The Effect of CEO Ethnicity, Ownership Concentration, and Audit Committee on Audit Report Lag

https://doi.org/10.35912/jgas.v5i2.1977
Published: Jul 2, 2025

Abstract:

Purpose: This study examines several factors that may affect audit report lag, including CEO ethnicity, ownership concentration, and the number of audit committee meetings among LQ 45 companies in Indonesia from 2019 to 2022.

Methods: This study employed a quantitative descriptive method to examine the relationships between variables, including the partial effects. SPSS was used as the statistical analysis tool to conduct descriptive statistics, assess assumption classifications, perform regression analysis of the research model, and test hypotheses using partial tests and the coefficient of determination.

Results: The results of this study indicate that the CEO ethnicity and audit committee variables do not significantly affect audit report lag. However, the audit committee variable partially has a significant influence on audit report lag.

Conclusion: CEO ethnicity does not significantly affect audit report lag. In contrast, ownership concentration significantly affects audit report lags. Furthermore, the audit committee variable does not significantly affect the audit report lag.

Limitation: Audit Report Lag can reduce the usefulness and reliability of financial reports for users. There is a lack of references to these variables, especially the rarely studied ethnic variables. This study contributes to the literature by examining the relationship between the ethnicity and race of CEOs at LQ 45 companies as the research subject.

Contributions: This study contributes to the audit literature by providing empirical evidence of the influence of CEO ethnicity, ownership concentration, and audit committee activities on audit report lag, specifically within LQ45 companies in Indonesia, highlighting the unique role of ethnic diversity in corporate governance contexts.

Keywords:
1. Audit Committee Fiscal Deficit
2. Audit Report Lag
3. CEO Ethnic
4. Stakeholder Concentration
Authors:
1 . Umi Kalsum
Universitas Sriwijaya
2 . Rika Henda Safitri
Universitas Sriwijaya
3 . Dirta Pratama Atiyatna
Universitas Sriwijaya
4 . Audrey Audrey
Universitas Sriwijaya
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How to Cite
Kalsum, U., Safitri, R. H., Atiyatna, D. P., & Audrey, A. (2025). The Effect of CEO Ethnicity, Ownership Concentration, and Audit Committee on Audit Report Lag . Journal of Governance and Accountability Studies, 5(2), 79–92. https://doi.org/10.35912/jgas.v5i2.1977
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Vol. 5 No. 2 (2025): July
Articles
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References

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    Bathala, C. T., & Rao, R. P. (1995). The determinants of board composition: An agency theory perspective. Managerial and decision economics, 16(1), 59-69. doi:https://doi.org/10.1002/mde.4090160108

    Benedetti, C., Rovelli, P., Colladon, A. F., De Massis, A., & Matzler, K. (2025). CEO identity and media perception: The influence on family firms’ brand importance. Journal of Family Business Strategy, 16(1), 100646. doi:https://doi.org/10.1016/j.jfbs.2024.100646

    Bhuiyan, M. B. U., Man, Y., & Lont, D. H. (2024). Audit report lag and the cost of equity capital. Journal of Capital Markets Studies, 8(2), 212-241. doi:https://doi.org/10.1108/JCMS-02-2024-0008

    Butarbutar, R. S. K., & Hadiprajitno, P. B. (2017). Analisis Faktor-Faktor Yang Berpengaruh Terhadap Audit Report Lag (Studi Empiris pada Perusahaan Manufaktur yang Terdaftar di Bursa Efek Indonesia Tahun 2012-2015). Diponegoro Journal of Accounting, 6(3), 50-61.

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    Enandar, A. H., Gojali, D., & Yulianti, L. (2023). Profitabilitas dan Ukuran KAP Terhadap Audit Delay pada Perusahaan Barang Konsumen Non Primer yang Terdaftar di DES Tahun 2021-2024. doi:https://doi.org/10.51211/joia.v10i1.3480

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    Hassan, Y. M. (2016). Determinants of audit report lag: evidence from Palestine. Journal of Accounting in Emerging Economies, 6(1), 13-32.

