GREEN ACCOUNTING AND ENVINMENTAL MANAGEMENT ACCOUNTING

•July 20, 2017 • Leave a Comment

Dasarikan dari GREEN ACCOUNTING SEMINAR

HMP Akuntansi Universitas Ma Chung Malang, 28 April 2017.

PENGANTAR

Tanggung Jawab Sosial dan Lingkungan (TJSL) merupakan amanat Undang-Undang.  Termaktub dalam: (1) UU 25/2007 tentang Penanaman Modal; (2) UU 40/2007 tentang Perseroan Terbatas, Pasal 66;2; (3) UU 18/2008 tentang pengolahan Sampah; (4) UU32/2009 tentang Analisis Mengenai Dampak Lingkungan (AMDAL) dan Pengelolahan Lingkungan Hidup.

Juga diperkuat dengan beberapa Peraturan dari tingkat Menteri, Gubernur, sampai Bupati atau Walikota.  Seperti yang terdapat pada: (1) Permeneg LH 1/2010 tentang Pengendalian Pencemaran Air; (2) Permeneg LH 17/2010 tentang Audit Lingkungan; (3) Pergub Jatim 72/2013 tentang Baku Mutu Air Limbah; (4) Perda Kota Malang 9/2009 tentang Penyelenggaraan Kebersihan; (5) Perda Kota Malang 2/2012 tentang Ketertiban Umum dan Lingkungan.

Diatur juga dalam Pernyataan Standar Akuntansi Keuangan (PSAK), pada PSAK 1 Pasal 9 tentang Laporan Dampak Lingkungan.  Sedangkan secara International telah diatur dalam Global Reporting Initiative (GRI) dan pelaksanaan operasional dengan Environmental Managemet Accounting (EMA).

 

GREEN ACCOUNTING (Dr. Erwin Saraswati – Universitas Brawijaya, Malang)

Pengantar

Global Warming & Climate Change benar-benar terjadi.  Suhu rata-rata Kota Malang pada tahun 2000 lebih panas 4 derajat Celcius ketimbang satu dekade sebelumnya.  Kenaikan suhu udara ini diakibatkan oleh naiknya CO2 dari aktivitas industri dan asap kendaraan bermotor.  Tidak bisa dihentikan karena aktivitas manusia yang semakin banyak, tetapi bisa dikurangi.  Belum lagi dampak sampah, plastik terurai setelah 100 tahun walau ada yang terbaru yang bisa terurai sekitar 5 tahun.  Tetapi, stereofoam tidak bisa terurai sama sekali.

Environmental Perspective

Five Core objectives of the environmental perspectives:

  1. Minimize the use of raw materials.
  2. Minimize the use of hazardous materials.
  3. Minimize energy requirements for production and use of the product.
  4. Minimize the release of solid, liquid, and gaseous residues.
  5. Maximize opportunities to recycle.

Reduce, reuse, and recycle.

Environmental Costs

These cost connected with the actual or potential deterotation of natural asset due to economic activities.  Environmental cost can include costs to:

  1. Clean up or remediate contaminated sites.
  2. Environmental fines.
  3. Penalties and taxes.
  4. Purchase to pullation prevention technologies.
  5. Waste management costs.

Environmental Cost Accounting

The generation analysis and use of moneterised environmentally related information in order to improve corporate environmental and economic performance.  ABC framework, cost driver yang berdampak pada lingkungan.

Two Ways of Environmental Costs

One is the ABC framework, looking for cost drivers at organizational levels, unit, abtch, product-sustaining, and facility.  The other is a cost of quality framework, which defines environmental costs in prevention, appraisal and internal and external failure.  This cost of quality approach supports pollution prevention as an appropiate management strategy.

Classification of Environmental Costs

  1. Prevention Costs

Evaluating and selecting suppliers; Pollution control equipment; designing processes and product; recycling product.

  1. Detection Costs

Audit environmental; inspecting product and processes; testing and measuring contamination.

  1. Internal Failure Costs

Operating pollution control equipment; treating and disposing of toxic waste.

  1. External Failure Costs

Cleaning up a polluted lake and oil spills; contaminated soil; using material and energy inefficiently.

Catatan: Minimal melakukan aksi dengan memboikot secara pribadi terhadap produk-produk dari perusahaan yang mencemari dan merusak lingkungan.

Why Is It Important to Measure Environmental Costs?

Awareness of environmental costs is important because environmental regulations have increased.  Merubah lingkungan akan mengacaukan siklus dan rantai makanan.

Environmental Management Accounting (EMA)

EMA is defined as the generation, analysis and use of financial and related non financial information, to support management whitin a company or business (Bartolomeo, et al, 2000).  EMA integrates corporate environmental and business policies, and thereby provides guidance on building a sustainable business.

Environmental Quality Cost Model

Look at costs and impact for damage done to environment.  In addition to direct costs, there are costs to preventing environmental degradation.

Defining, Meaasuring, and Controlling Environmental Costs

Environmenal costs: costs that are incured because poor environmenal quality exists or may exist.  Types of costs: (1) direct or indirect environmental costs (waste management; environmental certification and labeling; environmental training); (2) Contigent or intangible environmental costs (uncertain future remediation or compensation costs; product quality).

How to Estimate Sustainable Profit?

  1. Set boundries: must be controllable in some way.
  2. Establish targets: as per royal commission on environmental polluton, reduce carbon dioxide emission by 60% by 2050.
  3. Identify impacts.
  4. Valuation: impacts of environmental damages).

 

ENVIRONMENTAL MANAGEMENT ACCOUNTING (Arif Dermawan – Dinas Lingkungan Hidup Kota Malang)

Pengantar

Water Wars (Vandana Shiva), tentang perebutan air di Pakistan.  Air disebut sebagai Emas Biru.

Kota Malang menghadapi permasalahan perkotaan pada umumnya, transportasi dan sampah.  Perlu mitigasi A – B – C – D (Akademisi – Birokrat – Community – Developmentalis)

Carbon Footprint

Jejak karbon dari setiap aktivitas (produksi) manusia.  Tidak mungkin nol tetapi bisa diminimalisir dengan awareness untuk mereduksinya.  Salah satunya dengan melakukan urban farming.

Polusi di Kota Malang pertahun:

Emisi CO2 sebesar 249.120.924 kg/th (mobil pribadi: 88.917.140 kg/tj; sepeda motor: 71.182.456 kg/tj; kendaraan kecil (di bawah 100cc): 34.884.338 kg/tj).

Isu-isu terkait dengan perubahan iklim (climate change)

Jumlah orang sakit sebesar 278.558 pertahun (ISPA: 83.462; Primer Hypertension: 50.612; Influenza (unidentified virus): 29.108).

Environmental Management Accounting

Kombinasi keuangan dengan data fisik dan perhitungan biasa lingkungan dari kegiatan produksi perusahaan.

Perhitungan Emisi Gas Rumah Kaca (EGRK)

  1. Perhitungan EGRK sektor pengadaan dan penggunaan energi.
  2. Perhitungan EGRK sektor proses produksi dan penggunaan produk(IPPU).
  3. Perhitungan EGRK sektor pertanian, kehutanan, dan penggunaan lahan lainnya (AFOLU).
  4. Perhitungan dari sektor limbah.

Jumlah dan Komposisi Sampah Terkelola Kota Malang 2010

Total timbunan sampah: 156.822 ton/tahun: (sampah masuk TPA: 71.080 ton/tahun; kompos dikelola pemerintah: 3.318 ton/tahun; kompos dikelola masyarakat: 2.673 ton/tahun; sampah dikelola lapak: 36.500 ton/tahun).

