Factors Affecting the Internet Financial Reporting (IFR) at Manufacturing Industry in Indonesia

<b>English Abstract:</b> The purpose of this research is to analyze the effect of the company's size (SIZE), profitability short-term (S/T), the profitability of the medium (M/T), long-term profitability (L/T), corporate governance (TATK) and age listings (AGE) against internet financial reporting (IFR). This research using a sample of 57 manufacturing companies listed on the Indonesia stock exchange (idx) 2013-2015. This research uses research methods, namely quantitative approach. Data analysis using logistic regression test with Eviews program. Based on the results of hypothesis testing simultaneously shows that SIZE, S/T, f/T, L/T, TATK and AGE has an impact on internet financial reporting. While the results of hypothesis testing partially S/T, f/T, L/T, TATK and AGE has no significant influence against internet financial reporting, but the SIZE has significant influence against internet financial reporting.<br><br><b>Indonesian Abstract:</b> Tujuan penelitian ini adalah untuk menganalisis pengaruh ukuran perusahaan (SIZE), profitabilitas jangka pendek (S/T), profitabilitas jangka menengah (M/T), profitabilitas jangka panjang (L/T), tata kelola perusahaan (TATK) dan umur listing (UMUR) terhadap internet financial reporting (IFR). Penelitian ini menggunakan 57 sampel perusahaan manufaktur yang terdaftar di Bursa Efek Indonesia (BEI) tahun 2013-2015. Penelitian ini menggunakan metode penelitian yaitu pendekatan kuantitatif. Analisis data menggunakan uji regresi logistik dengan program Eviews. Berdasarkan hasil pengujian hipotesis secara simultan menunjukkan bahwa SIZE, S/T, M/T, L/T, TATK dan UMUR memiliki pengaruh terhadap internet financial reporting. Sedangkan hasil pengujian hipotesis secara parsial S/T, M/T, L/T, TATK dan UMUR tidak memiliki pengaruh signifikan terhadap internet financial reporting, namun SIZE memiliki pengaruh signifikan terhadap internet financial reporting.<br><br><br><br><br><br>