    Isnurhadi, I., Oktarini, K. W., Meutia, I., & Mukhtaruddin, M. (2020). Effects of stakeholder engagement and corporate governance on integrated reporting disclosure. Indonesian Journal of Sustainability Accounting and Management, 4(2), 164–173-164–173.

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    Kouchaki, M., Okhuysen, G. A., Waller, M. J., & Tajeddin, G. (2012). The treatment of the relationship between groups and their environments: A review and critical examination of common assumptions in research. Group & Organization Management, 37(2), 171-203.

    McLelland, A. J., & Giroux, G. (2000). An empirical analysis of auditor report timing by large municipalities. Journal of Accounting and Public Policy, 19(3), 263-281. doi:https://doi.org/10.1016/S0278-4254(00)00011-9

    Merter, A. K., & Özer, G. (2024). Audit Committee and Timely Reporting: Evidence From Turkey. SAGE Open, 14(1), 21582440241239516. doi:https://doi.org/10.1177/21582440241239516

    Meutia, I., Yaacob, Z., & Kartasari, S. F. (2023). SUSTAINABILITY REPORTING AND AUDIT COMMITTEE ATTRIBUTES: EVIDENCE FROM BANKS IN INDONESIA. Asian Academy of Management Journal, 28(2).

    Molla Imeny, V. (2016). The Impact of Ethnic Characteristics of CEOs on Audit Report Lag and Audit Fees. The Impact of Ethnic Characteristics of CEOs on Audit Report Lag and Audit Fees (November 20, 2016). doi:https://dx.doi.org/10.2139/ssrn.2873056

    Moradi, M., & Molla Imeny, V. (2019). The impact of CEOs' Ethnic characteristics on audit report lags and audit fees in Iran. Iranian Journal of Accounting, Auditing and Finance, 3(1), 75-96.

    Mutmainnah, N., & Wardhani, R. (2013). Analisis dampak kualitas komite audit terhadap kualitas laporan keuangan perusahaan dengan kualitas audit sebagai variabel moderasi. Jurnal Akuntansi dan Keuangan Indonesia, 10(2), 2.

    Okumu, A. B., Olweny, T., & Muturi, W. (2021). Theoretical Review of Effect of Firm Specific Factors on Performance of Initial Public Offering Stocks at the Nairobi Securities Exchange in Kenya. doi:https://doi.org/10.1177/0974686217701467

    Park, S. H., & Westphal, J. D. (2013). Social discrimination in the corporate elite: How status affects the propensity for minority CEOs to receive blame for low firm performance. Administrative Science Quarterly, 58(4), 542-586.

    Pratama, I. F., & Arifin, A. (2016). Analisis Faktor-Faktor Yang Mempengaruhi Audit Delay (Studi Empiris Pada Perusahan Manufaktur Yang Terdaftar Di Bursa Efek Indonesia periode 2012-2014). Universitas Muhammadiyah Surakarta.

    Rahman, M. J., Zhu, H., & Hossain, M. M. (2023). Auditor choice and audit fees through the lens of agency theory: evidence from Chinese family firms. Journal of family business management, 13(4), 1248-1276. doi:http://dx.doi.org/10.1108/JFBM-02-2023-0027

    Shi, Z., Huang, W., & Liang, Y. (2023). Work values and cultural background: a comparative analysis of work values of Chinese and British engineers in the UK. Frontiers in Psychology, 14, 1144557. doi:https://doi.org/10.3389/fpsyg.2023.1144557

    Siregar, D. A. R., Sari, D. W., & Islamiyah, H. A. T. (2024). Evaluating the COVID-19 Pandemic's Impact on Indonesia's Economic Growth, Unemployment, and Poverty. EcceS: Economics Social and Development Studies, 11(1), 24-48. doi:https://doi.org/10.24252/ecc.v11i1.48010

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    Susilowati, D., & Saseka, S. H. (2025). The Effect of Auditor Report Lag on Financial Performance and Company Governance in Consumer Cyclical Sector Companies. Sinergi International Journal of Accounting and Taxation, 3(2), 133-147. doi:https://doi.org/10.61194/ijat.v3i2.789

