IMPACT OF GOOD CORPORATE GOVERNANCE (GCG) ON RISK MANAGEMENT IN

PROPERTY AND REAL ESTATE EMITENT

(full name without title or other position),

Faculty / Department, and University / Institution.
Attach biographical data of the authors complete with postal address, email and telephone
number)

ABSTAK
This study is to examine the effect of size (SIZE), leverage (SA), sales growth (S.Growth), total
independent commissioner (KOMINDEPENDEN) and total audit committee (KOMAUDIT ) to the
disclosure of corporate risk. The sampling technique used in this research is purposive sampling,
with certain criteria are: (1) Property & Real Estate Company that has been open and listed in
Indonesia Stock Exchange (2) Property & Real Estate Company which has published annual report
in 2011 until 2016 on the BEI website (www.idx.co.id), which is complete and relevant to this
research.
The results of this study indicate that the data has been met by classical assumption test, such as: no
multicollinearity, heteroscedasticity and normal distributed. From the regression analysis, it was
found that leverage and size of independent commissioners were positive and significant with
corporate disclosure risk, while the size, sales growth, and total audit committee were not
significant to corporate risk disclosure.

Keywords: Risk Disclosure, Corporate Governance, Risk Management, Agency Theory,

Organizational Theory, Neoclassical Theory.

I. Background Issues
Nowadays world economic growth tends to stagnate for the last seven years, 2010 to 2016
economic growth is at 5.19% in 2016, Table 1.1 is the development of the compound annual growth rate
(CAGR) of Gross Domestic Product (GDP) of the World since 2010 - 2016:
Table 1 Economic Growth and World GDP CAGR 2010 - 2016
at Constant Prices

PercentageGrowth
GDP 2010 - 2016
Growth Rate
(Billion US Dollars)
(CAGR)
2016 7,536,775 3.2% 5:19
7,431,146 3.4% 2015%1:42
2014% 7,859,442 3.6% 5:45%
2013 7,655,127 3.5% 2.67%
2012 7448 .151 3.5% 2.78%
2011 7.311.193 4.3% 1.93%
2010 6.590.643 5.4% 8.27%

1
 Source: IMF, (GDP Current Prices) 2017

While the economic growth of ASEAN-5 countries tends to be higher, for the last seven years since
2010 until 2016 the ASEAN-5 economic growth is at 4.73% in 2016, Table 1.2 below is the development
of ASEAN GDP CAGR from 2010 to 2016:

Table 2 Growth of ASEAN-5 GDP 2010 - 2016

at Constant Price

Percentage Growth
GDP 2010 - 2016
Growth Rate
(Billion US Dollars)
(CAGR)
2016 2142.308 4.9% 4.73%
2015 2041.01 4.9% 3:19%
2014 2106.12 4.6% 0:16%
in 2013 2102.852 5.1% 3:15%
in 2012 2036.622 6.2% 5.72%
2011 1920.11 4.7% 13.4%
2010 1663.747 6.9% 24.3%
Source: IMF, (GDP Current Prices) 2017

Meanwhile, Indonesia's domestic challenge is characterized by an economic growth that tends to

be stagnant if seen from GDP in 2010 to 2016 shows economic growth grew by 4.88% become a good
indicator for Indonesia although not maximal yet. Table 1.3 is the development of GDP in 2010 to
2016, as follows:

Table 3 Growth of Indonesia's GDP 2010 - 2016

On the basis of Constant Price

Percentage Growth
GDP 2010 - 2016
Growth Rate
(Billion US Dollar)
(CAGR)
2016 9,443,034.4 5% 4.88%
2015 8,982,511.9 4.9% 4.65%
2014 8,564,866.0 5% 4.77%
2013 8.156.497.8 5.6% 5.26%
2012 7.727 .083.4 6% 5.69%
2011 7.287.635.3 6.2% 5.81%
2010 6.864.133.1 6.4% 5.86%
Source: World Bank (World Development Indicator), 21 October 2017

The current economic condition of Indonesia can still show its existence but based on Index
report The 2016 - 2017 Global Competitiveness released by the World Economic Forum (WEF)
released on September 27, 2017, shows Indonesia's competitiveness slumped from 37 to 41 from 138
countries.

