Readability of Financial Footnotes, Audit Fees, and Risk Management Committee

Title : Readability of Financial Footnotes, Audit Fees, and Risk Management Committee

Authors :
1. Aditya Aji Prabhawa
2. Iman Harymawan

Department : Accounting

Journal Name : Risks

Kinds of Journal : Scopus Q2

Keywords : readability; financial footnotes; audit fees; risk management committee; governance

ABSTRACT

We find that the readability of financial footnotes and risk management committees contributes to audit fees. We use observations from 758 companies listed in Indonesia for 2014–2018, and moderated regression analysis is used for statistical analysis. The results show that the readability of financial footnotes will affect audit fees paid, and RMC strengthens the relationship between the readability of financial footnotes and audit fees. In addition, we also used robustness assays to address endogeneity issues with consistent results as moderated regression analysis (hereafter MRA). These findings provide evidence for policymakers about the relationship between the readability of financial footnotes, RMC, and audit fees.

For details : https://www.mdpi.com/2227-9091/10/9/170