Perkiraan Jumlah Emisi GRK Pemerintah Kota Malang (ton/tahun)

Bangunan (2010: 14.440 à 2020:23.563); Armada Kendaraan (2010: 1.370 à 2020: 3.774); Penerangan Jalan Umum (2010: 14.712 à 2020: 23.982); Air Bersih dan Air Buangan (2010: 13.730 à 2020: 72.216); Total (2010: 44.252 à 72.216).

EMA: kemampuan yang akurat untuk mengidentifikasi, memperkirakan, mengalokasikan, dan mengelola atau mengurangi biaya kegiatan.  Bekerja akurat dan komprehensif berdasarkan kinerja yang terukur dan memperhatikan lingkungan dengan melibatkan pemangku kepentingan sehingga mampu meningkatkan citra perusahaan.

Catatan:

Sekolah Adiwiyata (SEKAR) (1) Sampah; (2) Energi; (3) Keanekaragaman hayati; (4) Air; (5) Rantai Makanan.  Mempertimbangkan emisi di sekolah. Di Kota Malang terdapat 473 Sekolah (SD, SMP, SMA) dan 63 Perguruan Tinggi.

 

Diskusi:

  1. Kevin: Data non keuangan untuk audit lingkungan?

Dihitungkan oleh ahlinya dan akuntan mencatat dalam besaran biaya (rupiah)

  1. Novelia: Besaran untuk environmental cost?

Ditetapkan berdasar target.

GRI telah ditetapkan menjadi stadar pelaporan keuangan sejak tahun 2016 dan akan berlaku sejak tahun 2018.

  1. Rahmad: Kewajiban perusahaan terhadap environmental cost dan sangsi?

Perusahaan wajib untuk penanganan lingkungan.

  1. Yunita: Sangsi dan award?

EMA untuk day to day operation.  Laporan yang berkaitan dengan lingkungan bersifat wajib, dengan alokasi biaya 1-3% after tax.  Award ada ISRA ada Indeks SRI Kehati.

  1. Wisda: Kegiatan dan pelaporan CSR?

Kegiatan CSR bersifat wajib, pelaporan CSR belum wajib (wajib pada tahun 2018).

Alokasi selama ini 99,8% untuk kegiatan sosial dan hanya 0,02% untuk kegiatan lingkungan.  Berdampak negatif, terjadi ketergantungan terhadap dana CSR.

Nestle tidak lagi menyebut dengan CSR tetapi Create Share Value (CSV) dengan konsep pemberdayaan masyarakat.

  1. Indra: Alokasi dana untuk dampak lingkungan?

Masing-masing perusahaan berbeda, tergantung materialitas kerusakan yang terjadi.  Harus dilakukan reduksi eksternalitas.

  1. Audito: Kepadadatan penduduk Kota Malang meningkat, Ruang Terbuka Hijau (RTH) menurun?

Hutan Kota Malabar sebagai taman kota aktif, tempat untuk beraktivitas warga dan fungsi rekreasi.  Sayangnya, di Kota Malang belum terkonsep dan belum beradaptasi dengan cuaca dan lingkungan.  Harus ada peran aktif masyarakat untuk berpartisipasi aktif memberi masukan pada Pemerintah Kota Malang.

Kota Malang merupakan daerah penyanggah pariwisata (Kota Batu) berdampak positif naiknya Pendapatan Asli Daerah (PAD) tetapi juga berdampak negatif pada naiknya jumlah sampah dan kemacetan.  Demikian pula dengan bertambahnya jumlah Perguruan Tinggi dan Lembaga pendidikan akan menaikkan jumlah siswa dan mahasiswa dari daerah lain yang akan berdampak pada kepadatan jumlah penduduk, transporstasi, dan sampah.

A History of the International Financial Reporting Standards (IFRS) By Setiyono Miharjo (FEB UGM & DSAK)

•July 18, 2017 • Leave a Comment

What are International Accounting Standards (IAS)?

International accounting standards are accounting standard issued by the International Caaounting Standards Board (IASB) and its predecessor, the International Accounting Standards Committee (IASC).  A set of established accounting standards put forth by the London Based International Accounting Standards Board (IASB) that gaining worlwide acceptance on an accelerating basis.

IFRS is a comprehensive, globally accepted set of accounting standards with key characteristics:

  1. principles based approach with a greater emphasis on interpertation and application of principles, rather than a rules governed approach;
  2. less extensive body of literature than US GAAP, with limited industry specific guidance and less deatiled applicaion guidance;
  3. greater emphasis oh the substance of transaction and an eveluation of whether the accounting presentation reflects the economic reality;
  4. renewed focus on the need for professional judgement in arriving at accounting conclusions;
  5. Greater use of fair value as a measurement basis placing emphasis on obtaining reliable measurements.

History and Development

In 1966, the history international accounting standards really began with proposal to establish an International Study Group comprising the institute of Chartered Accountants of England and Wales (ICAEW), American Intitute of Certified Accountants (AICPA), and Canadian Institute of Chartered Accountants (CICA).

In 1967, in Frebuary this resulted in the foundation of the Accountants International Study Group (AISG), which began to publish papers on important topics every few months and created an appetite for change.  Many of these papers led the way for the standards that followed, when in March 1973 it was finally agrred to establish and international body writing accounting standards for international use.

In 1973, in June the International Accounting Standards Committee (IASC) cam into existence, with the stated intent that the new international standards it relaeased must “be capable of rapid acceptance and implementation world wide”.  The IASC survived for 27 years, untll 2001, when the organization was restructured and the IASC was replaced by the the International Accounting Standards Board (IASB).  One of the most comprehensive accounts of this early history of international accounting standards ic contained Lord Benson’s article “the story of international accounting standards” which was published in Accountancy Magazine in July 1976 (Volume 87, Number 995) on pages 34—39.  A further source of information is Lord Benson’s biography “Accounting for life” wihich was published by Kogan Page, with the ICAEW in 1989.  Between 1973—2000 the International Accounting Standards Committee (IASC) released a series of standards called “Internasional Accounting Standards (IAS)’ in a numerical sequence that began with IAS 1 and ended with IAS 41 Agriculture with was published in December 2000.

In 2000, in May the International Organization of Securities Commissions (IOSCO) endorses IAS for use in connection wuth cross border listings (as announced in press release issued by IOSCO on 17 May 2000.  In August, the ICAEW issued policy statement (TECH 23/00) on the endorsement and enforcement of International Accounting Standards (IAS) within the EU which was summarized in the press release institute supports step to ensure that International Accounting Standards are effective in Europe released on 3 Audgust 2000.

In 2001, in April the IASC restructured their organization at the end of the twentieth century, which resulted in the formation of the International Accounting Standards Board (IASB).  These changes came into effect on 1 April 2001. At the time the IASB stated that they would adopt the body of standards issued by the Board of the International Accounting Standards Committee (IASC) (1)which would continue to be designted “International Accounting Standards; (2) but any new standards would published in a series called International Financial Reporting Standards (IFRS).

In 2003, In June the first IFRS was published (IFRS 1: First time Adoption of International Financial Reporting Standards (IFRS).

Perkembangan Standar Akuntansi di Indonesia

Pada tahun 1973—1984, Ikatan Akuntan Indonesia (IAI) membentuk komite Prinsip-Prinsip Akuntansi Indonesia untuk menetapkan standar-standar Akuntansi yang kemudian dikenal dengan Prinsip-Prinsip Akuntansi Indonesia (PAI).

Pada tahun 1984—1994, Komite PAI melakukan revisi secara mendasar PAI 1973 dan kemudian menerbitkan PAI 1984.

Pada tahun 1994, menjelang akhir tahun, Komite Standar Akuntansi memuli suatu revisi besar atas prinsip-prinsip akuntansi Indonesia dengan mengumumkan pernyataan standar-standar akuntansi tambahan dan menerbitkan interpretasi atas standar tersebut.  Revisi tersebut menghaslkan 35 pernyataan standar akuntansi keuangan yang sebagian besar harmonis dengan IAS yang dikeluarkan oleh IASB.

