An Analysis of Forward-Looking Disclosures, Corporate Governance and the Ability to Anticipate Future Earnings: Empirical Evidence from Indonesia

Abstract

This study aims to examine the effect of corporate governance, as measured by the effectiveness of the board of commissioners, the effectiveness of the directors, as well as the concentration of ownership to the level of mandatory forward-looking disclosures in the annual report. This study also aims to test the effect of mandatory forward-looking disclosures in the ability to anticipate future earnings in the current stock price. The results of the study support that the effectiveness of directors is positively associated with the level of forward-looking disclosures and ownership concentration is negatively associated with the level of forward-looking disclosures. However, this study found no significant relationship between the level of forward-looking disclosure and the effectiveness of the board of commissioners. The study also found no association between the level of forward-looking disclosures and the ability to anticipate future earnings in current stock prices.

Forward-Looking Information Disclosure and Firm Value in the Pandemic Era

“…FLID is voluntary; thus, corporations are less inclined to report it. The FLID regulations do not guarantee a better level of disclosure, especially given the absence of penalties for noncompliance (Maghfira & Tresnaningsih, 2017). However, these results align with Casas-Arce et al ( 2017) and Hassan et al (2009), stating that forward-looking information disclosure did not affect firm value.…”