Abstract
The reluctance of modern firms to disclose their risk management is often investigated; however, how it interacts with audit delay is still underrepresented in academic investigations. This article thus provides a glimpse of how profitability and leverage serve as predictors of audit delay and the risk management disclosure in Indonesia-listed firms, aside from managerial ownership as the moderating variable. A five-year market movement becomes the investigated data in a quantitative approach. The findings reveal that profitability and leverage are not related to risk management disclosure, but they affect audit delay and subsequently to the disclosure. Managerial ownership also boosts the relationships of the dependent variables. No Indirect relationships are reported.
Highlights
The low level of awareness of risk management in Indonesia is seen from the lack of implementation of tools to prevent losses in the form of financial and non-financial risks
This study examines the effect of managerial ownership on risk management disclosure, the impact of public ownership on risk management disclosure, the impact of leverage on risk management disclosure, and the effect of firm size on risk management disclosure in companies listed in the Indonesia Stock Exchange
This study investigates the role of managerial ownership as the moderating variable between audit delay and risk management disclosure (RMD)
Summary
The low level of awareness of risk management in Indonesia is seen from the lack of implementation of tools to prevent losses in the form of financial and non-financial risks They are making investors and users of financial statements less confident in the completeness and reliability of accounting figures in the report (Patel & Chrisman, 2014). The number of fraud cases committed by companies in financial statements indicates that the level of awareness of risk management in companies in Indonesia is still low This low awareness of risk management can be seen from the lack of implementation of tools to prevent losses in the form of financial and non-financial against the business risks faced (Alwi et al, 2021). It is seen from the awareness of company leaders to prepare good financial reports is still lacking (Robbins & Judge, 2009)
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