2
 Looking at the contribution of theindustries real estate and propertyin the last six years, the
property andindustries real estate contributed significantly to the growth rate of Gross Domestic
Product (GDP) in 2011 - 2016 showing growth rate of 17.6%, Table 1.4 is the development of 2011 up
to 2016 is as follows:

Table 4 Development of Industrial Property andContribution Real Estate To GDP Indonesia 2011-
2015 On a Constant Price

Contribution
Real estate & Property Growth Percentage Growth
GDP 2010 - 2016 Rate
(Billion US Dollar) (CAGR)
2016 278,472.90 2.81% 17.6%
2015 327,601.40 2.86% 21.7%
2014 256.440.20 2.79% 4.76%
2013 244.237.50 2.77 % 6.13%
2012 229.254.20 2.76% 6.90%
2011 213.441.40 2.79% 7.13%

Source: BPS, 2010, 2013 and 2017, p. 158

Murtiningsih (2009) in his research on Analysis of Macro Variable Shock Impacts on Property
Investment in Indonesia, stated that the property sector is one indicator of the rise of a country's
macroeconomic conditions. The development of the property industry contribution to GDP of 6.77%
signifies the start of a significant economic improvement, this is because the property sector has become a
primary need for the people of Indonesia. Even Bank Indonesia in its report on "Commercial Property
Development Quarter IV 2016" released on 14 February 2017 noted that the index of demand for
commercial property in 2016 showed a 1.52% increase of course will have implications for the growth of
the property industry.
That in line with the industry's growth contribution, which increased by 2.81% in 2016,property
and real estate businesses have bothimproved residentialresidential and commercialafter the monetary
crisis and showed rapid growth in Indonesia.
However, to support the contribution of property andcompanies real estate in sustaining
Indonesia's economy, good management is needed for companies in the industry to exist, the world of
investment that grows in the community one of them is to invest funds in the form of land or property and
business in the field property and real estate are generally long-term and will grow in line with economic
growth.
In the property business, investment decisions are a critical issue, including in placing the sources
of funds. According to Chadha and Sharma (2015), the capital structure consists of debt, common stock
and preferred stock that is used to finance various long-term projects of the company. Decision-making
capital structure is very vital, if there is a mistake in decision making companies can experience financial
distrees even to bankruptcy (Alipour et al, 2015).
In other words, the capital structure can describe the proportion of debt use to finance its
investment, so investors can know the balance between risk and return on investment that has been
planted in a company because the capital structure can affect the value of the company as Fibriyanto et al
(2015) Research research on "The Influence Analysis of Capital Structure on Value of Property Company
and Real Estate" in open company that active in real estate show that asset structure, profitability,
company size, simultaneous sales growth have significant influence to company value while firm size
have positive effect to value company.

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 Related to investment decisions in the management of funds in the form of capex (capital
expenditure) and opex (operation expenditure), persolan transparency has surfaced, especially the
disclosure of corporate risk one of them is in the disclosure ofannual report mandatory, not only presents
information related to finance, but non-financial information is also considered relevant as a form of
decision-making consideration.
Companies with good assets, debt and operating performance should focus on the issue of
transparency, this will impact the value of research companies conducted by Wahyuni et al (2013)
discusses "Factors affecting the value of open firms engaged in property, real estate estate and building
construction"results suggest that investment decisions, firm size, profitability have a positive effect on
firm value, while debt equity ratio (DER) has a negative effect on firm value, and dividend policy has no
effect on firm value and institutional ownership negatively affect value company. Novari and Lestari
Research (2016) on "The effect of firm size, leverage and profitability on the value of firms in the pro
andsector real" on 49 real estate and property listed firms shows that firm size has a positive and
significant effect on firm value, leverage has no significant effect on firm value, and profitability has
positive and significant effect to firm value.
Whereas the provisions governing the risk disclosure obligations in the Company's annual report
have been regulated in the Financial Services Authority Regulation No. 32 / POJK.03 / 2016 Concerning
Amendment to the Rules of the Financial Services Authority No. 6 / POJK.03 / 2015 On Transparency
and Publication of Bank Reports and Regulations of the Financial Services Authority No. 29 / POJK.04 /
2016 Regarding the Issuer's Annual Report or Public Company the regulation governs the rules for the
accuracy of the annual report of a public company, the regulation essentially regulates the obligations of
the Bank and Public Company to report its business activities which include the operations, reported
technical reports as well disclosure obligations in a transparent manner on financial, operational, and
compliance matters.
The risk disclosure obligation has led to regulatory bodies in Indonesia issuing rules requiring the
existence of risk-related information reported by the company in the annual report, as set out in SFAS No.
60 (Revised 2010) on Financial Instruments: Disclosures, stating that information may be used by users
of financial statements to evaluate the type and level of risk of financial instruments that must be
disclosed. Disclosure of such information in the form of qualitative disclosure and quantitative disclosure.
In qualitative disclosure, entities are required to disclose risk exposures, how risks arise, objectives,
policies and risk management processes and risk measurement methods. Whereas in quantitative
disclosures, entities are required to disclose credit risk, liquidity risk, and market risk including creating
sensitivity analyzes for each type of market risk.
While the Financial Services Authority also has provisions related to risk disclosure issues, the
Financial Services Authority Regulation No.18 / POJK.3 / 2016 Concerning the Implementation of Risk
Management for Commercial Banks is a regulation requiring the Bank to prepare an Annual Report at
least covering the types of risk and potential loss (risk exposures) faced by the Bank and risk management
practices adopted by the Bank. For Commercial Banks Conventional risk management practices at least
for credit risk, market risk, operational risk, liquidity risk, strategic risk / business risk, reputation risk,
compliance risk, and legal risk. (Regulation of Bank Indonesia No. 11/25 / PBI / 2009 Concerning
Amendment to Bank Indonesia Regulation No. 5/8/2003 concerning Implementation of Risk
Management for Commercial Banks) Article 4 paragraph (1) a - h)
For issuers in the Stock Exchange Indonesia (BEI) then the provisions relating to Securities Listing
have been regulated About Regulation IA - Decree of the Board of Directors of PT BEI Number KEP-
00001 / BEI / 01-2014 Year 2014, Number V sub-section of Requirements for Persuaan Listed To Keep
Listed in Stock is regulated matters relating to the number of shares that must be owned by the public is
equal to 7.5% and also set about the minimum number of shareholders' holdings of 300.
Based on the explanation imposed his sanctions on public companies that are not obedient to the
regulation is a necessity and it is a form of consistency of the relevant authorities in creating good
governance, in a non-compliant public company, the consequences are pat is done byforce
delistinganddelisting.