INTRODUCTION
One development technology which have been known in general by all people in society is internet. The growth of internet indirectly provided solution in order to help and make the business dealings so it is more effective, efficient in the time and economical. Media of communication the internet has making a progress technology the rapidly, the internet also capable of being one alternative new for the company to present information quickly on companies financially or non-financial stocks. Progress media of communication the internet in the business world indicated by starting out many companies having private website. One of the benefits use the internet for a the company is to ease in the disclosure of financial report.
Technology development internet media demanding companies to prefer media of communication this in relating to the businesses. It would be easier if communicating directly without having to come to the company.
According to Narsa and Pratiwi (2012), the internet has become the medium of information supporting the existence of the openness and transparency of financial reporting, by the existence of internet media can reduce the level of excessive information received by one party, so that it can accelerate the development of business in the company. Internet Financial Reporting (IFR) is a way for companies to report financial information to the investor by using internet technology. Internet Financial Reporting (IFR) appeared and developed as the fastest media to inform things associated with the company in recent years. According to Debreceny et al (2002) in Hanny and Chariri (2007), the use of the internet is causing financial reporting becomes faster and easier, so it can be accessed by anyone, anytime and anywhere.
Internet financial reporting (IFR) helps companies in facilitating dissemination of information regarding the company's advantage. The existence of Internet financial reporting (IFR) make company able to provide information accurately to the users of financial statements, particularly investors. Investors will be more interested in the financial reporting Electronic copy available at: https://ssrn.com/abstract=3298207 of the company that owns the information clearly, accurately and on time. This means that with the application of Internet financial reporting (IFR) within the company as a communication medium in delivering a complete company information to the public, particularly investors.
Not all companies implement Internet Financial Reporting (IFR) because according to the company there is nothing to ensure the safety of the use of the internet. The users of Internet Financial Reporting (IFR) have some differences in the use of information in the financial statements. Internet Financial Reporting (IFR) are able to provide information more quickly.
The higher the level of disclosure of information in quantity or transparency, then the greater the impact of the disclosure is against the decision of the investors (Narsa & Pratiwi, 2012). Based on the theory of agency between the agent and principal, the principal takes the form of liability of management. Murtini (2014) suggests that in a contract between the managers and the shareholders then Manager seen as party agents and shareholders is seen as a principal. Wealth manager as agent of the company, drawing up of financial statements as a means of accountability agent to the principal. The existence of Internet Financial Reporting (IFR) management can provide the desired information disclosure by the Agency. Internet Financial Reporting (IFR) will also decrease the agency cost the usual costs incurred for printing and delivery of financial statements.
According to Dolinšek et al (2001) Internet Financial Reporting (IFR) is an important factor because the existence of Internet Financial Reporting (IFR) will help a company to publish financial statements. The users of the financial statements will also be helped by the existence of Internet Financial Reporting (IFR) will facilitate in receiving information of the financial statements. The company will be able to compete healthily with the competitors with the information disclosure of the financial statements of the application of Internet Financial Reporting (IFR). The users of financial statements have some difference in the use of information in the financial statements. The presentation of the financial statements through Electronic copy available at: https://ssrn.com/abstract=3298207 the (Internet Financial Reporting) can give a positive or negative sign on the information contained in the financial statements. Bozcuk (2012) are doing a research on whole company that exists in the Istanbul Stock Exchange (ISE) during the month of December 2009. Research by using several independent variables consisted of company size, profitability, growth prospects, ownership structures, corporate governance and the type of industry. Research results from Bozcuk (2012) shows that only the independent variable of size of company and corporate governance have significant influence towards Internet Financial Reporting (IFR). Companies that have a large size enterprise and using the famous as Big Four auditor in the audit as well as participate in corporate governance index of the Istanbul Stock Exchange using the Internet Financial disclosure Reporting format (IFR) more sophisticated such as audio, video files, internal search engines and hyperlinks in the financial statements. The Internet is one of the most sophisticated communications medium, the internet can help facilitate communication between the company and business colleagues. The times make the absence of a business that has no effect on the development of current technologies. A fairly high economic growth because of the support from the Government, business and the community who help the development and improvement of the competitiveness of national industries. According to data of the Central Bureau of statistics (BPS), one of the industry's growth by as much as 4 percent is the manufacturing industry (Afrianto, 2016). Economic growth performance is mostly in the business sector, the manufacturing industry. The manufacturing industry is experiencing growth that is high enough. Giving rise to the interest for researchers to examine the manufacturing sector. This research uses the manufacturing sector companies listed on the Indonesia stock exchange (IDX) by 2013-2015. Manufacturing companies tend to be more sensitive to the condition of the economy as well as the application of higher technology than any other sector. The manufacturing industry also experienced a more rapid development since adopting the sophistication of the technology continuously.
The issues examined are: 1. What is the size of the company, profitability, corporate governance and the listing of Internet influence on Financial Reporting (IFR)?

HYPOTHESIS DEVELOPMENT
Company size is to assess a company with certain guidelines or rules. Company size has a significant influence and has a positive relationship to financial reporting through IFR (Internet Financial Reporting). In other words the size of the company has a positive relationship to financial reporting through Internet Financial Reporting (Prasetya and Irwandi, 2012).
Research Prasetya and Irwandi (2012) have similar results with a study of (Aqel, 2014) who conducted research on Turkish firms, revealing that independent variables of firm size are statistically significant at the 5% level against financial reporting through Internet Financial Reporting (IFR) . In contrast to research (Narsa & Pratiwi, 2012) using firm size as a control variable, the results of the study indicate that firm size has a significant negative effect on firm value. The larger the company will be followed by the greater the risks facing the company.
According to Kelton and Yang (2008) in Bozcuk (2012) prove that company size as well as index presentation disclosure format. In a multivariate regression analysis for firm size and auditor samples positively significant. Therefore, firm size has significant effect on Internet Financial Reporting (IFR). Based on the above description, the hypothesis is proposed as follows: H1: Company size affects Internet Financial Reporting (IFR).
Profitability is the company's way of managing management. Management management is done to provide information on the company's performance in improving the profitability of the company. Profitability is one of the most important factors of internet financial reporting (Agyei-mensah, 2012).
To increase the confidence of investors the company must disseminate financial information. One way companies to disseminate information is to use internal financial reporting. Companies that have more information tend to have high profitability. If the profitability of a company is good then it will encourage the company to disseminate good news to the stakeholders. Conversely, if the company has a profitability that tends to be bad then it will try to hide bad news. High profitability in a company can be a factor of persilence by stakeholders. Stakeholders can assess the position of the company's competition. The results proved that there is no evidence of profitability on the quality of financial reporting through the internet. High profitability is less able to encourage management to convey financial information (Murtini, 2014). A similar study was conducted by (Aqel, 2014) revealed that profitability had a statistically significant effect on the 5% level.
In contrast to the research of Narsa and Pratiwi (2012) which use profitabiltas as control variable of research result show that profitability of company have significant positive effect to company value. The other research from Prasetya and Irwandi (2012) proves that profitability has no significant effect on IFR. According to Bozcuk (2012) who conducted a study on the Istanbul Stock Exchange revealed that profitability has no effect on Internet Financial Reporting. Based on the above description, in this study used 3 independent variables to test the relationship profitability with Internet Financial Reporting that is short-term profitability, medium term profitability, long-term profitability, the hypothesis is proposed as follows: H2: Short-term profitability affects Internet Financial Reporting (IFR).

