Title: Political Connection and the Readability of the MD&A Disclosure
Authors:
- Faith Haryamawan
- Tubagus Algan Roiston
Department: Department of Accounting
Journal Name: Accrual : Accounting Journal
Kinds of Journal: Sinta 2
Keywords: Disclosure, MD&A, Political Connection, Readability
Abstract:
This research examination is the relationship between politically connected compans and the readability of the Company’s MD & a. Our results show that in the Indonesian settings, the experience of parliamentarians (DPR, MPR), regional heads and local government officials at the Company Executive Level Plays an Important role in the readability of a company’s management discussion & analysis (MD & A). Based on self-representation theory, we suspect that companies with political connections make it possible to make the disclosures on the company’s md & a easy to read because the management with the political connections of the puts forward their image in the stakeholders’ Eyes. The narrative that is conveyed is easier to understanding as a result. Besides this, management who come from the political circle have the talent and expertise of managing their image in the public eye, thus enabling to convey the narrative on md & a in a way that is easy to read for the reasoning of concerning the company performance or maintenance of their image. We also tested the endogeneity effect using coarsened exact matching regression (Cem) to confirmation our findings and obtained the same result as our previous previous assumptions – that politically connected compans have an MD & a that is easy to read.
For details: https://journal.unesa.ac.id/index.php/aj/article/view/16927
