and cheer me up when making this skripsi until done.
9. My college best friends Rifa Anggita Sari and Inri Asridisastra for wonderful
friendship from the first day of college until now and forever also support and
pray to keep stronger to finish this skripsi.
10. Pekoks Genks, Momi Hilda, Babe Dhofir, Bagus, Jimi, John, Inri, Anggi, Fidsa
for the hilarious jokes and cool unforgettable friendship ever. You are my second
family in Solo.
11. My awesome friends Amalia Dewi Latifah, Okki Carolina, Widowati Dian P.,
and Fitri Setyowati who always help me through the up and down in college life
and always support and cheer me up in making this skripsi.
12. Executive Board of AIESEC UNS 13/14, Novi, Ovi, Imel, Monika, Farkhan,
Ocha, Reva, and Que. Thank you for the hard work during my leadership time as
President in AIESEC UNS. All of you are awesome people that I‟ve ever met.
13. All AIESEC UNS‟s members. Hey AIESEC?! What‟s up!!!!
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14. Rio, Yonatan, Bayu, Indro, Asri, Tunjung, Gilang, Icha. Thank you for always
helping me in everything during the process of this skripsi until done.
15. My best friend in SMA N 3 Semarang, Sekar, Dama, Aulia, and Pita. Thank you
for the sharing that always inspire and burn my spirit to be BIG woman someday.
16. All my friends in HMJ Akuntansi, who is the best? Accounting Society!
17. All of my friends in Accounting Department, I am excited to have you all in the
last four years. Keep in touch and success for your future endeavours.
18. For all people that Researcher could not mention one by one, I thanks for all
your support until now.
Researcher realizes that this research is far from being perfect. This study has
a lot of constraint, thus any suggestions and critics are expected for the sake of
improving this study.
As I close this acknowledgement, I expect that this writing will be useful to
all parties.
Surakarta, August 13th, 2014
Merinta Bella Permatasari
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TABLE OF CONTENTS
Page
PAGE OF TITLE ………………………………………………………………
i
ABSTRACT……………………………………………………………………..
ii
ABSTRAK………………………………………………………………………
iii
PAGE OF ADVISOR‟S APPROVAL………………………………………….
iv
PAGE OF APPROVAL………………………………………………………...
v
PERNYATAAN………………………………………………………………...
vi
PAGE OF MOTTO……………………………………………………………...
vii
PAGE OF DEDICATION………………………………………………………
viii
ACKNOWLEDGENMENT…………………………………………………….
ix
TABLE OF CONTENT…………………………………………………………
x
LIST OF TABLES………………………………………………………………
xii
LIST OF APPENDIXES………………………………………………………..
xiii
CHAPTER I. INTRODUCTION……………………………………………..
1
A. Research Background………………………………………………...
1
B. Research Question……………………………………………………
4
C. Research Objectives………………………………………………….
5
D. Research Benefits…………………………………………………….
5
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CHAPTER II. LITERATURE AND HYPOTHESIS DEVELOPMENT….
6
A. Agency Theory and Stakeholder Theory……………………………..
6
B. Financial Risk Disclosure…………………………………………….
8
C. Ownerships…………………………………………………………...
10
D. Board of Commissioner………………………………………………
11
E. Hypothesis Development…………………………………………….
12
CHAPTER III. RESEARCH METHODOLOGY……………………...…..
16
A. Research Design……………………………………………………...
16
B. Population and Sample……………………………………………….
16
C. Variable and Measurement Techniques………………………………
18
D. Data Analysis Methods………………………………………………
21
CHAPTER IV. RESULT AND ANALYSIS……………………………….
26
A. Data Description……………………………………………………..
26
B. Classic Assumption Analysis………………………………………...
26
C. Descriptive Statistics Analysis……………………………………….
27
D. Hypothesis Analysis………………………………………………….
33
CHAPTER V. CONCLUSION AND RECOMMENDATION…………...
43
A. Conclusion…………………………………………………………..
43
B. Research Constraints………………………………………………..
44
C. Recommendations…………………………………………………... 45
REFERENCES………………………………………………………………...
