THE EFFECT OF COMPANY’S MANAGEMENT DISCUSSION AND ANALYSIS DISCLOSURE TO SHAREHOLDERS REACTION
Abstract
This research aims to describe how Indonesia capital market would react upon non-financial information Management Discusion and Analysis disclosure for 85 manufacturing company in 2018. The result of the research showed that (1) non-financial information for manufacturing companies such as Management Discussion and Analysis as part of annual report has no significant impact towards investor in Indonesia. (2) MD&A purpose for disclosing information in manufacturing company for Indonesia capital market is not functioning. (3) MD&A disclosure for manufacturing companies are not fully prepared by management.
Keywords: Management discussion and analysis, market reaction, trading volume activity
References
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Li, F. (2010). The Information Content of Forward-Looking Statements in Corporate Filings-A Naive Bayesian Machine Learning Approach. Journal of Accounting Research, 1049-1102.
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Nuswandari, C. (2009). Pengungkapan Pelaporan Keuangan dalam Perspektif Signalling Theory. Kajian Akuntansi, 48-57.
Rosenberg, B., Reid, K., & Lanstein, R. (1984). Persuasive evidence of market inefficiency. The Journal of Portofolio Management, 9-16.
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Shiller, R. J. (2003). From Efficient Markets Theory to Behavioral Finance. Journal of Economic Perspectives, 83-104.
Sugiyono. (2018). Metode Penelitian Bisnis. Bandung: Alfabeta.
Sunur, I. (2009). Pengaruh Peristiwa Pergantian Presiden Republik Indonesia terhadap Return dan Trading Volume Activity. Jurnal Bisnis dan Akuntansi, 97-106.
Surata, P. A., & Astika, I. B. (2019). Reaksi Pasar Atas Pengungkapan Management Discussion and Analysis. E-Jurnal Akuntansi, 987-1011.
Tailab, M. M., & Burak, M. J. (2018). Examining the Effect of Linguistic Style in an MD&A on Stock Market Reaction. International Journal of Business Communication, 1-29.
Tarca, A., Street, D. L., & Aerts, W. (2011). Factors affecting MD&A disclosures by SEC registrants: Views of practitioners. Journal of International Accounting, Auditing and Taxation, 45-59.
Thinggaard, F., Jeppesen, C. S., & Madsen, K. (2015). The information content of note disclosures and MD&A information in the financial report: A study of market reactions in Denmark. Danish Journal of Management & Business, 25-42.
Utami, A. T. (2018). Efisiensi Pasar Bentuk Lemah Pada Pasar Modal Indonesia, Malaysia dan Korea Selatan Periode Krisis Ekonomi Global 2008. Jurnal Inspirasi Bisnis & Manajemen, 101-116.
Willis, A. (2003). 20 Questions Directors Should Ask about Management's Discussion and Analysis. Toronto: Chartered Accountants of Canada.
Wiyani, Wahyu, & Wijayanto, A. (2005). Pengaruh Nilai Tukar Rupiah, Tingkat Suku Bunga Deposito dan Volume Perdagangan Saham Terhadap Harga Saham. Jurnal Keuangan dan Perbankan, 884-903.
Otoritas Jasa Keuangan. (2016, November 02). Retrieved January 17, 2020, from Undang-Undang No. 40 Tahun 2007 Tentang Perseroan Terbatas: https://www.ojk.go.id/sustainable-finance/id
Ady, S. U., & Mulyaningtyas, A. (2017). Eksplorasi Tingkat Efisiensi Pasar Modal Indonesia Studi Kasus di Bursa Efek Indonesia. Ekspektra: Jurnal Bisnis dan Manajemen, 103-123.
araward.id. (n.d.). Retrieved July 8, 2020, from Annual Report Award.
Arvidsson, S. (2011). Disclosure of non-financial information in the annual report: A management-team perspective. Journal of Intellectual Capital, 277-300.
Audi, R., Loughran, T., & McDonald, B. (2015). Trust, but Verify: MD&A Language and the Role of Trust. Jurnal of Business Ethics.
Barnea, A., Cronqvist, H., & Siegel, S. (2010). Nature of Nurture: What Determines Investor Behavior? Journal of Financial Economics, 583-604.
Botosan, C. A. (1997). Disclosure Level and the Cost of Equity Capital. The Accounting Review, 323-349.
Brown, S. V., & Tucker, J. W. (2011). Large-Sample Evidence on Firms’ Year-over-Year MD&A Modifications. Journal of Accounting Research, 309-346.
Bryan, S. H. (2007). Incremental Information Content of Required Disclosures Contained in Management Discussion and Analysis. The Accounting Review, 285-301.
Clarkson, P. M., Kao, J. L., & Richardson, G. D. (1999). Evidence That Management Discussion and Analysis (MD&A) is a Part of a Firm's Overall Disclosure Package. Contemporary Accounting Research, 111-134.
Cohen, J. R., Gaynor, L. M., Holder-Webb, L. L., & Montague, N. (2008). Management’s Discussion and Analysis: Implications for Audit Practice and Research. Current Issues in Auditing, A26-A35.
Connelly, B. L., Certo, S. T., Ireland, R. D., & Reutzel, C. R. (2011). Signaling Theory : A Review and Assessment. Journal of Management, 39-67.
Davis, A. K., & Tama-Sweet, I. (2012). Managers' use of language across alternative disclosure outlets: Earnings press releases versus MD&A. Contemporary Accounting Research, 804-837.