Pada tahun 1994—2004, terjadi perubahan kiblat Standar Akuntansi Keuangan di Indonesia dari USGAAP ke IFRS.  Sejak tahun 1994, telah menjadi kebijakan Komite Standar Akuntansi Keuangan untuk menggunakan International Accounting Standards (IAS) sebagai dasar untuk membangun standar akuntansi keuangan Indonesia.  Pada tahun 1995, IAI melakukan revisi besar untuk menerapkan standar-standar akuntansi baru yang kebanyakan konsisten dengan  IAS.  Beberapa standar diadopsi dari USGAAP dan lainnya dibuat sendiri.

Pada tahun 2006—2008, Konvergensi Pertama.  Sejak tahun 1995 sampai tahun 2010, Standar Akuntansi Keuangan (SAK) terus direvisi secara berkesinambungan, baik berupa penyempurnaan maupun penambahan standar baru.  Proses revisi dilakukan enam kali pada tanggal (1) 1 Oktober 1995; (2) 1 Juni 1999; (3) 1 April 2002; (4) 1 Juni 2006; (5) 1 September 2007: (6) 1 Juli 2009.  Pada tahun 2006, dalam kongres IAI ke X di Jakarta, ditetapkan bahwa konvergensi penuh IFRS akan diselesaikan pada tahun 2008.  Target ketika itu adalah taat penuh dengan semua standar IFRS pada tahun 2008.  Namun dalam perjalanannya, ternyata tidak mudah. Sampai akhir tahun 2008 jumlah IFRS yang diadopsi baru mencapai 10 standar IFRS dari 33 standar yang ada.

Kendala harmonisasi PSAK ke IFRS

  1. Dewan Standar Akuntnasi kekurangan sumber daya.
  2. IFRS berganti terlalu cepat sehingga ketika proses adopsi suatu standar IFRS masih dilakukan, IASB sudah dalam dalam proses mengganti IFRS tersebut.
  3. Kendala bahasa, karena setiap standar IFRS harus diterjemahkan ke dalam Bahasa Indonesia dan seringkali mengalami kesulitan.
  4. Infrastruktur profesi akuntansi yang belum siap untuk mengadopsi IFRS karena banyak metode akuntansi baru yang harus dipelajari oleh akuntan.
  5. Kesiapan perguruan tinggi dan akuntan pendidik untuk berganti kiblat ke IFRS.
  6. Dukungan pemerintah terhadap isu konvergensi tidak memadai.

Konvergensi IFRS Tahap II (2008—2012) dan Masa Depan Pelaporan Keuangan di Indonesia

Latar Belakang

IAI menjadi anggota International Federation of Accountants (IFAC) sejak tahun 1986.  IFAC didirikan pada tahun 1977.

Misi dari IFAC adalah sebagai berikut.

  1. To serve the public interest.
  2. Strengthen the accountancy profession worldwide.
  3. (and) Contribute to the development of strong international economies.
  4. (by) Establishing and promoting adherence to high quality professional standards.
  5. Furthering the international convergence of such standards.
  6. (and) Speaking out on public interest issues where the profession’s expertise is most relevant.

The Statement of Membership Obligations (SMO) apply to full and assoiciate member of IFAC.  These statement require member bodies to use their best endeavors to meet the obligations.  In exceptional circumstances, a member body may depart from the obligations contained in these statements, if doing so will fulfill its public interest duties more effectivly.  The member body should be prepared to justify the departure.  A member body that fails to follow the obligations of these statements, or justify satisfactory why it has departed from them, may be suspended or removed from membership.  SMO 7 – International Financial Reporting Standards. Set out the obligations of member bodies of IFAC in relation to IFRS issued by the IASB.

DSAK-IAI sedang melakukan konvergensi IFRS dengan target penyelesaian pada tahun 2012.  Sepanjang tahun 2009, DSAK-IAI telah mengesahkan 10 PSAK baru, 5 ISAK, dan mencabut 9 PSAK berbasis industri dan 1 ISAK.

G20 Leaders Meeting

Konvergensi IFRS adalah juga salah satu kesepakatan pemerintah Indonesia sebagai anggota G20 Forum.  Hasil dari pertemuan pemimpin forum negara G20 di Wahsington DC, 15 November 2008.  Prinsip-prinsip G20 yang dicanangkan adalah sebagai berikut.

  • Strengthening transperency and accountability.
  • Enhancing sound regulation.
  • Promoting integrity in financial markets.
  • Reinforcing international cooperation.
  • Reforming international financial institutions.

Pada kesepatakan G20 London Summit, 2 April 2009 dihasilkan 29 kesepakatan, pada kesepakatan nomor 13—16 adalah tentang strengthening financial supervision and regulation.  Pada butir kesepakatan nomor 15 dikatakan “to call on the accounting standard setters to work urgently with supervisors and regulatiors to improve standards on valuation and provisioning and achieve a single set of high quality global accounting standards.”

IFRS Today and Tomorrow

Today, IFRS is used in over 100 countries.  Required acrross all EU countries, starting in 2005.  Brazil, Canada, and India have announced madated use.  By 2011, it’s expected that:

  • All major countries will have adopted IFRS to some extent.
  • China and Japan will be sustantially converged to IFRS.
  • US Public Companies will likely have the option of using either IFRS of US GAAP.

Perbandingn IFRS dan PSAK pada 31 Desember 2009.  PSAK 43 Standar, 8 Standar Syariah, 13 ISAK, 4 Technical bulletin, dan 1 SAK ETAP. Sedangkan IFRS terdiri dari 37 Standar (8 IFRS dan 29 IAS), 27 Interpretations (16 IFRIC dan 11 SIC).

Pada 31 Maret 2010, PSAK telah mencapai 50% fully comparable, 12% substantially comparable, 19% non comparable, 19 substantially non comparable.  Rincian PSAK Non Comparable per 31 Maret 2010 adalah sebagai berikut.

  • PSAK 3 Laporan Keuangan Interin (ED PSAK 3 Revisi 2010)
  • PSAK 18 Akuntansi Dana Pensin (ED PSAK 18 Revisi 2010)
  • PSAK 21 Ekuitas (akan dicabut)
  • PSAK 27 Akuntan Koperasi (akan dicabut)
  • PSAK 28 Akuntansi Asuransi Kerugian (belum diputuskan)
  • PSAK 29 Akuntansi Minyak dan Gas Bumi (belum diputuskan)
  • PSAK 33 Akuntansi Pertambangan Umum (belum diputuskan)
  • PSAK 36 Akuntansi Asuransi Jiwa (belum diputuskan)
  • PSAK 38 Restruksturisasi Ekuitas sepengendali (belum diputuskan)
  • PSAK 44 Aktivitas Pengembangan Real Estate (belum diputuskan, akan diganti dengan IFRIC 15).
  • PSAK 45 Akuntansi Entitas Nirlaba (direvisi)
  • PSAK 47 Akuntansi Tanah (belum diputuskan)
  • PSAK 50 Instrumen Keuangan: Penyajian dan Pengungkapan (ED PSAK50 dan PSAK 60 Revisi 2010).
  • PSAK 51 Kuasi Reorganisasi (belum diputuskan)
  • PSAK 53 Kompensasi Berbasis Saham (belum diputuskan)

Sasaran Konfergensi IFRS tahun 2012

Merevisi PSAk agar secara material sesuai dengan IFRS versi 1 Januari 2009 yang belaku efektif pada tahun 2011/2012.  Konvergensi IFRS di Indonesia dilakukan secara bertahap.  Pada tahun 2010—2012 SAK Umum akan disusun berbasis IFRS, syariah, dan nonprofit, serta ETAP.  Setelah tahun 2012 akan disusun SAK berbasis IFRS, dan PSAK non IFRS termasuk Syariah, ETAP, dan Nonprofit.