    To, C., Sherf, E. N., & Kouchaki, M. (2024). How much inequity do you see? Structural power, perceptions of gender and racial inequity, and support for diversity initiatives. Academy of Management Journal, 67(1), 126-149. doi:https://doi.org/10.5465/amj.2022.0253

    Ursel, N., Durante, A., & Elsaid, E. (2023). Ethnic minority CEO turnover: Resource?based and leadership categorization perspectives. Journal of Organizational Behavior, 44(4), 682-699. doi:https://doi.org/10.1002/job.2688

    Wulan, A. B. N. (2022). Analisis Faktor-Faktor yang Mempengaruhi Audit Delay Studi Empiris pada Perusahaan Manufaktur Sektor Barang Konsumen Non-Primer yang Terdaftar di BEI Tahun 2019-2022/Ariska Berlian Nur Wulan/33189116/Pembimbing: Rizka Indri Arfianti.

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  1. Anantharaman, D., Rozario, A., & Zhang, C. A. (2023). Artificial intelligence and financial reporting quality. Available at SSRN 4625279. doi:https://dx.doi.org/10.2139/ssrn.4625279
  2. Arfitra, R. I., & Nurbaiti, A. (2018). Analisis Faktor Yang Mempengaruhi Audit Report Delay (kajian Empiris Perusahaan Manufaktur Sektor Aneka Industri Yang Terdaftar Di Bursa Efek Indonesia Periode 2012-2016). eProceedings of Management, 5(2).
  3. Arifa, A. N. (2013). Pengembangan model audit delay dengan audit report lag dan total lag. Accounting Analysis Journal, 2(2).
  4. Azizan, S. (2019). Ceo’s gender, power, ownership: Roles on audit report lag. Management & Accounting Review (MAR), 18(2), 245-274. doi:http://dx.doi.org/10.24191/mar.v18i2.958
  5. Bathala, C. T., & Rao, R. P. (1995). The determinants of board composition: An agency theory perspective. Managerial and decision economics, 16(1), 59-69. doi:https://doi.org/10.1002/mde.4090160108
  6. Benedetti, C., Rovelli, P., Colladon, A. F., De Massis, A., & Matzler, K. (2025). CEO identity and media perception: The influence on family firms’ brand importance. Journal of Family Business Strategy, 16(1), 100646. doi:https://doi.org/10.1016/j.jfbs.2024.100646
  7. Bhuiyan, M. B. U., Man, Y., & Lont, D. H. (2024). Audit report lag and the cost of equity capital. Journal of Capital Markets Studies, 8(2), 212-241. doi:https://doi.org/10.1108/JCMS-02-2024-0008
  8. Butarbutar, R. S. K., & Hadiprajitno, P. B. (2017). Analisis Faktor-Faktor Yang Berpengaruh Terhadap Audit Report Lag (Studi Empiris pada Perusahaan Manufaktur yang Terdaftar di Bursa Efek Indonesia Tahun 2012-2015). Diponegoro Journal of Accounting, 6(3), 50-61.
  9. Chau, G. K., & Gray, S. J. (2002). Ownership structure and corporate voluntary disclosure in Hong Kong and Singapore. The International Journal of Accounting, 37(2), 247-265.
  10. Denis, D., Ariesta,Made, & Rousilita, S. (2024). Karakteristik CEO dan Manajemen Laba (CEO
  11. Characteristics and Earnings Management). doi:https://doi.org/10.35912/jakman.v6i1.3566
  12. Drury, A., & Michael, L. (2021). What Is the Role of Agency Theory in Corporate Governance: Retrieved from investopedia: https://www. investopedia. com/ask/answers ….
  13. Durand, G. (2019). The determinants of audit report lag: a meta-analysis. Managerial Auditing Journal, 34(1), 44-75. doi:https://doi.org/10.1108/MAJ-06-2017-1572
