FINANCIAL STATEMENT INTEGRITY : CORPORATE GOVERNANCE AND QUALITY AUDIT EVIDENCE FROM FOOD AND BEVERAGE COMPANIES IN INDONESIA

The purpose of this study was to examine the effect of corporate governance and audit quality, corporate governance as proxied by institutional ownership, managerial ownership, audit committees, independent commissioners on the integrity of financial statements in manufacturing companies in the food and beverage industry sub-sector. This study uses a quantitative approach whose research object is taken from a sample of manufacturing companies in the food and beverage industry sub-sector as many as 6 companies during the 4-year observation period in order to obtain 24 observation samples. The analytical method used is multiple linear regression analysis with a significant level of 5%. Based on the results of the study, the multiple linear regression analysis equations are: Financial Statement Integrity = 0.239 – 0.070 Institutional Ownership + 5.371 Managerial Ownership – 0.976 Audit Committee + 4.740 Independent Commissioner – 0.379 audit quality + e. The conclusion of the analysis is partial managerial ownership and independent commissioner affect the integrity of financial statements while institutional ownership, audit committee, and audit quality have no effect on the integrity of financial statements, simultaneously institutional ownership, managerial ownership, audit committee, independent commissioners and audit quality have an effect on the integrity of financial statements. managerial ownership and independent commissioners strengthen their relationship with financial statement integrity and institutional ownership, audit committees, and audit quality weaken their relationship with financial statement integrity. The proxy of corporate governance and audit quality on the coefficient of determination shows the percentage of influence of 83.6%, while the rest is influenced by other variables of 16.4%.

are fundamental qualities which are requirements for making decisions on financial statements set by the International Accounting Standard Aboard (IASB) (Fajaryani, 2015in Akram, Basuki, & Budiarto, 2018. Verifiability, representational faithfulness and neutrality are standards of integrity that can be relied upon (reliability) for presentation in financial statements (Gayatri andDharma, 2013 in Siahaan, S. B., 2017).
Companies with integrity will produce good company performance, which will maintain the company's existence in the future. Observation or control within the company is necessary for the creation of high-integrity financial reports in order to avoid fraud that could occur in every company. Observation or supervision that is carried out is by implementing a system of ownership and management system within the company which is often referred to as a systematic and orderly Corporate Governance with the concept of GCG (Good Corporate Governance). GCG aims to improve business success and corporate accountability to realize shareholder value in the long term while still observing the interests of other stakeholders, based on laws and regulations and ethical values (Sutedi, 2012). Within Corporate Governance there are several structures that contribute or serve as controllers within the company, namely institutional ownership, managerial ownership, audit committee, and independent commissioners (Istiantoro, Paminto, & Ramadhani, 2018).
However, to realize the integrity of financial statements is in fact not an easy thing, it can be seen from the many problems of manipulation of accounting data that exist in several large companies such as Global Crossing, Enron, Toshiba, Tyco, Worldcom, and also in several companies in Indonesia such as Bank Century, PT Kimia Farma, and Bank Lippo. The problems that occurred in the Enron Company were proven to include many sides such as the CEO, the Commissioner, the audit committee, the internal audit, to the external auditor where the side or the party itself is part of the company (Solikhah, 2017) as the disclosure of this case made the stock price decline, of course this was due to the reduced confidence of the financial community in the company. Another case of falsification of financial statements at Indonesian companies in 2012 occurred in PT Garda Tujuh Buana Tbk (GTBO) (Dan, Rosyida Alfi Qonitin and Yudowati, 2018). The manipulation cases that occur prove the lack of integrity of financial statements because they do not show the actual economic condition of the company, even though the integrity of financial statements is very important because it has a great influence on users of financial statements to be used as decision making material. The existing manipulation cases also prove the lack of oversight of corporate governance or the non-implementation of GCG in the company, which in the end also raises doubts about the company's corporate governance.
In addition to corporate governance that carries out supervision, audit quality is also related to the integrity of financial reports because the financial statement information used is of course a financial report after the auditing process carried out by the Public Accounting Firm (KAP). If the audit quality can meet the standards that have been set then the integrity of a financial report can be carried out. Financial reports that are reliable and can be used as material for decision making are financial statements that have high audit quality.  In the table above, the calculation of the integrity of financial statements is proxied by the conservatism index using the MBV (Market to Book Value) measurement in Manufacturing Companies in the Food and Beverage Industry Sub-Sector listed on the Indonesia Stock Exchange in 2017-2020. When compared to other food and beverage industry companies, the highest MBV ratio was 3.47 at Ultra Jaya Milk Industry & Trading Company Tbk in 2017, while the lowest MBV ratio was at Sekar Bumi Tbk in 2019, which was 0.68. In theory, the higher the MBV ratio in the company, the better the company's performance in its management so that the resulting financial reports include integrity, therefore investors are increasingly interested in investing their shares in the company and inversely if the MBV ratio in If the company is low, then there is a possibility that the management's performance at the company is questionable because the stock price is underprice, but the low ratio in the stock can also be considered by investors, because investors can get capital gains when the stock price increases in price.
From the description of the background of the problem, the authors are interested in conducting research with the title FINANCIAL STATEMENT INTEGRITY :