Peta jalan yang disusun adalah sebagai berikut:

  • Tahap Adopsi (2008—2010)

Adopsi seluruh IFRS ke PSAK, persiapan infrastruktur yang diperlukan, dan evaluasi dan kelola dampak adopsi terhadap PSAK yang berlaku.

  • Tahap Persiapan Akhir (2011)

Penyelesaian persiapan infrastruktur yang diperlukan, dan penerapan secara bertahap beberapa PSAK berbasis IFRS.

  • Tahap Implementasi (2012)

Penerapan PSAK berbasis IFRS secara bertahap, dan evaluasi dampak penerapan PSAK secara komprehensif.

PSAk yang telah disahan sampai tanggal 23 Desember 2009 adalah sebagai berikut.

  • PSAK 1 (Revisi 2009) Penyajian Laporan Keuangan
  • PSAK 2 (Revisi 2009) Laporan Arus Kas
  • PSAK 4 (Revisi 2009) Laporan Keuangan Konsolidasian dan Laporan Keuangan Tersendiri.
  • PSAK 5 (Revisi 2009) Segmen Operasi.
  • PSAK 12 (Revisi 2009) Bagian Partisipasi dalam Ventura Bersama.
  • PSAK 15 (Revisi 2009) Investasi dalam Entitas Asosiasi.
  • PSAK 25 (Revisi 2009) Kebijakan Akuntansi, Perubahan Estimasi Akuntansi, dan Kesalahan.
  • PSAK 48 (Revisi 2009) Penurunan Nilai Aset.
  • PSAK 57 (Revisi 2009) Provisi, Liabilitas Kontijensi, dan Aset Kontijensi.
  • PSAK 58 (Revisi 2009) Aset Tidak Lancar yang Dimiliki untuk Dijual dan Operasi yang Dihentikan.

PSAK Baru yang disahkan pada tanggal 19 Februari 2010 adalah sebagai berikut:

  • PSAK 7 (2010) Pengungkapan Pihak-Pihak yang Berelasi.
  • PSAK 10 (2010) Transakasi Mata Uang Asing (Disahkan tanggal 23 Maret 2010)
  • PSAK 12 (2010) Lindung Nilai Investasi Neto dalam Kegiatan Usaha Luar Negeri.
  • PSAK 14 (2010) Biaya Situs Web
  • PSAK 19 (2010) Aset Tidak Berwujud
  • PSAK 22 (2010) Kombinasi Bisnis (Disahkan tanggal 3 Maret 23)
  • PSAK 23 (2010) Pendapatan

Interpretasi yang telah disahkan sampai tanggal 23 Desember 2009 adalah sebagai berikut:

  • ISAK 7 (Revisi 2009) Konsolidasi Entitas Bertujuan Khusus.
  • ISAK 9 Perubahan atas Liabilitas Purna Operasi, Liabilitas Restorasi, dan Liabilitas Serupa.
  • ISAK 10 Program Loyalitas Pelanggan.
  • ISAK 11 Distribusi Aset Nonkas Kepada Pemilik.
  • ISAK 12 Pengendalian Bersama Entitas, Kontribusi Nonmoneter oleh Venturer.

PPSAK yang telah disahkan sepanjang tahun 2009 dan berlaku efektif pada tahun 2010 adalah sebagai berikut:

  • PPSAK 1: Pencabutan PSAK 32 Akuntansi Kehutanan, PSAK 35 Akuntansi Pendapatan Jasa Telekomunikasi, dan PSAK 37 Akuntansi Penyelenggaraan Jalan Tol.
  • PPSAK 2: Pencabutan PSAK 41 Akuntansi Waran dan PSAK 43 Akuntansi Anjak Piutang.
  • PPSAK 3: Pencabutan OSAK 54 Akuntansi Restrukturisasi Utang Piutang Bermasalah.
  • PPSAK 4: Pencabutan PSAK 31 (Revisi 2000) Akuntansi Perbankan, PSAK 42 Akuntansi Perusahaan Efek, dan PSAK 49 Akuntansi Reksadana.
  • PPSAK 5: Pencabutan ISAK 06 Intepretasi atas Paragraf 12 dan 16 PSAK 55 (1999) tentang Instrumen Derivatif Melekat pada Kontrak dalam Mata Uang Asing.

Exposure Draft Public Hearing tanggal 27 April 2010

  • ED PSAK 3 Laporan Keuangan Interim
  • ED PSAK 15 Batas Aset Imbalan Pasti, Persyaratan Pendanaan Minimum dan Interaksinya.
  • ED PSAK 16 Perjanjian Konsesi Jasa (IFRIC 12)
  • ED PSAK 17 Laporan Keuangan Interim dan Penurunan Nilai
  • ED PSAK 18 (2010) Program Manfaat Purnakarya
  • ED PSAK 24 (2010) Imbalan Kerja

Exposure Draft Public Hearing tanggal 14 Juli 2010

  • ED PSAK 8 (Revisi 2010) Peristiwa Setelah Tanggal Neraca
  • ED PSAK 50 (Revisi 2010) Instrumen Keuangan, Penyajian
  • ED PSAK 53 (revisi 2010) Pembayaran Berbasis Saham
  • ED PSAK 60 Intrumen Keuangan, Pengungkapan

Exposure Draft Public Hearing tanggal 30 Agustus 2010

  • ED PSAK 46 (Revisi 2010) Pajak Pendapatan
  • ED PSAK 61 Akuntnasi Hibah Pemerintah dan Pengungkapan Bantuan Pemerintah
  • ED PSAK 63 Pelaporan Keuangan dalam Ekonomi Hiperinflasi
  • ED ISAK 18 Bantuan Pemerintah – Tidak ada Relasi Spesifik dengan Aktivitas Operasi.
  • ED ISAK 20 Pajak Penghasilan – Perubahan Dalam Status Pajak Entitas atau Para Pemegang Saham Lainnya.

IFRS Which Are Still Under Discussion in 2012

  • IFRS 1 First Time Adoption
  • IFRS 4 Insurance Contract
  • IFRS 6 Exploration and Evaluation Mineral Resources
  • IFRS 41 Agricukture

The Board is observing the current develpment of IASB for those standards.

Manfaat Konvergensi IFRS

  • Memudahkan pemahaman atas laporan keuangan dengan penggunaan Standar Akuntansi Keuangan yang dikenal secara internasional (enhance comparability).
  • Meningkatkan arus investasi global melalui transparansi.
  • Menurunkan biaya modal dengan pembuakaan peluang fund raising melalui pasar modal secara global.
  • Menciptakan efisiensi penyusunan laporan keuangan.
  • Meningkatkan kualitas laporan keuangan dengan antara lain mengurangi kesempatan untuk melakukan earaning management.
  • Reklasifikasi antar kelompok surat berharga (securities) dibatasi dan cenderung dilarang.
  • Reklasifikasi dari ke FVTPL dilarang.
  • Reklasifikasi L & R ke AFS dilarang.
  • Tidak ada lagi extraordinary items.

Hasil Riset IAS and Accounting Quality (Barth, Landsman, & Lang)

A goal of IASC and IASB is to develop an internationally acceptable set of high quality financial reporting standards.  To Achieve this goal, the IASC and IASB have issued principles-based standards, and taken steps to remove allowable accounting alternatives and to rquire accounting measurements that better reflect a firm’s economic position and performance (IASC, 1989).