H4: Long term profitability affects Internet Financial Reporting (IFR).
Corporate governance significantly affects financial reporting through IFR (Internet Financial Reporting). Companies that have a good reputation will have an impact describes good corporate governance (Bozcuk, 2012).
Agency theory explains and predicts that audits help reduce agency costs arising from conflicting interests between managers and shareholders (Sabri Boubaker, 2012 According to research from (Handoko & Fuad, 2013) shows that the age of listings has a negative relationship to financial reporting through Internet Financial Reporting (IFR) so it can be said to affect IFR. Thus, the listing age can be said to have a positive relationship to financial reporting through IFR (Internet Financial Reporting). According to (Lestari & Chariri, 2011) age listings have an influence on the practice of Internet Financial Reporting (IFR). Age listings do not guarantee quality resources in practice Internet Financial Reporting (IFR) (Prasetya & Irwandi, 2012). Based on the results of the above description, the hypothesis is proposed as follows: H6: Age listing affects Internet Financial Reporting (IFR).

RESEARCH METHODOLOGY
Based on the level of the formulation of the problem, the study includes a formal research because it starts with a hypothesis that aims to test the hypothesis to the question posed.
The technique of sampling done by using purposive sampling, where a sample was made the object of research are determined based on certain criteria. The criteria established for the sampled in this study are as follows: 1. Manufacturing companies listed on the Indonesia stock exchange in 2013 to 2015.
2. The financial report presenting the currency of rupiah in financial reporting. This research uses the company's size, profitability, corporate governance and listing its independent variables as age.
1. Firm Size SIZE diproxy with the value of the logarithm of the total assets in percent.

Profitability
Profitability in this study proxied by short term profitability, medium term profitability, long-term profitability. Short term profitability to be measured using ratio of ROE. The formula: Long-term profitability measured as follows:

Corporate Governance
Governance of a company can be measured from the auditor who performs auditing practices in the company. Audit firm which has the size of a large company like the Big Four already proved to have a good audit experience and trusted. The company's auditing by auditors tend to be famous has a good corporate governance (Bozcuk, 2012). Corporate governance in this research will be measured by using a dummy. Companies that use the Big Four auditors included in the HOOD of the Big Four is Ernst Young, & Deloiitte Touche, KPMG and the largest Copper PriceWaterhouse will be number 1, while companies that do not use the HOOD of the Big Four will be given the number 0.

Age Listing
The company will have the listings and listings have a duty to perform financial reporting. Age of listing companies measured using the difference between the observation year financial reports with the year when the Initial Public Offering (IPO). Companies listed on the Indonesia Stock Exchange will provide more complete financial reporting compared to other companies. This ratio can be calculated as follows:

Internet Financial Reporting (IFR)
Electronic copy available at: https://ssrn.com/abstract=3298207 The dependent variable of this research is the Internet Financial Reporting (IFR). IFR is the inclusion of financial information of the company through the company's website. The company implemented the IFR rated 1, companies that do not implement IFR rated 0