4
 PT. Lamicitra Nusantara, Tbk (LAMI) is one of the public companies that has a business focus on
the management of commercial property, in 2001 the company has made an initial public offering but in
September of 2017 the company has filed delisting, that the company can not meet several conditions
such as the terms of the stock ownership restriction, that LAMI can not meet the public shareholding
limits of 7.5% until 2016 it is known that LAMI only has publicly owned shares of 7.11%, the regulation
also regulates the liability of the number of accounts publicly traded, LAMI is unable to meet the set
amount of 300, the implications of inability to comply with the provisions of such a public company may
be fined and subsequently suspended, as well as during 2011 to 2015 the company does not conduct an
evaluation of its operations, perus ahaan only reveal financial risks such as market risk, interest rate risk,
credit risk and liquidity risk.
The results of research from Amran, et al (2009) show that significantly and positively the size
of firms and industry types are related to risk disclosure, The results of this research are in line with the
research of Elzahar and Hussainey (2012), which examines the "Determinants of Narrative Risk
Disclosures in UK Interim Reports" in 72 Public Companies in the UK, the results of this research
show that firm size and industry type are related to risk- .
While the results of research from Al - Moataz and Hussainey (2012) which examined the
"Determinants of Corporate Governance Disclosure in Saudi Companies" on 97 registered financial
statements in Saudi Arabia in 2006-2007, showed that the size of independent commissioners, the size
of the audit committee, profitability, liquidity and gearing have a significant influence on risk
disclosure (corporate risk disclosure). Then research from Zadeh and Eskandari (2012) which
examines "Firm Size As Company's Characteristic and Level of Risk Disclosure: Review on Theories
and Literatures" in public companies in malaysia, shows that firm size affects the level of risk
disclosure in the annual report, thus the study has found a positive relationship between firm size and
risk disclosure rates.
The research undertaken by Neifar and Hailoui (2013) which examines the on the Tunisian Stock
Exchange 23 companies listed on the Tunisian stock exchange there is a difference in a
publiclycompany listed in Tunisia, that business growth, ownership structure, duality CEOs, have no
significant effect on risk disclosure.
Research Utomo and Chairi (2014) who examine the "Determinant of Risk Disclosures of Non-
Financial Companies in Indonesia" in 355 non-financial companies stated that the leverage, industry type
and frequency of board of commissioners meeting positively affect the level of risk disclosure, but in the
research stated that audit committee has no effect on risk disclosure.
Research from Dominguez and Gamez (2014) examining the "Corporate Reporting on Risk
Evidence From Spanish Company" on publicly listed companies in 2007, 2008 and 2009 madrid
exchanges that disclose information about risk indicates that there is a negative effect on board size with
risk disclosure, size also have a negative effect on risk disclosure, there is also no significant influence on
external direction, board activity, board stocks ownership, profitability and debt size to Risk Corporate
Disclosure
Research Cunha and Mendes (2017) who examine about "Financial Determinants of Corporate
Governance Disclosure: Portugese Evidence " to a company listed on euronext lisbon indext states that
firm size and business growth have a significant effect on risk disclosure, but financial leverage has a
negative relationship to risk disclosure this is slightly different from the research of Amran et.al seb
agaimana researchers convey on the previous page.
With the above issues and research gaps, the focus of this research is the Impact of Good
Corporate Governance (GCG) on Risk Management on Property and Real Estate Issuers.