Limiting alternatives can increase accounting quality because doing so limits management’s opportunistic discretion in dtermining accounting amount (Asbaugh and Pincus, 2001).  Accounting amounts that better reflect a firm’s underlying economics, resulting from either principles-based standards or required accounting measurements, can increase accounting quality because doing so provides investors with information to aid them in making investment decision.

However, there are at least two reasons why our predictions may not be borne out.  First, IAS may be of lower quality than domestic standards.  For example, limiting managerial discretion relating to accounting alternatives could eliminate a firm’s ability to report accounting measurements that are more reflective of the firm’s economic position and performance.  In Addition, the inherent flexibility in principles-based standards coul provide greater opportunity for firms to manage earnings, thereby decreasing accounting quality.  Thsi flexibility has long been a concern of securities markets regulators, especially in international context (Breeden, 1994).

Based on inferencs on a sample of firms in 21 countries that adopted IAS between 1994 and 2003 we find that in the postadoption period firms applying IAS generally evidence less earnings management, more timely loss recognition, and more value relevance od accounting amounts than do firms not applying IAS.

Dampak IFRS terhadap Sistem Akuntansi dan Pelaporan

Penyajian

  • Konsep other comprehensive income di dalam laba rugi komprehensif.
  • Perubahan definisi-definsi seperti kewajiban menjadi liabilitas dan hak minoritasmenjadi kepentingan non pengendali (non-controlling interest).
  • Pos luar biasa tidak lagi diperbolehkan.
  • Perubahan nama laporan keuangan

A Complete set of financial statements comprises:

  • A statement of financial position as at the end of period.
  • A statement of comprehensive income for the period.
  • A statement of changes in equity for the period.
  • A statement of cash flow for the period.
  • Notes, comprising a summary of significant accountiog policies and other explanatory information.
  • A Statement of financial position as at the beginning of the earliest comparative period when an entity applies an accounting policy retrospectively or makes a retropestive restatement of items in its financial statement, or when it reclassifies items in its financial statement.

Catatan:

  • Tidak diatur tentang format laporan keuangan.
  • Prudence versus Conservatism.
  • Dibolehkan menggunakan revaluation method untuk penilaian PPE.

Pengukuran

  1. Peningkatan Penggunaan Nilai Wajar (fair value)

Standar IFRS lebih condong kepada penggunaan nilai wajar, terutama untuk properti investasi, beberapa aset tidak berwujud, dan aset biologis.  Dengan demikian, diperlukan sumber daya yang kompeten untuk menghitung nilai wajar atau bahkan perlu menyewa jasa konsultan penilai terutama untuk aset-aset yang tidak memiliki nilai pasar aktif.

  1. Penggunaan Estimasi dan judgement

Akibat karakteristik IFRS yang lebih berbasis pada prinsp, akan lebihbanyak dibutuhkan judgement untuk menentukan bagaimana suatu transaksi kekuangan dicatat.

Pengungkapan

Persyaratan pengungkapan yan lebih banyak dan lebih rinci.  IFRS mensyaratkan pengungkapan berbagai informasi tentang risiko baik kualitatif maupun kuantitatif.  Pengungkapan dalam laporan keuangan harus sejalan dengan data atau informasi yang dipakai untuk pengambilan keputusan yang digunakan oleh manajemen.

What Are Companies Saying

  • 37% said simplified financial accounting and reporting.
  • 45 said cost saving.
  • 5% said easier access to capital.
  • 37% said improves financial reporting and transparency.
  • 17% said other.

Today, moe than 100 countries permit or require IFRS for listed companies, with more than 40% of the Global Fortune 500 using IFRS.  Stock exchange in the 85 countries requiring IFRS comprise 35% of the global market capitalization, compared 28% of the global market capitalization held by US exchanges.  Several major countries have plans to adopt or converge to IFRS in the near future.  Brazil (2010), Canada, India, Japan, South Corea (2011), Indonesia and Malaysia (2012).  42% indicated that, if permitted, they would implementing IFRS sooner than 2014 (the initial mandatory date within the SEC proposed roadmap).

Perceived challenges to adopt IFRS: 32% lack of skilled personnel; 7% insufficient technology; 33% lack of accounting technical guidance; 18% cost to convert; 10% other.

Dampak Konvergensi IFRS terhadap Pendidikan Akuntansi

  • Mahasiswa harus belajar tentang konsep yang ada di dalam rerangka konseptual (conceptual framework).
  • Mahasiswa harus menguasai teori-teori yang mendasari pelaporan keuangan, ekonomika makro, keuangan, portofolio dan lainnya.
  • Mahasiswa juga harus menguasai valuation theory.
  • Mahasiswa harus belajar bagaimana menbuat judgement (belajar memahami BC dalam setiap standar).
  • Pembentukan IFRS task force.
  • Kajian-kajian dan riset mengenai IFRS.
  • Pengajaran principle based dan bukan ruled based dan pengungkapan berdasar IFRS.
  • Penggunaan text book berbasis IFRS.
  • Pengetahuan mengenai pengungkapan berdasarkan IFRS.
  • Pemutakhiran materi ajar terutama untuk mata kuliah yang terkena dampak besar dari konvergensi IFRS.
  • Matakuliah yang terdampak paling besar adalah: Akuntansi Keuangan Menengah, Akuntansi Keuangan Lanjutan, Teori Akuntansi, Akuntansi Internasional, Seminar Akuntansi, Statistika Akuntansi, Metodologi Penelitian.

Catatan:

  1. Pembelajaran bisa dari iasb.org www.iasplus.com www.iaiglobal.com www.ifac.org
  2. IFRS per 1 Januari 2009 dapat diunduh gratis dari situs web IASB.
  3. Exposure draft semua ED PSAK dapat diunduh gratis dari situs WEB IAI.


 

Contoh Standar yang Meningkatkan Transparansi

  1. Laporan keuangan parent harus dikonsolidasi, kalaupun menerbitkan lporan keuangan tersendir harus ada parent yang mengonsolidasi laporannya.
  2. Related party transcation diatur secara lebih ketat.
  3. Pengukuran dan pengungkapan surat berharga diatur lebih rinci (IAS 32 dan IAS 39).

Prudence

Prudence Is the inclusion of caution in the exercise of the judgements needed in making the estimates required under conditions of uncertainty, such that assets or income are not overstated and liabilities or expenses are not uderstated.  However, the exercis of prudence does not allow, for example, the creation of hidden reserves or exercise provisions, the deliberate understatement of assets or income, or the deliberate overstatement of liablities or expenses, because the financial statements would not be neutral and, therefore, not have the equality of reliability.

Principles Based Reporting

Principles based accounting provides a conceptual basis for accountants to follow instead of a list of detailed rules.

Lease Accountig Under Rules Based and Principles Based Approach

Principles based accounting for leases is addressed in 6 IASB pronouncements and on interprtetation.  In contrast, USGAAP related to lease accounting is addessed in 20 statements, 9 FASB Interpretations, 10 Technical Bulletins, and 39 EITF Abstracts.

Whether a lease is afinance lease or an operating lease depends on the substance of the transaction rather than the form of the contract. Examples of situations that indivdiually or in combination would normally lead to a lease being classified as a finance lease are:

  1. The lease transfers ownership of the asset to the lease by the end of the lease term.
  2. The lessee has the option to purchase the asset at a price that is expected to be sufficiently lower than the fair value at the date the option becomes exercisable for it to be reasonably certain, at the inception of the lease, that the option will be exercised.
  3. The lease term is for the major part of the economic life of the asset even if title is not transferred.
  4. At the inception of the lease the present value of the minimum lease payments amounts to at least sunstantially all of the fair value of the leased asset.
  5. The leased assets are of such a specilised nature that only the lease can use them without major modifications.