  14. Enandar, A. H., Gojali, D., & Yulianti, L. (2023). Profitabilitas dan Ukuran KAP Terhadap Audit Delay pada Perusahaan Barang Konsumen Non Primer yang Terdaftar di DES Tahun 2021-2024. doi:https://doi.org/10.51211/joia.v10i1.3480
  15. Ghozali, I. (2018). Aplikasi analisis multivariate dengan program IBM SPSS 25: Universitas Diponegoro.
  16. Harjoto, M. A., Laksmana, I., & Lee, R. (2015). The impact of demographic characteristics of CEOs and directors on audit fees and audit delay. Managerial auditing journal, 30(8/9), 963-997.
  17. Hashemi, M. A., Yousofi, A., & Hashemi, M. R. (2017). The effect of inter-ethnic cultural relationships on universalism in Iran. International Journal of Sociology and Anthropology, 9(7), 69-81.
  18. Hassan, Y. M. (2016). Determinants of audit report lag: evidence from Palestine. Journal of Accounting in Emerging Economies, 6(1), 13-32.
  19. Isnurhadi, I., Oktarini, K. W., Meutia, I., & Mukhtaruddin, M. (2020). Effects of stakeholder engagement and corporate governance on integrated reporting disclosure. Indonesian Journal of Sustainability Accounting and Management, 4(2), 164–173-164–173.
  20. Kalsum, U., Fuadah, L. L., & Safitri, R. H. (2021). Good corporate governance, ethnic CEO and audit fees for manufacturing companies listed on the Indonesia stock exchange (IDX). Jurnal Akuntansi dan Auditing Indonesia, 65-75.
  21. Kamkankaew, P. (2023). CURRENT TRENDS IN STRATEGIC MANAGEMENT: A COMPARATIVE ANALYSIS OF SWOT AND SOAR APPROACHES. RMUTT GLOBAL BUSINESS ACCOUNTING AND FINANCE REVIEW, 7(2), 63-78. doi:http://dx.doi.org/10.60101/gbafr.2023.269044
  22. Katutari, R. A., & Yuyetta, E. N. A. (2019). Pengaruh kepemilikan institusi, karakteristik dewan komisaris dan komite audit terhadap profitabilitas. Diponegoro Journal of Accounting, 8(3).
  23. Kennedy, K., & Schumacher, P. (2005). A collaborative project to increase the participation of women and minorities in higher level mathematics courses. Journal of Education for Business, 80(4), 189-193.
  24. Kouchaki, M., Okhuysen, G. A., Waller, M. J., & Tajeddin, G. (2012). The treatment of the relationship between groups and their environments: A review and critical examination of common assumptions in research. Group & Organization Management, 37(2), 171-203.
  25. McLelland, A. J., & Giroux, G. (2000). An empirical analysis of auditor report timing by large municipalities. Journal of Accounting and Public Policy, 19(3), 263-281. doi:https://doi.org/10.1016/S0278-4254(00)00011-9
  26. Merter, A. K., & Özer, G. (2024). Audit Committee and Timely Reporting: Evidence From Turkey. SAGE Open, 14(1), 21582440241239516. doi:https://doi.org/10.1177/21582440241239516
  27. Meutia, I., Yaacob, Z., & Kartasari, S. F. (2023). SUSTAINABILITY REPORTING AND AUDIT COMMITTEE ATTRIBUTES: EVIDENCE FROM BANKS IN INDONESIA. Asian Academy of Management Journal, 28(2).
  28. Molla Imeny, V. (2016). The Impact of Ethnic Characteristics of CEOs on Audit Report Lag and Audit Fees. The Impact of Ethnic Characteristics of CEOs on Audit Report Lag and Audit Fees (November 20, 2016). doi:https://dx.doi.org/10.2139/ssrn.2873056
  29. Moradi, M., & Molla Imeny, V. (2019). The impact of CEOs' Ethnic characteristics on audit report lags and audit fees in Iran. Iranian Journal of Accounting, Auditing and Finance, 3(1), 75-96.