Fama, E. F. (1970). Efficient Capital Markets: A Review of Theory and Empirical Work. The Journal of Finance, 383-417.
Ferreira, D., & Rezende, M. (2007). Corporate strategy and information disclosure. RAND Journal of Economics, 164-184.
Gani, I., & Amalia, S. (2015). Alat Analisis Data. Yogyakarta: ANDI.
Gitman, L. J., & Joehnk, M. D. (2015). Fundamentals of Investing. Boston: Pearson Education.
Grossman, S. J., & Stiglitz, J. E. (1980). On the Impossibility of Informationally Efficient Markets. The American Economic Review, 393-408.
Gunawan, H., & Lina, E. O. (2015). Mandatory and Voluntary Disclosure of Annual Report on Investor Reaction. International Journal of Economics and Financial Issues, 311-314.
Kearney, C., & Liu, S. (2014). Textual sentiment in finance: A survey of methods and models. International Review of Financial Analysis, 1-15.
Laksmana, K. A., & Dewi, N. L. (2019). Studi Komparatif The Day of The Week Effect dan The Month of The Year Effect Dalam Perolehan Retun Saham di Bursa Efek Indonesia pada Perusahaan LQ 45 Periode Februari 2017 - Januari 2018. Jurnal Satyagraha, 123-136.
Lee, J., & Park, J. (2018). The Impact of Audit Committee Financial Expertise on Management Discussion and Analysis (MD&A) Tone. European Accounting Review, 1-22.
Li, F. (2010). The Information Content of Forward-Looking Statements in Corporate Filings-A Naive Bayesian Machine Learning Approach. Journal of Accounting Research, 1049-1102.
Lindrianasari, Gultom, S. B., & L. A. (2017). Management Discussion and Analysis, Corporate Governance Perception Index and Market Reaction. Corporate Ownership & Control, 165-175.
Lo, K., Ramos, F., & Rogo, R. (2017). Earnings management and annual report readability. Journal of Accounting and Economics, 1-25.
Ma, J., Pagan, J. A., & Chu, Y. (2009). Abnormal Returns to Mergers and Acquisitions in Ten Asian Stock Markets. INTERNATIONAL JOURNAL OF BUSINESS, 235-250.
Mayew, W. J., Sethuraman, M., & Venkatachalan, M. (2015). MD&A Disclosure and the Firm's Ability to Continue as a Going Concern. The Accounting Review, 1621-1651.
Nuswandari, C. (2009). Pengungkapan Pelaporan Keuangan dalam Perspektif Signalling Theory. Kajian Akuntansi, 48-57.
Rosenberg, B., Reid, K., & Lanstein, R. (1984). Persuasive evidence of market inefficiency. The Journal of Portofolio Management, 9-16.
Ross, S. A. (1973). The economic theory of agency: The principal's problem. The American economic review, 134-139.
Ross, S. A. (1977). The determination of financial structure: the incentive-signalling approach. The Bell Journal of Economics, 23-40.
Shiller, R. J. (2003). From Efficient Markets Theory to Behavioral Finance. Journal of Economic Perspectives, 83-104.
Sugiyono. (2018). Metode Penelitian Bisnis. Bandung: Alfabeta.
Sunur, I. (2009). Pengaruh Peristiwa Pergantian Presiden Republik Indonesia terhadap Return dan Trading Volume Activity. Jurnal Bisnis dan Akuntansi, 97-106.
Surata, P. A., & Astika, I. B. (2019). Reaksi Pasar Atas Pengungkapan Management Discussion and Analysis. E-Jurnal Akuntansi, 987-1011.
Tailab, M. M., & Burak, M. J. (2018). Examining the Effect of Linguistic Style in an MD&A on Stock Market Reaction. International Journal of Business Communication, 1-29.
Tarca, A., Street, D. L., & Aerts, W. (2011). Factors affecting MD&A disclosures by SEC registrants: Views of practitioners. Journal of International Accounting, Auditing and Taxation, 45-59.
Thinggaard, F., Jeppesen, C. S., & Madsen, K. (2015). The information content of note disclosures and MD&A information in the financial report: A study of market reactions in Denmark. Danish Journal of Management & Business, 25-42.
Utami, A. T. (2018). Efisiensi Pasar Bentuk Lemah Pada Pasar Modal Indonesia, Malaysia dan Korea Selatan Periode Krisis Ekonomi Global 2008. Jurnal Inspirasi Bisnis & Manajemen, 101-116.
Willis, A. (2003). 20 Questions Directors Should Ask about Management's Discussion and Analysis. Toronto: Chartered Accountants of Canada.
Wiyani, Wahyu, & Wijayanto, A. (2005). Pengaruh Nilai Tukar Rupiah, Tingkat Suku Bunga Deposito dan Volume Perdagangan Saham Terhadap Harga Saham. Jurnal Keuangan dan Perbankan, 884-903.
Published
2021-09-30
How to Cite
SORITON, Natasya Imanuella; RANTUNG, Rinny.
THE EFFECT OF COMPANY’S MANAGEMENT DISCUSSION AND ANALYSIS DISCLOSURE TO SHAREHOLDERS REACTION.
Klabat Accounting Review, [S.l.], v. 2, n. 2, p. 134-147, sep. 2021.
ISSN 2722-7278.
Available at: <https://ejournal.unklab.ac.id/index.php/kar/article/view/597>. Date accessed: 15 oct. 2025.
doi: https://doi.org/10.60090/kar.v2i2.597.134-147.
Section
Articles
This work is licensed under a Creative Commons Attribution 4.0 International License.