PROBLEM RESEARCH
The formulation of the problem in this research are: 1. Does corporate governance affect the integrity of financial statements in manufacturing companies in the food and beverage industry sub-sector? 2. Does audit quality affect the integrity of financial statements in manufacturing companies in the food and beverage industry sub-sector? 3. Do corporate governance and audit quality affect the integrity of financial reports in manufacturing companies in the food and beverage industry sub-sector?

RESEARCH PURPOSES
The objectives of this research are: 1. To determine the effect of corporate governance on the integrity of financial statements in manufacturing companies in the food and beverage industry sub-sector.

2.
To determine the effect of audit quality on the integrity of financial statements in manufacturing companies in the food and beverage industry sub-sector. 3. To determine the effect of corporate governance and audit quality on the integrity of financial reports in manufacturing companies in the food and beverage industry subsector.

BENEFITS OF RESEARCH
The benefits in this research are: 1. To determine the effect of corporate governance on the integrity of financial statements in manufacturing companies in the food and beverage industry sub-sector. 2. To determine the effect of audit quality on the integrity of financial statements in manufacturing companies in the food and beverage industry sub-sector. 3. To determine the effect of corporate governance and audit quality on the integrity of financial reports in manufacturing companies in the food and beverage industry subsector

Conceptual Framework
Picture 3. H3: There is an effect of the audit committee on the integrity of the financial statements. 4. H4: There is an effect of the number of independent commissioners on the integrity of the financial statements. 5. H5: There is an effect of audit quality on the integrity of financial statements. 6. H6: There is an effect of institutional ownership, managerial ownership, audit committee, independent commissioner, and audit quality on the integrity of financial statements

Types of Research and Types of Data
In this research, the type of research used is descriptive research with a quantitative approach. The data used in this research is secondary data. The data sources in this study are the annual financial reports of 6 manufacturing companies in the food and beverage industry sub-sectors listed on the BEI and which meet the research criteria, namely as many as 24 data and using data for 4 years, namely from 2017-2020.

Population and Sample
The population used in this study are all manufacturing companies in the food and beverage industry sub-sector listed on the Indonesia Stock Exchange in 2017-2020. The number of registered food and beverage industry sub-sector manufacturing companies from 2017-2020 is 28 companies. In this study, the sample was determined based on the purposive sampling method, which is a sample of the companies used which were selected based on certain criteria. The criteria used are: 1. Manufacturing companies in the food and beverage industry sub-sector thatlisted on the Indonesia Stock Exchange from 2017-2020. 2. Companies that do not publish financial statements in a row in the study period. 3. Companies that do not have managerial shares. 4. Companies that do not issue audited financial statements consecutively in the study period. Based on the above criteria, the sample obtained by the researcher in the study period totaled 6 samples.