II. ResearchIssues
Researchwill examine firm size, leverage, sales growth, independent commissioner size and audit
committee size as a dependent variable, to the disclosure of corporate risk as an independent variable.
The emergence of the risk disclosure obligation to the issuer causes management to have a careful
action in identifying, measuring, monitoring and controlling risks. So it is important for management to

5
do risk management so that reporting on risk disclosure is done transparently that will affect company
value.
The results of previous research indicate that there is a gap, this study further analyzes the
determinants affectingcorporate risk disclosure, such as firm size, leverage, sales growth, the size of
independent commissioners and the size of the audit committee to the determinants of risk disclosure on
property andcompanies real estate listed on the Indonesia Stock Exchange period 2011-2016.
From the above explanation, it can be stated research problem as follows:
1. There is influence of company size on(corporate risk disclosurerisk corporate disclosure) annual
report of property andcompanies real estate listed on BEI.
2. There is aeffect leverage on corporate risk disclosure rate (corporate riskannualreport) of property
andfirms real estate listed on BEI.
3. There are significant sales growth in the level of disclosure of corporate risk(riskof
corporatedislclosure)annual report property andcompany real estate listed on the Stock Exchange.
4. There is the influence of the size of independent directors on the company's risk disclosure
level(corporateriskdislclosure)annual report property andcompany real estate listed on the Stock
Exchange.
5. There is the influence of the size of the audit committee at the level of disclosure of corporate
risk(riskof corporatedislclosure)annual report property andcompany real estate listed on the Stock
Exchange.

III. Understanding Risk Disclosure Theory (Risk Disclosure)

Jehle and Reny (2011: 379) found in the neoclassical theory of consumer behavior and enterprises,
consumers have perfect information about the important features of the commodities they buy, such as its
quality and durability. The company has perfect information about input productivity on demand.
Therefore, it is possible to develop consumer theory separately demand and supply the producers, and
after that just put them together by insisting on market prices.
(IBI, 2014: 32-33) Risk measurement is used to measure risk exposure of a bank or company as
a reference to decide whether a control process is necessary, at least the risk measurement process
should be able to measure 1) the overall risk exposure. 2) All risks attached to all transactions and
products. 3) Sensitivits products / activities to changes in risk factors that affect it, whether under
normal conditions or not. 4) trend of change of factors mentioned based on fluctuations that occurred in
the past by taking into account the correlation factor.
Disclosure (disclosure) is the dissemination of material information to the public where the
contents of the evaluation of a company's business activities. Risk disclosure becomes important when
an investor needs a long-term information relating to mutual fund activity, more precisely important
risk disclosure as it helps stakeholders in obtaining the information necessary to understand risk
profiles, monitor risk and detect potential problems. (Lindsey and Shrives 2006: 388).
In calculating the level of risk disclosure quantity in this research Amran et.al (2012) that is, 1)
Financial risk is a risk associated with financial instruments such as market risk, credit, liquidity, and
interest rate on cash flow. 2) Operational risk is a risk associated with customer satisfaction, product
development, resource search, product failure, and environment. 3) The risk of power is a risk
associated with the human resources and performance of employees. 4) The risk of technology and
information processing is a risk associated with access, availability, and infrastructure of technology
and information owned by the company. 5) Integrity risk is a risk associated with employee and
employee fraud, illegal acts, and reputation. 6) Strategic risk is a risk associated with environmental,
industry, business portfolio, competitors, regulatory, political and power surveillance.

6
 The benefits of corporate risk disclosure are 4 (four), namely: improving corporate transparency,
encouraging effective risk management, minimizing issues related to stock valuations (over / under),
helping analysts predict earnings.