APPENDIXES
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46
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LIST OF TABLES
TABLE
PAGE
3.1 Research Population and Sample……………………………………….
17
3.2 Description of Equation on Financial Risk Disclosure…………………
19
3.3 Description of Equation on Regression Analysis………………………
24
4.1 Descriptive Statistics of Financial Risk Disclosure……………………
27
4.2 Descriptive Statistics of Independent Variable………………………..
29
4.3 Pearson Correlation……………………………………………………
32
4.4 Stepwise Multiple Regressions Result ……………..............................
34
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LIST OF APPENDIXES
Appendix I
List of Banks
Appendix II
Foreign Ownership, Number of Branches, Board Composition and
Financial Risk Disclosure
Appendix III
Financial Disclosure Items
Appendix IV
Descriptive Statistics
Appendix V
Classic Assumption Tests
Appendix VI
Pearson Correlations
Appendix VII
Result of Linear Regression (Stepwise method)
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THE INFLUENCE OF FINANCIAL RISK DICLOSURES:
EVIDENCE ON INDONESIAN BANKING
SKRIPSI
Submitted as Partial Fulfillment of Requirement for the Degree of Sarjana
Ekonomi (SE) at the Universitas Sebelas Maret
BY:
MERINTA BELLA PERMATASARI
F0310055
FACULTY OF ECONOMIC AND BUSINESS
SEBELAS MARET UNIVERSITY SURAKARTA
2014
commit to user
perpustakaan.uns.ac.id
digilib.uns.ac.id
ABSTRACT
THE INFLUENCE OF FINANCIAL RISK DICLOSURE:
EVIDENCE ON INDONESIAN BANKING
Merinta Bella Permatasari
NIM F0310055
This research aim to investigate the impact of board of independence, foreign
ownership, and board of commissioner compositions (i.e. board directorship, board
nationality, and board with economic educational background) on financial risk
disclosure. Financial risk disclosures are proxies by the items within annual reports.
This research use a sample of 71 Regional Development Banks (BPD), 43 non-listed
banks, and 145 listed banks in Indonesia Stock Exchange over 2008-2012 measured
by the stepwise method.
This paper document has no significant effect between board of independence,
foreign ownership, and board of commissioner composition to financial risk
disclosure in Indonesia. In other hand, bank size as control variable has positive
significant effect to financial risk disclosure.
Keyword: Financial Risk Disclosure, Board of Independence, Foreign Ownership,
Board of Commissioner compositions, Bank Size.
commit to user
ii
perpustakaan.uns.ac.id
digilib.uns.ac.id
ABSTRAK
THE INFLUENCE OF FINANCIAL RISK DISCLOSURES:
EVIDENCE ON INDONESIAN BANKING
Merinta Bella Permatasari
NIM F0310055
Penelitian ini dilakukan untuk menguji apakah pengaruh dari komisaris
independen, kepemilikan asing, dan komposisi dewan komisaris (terdiri dari proporsi
directorship pada dewan komisaris, kebangsaan pada komisaris, dan dewan
komisaris dengan latar belakang pendidikan ekonomi). Tingkat pengungkapan risiko
keuangan diproksikan dengan item-item yang terdapat pada laporan tahunan
perusahaan. Sampel penelitian ini menggunakan 71 Bank Pembangunan Daerah
(BPD), 43 bank yang tidak listing, dan 145 bank yang listing di Bursa Efek Indonesia
selama periode 2008-2012.
Hasil penelitian ini menunjukkan bahwa tidak memiliki pengaruh signifikan
antara dewan komisaris, kepemilikan saham, dan komposisi dewan komisaris
terhadap pengungkapan resiko keuangan di Indonesia. Di sisi lain, ukuran bank
sebagai variabel kontrol memiliki pengaruh positif yang signifikan terhadap
pengungkapan risiko keuangan.
Kata Kunci: Pengungkapan Resiko Keuangan, Komisaris Independen, Kepemilikan
Asing, Komposisi Dewan Komisaris, Ukuran Bank.