 

 

Robert Herz, FASB Chair (2002)

Under a principles based approach, one starts with laying out the key objectives of good reporting in the subject area and tha provides guidance explaining the objective and relating it to some common examples.  While rules are sometimes unavoidable, the intent is not to try to provide specific guidance or rules for every possible situation.  Rahter, if in doubt, the reader is directed back to the principles.

Advantage Disadvantage of Principles Based Accounting

  • Broad guidelines that can be applied to numerous situations.
  • Broad principles avoid the pitfalls associated with precise requirements that allow contracts to be written specially to manipulate their intent.
  • 1981 study sponsored by FASB found evidence that managers purposefully to structure leases as operating leases to acoid incurring additional liabilities. Providing broad guidelines may improve the representational faithfulness of financial statements.
  • Principles based accounting standards allow accountants to apply professional judgment in assessing the substance of a transaction. This approach is substantially different from underlying “box ticking’ approach common in rules based accounting standards.
  • FASB Chair Robert Herz has stated that he believes the professionalism of financial statements would be enhanced if accountants are required to utilize their judgement instead of relying on detailed rules.
  • A principles based system would result in simpler standards. Herz has claimed that  a principles based system would lead to standards that would be less than 12 pages long, instead of over 100 pages (Bussiness Week Online, 2002).
  • Principles would be easier to comprehend and apply to a broad range transactions. Harvery Pitt, former SEC Chairman, emplained this as follows: “Because are developed based on rules… they are insufficiently flexible to accomodate future developments in the marketplace.  This has resulted in accounting for unaticipated transactions that is less transparent.”
  • Finally, the use of principles based accounting standards may provide accounting statements that more accurately reflect company’s actual performance because, as Australian Securities and Investment Commission Chair David Knott has statatedm an increase in principle based accounting standards would reduce manipulations of the relus (nationwide News, 2002).

Drawbacks to Principle Based Approach to Standards Setting

  1. In Lack of precise guidelines could create inconsistencies in the application of standards accross organizations. For example, companies are required to recognize both an expense and a liability to a contigent liability that is probable and estimable.  On the other hand, a contigent liability that is reasonably possible is only reported in the footnotes.  With no precise guidelines, how should companies determine if liabilities are probable or only reasonably possible?
  2. Many accountants seem to prefer rules based standards, possibly because of their concerns about the potential of litigation over their exercise of judgment in the absence of bright line rules.
  3. The number of request for implementation guidance received by FASB has always been high, and their significance resulted in the formation of the Emerging Issues Task Force. If financial statements conform with accepted rules, the bases for a lawsuit are diminished.
  4. Sebuah perusahaan swasta membangun sebuah unit pembangkit tenaga listrik yang listriknya dijual ke PLN. Siapa yang harus mengakui aset atas unit pembangkit tersebut?

Users and Information Needs

  1. Providers of capital – decision making or analys of risk and return of investment.
  2. Employees – tability of employers or remuneration.
  3. Lenders – financial health.
  4. Supplies – viability of firm.
  5. Customers – continuance.
  6. Goverments – regulatory, taxation, statistics.
  7. Public – contribution, trends, developments.

Financial Statements

Included:

  1. Statement of financial position (balance sheet).
  2. Statement of comprehensive income.
  3. Statement of changes in equity.
  4. Statement of cash flows.
  5. Notes to the financial statements.

Not Included:

  1. Reports by directors.
  2. Statements by chairman.
  3. Discussion and analysis by management.
  4. Other narative reporting.

Objective of Financial Statement

  1. The objective of financial statements is to provide information about the financial position, performance and changes in financial position of an entity that is useful to awide range of users in making economic decision.
  2. Financial statements prepared for this purpose meet the common needs of most users. However, financial statements do not provide all the information that users may need to make economic decisions sinc they largely portray the financial effects of past events and do not necessarily provide non financial information.

 

 

FORENSIC ACCOUNTING: Exploring the Dark Side and Strengtehing the Bright Side of Accounting By I Gusti Agung Rai (The Board Member of BPK-RI) Note from Brawijaya Accounting Fair 2008

•June 16, 2017 • Leave a Comment

Indonesia is in high ranking position for the most corrupted countries.  Corruption has penetrated into all sectors and activites.  To combating the corruption, we need knowledge and experience in Forensic Accounting (FA).  FA is a good tool to overcome and disclose the impact of accounting fraud.

What is the Forensic Accounting and Accounting Fraud

Merriam Webster’s Collegiate Dictionary 10th Edition define that “forensic (1) used in or suitable to court or judicature or to public dicussion and debate; (2) argumentative  or rhetorical; (3) relating or dealing with the application of scientific knowledge to legal problems.  So, forensic covers the application of various knowledge and science into legal problems.  In fact, there are already many examples of the uses of forensic in other disciplines such as forensic anthropoloist, forensic chemist, and forensic dentist.  Forensic accounting in another example of the use of forensic that relates to accounting discipline.

Regarding the forensic in accounting discipline, D.L. Crumbley (Editor in Chief of Journal of Forensic Accounting) has written: “Simply put, forensic accounting is legally accurate accounting.  That is, accounting that is sustainable in some adversarial legal proceeding or within some judicial of administrative review.”  He used more general terms like legal proceeding and judicial or administrative review to describe the use of forensic in accounting discipline.  As such, Forensic Accounting involve three discipline like The Accountancy, The Law, and The Audit.

There are other terms that relate to be percieved to have the same meaning with Forensic Accounting like Fraud Auditing, Investigative Accounting, Ligitation Support, and Valuation Analysis.  However, there are no clear definintions regarding to these terms yet.

Bologna & Lindquist () explained tha some traditional accountants differentiated Forensic Accounting to Fraud Auditing. According to traditional group, The Forensic Auditing relates to the proactive methods and approach to investigate fraud.  The purpose of the Fraud Auditing is to obtain evidence to proof that fraud has happened.  Then, the Forensic Accountant will be called when evidence already gathered, or when the suspicions become allegations, complaints, or discovery.

The Associaon of Certified Fraud Examiners (ACFE) identified some differences between traditional Audit and Frauyd Examination (Forensic Accounting).

Issue Auditing Fraud Examination
Timing Recurring:

Audit are conducted on a regular recurring basis.

Non Recurring:

Fraud examinations are non recurring.  They are conducted only with sufficient predication.

Scope General:

The scope of the audit is a general examination of financial data.

Specific:

The fraud examination is conducted to resolve specific allegations.

Objective Opinion:

An audit is generally conducted for the purpose of expressing an opinion on the financial statement or related information.

Affix Blame:

The fraud examination’s goal is to determine whether fraud has/is occuring and to determine who is responsible.

Relationship No Adversial:

The audit process is non adversial in nature

Adversial:

Fraud examinations, because they involve efforts to affix blame are adversial in nature.

Methodology Audit techniques:

Audits are conducted primanly by examining financial data.

Fraud Examination:

Fraud examinations are condusted  by (1) document examination; (2) review of outside data such as public records; and (3) interviews.

Presumption Professional Skepticism:

Auditors are required to apporach audits with professional skepticism.

Proof:

Fraud examiners approach the resolution of a fraud by attempting to establish sufficient proof to support of refure an allegation of fraud.

Source: ACFE

In Indonesia, the development of forensic accounting got its momentum when we experienced financial crisis in 1998—1999. During this period, many forensic accountings have been undertaken as part of the loan provisions.  This development then accelerated when new elected government created Corruption Eradication Commission (Komisi Pemberantasan Korupsi).

In public sector, the pracitice forensic aacounting usually carried out by govermental institutions dealing with legal matter, such as the Police, the Attorney General, PPATK, and KPK.  In addition to the institutions, the BPK also has authority to perform and has performed forensic accounting for several years.  This authority stipulated in Law 15/2004 and Law 15/2006.  According to these laws, BPK has a mandate to conduct three types of audit: Financial Audit, Performance Audit, and Special Purpose Audit. The forensic accounting comes under the definition of Special Purpose Audit.