Testing The Model
The research model can be written as follows: = α + X1 + X2 + X3 + X4 + X5 + X6 + є Where : X 1: the size of a company is measured by the ratio of total assets. X 2: short term profitability measured by ROE ratio formula that year.
X 3: medium-term profitability measured by the formula ratio ROE last year.
X 4: long-term profitability measured by the formula of the ratio of the average ROE for 3 years.
X 5: corporate governance is measured with the dummy from the use of reputable Auditors The significance level smaller than 0.05 or 5%. As for the value of the resulting coefficient is 0.627993. So it can be said that the size of the company's significant positive effect towards the IFR (Internet Financial Reporting).
The variable profitability short-term (S/T) has the value level of significance of 0.4891 or 48,91%. The significance level is greater than 0.05 or 5%. As for the value of the resulting coefficient is-1.160549. So it can be said that short term profitability (S/T) do not affect significantly negatively to IFR (Internet Financial Reporting).
Electronic copy available at: https://ssrn.com/abstract=3298207 Medium-term profitability of independent variables (M/T) has value to the level of significance of 0.9407 or 94.07%. The significance level is greater than 0.05 or 5%. As for the value of the resulting coefficient is 0.000223. So it can be said that short term profitability (M/T) has no effect against the posifit significant IFR (Internet Financial Reporting). This shows the profitability of the medium (M/T) does not affect the IFR (Internet Financial Reporting).
The long-term profitability of independent variables (L/T) has value to the level of significance of 0.2055 or 7%. The significance level is greater than 0.05 or 5%. As for the value of the resulting coefficient is 1.578345. So it can be said that the long-term profitability (L/T) not significant positive effect towards the IFR (Internet Financial Reporting).
Independent variable corporate governance (TATK) has value to the level of significance of 0.3218 or 32,18%. The significance level is greater than 0.05 or 5%. As for the value of the resulting positive coefficient is 0.543649. So it can be said that the corporate governance (TATK) not significant positive effect towards the IFR (Internet Financial Reporting) Independent variables age listing (AGE) has value to the level of significance of 0.7946 or 79,46%. The significance level is greater than 0.05 or 5%. As for the value of the coefficient resulting from listing (AGE) is negative is of-0.007960. So it can be said that the age of listing (AGE) do not affect significantly negatively to IFR (Internet Financial Reporting). The variable is independent of the size of the company shows the value significance of 0.0013. The singnifikansi level is smaller than 0.05. The resulting coefficients are positive of 0.627993 meaning that H1 is accepted so that it can be concluded that the size of the company significantly positive effect against Internet Financial Reporting. This shows that the size of the company will affect IFR (Internet Financial Reporting). The results support the research conducted by (Bozcuk, 2012), (Prasetya & governor, 2012), (Handoko & Fuad, 2013), (Aqel, 2014).
It can be caused due to the size of a large company becomes a factor contributing to provide more information to the inverstor. A company with a large size tend to manage his company by using the principles of Good Corporate Governance.
Partial assay results or the t test for independent variables firm size (SIZE) on research Bozcuk (2012) (Bozcuk, 2012). This is because the theory reveals that the size of the company's first large company to issue agency cost. The larger the size of the manufacturing company, the greater the costs to be incurred. Therefore, management will receive a lot of Electronic copy available at: https://ssrn.com/abstract=3298207 information from various sources that exist. This is supported by the Agency which is the cost incurred by the company to encourage menajer so as to act more in the interests of the shareholders. Prasetya and governor (2012), proving the size of the company (SIZE) positively affects IFR (Internet Financial Reporting), firm size (SIZE). According to him, the size of the company has a large agency cost because large companies have to submit a complete financial reporting to shareholders as a form of management liability. Handoko and Fuad (2013), proving the size of the company (SIZE) positively affects IFR (Internet Financial Reporting), firm size (SIZE). According to him, the size of a large company will issue a larger agency cost as well as companies that have a size bigger company has more information and is more complex to be presented to investors. Therefore, companies that measure is most likely prefer to present its financial statements through the IFR to reduce agency cost.
Large size companies that have a substantial risk. Large companies are more likely to disclose information asymmetry in the financial statements. The company will provide important information to management to achieve huge profits. This proves that this research was supported by signaling theory. Aqel (2014), proving the size of the company (SIZE) positively affects IFR (Internet Financial Reporting), firm size (SIZE). According to him, the research findings indicate that large firms have fairly high growth companies, companies with high foreign ownership and shareholders are concentrated have a higher tendency to report on the financial statements via the internet.
Meanwhile, the results of this study is different from the research conducted by Agyei-Mensah (2012) and Narsa and Pratiwi (2012), which revealed that the size of the company (SIZE) had no significant effect on the IFR (Internet Financial Reporting).
Agyei-Mensah (2012) the size of the company and significant negative effect on the (Internet Financial Reporting) states that not all big companies have web sites to report the company's financial statements.
According to (Narsa & Pratiwi, 2012), the size of the company and significant negative effect on firm value. The bigger the company will be followed by greater the risk faced by the company. Some of this can cause serious problems for the company, one of which is susceptible to the asymmetry of information, so that each company must have a more effective and efficient way to manage the company. The size of the company and significant negative effect on firm value.
The variables are independent of short-term profitability shows the value significance of 0.4891. The significance level smaller than 0.05. The value of the resulting coefficient is negative of the mean 1.160549-H2 was rejected so it can be inferred that the short term profitability do not affect significantly against Internet Financial Reporting. As for the independent variable of the medium term profitability shows the value significance of 0.9407.
The significance level is greater than 0.05. The resulting coefficients are positive of 0.000223 which means the H3 was rejected so it can be inferred that the medium term profitability do not affect significantly to Internet Financial Reporting. And independent variables of profitability shows the value of long-term significance of 0.2055. The significance level is greater than 0.05. The resulting coefficients are positive of 1.578345 which means the H4 was rejected so it can be inferred that the long-term profitability significantly to no effect (IFR) Internet Financial Reporting.