Data collection technique
In this study, the data collection techniques used are as follows: 1. Documentation: this study takes data from the annual financial statements published on the Indonesia Stock Exchange website, namely www.idx.co.id for the period 2017-2020. 2. Literature study: books, writings and scientific journals and scientific research reports related to the research theme. The tool used for data analysis in this study was the computer program SPSS version 20 (Statistical Program For Social Science Version 20) for windows.

DESCRIPTIVE STATISTICAL ANALYSIS
In this study, researchers used measurements of the minimum value, maximum value, average value (mean) and standard deviation.

Classic assumption test
In this study, the researchers tested the classical assumptions first, which included normality test, multicollinearity test, heteroscedasticity test, and autocorrelation test.

Multiple Linear Regression Analysis
Used to measure the size of the influence between two or more independent variables on 1 dependent variable and predict variables using the dependent variable.

Partial Regression Coefficient Test (T Test)
The t test can be used to determine whether the independent variable has a significant effect or not on the dependent variable. The hypotheses to be tested are as follows: 1. Ho: The independent variable has no effect on the dependent variable. 2. Ha: The independent variable has an effect on the dependent variable.
The basis for making the decision is: 1. If t count < t table ort count > -t table then Ho is accepted and Ha is rejected for = %.

If t count > t table ort count < -t table then
Ha is accepted and Ho is rejected for = 5%. 3. If the probability (sig t) < (0.05) then the probability level of the independent variable on the dependent variable is significant, and vice versa if (sig t) > (0.05) then the probability of the variable is not significant.

Simultaneous Test (F Test)
The F test is used to determine whether all independent variables simultaneously have an effect on the dependent variable. The tested hypotheses are: 1. If the value of fcount > ftable, the hypothesis is accepted, that is, all independent variables simultaneously affect the dependent variable. 2. If the value of fcount < ftable, the hypothesis is rejected, that is, all independent variables simultaneously have no effect on the dependent variable.

Coefficient of Determination Test
The coefficient of determination measures how far the model's ability to explain variations in the dependent variable is. The small value of R2 means the ability of the independent variables in explaining the variation of the dependent variable is limited. A value close to one means that the independent variable provides almost all the information needed to predict the dependent variables.

RESULTS AND DISCUSSION
Descriptive statistics Table 2 Descriptive Statistics VOLUME 1 NO.1 (2022) From the table above, it is known that the number of data N used in this study amounted to 24 data samples. In addition, it is known that the average value of the independent variable X varies, for institutional ownership (X1)

Classical Assumption Test Normality Test 1. Histogram Graph Picture 2 Histogram
From the picture above, it can be seen that the data is in the form of a bell upwards, so it can be concluded that the data is normally distributed.

Table 3 KS-Tes
From the table, it is known that the significance value is 0.344, which means it is greater than 0.05 so that the data can be said to be normally distributed.

Multicollinearity Test Table 4 Multicollinearity Test
The independent variable tolerance value for institutional ownership is 0.347 > 0.1, managerial ownership is 0.590 > 0.1, the audit committee of 0.311 > 0.1, independent commissioners of 0.840 > 0.1, and audit quality of 0.355 > 0.1. While the VIF value for institutional ownership is 2.884 < 10, managerial ownership is 1.694 < 10, audit committee is 3.218 < 10, independent commissioner is 1.191 < 10, and audit quality is 2.816 < 10, so it can be concluded that there is no multicollinearity. It can be seen that all data in the study did not occur heteroscedasticity because all variables showed significant values exceeding 0.05.