Similar to general practices, the practicie of forensic accounting in public sector deal with the fraud.  The already well known type of fraud is corruption.  There many examples of corruption that will be elaborated further in the following sessions.

What is Accounting Fraud

Our understanding about the nature of accounting is the services activities, which provide quantitative information regarding business or economic activities.  The objective of accounting is to provide management with financial-related information that will be used in decision making.  The information is provided through a set of financial reports, which are the output of series procedures to record, summarize, and report economic transactions and activities.  We might never imagine that such well-developed process of recording and reporting transactions could be used as a tool to commit fraud.

Simply defined, fraud is a violation of the laww, planned deceit, and dishonesty.  Its consists of various types of white collar crime, including embezzlement, larcerny, concealment of informataion, concealment of liabilities, concealment of facts, engineering of facts, and corruption (Rezaea, 2002).  In termes of business, frauds related to financial accounting sometimes referred to as occupational fraud and abuse.  The ACFE defined this type of raud as “The use of one’s occupation for personal enrichment through the deliberate misuse or misapplication of the employing organization’s resources or assets.”  Three major types of occupational fraud are corruption, asset misappropition, and fraudelents statements (which include financial statement schemes).

There are many theories explaining why people commit fraud.  One of them is agency problem that derived from the agency theory.  The agency theory, firstly intriduced by Jensen & Mackling (1976).  Explained the principal – agent relationship, relationship between management and the owners.  Referrinng to this theory, fraud happens becuase managements (the agents) behave not in the interest of the owners, but for his/her individual interest as opportunistic behaviors.

Another theory is called asymmtric information.  This theory is based upon the asymmetric access to information between the principals (owners) and the agents (management).  This differences generate two types of agent’s behaviors like hidden action and hidden information.  By hiddening some actions and/or information, managements could commit fraudulent activities for their benefit.

Cressey (Fraud Examiners Manuals, 2006) identified three common causes that trigger fraud.  He depicted the causes in a triangle, which then is known as the fraud triangel.  First, there is pressure engage in fraud, such as economical needs.  Second, there is opportunity that allows individual to commit fraud or to causal dishonest act.  Third, the ability to justify an act and to exploit legal loopholes to cover up/conceal fraud.

More over, ACFE has identified types of fraud and presented in a chart that is called fraud tree.

The Relation between Forensic Accounting and Accounting Fraud

Referrig to above explanations, we could see that forensic accounting is carried out to investigate financial statement related fraud, by using some investigative audit techniques.  Several traditional audit techniques can be used to perform investigative audit, such as physical examination, documentation review, reperformance, an inquiries.

With the increase in importance and demand, the forensic accounting and invesitigative audit har emerged to be a profession.  Being a certified fraud investigator, which is called Certified Fraud Examiner (CFE), give the accountants/auditors credentials that highly valued by business society.  However, to be a good fraud auditors/forensic accountants need additional skills and knowledge.  Davia (2010) advised five rules that should be followed when performing forensic accountants/audit:

  • Avoid becoming premturely entangled in developing endless facts and circumtances of a case of fraud, to the exclusion of identifying a perpetrator or perpetrators, and providing their involement.
  • Fraud auditors must constantly strive to prove perpetrator’s intent to commit fraud.
  • Be creative, think like perpetrator, do not predictable.
  • Fraud auditing detecting procedures must take into account that much fraud involves conspiracy.
  • Proactive fraud detection strategy must consider that fraud may appear accounting records as distinct entries or hosted entries, and in some instances may not appear in the records at all.

 

Frauds In Indonesia

Let’s see where Indonesia in Global Corruption Index.  One of the indicators of corruption index widely used is Corruption Perception Index (CPI).  This index is developed by Transparency Intenational 9TI), a Non Govermental Organization (NGO) concerned with the fighting against corruption in the world.  In 2007, Indonesia is number 143 from 179 countries in the world. Very low position, it’s mean corruption in Indonesia is very high.

Prof. Dr. Soemitro once estimated that the fraud procurement process in Indonesia could involve as much as 30% of procurement budget.  However, some procurement fraud cases bring into the court indicated that the amount of money involved could be much larger.

One of the largest fraud incdence is the distribution Bank Indonesia’s Liquidity Supports (BLBI) during and after crisis of 1997.  This fraud involved as large money as RP650 Trillion and spread over 10 years.  The natures od BLBI which involving large amount of money but lacking strong controls is good conditions for fraud to happen.

There are many other examples how fraud has penetrated deeply into sectors and segments in governement suc as (1) laws; (20 defence; (3) banking system; (4) local governemnets; (5) state owned enterprises; and (6) parlement.

 

How is the Forensic Accountant Disclose the Accounting Fraud

Every perpetrator always tries to find ways to commit fraud succesfully.  The scheme he/she used ussually follows the cycle of accountancy.  This cycle can be divided into three phases: input – process – output.

In the input phases, where transaction document are prepared and captures, the fraud scheme invlove such activities as forging documents, enginering fictitious documents, creating corroborating documents, and omitting illegal transactions.  In the process phases, ussualy committed by exploting the weakness in the internal control systems, issuing internal policies to justify committed planned fraud changing or manipulating financial records, and misapplication of accounting principles.  In the output phases, when the financial reports are produced, the fraud ussually committed by disclosing inadequately and by exploiting the loopholes in the Financial Accounting Standards.

For the govermental sector, the incidence of fraud also follows the same process.  It happens in all phases of budgeting cycle.  Some examples of fraud in govermental sector are (1) reallocating between expenditures account; (2) not recording revenue transactions; (3) recording fake transactions; (4) overlauing assets; and (5) inadequate disclosure.

The fundamental principle that has proven to be effective in conducting forensic accounting, that is follow the money.  One example of the application of this principes is in the Bank Bali Case.

 

How he Forensic Accounting Deal With Acccounting Fraud

The objective of the forensic accounting is to proof whether the incidence of fraud happened or not.  As such at the end of the audit, the forensic acccountant/investigative auditors should be able to provide adequate, sufficient, and reliable evidence o answer the audit objective.  If the auditors concluded that there is a incidence of fraud, the evidence obtained during the audit could be used for litigation.

In general, the process of identifying and the proofing the incidence of fraud is as follow (ACFE).

  • Develope fraud theory.
  • Who migh be involved?
  • What might have happened?
  • Where are the possible concealmnet places or methods?
  • When did this take place (past, present, or future)?
  • How is the fraud being perpetrated?
  • Determine where the evidence is likely to be.
  • On book versus off book.
  • Direct or circumstantial.
  • Identify potential witness.
  • What evidence is necessary to prove intent?
  • Number of occurences.
  • Other areas of impropnery.
  • Revise fraud theory
  • Prepare chart linking people and evidence
  • Determine defense to allegation
  • Is evidence sufficient to proceed? Yes!
  • Complete the investigation through interviews, document examination, observations.

Article 14 of Law 15/2004 stated, that should during the audit BPK found the indication of fraud, the BPK should report in appropiate time such incidences to the legal institutions authorized by law to deal with such incidences.

 

 

References

The Associaon of Certified Fraud Examiners (ACFE). (2006).  Fraud Examiners Manual.

Bologna, G.J. & Lindquist, R.J. (). Fraud Auditing and Forensic Accounting: New Tools and Technique.

Davia, H.D. (2010).  Fraud 101: Techniques and Stategies for Detection. John Wiley & Sons.

Jensen, M.C. & Meckling, W.H. (1976). Theory of the Firm: Managerial Behavior, Agency Costs and Ownership Structure.  Journal of Financial Economics. No. 3.

