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Board Of Commissioners Size Case Study

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Board of Commissioners Size has a significant effect on financial risk disclosure.
From the hypothesis testing result, it was concluded that board of commissioners size has the significant value of 0.000 at the significance level of 0.050, meaning that the size of the board of commissioners has a significant effect on financial risk disclosure. Therefore, the larger the number of members of the board of commissioners of a company was likely to provide more optimal supervision of management and thus the company would be encouraged to disclose better, complete, and informative financial risk. This meant that hypothesis 1 was accepted. This result was in line with Abeysekera (2008) stating that the board of commissioners has a positive effect …show more content…

This meant that hypothesis 3 was rejected. This result was in line with Brick and Chidambaran (2010) stating that the company risk disclosure contained in the annual report is the operational policy of management and is discussed by the management and the lower ranks. Therefore, the disclosure is excluded from the main agenda of discussion in board of commissioners meetings. In conclusion, the number of board of commissioners meeting within a year has no significant effect on company risk …show more content…

This meant that hypothesis 4 was rejected. This result was in line with Gerb (2000), Eng dan Mak (2003) revealing a negative relationship between managerial ownership and disclosure level. While Probohudono et al. (2013) found that there was no consistent effect of managerial ownership and risk disclosure.

Profitability ratio has a significant effect on financial risk disclosure.
From the hypothesis testing result, it was concluded that ROA and ROE has the significant value of 0.025 and 0.000 respectively at the significance level of 0.050, meaning that profitability using ROA and ROE ratio has a significant effect on financial risk disclosure. This meant that hypothesis 5 was accepted. This result was in line with Hossain (2008) stating that the variable of profitability of the company has an influence on the level of risk disclosure.

Liquidity ratio has a significant effect on financial risk

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