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MOTTO
Nothing is impossible, the word itself says ‘I’m possible’!
(Audrey Hepburn)
Don’t even try to judge me Dude, You don’t know what the fuck I’ve been through
(Eminem)
Strive to be a success, but rather to be of value
(Albert Einstein)
The mind is everything. What you think you become
(Buddha)
Believe you can and you’re halfway there
(Theodore Roosevelt)
Fall seven times and stand up eight
(Japanese Proverb)
Happiness is not something readymade. It comes from your own actions
(Dalai Lama)
Challenges are what make life interesting and overcoming them is what makes life
meaningful
(Joshua J. Marine)
You can’t fall if you don’t climb. But there’s no joy in living your whole life on the
ground
(Unknown)
commit to user
vii
perpustakaan.uns.ac.id
digilib.uns.ac.id
DEDICATION
This skripsi and whatsoever success that I could achieve is dedicated to
My mom, my dad, my little brother and all my beloved big family.
My supervisor and all lecturer Faculty of Economic and Business UNS
My best friends
Thank you for the advices, support and pray every single day in reminding me to be
humble and useful for everybody surrounds me. Your love and care are the only
thing that keeping me strong during the hard time.
commit to user
viii
perpustakaan.uns.ac.id
digilib.uns.ac.id
ACKNOWLEDGEMENT
Researcher will be grateful to Allah SWT for all the mercy and bless so that I
was able to finish this research well.
This Skripsi is proposed to complete all the requirements of achieves the
degree of Sarjana Ekonomi of Accounting Department, Sebelas Maret University,
Surakarta.
Researcher realizes that she could not have finished this skripsi without the
supports and involvement of many parties both directly and indirectly. I owe a very
great debt and thanks to:
1. Allah SWT for endowing me for health, patience, strength and knowledge also
His blessing to complete this study.
2. Dr. Wisnu Untoro, M.S., as the Dean of Economics Department, Sebelas Maret
University, Surakarta.
3. Drs. Santoso M.Si., Ak., as the Head of Accounting Department, Sebelas Maret
University, Surakarta.
4. Drs. Muh Agung Prabowo, M.Si., Ph.D, Ak., as my supervisor. I wish to express
my deepest thanks to Mr. Agung for his considerable help to give advices and a
very closely improved result.
5. Agung Nur Probohudono, SE., M.Si., Ph.D., Ak and Irwan Trinugroho, SE.,
M.Sc. as my informal advisor. Thanks for inspire and help me through several
issues to finish my skripsi
commit to user
ix
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6. All lectures and staff in Faculty of Economics, Sebelas Maret University who
have provided knowledge, guidance, and service.
7. My father as my role model who always give me support, my mother as my
mood booster and angels for my heart and my little brother for the help and
support. Also my beloved aunties, auntie Ning, auntie Wiwit, auntie Ninik for the
pray and support who always keep me stronger.
8. My man and hero, Okfidsa Java Wilsandrilla for assist me, accompany me, listen
to me, hug me, and cheer me up when making this skripsi until done.
9. My college best friends Rifa Anggita Sari and Inri Asridisastra for wonderful
friendship from the first day of college until now and forever also support and
pray to keep stronger to finish this skripsi.
10. Pekoks Genks, Momi Hilda, Babe Dhofir, Bagus, Jimi, John, Inri, Anggi, Fidsa
for the hilarious jokes and cool unforgettable friendship ever. You are my second
family in Solo.
11. My awesome friends Amalia Dewi Latifah, Okki Carolina, Widowati Dian P.,
and Fitri Setyowati who always help me through the up and down in college life
and always support and cheer me up in making this skripsi.
12. Executive Board of AIESEC UNS 13/14, Novi, Ovi, Imel, Monika, Farkhan,
Ocha, Reva, and Que. Thank you for the hard work during my leadership time as
President in AIESEC UNS. All of you are awesome people that I‟ve ever met.
13. All AIESEC UNS‟s members. Hey AIESEC?! What‟s up!!!!
commit to user
x
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digilib.uns.ac.id
14. Rio, Yonatan, Bayu, Indro, Asri, Tunjung, Gilang, Icha. Thank you for always
helping me in everything during the process of this skripsi until done.