IV. Previous Research

Table 5 Previous Research Summary
No Title & Researcher Methods Research Results
Name Research
1. Azlan Amran, Abdul Linear of corporate diversification
Manaf Rosli Bin, Bin RegressionContent strategy, firm size, industry
Che Haat Mohd Hasan Analysis type, andrate leverage
(2009) "Risk influence (+) Positive to
Reporting: An IndependentIndep Risk Disclosure.
Exploratory Study on endent:
Risk Management Company Size,
Disclosure in Company
Malaysian Annual Diversification,
Report" On 100 Issuers Industry Type,Level
in Bursa Malaysia Leverage
Dependent: Lanjutan Tabel 2.1
Disclosure Risk
2. Yogi Utomo and Research The results of the research
Anis Chariri Methods: indicate that the
Linear Regression ownership structure,
"Determinant of Risk Analysis independent directors and
Disclosure at 355 Independent: audit committee do not
Non-Financial Ownership significantly and (-)
Companies in Structure, influence risk disclosure,
Indonesia" Independent while leverage, industry
Commissioner, type and frequency of
Audit Committee, board meetings have a
Leverage, Industrial significant and (+)
Type Frequency of influence in risk
Meeting of Board disclosure.
of Commissioners,
Dependen:
Disclosure Risk
3. Ehsan al muataz and Independent: Independent
Khaled Hussainey Independent commissioners, the size
(2012) Commissioner, the of the audit committee,
"Determinant of size of the audit profitability, liquidity and
corporate governance committee, gearing have significant

7
 disclosure in the profitability, and positive (+) influence
Saudi company" liquidity, gearing on corporate governance
and size in arabic saudit, while
Dependent size (-) has no significant
Risk disclosure. effect.
4.Elzahar and Hussainey (2012), Content Analysis Industry type and
"Determinants of Independent: firm size have a positive
Lanjutan Tabel 2.1
Narrative Risk Company size, and (+) relationship with
Disclosures in UK industry type, risk disclosure level.
Interim Reports" on 72 liquidity, gearing, Liquidity, gearing, cross
Public Companies in cross listing. listing, and GCG
the UK, Dependent Mechanisms (-) have no
Risk disclosure. effect on risk disclosure.
5. Omar Johmani (2013) Independent: Company size and leverage have
"Ownership structure Blockholder significant influence and
and corporate ownership, (+ ) to Risk Disclosure
voluntary disclosure managerial whereas other variables (-
evidence from ownership, ) and have no effect.
Bahrain government
ownership, firm
size, leverage, and
profitability
Dependent:
Voluntary
disclosure score
6. Mohamed Linear Regression a. are the positive (+)
Akhtarudin, Monirul Independent: between the number of
Alam Husain, and Number of commissioners, and the
Lee Yao (2014) members of the proportion of non-
"Corporate governance board of executive directors
and voluntary disclosure commissioners, indepent with voluntary
in corporate annual independent non- penungkapan
reports of Malaysian executive directors, b. other variables had
listed firms: ownership structure, no influence on voluntary
family control , and disclosure
the audit committee Lanjutan Tabel 2.1
Dependent:
corporate
governance and
voluntary disclosure
7.Neifar and Hailoui (2013)" Linear RegressionForeign Ownership, Business
Determinants of Independent: Growth, ROE, Positive (+)
Corporate Governance Foreign ownership and Influence on
Disclosure: 23 Cities of participation, CEO Disclosure, Ownership
Tunisian Firms Listed duality, ROE, firm Structure, CEO Duality,
on the Tunis Stock size, leverage, Size company and leverage
Exchange " 23 public business growth, have no significant effect
companies on the Dependent: on risk disclosure.
Tunisian stock Risk Disclosure
exchange

8
 8.Dominguez and Gamez (2014) Linear Regressionthere is a negative influence (-) on
"Corporate Reporting Independent: the board size with risk
on Risk Evidence From Board Size, disclosure, size also
Spanish Company" to company size, negatively affecting risk
open companies in external direction, disclosure, nor any
2007, 2008 and 2009 board activity, significant influence on
madrid stock exchange board stocks external direction, board
ownership , activity, board stocks
profitablity and debt ownership, profitability and
size size debt to Risk Corporate
Dependent: Disclosure
Risk Disclosure
9. Cunha and Mendes Linear Regressionstates that firm size and business
Research (2017) which Independent: growth have a significant
examines the "Financial Company size, and positive influence on
Determinants of leverage, business risk disclosure, but
Corporate Governance growth, corporate financial leverage has a
Disclosure: Portugese performance negative (-) relationship to
Evidence" in companies Dependent: risk disclosure, the
listed on euronext lisbon Risk Disclosure Lanjutan
company's Tabel 2.1
performance
indext

V. Framework
Researchuses the dependent variable ofrisk disclosure. The independent variables used in this
research are firm size, leverage, business growth, the size of independent commissioners and the size
of the audit committee. Among others are as follows:

2.1 Frame Work

9
 VI. Variable and Measurement of
i. Dependent Variables (Bound)
Dependent variable in this research is Corporate Risk Disclosure (risk corporate disclosure).
Corporate risk disclosure is measured by the total number of risks disclosed in the annual report and
refers to Linsley and Shrives (2006) and Amran et al (2009) research, which are: 1) Financial risk is a
risk associated with a company's financial instruments such as market risk, credit , liquidity, and
interest rate on cash flow. 2) Operational risk is a risk associated with customer satisfaction, product
development, resource search, product failure, and environment. 3) The risk of power is a risk
associated with the human resources and performance of employees. 4) The risk of technology and
information processing is a risk associated with access, availability, and infrastructure of technology
and information owned by the company. 5) Integrity risk is a risk associated with employee and
employee fraud, illegal acts, and reputation. 6) Strategic risk is a risk associated with environmental,
industry, business portfolio, competitors, regulatory, political and power surveillance. The equations
used to calculate the level of risk disclosure quantity in this research Amran et.al (2012):

1
𝑅𝑅𝑅𝑅𝑅 = ∑𝑅 𝑅𝑅𝑅𝑅𝑅𝑅𝑅
𝑅𝑅𝑅𝑅𝑅 𝑅 = 1 2.1
Description :
RDSby: Score disclosure company B in Y
MAXby: The maximum value achieved by firm B in Y
I : Items in the framework
SCOREiby : Score for item I, firm B in Y Years

ii. Independent variable (Free)

1) Company size (SIZE)
Company size is valued based on the value of its assets, because total assets are resources owned
by companies that have useful economic value on future. In this research the size of the company
becomes an independent variable. This variable is proxied with the growth of total assets in 2011
to 2016 which then symbolized as SIZE, Benkraiem and Gurau (2013).
𝑅𝑅𝑅𝑅𝑅 −𝑅𝑅𝑅𝑅𝑅−1
SIZE = 𝑅𝑅𝑅𝑅 2.2
𝑅−1
2) Akiva Structure (SA)
In this research, the capital structure is measured by debt to equity ratio (DER). DER is the ratio
used to measure the level of leverage (debt use) to the company's total shareholder's equity .
Mathematically DER can be formulated as follows (Benkraiem and Gurau 2013):
DER = Total Debt
Total Equity 2.3

Total debt represents total liabilities (both long-term and short-term debt).
3) Sales Growth (S.GROWTH)
Sales Growth as measured by reducing certain time sales with previous period sales divided by
previous period sales presented by the company's annual financial statements in the period 2011 to
2015 which then symbolized to be S.GROWTH. (Viviani, 2008)

𝑅𝑅𝑅𝑅𝑅𝑅 −𝑅𝑅𝑅𝑅𝑅𝑅−1
S.GROWTH =
𝑅𝑅𝑅𝑅𝑅𝑅−1
2.3

10
 4) Size Independent Commissioner (KOMINDEPENDEN) The
number of independent commissioners is presented with the total number of independent
commissioners owned by the company.

5) Audit Committee Size (KOMAUDIT)

The members of the audit committee are presented with the number of audit committees held by
the company, in accordance with Kep. Bapepam LK no. 643 / BL / 2012 the audit committee shall
consist of at least 3 (three) internal and external members of the issuer..

VII. Hipotesis
Past research has pointed to a gap in research issues related to the determinants of risk disclosure, the
diversity of factors that influence it makes the researches have their own characteristics, due to their
respective industry factors and state differences. Based on this research is measuring the effect of firm
size, leverage, sales growth, number of independent commissioners and the number of audit committees,
as for the hypothesis developed as follows:

1. H1: The size of the company has a significant and positive influence on the level of risk corporate
disclosure on property companies and real estate Indonesia.

2. H2: Leverage has a significant and positive influence on the level of risk corporate disclosure on
property companies and real estate Indonesia.

3. H3: Business growth has a significant and positive influence on the level of risk corporate
disclosure (disclosure risk) on property companies and real estate Indonesia.

4. H4: Independent commissioners have a significant and positive influence on the level of risk
corporate disclosure on property companies and real estate Indonesia.

5. H5: Audit Committee has a significant and positive influence on the level of risk corporate
disclosure on property companies and real estate Indonesia.

I. Research
ResultsThe statistical test t or partial test is done to illustrate how far the influence of each
independent variable individually in explaining the dependent variable.
Partial test decision making is as follows:
If sig. <0,05, then H0 is rejected.
If sig. > 0.05, then H0 fails to be rejected.