Medium
The results of this study is different from the research conducted by (Prasetya and governor, 2012) revealed that profitability does not significantly influence the IFR (Internet Financial Reporting). According to profitability is a determining factor in the company.
Companies that have poor performance tend to avoid financial reporting as IFR (Internet Financial Reporting) for companies to hide badnews so that investors do not know.  (Prasetya and governor, 2012).
Meanwhile, the results of this study is different from the research conducted by Handoko and Fuad (2013) which revealed that the age listing positive and significant effect on the level of disclosure of IFR (Internet Financial Reporting). According to Handoko and Fuad (2013) the higher the antecedents it will affect the disclosure of financial reporting through the internet.

CONCLUSION
1. An independent variable of firm size indicates a significance value of 0.0013. The significance level is less than 0.05. The resulting coefficient value is positive equal to 0.627993 which means H1 accepted so it can be concluded that firm size has a significant effect positive to (IFR) Internet Financial Reporting.
2. The independent variable of short-term profitability indicates a significance value of 0.4891. The significance level is less than 0.05. The resulting coefficient value is negative at -1.160549 which means H2 is rejected so it can be concluded that shortterm profitability has no significant effect on IFR (Internet Financial Reporting). The Electronic copy available at: https://ssrn.com/abstract=3298207 independent variable of medium term profitability shows a significance value of 0.9407. The significance level is greater than 0.05. The value of the resulting coefficient is positive 0.000223 which means H3 is rejected so it can be concluded that mediumterm profitability has no significant effect on (IFR) Internet Financial Reporting. And the independent variable of long-term profitability shows a significance value of 0.2055. The significance level is greater than 0.05. The resulting coefficient value is positive at 1.578345 which means H4 is rejected so it can be concluded that long-term profitability has no significant effect on (IFR) Internet Financial Reporting.
3. The independent variable of corporate governance shows a significance value of 0.3218. The significance level is greater than 0.05. The value of the resulting coefficient is positive 0.543649 which means H5 is rejected so it can be concluded that corporate governance has no significant effect on (IFR) Internet Financial Reporting.
4. The independent variable of the listing age indicates a significance value of 0.7946. The significance level is greater than 0.05. The resulting coefficient value is negative at -0.007960 which means H6 denied listing age has no significant effect on (IFR) Internet Financial Reporting.
Further research may use the entire company are recorded in the Indonesia stock exchange in order to analyze factors that affect Internet Financial Reporting (IFR). Further research is expected to be able to use the research observation period longer. About five or ten years in order to provide an overview of the conditions that will be most appropriate. And can add several other variables that have never been previously conscientious in.