15. My best friend in SMA N 3 Semarang, Sekar, Dama, Aulia, and Pita. Thank you
for the sharing that always inspire and burn my spirit to be BIG woman someday.
16. All my friends in HMJ Akuntansi, who is the best? Accounting Society!
17. All of my friends in Accounting Department, I am excited to have you all in the
last four years. Keep in touch and success for your future endeavours.
18. For all people that Researcher could not mention one by one, I thanks for all
your support until now.
Researcher realizes that this research is far from being perfect. This study has
a lot of constraint, thus any suggestions and critics are expected for the sake of
improving this study.
As I close this acknowledgement, I expect that this writing will be useful to
all parties.
Surakarta, August 13th, 2014
Merinta Bella Permatasari
commit to user
xi
perpustakaan.uns.ac.id
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TABLE OF CONTENTS
Page
PAGE OF TITLE ………………………………………………………………
i
ABSTRACT……………………………………………………………………..
ii
ABSTRAK………………………………………………………………………
iii
PAGE OF ADVISOR‟S APPROVAL………………………………………….
iv
PAGE OF APPROVAL………………………………………………………...
v
PERNYATAAN………………………………………………………………...
vi
PAGE OF MOTTO……………………………………………………………...
vii
PAGE OF DEDICATION………………………………………………………
viii
ACKNOWLEDGENMENT…………………………………………………….
ix
TABLE OF CONTENT…………………………………………………………
x
LIST OF TABLES………………………………………………………………
xii
LIST OF APPENDIXES………………………………………………………..
xiii
CHAPTER I. INTRODUCTION……………………………………………..
1
A. Research Background………………………………………………...
1
B. Research Question……………………………………………………
4
C. Research Objectives………………………………………………….
5
D. Research Benefits…………………………………………………….
5
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CHAPTER II. LITERATURE AND HYPOTHESIS DEVELOPMENT….
6
A. Agency Theory and Stakeholder Theory……………………………..
6
B. Financial Risk Disclosure…………………………………………….
8
C. Ownerships…………………………………………………………...
10
D. Board of Commissioner………………………………………………
11
E. Hypothesis Development…………………………………………….
12
CHAPTER III. RESEARCH METHODOLOGY……………………...…..
16
A. Research Design……………………………………………………...
16
B. Population and Sample……………………………………………….
16
C. Variable and Measurement Techniques………………………………
18
D. Data Analysis Methods………………………………………………
21
CHAPTER IV. RESULT AND ANALYSIS……………………………….
26
A. Data Description……………………………………………………..
26
B. Classic Assumption Analysis………………………………………...
26
C. Descriptive Statistics Analysis……………………………………….
27
D. Hypothesis Analysis………………………………………………….
33
CHAPTER V. CONCLUSION AND RECOMMENDATION…………...
43
A. Conclusion…………………………………………………………..
43
B. Research Constraints………………………………………………..
44
C. Recommendations…………………………………………………... 45
REFERENCES………………………………………………………………...
APPENDIXES
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LIST OF TABLES
TABLE
PAGE
3.1 Research Population and Sample……………………………………….
17
3.2 Description of Equation on Financial Risk Disclosure…………………
19
3.3 Description of Equation on Regression Analysis………………………
24
4.1 Descriptive Statistics of Financial Risk Disclosure……………………
27
4.2 Descriptive Statistics of Independent Variable………………………..
29
4.3 Pearson Correlation……………………………………………………
32
4.4 Stepwise Multiple Regressions Result ……………..............................
34
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LIST OF APPENDIXES
Appendix I
List of Banks
Appendix II
Foreign Ownership, Number of Branches, Board Composition and
Financial Risk Disclosure
Appendix III
Financial Disclosure Items
Appendix IV
Descriptive Statistics
Appendix V
Classic Assumption Tests
Appendix VI
Pearson Correlations
Appendix VII
Result of Linear Regression (Stepwise method)
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xv