Autocorrelation Test Table 5 Autocorrelation Test
It can be seen that the DW value for this study is 1.451 which is at -2 <1.451 < +2, so it can be concluded that there is no autocorrelation. Table 6 Multiple Linear Regression Analysis

Partial Regression Coefficient Test (Test T)
Based on the table above, it can be explained as follows: 1. X1 (institutional ownership) has a tcount value of -0.122 thus -tcount > -ttable (-0.122 > -2.10092) and has a sig.t value of 0.905 thus (0.905 > 0.05) which is statistically a variable X1 (institutional ownership) has no significant effect on Y (integrity of financial statements), then Ha is rejected and Ho is accepted. 2. X2 (managerial ownership) has a tcount value of 6.655, thus tcount > ttable (6.655 > -2.10092) and has a sig.t value of 0.000 thus (0.000 < 0.05) which is statistically a variable X2 (managerial ownership) ) has a significant positive effect on Y (integrity of financial statements), then Ha is accepted and Ho is rejected. 3. X3 (audit committee) has a value of tcount equal to -0.971 thus -tcount > (0.345 > 0.05) which statistically X3 variable (audit committee) has no significant effect on Y (integrity of financial statements), then Ha is rejected and Ho is accepted. 4. X4 (independent commissioner) has a tcount value of 3.801, thus tcount > ttable (3.801 > -2.10092) and has a sig.t value of 0.001 thus (0.001 < 0.05) which is statistically a variable X4 (independent commissioner). ) has a significant positive effect on Y (integrity of financial statements), then Ha is accepted and Ho is rejected. 5. X5 (audit quality) has a tcount of -1.528 thus -tcount > -ttable (-1.528 > -2.10092) and has a sig.t value of 0.144 thus (0.144 > 0.05) which statistically variable X5 (audit quality) has no significant effect on Y (integrity of financial statements) then Ha is rejected and Ho is accepted. commissioner, audit quality simultaneously or jointly have a significant effect on the dependent variable, namely the integrity of financial statements.

Coefficient of Determination (R2) Table 8 Coefficient of Determination (R2)
Based on the table above, the determination value of R square is 0.836 or 83.6%, this proves that the percentage of the influence of institutional ownership, managerial ownership, audit committee, independent commissioner, audit quality in manufacturing companies in the food and beverage industry sub-sector is 83.6%. while the rest is influenced by other variables by 16.4%.

CLOSING Conclusion
Based on the results of the research that has been done, it can be concluded several things as follows: 1. The results of the partial test show that the institutional ownership variable has no significant effect on the integrity of financial statements with a value of -tcount -0.122 > -ttable -2.10092 and a significant value of 0.905 > 0.05. 2. The results of the partial test show that the managerial ownership variable has a significant effect on the integrity of financial statements with a tcount of 6.655 > ttable -2.10092 and a significant value of 0.000 <0.05. 3. The results of the partial test show that the results of the audit committee variable have no significant effect on the integrity of the financial statements with a value of -tcount -0.971> -ttable -2.10092 and a significant value of 0.345 > 0.05. 4. The results of the partial test show that the independent commissioner variable has a significant effect on the integrity of the financial statements with a tcount of 3.801 > ttable -2.10092 and a significant value of 0.001 <0.05. 5. The results of the partial test show that the results of the audit quality variable have no significant effect on the integrity of the financial statements with a value of -tcount -1.528 > -ttable -2.10092 and a significant value of 0.144 > 0.05. 6. Simultaneous test results show the results of the variables of institutional ownership, managerial ownership, audit committee, independent commissioner, and audit quality on the integrity of financial statements with a value of Fcount 24.394 > Ftable 2.74 with a significant value of 0.000 <0.05.

Suggestion
Based on the conclusions above, it can be concluded the following suggestions: 1. Researchers with similar topics are expected to continue this research by adding variables, other formulas, years of observation, and the number of population used as research samples which are not only limited to manufacturing companies, but also other types of industries listed on the Indonesia Stock Exchange, to expand observations so that it is expected to produce better research. 2. For the public, if they want to take into account the decision to invest in a company, they should be more careful and careful because they cannot only pay attention to the profits earned by the company but also pay attention to the integrity of its financial statements. 3. For companies, they should be able to improve their performance and quality the company in order to attract investors to invest, and of course the company must also be open to shareholders in terms of publishing financial statements in order to increase investor confidence.