Stock Reaction to the Implementation of Extensible Business Reporting Language

• Published in: The Journal of Asian finance, economics, and business Vol. 8; no. 1; pp. 675 - 685
• Main Authors: JUNUS, Onong, IRWANTO, Andry
• Format: Journal Article
• Language: Korean
• Published: 한국유통과학회 30.01.2021; Korea Distribution Science Association
• Subjects: Stock Price Reaction; Financial Statement; Extensible Business Reporting Language (XBRL)
• ISSN: 2288-4637; 2288-4645

The purpose of this study is to examine the reaction of stock prices on the implementation of Extensible Business Reporting Language (XBRL) in companies listed on the Indonesia Stock Exchange (IDX). Using the event study method and calculating abnormal returns of the 2015 financial statements of 462 companies listed on the IDX, findings showed that 49 companies have not applied the XBRL format in their financial statements. Based on the results of the Average Abnormal Return (AAR) and Cumulative Average Abnormal Return (CAAR) values, using the one-sample test, investors react to shares in companies that have not implemented XBRL and who have implemented XBRL; however, based on the independent t-test based on average values there are differences between companies that have not applied XBRL and those who have implemented XBRL. This research only looks at the one-year implementation of XBRL in financial reporting (2015), then the research does not separate which companies are on time in the delivery of financial statements to the public through the IDX website. Our research contributes to the understanding of the use of XBRL in corporate financial reporting because before the XBRL financial reporting format was published, the company had published a financial statement format based on the legal provisions of financial statements in Indonesia.