The Influence of Corporate Governance and Key Audit Matters on the Quality of Financial Reporting: The Moderating Role of Firm Size in IDX-Listed Manufacturing Companies (2020–2023)

This research examines how Good Corporate Governance (GCG) and Key Audit Matters (KAM) influence

financial reporting quality, with firm size considered as a moderating factor. The study is conducted on manufacturing

companies listed on the Indonesia Stock Exchange (IDX) during 2020–2023. GCG is assessed through two proxies: the

proportion of independent commissioners and the size of the audit committee. A quantitative approach is applied, relying

on secondary data obtained from annual reports and audited financial statements. Data analysis employs multiple linear

regression and Moderated Regression Analysis (MRA) using EViews 12. Unlike prior studies that typically address GCG

and KAM in isolation, this work combines the two to build an integrated empirical model. The findings indicate that both

independent commissioners and audit committee size do not significantly affect financial reporting quality. In contrast,

KAM disclosures exert a positive and significant impact. Moreover, firm size does not moderate the relationship between

GCG, KAM, and reporting quality. These results highlight that auditor transparency—captured through KAM

disclosures—has greater influence on the credibility of financial statements compared to board-level governance

mechanisms. The study enriches the literature by presenting the joint effect of governance and audit disclosures, while

offering practical implications for regulators, policymakers, and practitioners to reinforce governance standards, enhance

audit transparency, and reduce risks of financial misstatement in Indonesia.