11
 Table 4.6 Partial Testing

From multiple regression tests described results 1) Size has a significant value of 0.000 <0.05 so
that the effect on disclosure. The value of influence is negative at -0.449 which explains the larger the
size of the company, the lower the disclosure 2) Leverage has a significant value of 0.000 <0.05 so that it
affects the disclosure. The value of influence is positive at 0.258 which explains the higher the leverage
of the company, the higher disclosure 3) Growth has a significant value of 0.001 <0.05 so that the effect
on disclosure. The value of influence is negative at -0.266 which explains the greater the growth of the
company, the lower the disclosure 4) Independent Commissioner has a significant value of 0.004 <0.05 so
that the effect on disclosure. The value of influence is positive at 0.188 which explains the more number
of independent commissioners of the company, the higher the disclosure 5) The Audit Committee has a
significant value of 0.000 <0.05 so that it affects the disclosure. The value of influence is negative at -
0.314 which explains the increasing number of audit committees, the lower the disclosure

Analysis Results
From the description above data can be attributed to previous research and some theories, among
others:
1 Company Size Negatively Affects Disclosure
Related to the size of the company that the results of this study are in line with the research of El
Muataz and Khalid Hussainey (2012) which states that there is no significant linking result between firm size
and risk disclosure as well as Neifar and Hailloui (2012) study which examines the determinants of corporate
governance disclosure case of Tunisian firms stating that there is a negative influence between firm size and
risk disclosure.

2 Positive PositiveDisclosure
Leverage onLeverage that positively affects disclosure has been in line with agency theory expressed
by Amran et al (2009). Amran et al (2009) reveals that creditors in companies with high levels of debt risk
can force firms to disclose more information in an annual report and in line with research conducted by
Utomo and Chairi (2014) Research which examines the "Determinant of Risk Disclosure In Non-Financial
Companies in Indonesia " in 355 nonfinancial corporations which stated that higher percentage comparison of
debt on assets in a company can increase the amount of risk information disclosed in the annual report. This
is because with the percentage of high debt-to-asset ratio, firms are usually more speculative and risky.

3 Negative Disclosure
Sales Growth on Sales Growthnegatively affects disclosure, this result is contrary to research conducted
by Linsley and Shrives (2006) which states there is a positive influence between total revenue and risk

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 disclosure, this is reinforced by one of GCG principles that is Accountability(Accountability),clarity of function,
implementation and accountability of organs so that the management company to run effectively in order to
maximize profits, in the sense of maximizing the company less this principle so that the income generated is not
optimal.

4 Size of Independent Commissioner Positively Affects Disclosure

Independent commissioner influential on disclosure, has been in line with research Al - Moataz and
Hussainey (2012) who studied the "Determinants of Corporate Governance Disclosure in Saudi Companies"
on 97 registered Saudi Arabian financial statements from 2006-2007, show that the size of independent
commissioners has a significant positive effect on risk disclosure. Utomo and Chairi (2014) stated that
independent commissioners play an important role in supervising and controlling the activities and activities
of the executive director. The goal is to convince shareholders that the company's management has taken an
action that prioritizes its interests so that conflicts of interest can be avoided. Independence of independent
commissioners is urgently needed to assist the board of commissioners in performing the oversight function.
Theoretically supervision would be better if the proportion of independent commissioners owned by the
company is greater, so the supervisory function would be better.

5 The size of the Audit Disclosure

Committee has a negative effect on Audit Committeenegatively affecting disclosure. This is in line
with the research conducted by Utomo and Chairi (2014) who examines the "Determinant of Risk Disclosures
of Non-Financial Companies in Indonesia" in 355 nonfinancial corporations stated that the audit committee
as a committees' supervisory committee in oversight is able to extend information disclosed by the company
in financial reporting. However, the results of the insignificant research indicate that the audit committee has
no role in influencing the extent of risk disclosure in the annual report.

IX. Implications
Based on the analysis of the results as mentioned above, the direct effects or implications of the final
outcome are as follows:

1 Implications for the Negative Influence of Companies on Disclosure

Research results show that firms with large assets tend not to follow the rules issued by the relevant
authorities and few disclosing information in their annual report. Because disclosing additional information in
the annual report is a decision that will impact the company's reputation. That there is a contradiction with
Elzahar & Hussainey's (2012) statement that states large-scale companies are more likely to disclose risk
information to the United Kingdom Interim Report.
Based on the considerations of Wahyuni et al (2013) the company with the size of its assets bearuntuk
focus more on transparency.

2 Implications for Positive Positive Leverage on Disclosure

Research results show firms with higher debt structures than capital structures perform greater
disclosure, this is consistent and consistent with the agency theory expressed by Amran et al (2009) that is the
percentage comparison of the upper debt high assets, companies are more speculative and risky.
For that reason, the creditor has a great bargaining position to the company to disclose information
related to the risks closely related to the operations, to thefirms the property and real estate risks that arise are
strongly related, among others: 1) legal risks for example, related to the failure of the building , will have an
impact on customer satisfaction and company reputation, 2) the financial risks associated withmanagement
sinking fund will also impact on operational risks such as human resources and routine maintenance costs,
things like this that should be disclosed in more detail to the company.