  30. Mutmainnah, N., & Wardhani, R. (2013). Analisis dampak kualitas komite audit terhadap kualitas laporan keuangan perusahaan dengan kualitas audit sebagai variabel moderasi. Jurnal Akuntansi dan Keuangan Indonesia, 10(2), 2.
  31. Okumu, A. B., Olweny, T., & Muturi, W. (2021). Theoretical Review of Effect of Firm Specific Factors on Performance of Initial Public Offering Stocks at the Nairobi Securities Exchange in Kenya. doi:https://doi.org/10.1177/0974686217701467
  32. Park, S. H., & Westphal, J. D. (2013). Social discrimination in the corporate elite: How status affects the propensity for minority CEOs to receive blame for low firm performance. Administrative Science Quarterly, 58(4), 542-586.
  33. Pratama, I. F., & Arifin, A. (2016). Analisis Faktor-Faktor Yang Mempengaruhi Audit Delay (Studi Empiris Pada Perusahan Manufaktur Yang Terdaftar Di Bursa Efek Indonesia periode 2012-2014). Universitas Muhammadiyah Surakarta.
  34. Rahman, M. J., Zhu, H., & Hossain, M. M. (2023). Auditor choice and audit fees through the lens of agency theory: evidence from Chinese family firms. Journal of family business management, 13(4), 1248-1276. doi:http://dx.doi.org/10.1108/JFBM-02-2023-0027
  35. Shi, Z., Huang, W., & Liang, Y. (2023). Work values and cultural background: a comparative analysis of work values of Chinese and British engineers in the UK. Frontiers in Psychology, 14, 1144557. doi:https://doi.org/10.3389/fpsyg.2023.1144557
  36. Siregar, D. A. R., Sari, D. W., & Islamiyah, H. A. T. (2024). Evaluating the COVID-19 Pandemic's Impact on Indonesia's Economic Growth, Unemployment, and Poverty. EcceS: Economics Social and Development Studies, 11(1), 24-48. doi:https://doi.org/10.24252/ecc.v11i1.48010
  37. Strano, S. M. (2023). The power of perceptions: unveiling the strategic impact of family business brands through signaling theory.
  38. Supawat, L., & Arnat, L. (2023). Market Reaction to Corporate Releases and News Articles: Evidence from Thailand’s Stock Market. International Journal of Financial Studies, 11(3), 111. doi:https://doi.org/10.3390/ijfs11030111
  39. Susilowati, D., & Saseka, S. H. (2025). The Effect of Auditor Report Lag on Financial Performance and Company Governance in Consumer Cyclical Sector Companies. Sinergi International Journal of Accounting and Taxation, 3(2), 133-147. doi:https://doi.org/10.61194/ijat.v3i2.789
  40. To, C., Sherf, E. N., & Kouchaki, M. (2024). How much inequity do you see? Structural power, perceptions of gender and racial inequity, and support for diversity initiatives. Academy of Management Journal, 67(1), 126-149. doi:https://doi.org/10.5465/amj.2022.0253
  41. Ursel, N., Durante, A., & Elsaid, E. (2023). Ethnic minority CEO turnover: Resource?based and leadership categorization perspectives. Journal of Organizational Behavior, 44(4), 682-699. doi:https://doi.org/10.1002/job.2688
  42. Wulan, A. B. N. (2022). Analisis Faktor-Faktor yang Mempengaruhi Audit Delay Studi Empiris pada Perusahaan Manufaktur Sektor Barang Konsumen Non-Primer yang Terdaftar di BEI Tahun 2019-2022/Ariska Berlian Nur Wulan/33189116/Pembimbing: Rizka Indri Arfianti.
  43. Yudhistira, Y. R. (2023). ANALISA FAKTOR KEBERHASILAN MANAJEMEN TIMESHEET PADA KINERJA NON-FINANCIAL COMPANY. Jurnal Ilmiah Manajemen, Ekonomi, & Akuntansi (MEA), 7(2), 102-108. doi:https://doi.org/10.31955/mea.v7i2.2980