3 Implications for Negative Influential Business Growth on Disclosure

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 Research results show that during the period 2011-2016 there was no significantgrowth business, given
the limited land for landed houses and based on the previous chapter that stated the property demand index
which grew by 1.52% in the apartment segment should senior management think to develop property and real
estate business which initially focus in the field of wide complex housing, currently more focus on apartments
and offices through the scheme build operating transfer and build to suit.

4. Implications of Independent Commissioners Positive to Disclosure The

size of a large independent commissioner influences disclosure, in accordance with the agency theory
which states that the board of commissioners functioning in the supervision of the company can influence
management to increase the extent of disclosure in annual report Utomo and Chairi's(2014 ).
The commissioner's tasks focused on corporate supervision have had a good impact on disclosures that
may affect corporate value, reinforced by the agency theory which explains that companies that separate
management and ownership functions will be vulnerable to agency conflict (Jensen and Mackling , 1976). Thus
Agent as a party more know the condition of the company should do the practice. This is because information
about risk is important information that may affect the principal consideration of the future state facing the
company. The main purpose of risk disclosure is to reduce the information asymmetry that occurs between
agents and principals.

5. Implications for the Audit Committee have a Negative Influence on Disclosure

Research results show that firms with large audit committee size influence disclosure, in the sense that
the larger the audit committee size the lower the disclosure, in terms of the average audit committee size of
the sample companies that tend to be stable and are constantly at odds with the extent of risk exposure firms
that tend to be dynamic and fluctuating. The effect of non-positive audit committees on risk disclosure
contradicts the agency theory expressed by Utomo and Chairi (2014) which states that audit committees as
committees' supervisory committees in oversight are able to extend information disclosed by companies in
financial reporting. However, these results negatively affect risk disclosures that reflect the role of audit
committees in minimally affecting the extent of risk disclosure in the annual report.
On this matter, the audit committee and the internal control unit should understand the management of
corporate risk management as a material consideration in assessing the effectiveness of the company's audit.
internal control units should perform risk-based audits of products marketed infirms in property and real
estate order to make this contribution to GCG implementation.

X. CONCLUSIONS AND SUGGESTIONS

Conclusion
Based on the results of analysis and discussion can be summarized as follows 1) Size negative effect on
disclosure. Which explains the larger the size of the company, the lower the disclosure. 2) leverage affect
disclosure. which explains the higher the structure of the Leverage firm, the higher the disclosure. 3) Growth
has negative effect on disclosure. which explains the greater the growth of the company, the lower the
disclosure. 4) Independent commissioner positively affects disclosure. which explains the increasing number of
independent corporate commissioners, the higher the disclosure. 5) Audit Committee has a negative effect on
disclosure. Which explains the increasing number of audit committees, the lower the disclosure.

Suggestions
Some suggestions that can be given based on the results of this study include 1) For further research is
expected to use such as questionnaires or interviews to find out more complete information about the risk

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management committee, internal audit and board of commissioners so as to produce more accurate research
results and conclusions it is also advisable to add both external and internal factors as other independent
variables that may affect risk disclosure. 2) For the company's management the results of this study indicate that
Risk disclosure is closely related to corporate governance and firm size, the existence of broad and specific
Risk Disclosure will provide an overview to stakeholders that the company has implemented an effective risk
management system and good corporate governance. Therefore, it is very important for companies, especially
large-scale companies in thesector Property and Real Estate to consider establishing separate risk management
committees from other committees so that the company's risk management can be focused and generate more
specific Risk Disclosure in order to make the company's value high andcompanies property andreal estate is
large-scaleexpected to further develop the business in the apartment segment so that sales can grow
significantly,
3) For the public accounting profession and Internal Control Unit (SPI) expected to understand about the
management of corporate risk management as a consideration in assessing the effectiveness of internal control
company , risk management and internal control through risk based audit contributes to the implementation of
GCG, especially in improving the achievement of the company's mission
4) For investors and capital market analysis with this research, every investor is expected to be more
aware of the importance of enterprise risk management, uncertainty of the situation and conditions in the
business world so that it can be taken into consideration for investors before making a decision to invest in
thesector Real Estate & Property. 5) For regulators (policy makers) Given the results of this study, it is expected
to be useful for the government and regulators associated with the importance of risk management
implementation and transparency issues forcompanies propertyand Real Estate in Indonesia.

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