Merriam Webster’s Collegiate Dictionary 10th Edition

Zabihollah, R. (2002). Financial Statement Fraud Prevention and Detection.  Canada: John Wiley & Sons Inc.

RENCANA DAN PROGRAM ADOPSI PENUH (FULL ADOPTION) IFRS dan STRUKTUR SERTA TANTANGAN DEWAN STANDAR AKUNTANSI KEUANGAN (DSAK)

•June 16, 2017 • Leave a Comment

RENCANA DAN PROGRAM ADOPSI PENUH (FULL ADOPTION) IFRS dan STRUKTUR SERTA TANTANGAN DEWAN STANDAR AKUNTANSI KEUANGAN (DSAK)

Dewan Standar Akuntansi Keuangan (DSAK) Ikatan Akuntan Indoensia (IAI)

Catatan dari Brawijaya Accounitng Fair 2008

RENCANA DAN PROGRAM ADOPSI PENUH IFRS

Alasan Adopsi Penuh IFRS

Adposi penuh IFRS dilakukan untuk meningkatkan kualitas SAK dan mengurangi biaya penyusunannya.  Selain itu, untuk meningkatkan kredibilitas dan kegunaan Laporan Keuangan (LK) melalui peningkatan kualitas dan kredibilitas LK.  Merupakan permintaan dari regulator melalui surat yang mengingatkan pentingnya align dengan IOSCO.

Manfaat Adopsi Penuh IFRS

Adopsi penuh IFRS bermanfaat untuk memudahkan pemahaman atas LK, karena penggunaan SAK yang telah dikenal secara internasional (enhance comparability).  Diharapkan akan meningkatkan arus investasi global melalui transparansi.  Juga menurunkan biaa modal dengan membuka peluang penggalian dana (fund raising) melalui pasar modal secara global.

Tantangan Adopsi Penuh IFRS

Aspek Regulasi

Ada beberapa regulasi yang mengatus aspek pencatatan seperti ekuitas dan tanah yang mengatur secara berbeda dengan IFRS.  SAK-IFRS tetap mengacu pada hirarki perundang-undangan nasional.  Adopsi Penuh IFRS dilakukan dengan memasukkan muatan lokal.

Infratruktur Lingkungan Ekonomi Nasional

Tidak tersedia pasar untuk menentukan nilai wajar aset nonkeuangan.  Selain itu, tingkat inflasi yang relatif tinggi dibandingkan negara-negara maju akan meningkatkan volatilitas nilai wajar.  Permasalahan yang sama yang dihadapi oleh berbagai negara berkembang yang mengadopsi penuh IFRS.

Tingkat Kesiapan

Penggunaan profesisonal judgement akan menjadi kendala tersendiri.  Pemahaman penyusun, auditor, akademisi, dan regulator yang belum tentu sama.  Akan semkin mengningkatkan ketergantungan pada profesi lain. Sehingga, pelu pelatihan profesional yang masif dan berkelanjutan.

Masalah Penerjemahan

Terbatasnya sumberdaya dan konsumsi waktu yang tidak sedikit.  Penerjemahan harus mudah difahami.  Sehingga, peningkatan pelatihan profesional perlu dilakukan secara masif.

Strategi Adopsi Penuh IFRS

Alternatif Strategi

Big Bang Strategy, adopsi penuh dilakukan sekaligus tanpa masa transisional.  Telah banyak dilakukan oleh negara-negara maju dan sebagian kecil negara berkembang seperti Afrika Selatan.

Gradual Strategy, adopsi penuh dilakukan secara bertahap dengan masa transisi.  Strategi yang banyak digunakan oleh negara-negara berkembang.  Syaratnya memerlukan kesiapan yang mencukupi dan tidak menimbulkan gegar psikology (psychological shock).  Strategi yang mampu mengurangi dampak negatif.  Untuk Indonesia, yang paling cocok adalah Strategi Gradual Terakselerasi (dipercepat).

PSAk harus menggunakan Bahasa Indonesia sebagaimana amanat Undang-Undang 4/2004 tentang Pembentukan Peraturan dan Perundang-undangan.

Tahapan (roadmap) Adopsi Penuh IFRS

  1. Tahap Adopsi (2007—2009)

Waktu yang diperlukan untuk mengadopsi seluruh IFRS ke PSAK.  Waktu untuk persiapan infrastruktur yang diperlukan.  Waktu untuk evaluasi dan kelola dampak adopsi terhadap standar akuntansi.

  1. Tahap Persiapan (2010)

Waktu untuk penyelesaian persiapan infrastruktur yang diperlukan.  Evaluasi penerapan per PSAK yang diadopsi penuh dari IFRS.  Cadangan waktu penyelesaian adopsi penuh.

  1. Tahap Implementasi (2011)

Waktu penerapan pertama kali seluruh PSAK yang sudah mengadopsi penuh IFRS.  Evaluasi dampak penerapan PSAK adopsi penuh IFRS secara komprehensif.

Dampak adopsi penuh terhadap PSAK adalah (1) revisi terhadap PSAK dan lahirnya PSAK baru; (2) PSAK untuk industri khusus dihilangkan dan dimunculkan pedoman akuntansi sebagai pengantinya; (3) PSAK derivasi dari Undang-Undang dipertahankan; dan (4) PSAK yang belum atau tidak diatur dalam IFRS akan dikembangkan.

Infrastruktur dan Dukungan

Infrastuktur

Diperlukan sumber daya finansial yang memadai.  Tidak membebani manajemen purnawaktu untuk mencari dana selain mendukung aktivitas DSAK.  Imbalan yang layak kepada pihak eksternal IAI yang ikut dalam proses adopsi IFRS.  Pembentukan dana abadi.

Diperlukan sumber daya manusia sebagai manajemen purnawaktu yang mencukupi dengan cara menambah jumlah manajemen purnawaktu dadn meningkatkan imbalan.  Selain itu, perlu penguatan kelembagaan DSAK dengan menambah jmlah anggota DSAK dan memperbaiki mekanisme kerja DSAK.

Dukungan

Perlu dukungan sumber daya finansial dengan adanya komitmen dan dukungn dari semua pihak untuk penyediaan sumberdaya finansial.  Harus dilakukan sinkronisasi regulasi antara PSAK dan peraturan dan perundangan untuk saling melengkapi dan bukan saling meniadakan.  Bagi para pemakai, seperti para penyusun perlu peningkatan kemampuan dalam hal principlebased.  Sedangkan untuk auditor perlu peningkatan kapasitas dan integritas karena IFRS penuh dengan professional judgement.  Sedangkan untuk para akademisi perlu melakukan perubahan orientasi pendidikan akuntansi ke IFRS.

Penyusunan PSAK UKM

Acuan penyusunan PSAK UKM akan menggunakan IFRS for SME yang disesuikan dengan kondisi di Indonesia.  Proses penyusunan telah mulai berjalan dengan adanya Tim Kerja yang terdiri dari IAI, akademisi, Depkeu, HIPMI, dan KAP.

Diperlukan dana Rp1 Milyar yang saat ini masih menggunakan dana talangan karena belum ada dana yang masuk.  Diperlukan dukungan komite akuntansi untuk UKM seperti Komite Akuntansi Syariah.  Diperlukan staf purnawaktu yang khusus mendukung kegiatan Komite Akuntansi untuk UKM.

 

STRUKTUR DAN TANTANGAN DEWAN STANDAR AKUNTANSI KEUANGAN (DSAK)

Oleh M. Yusuf Wibisono (Ketua DSAK)

Accounting Standard Setter di Indonesia terdiri dari Dewan Standar Akuntansi Keuangan (DSAK) atau Indonesia Accounting Standarb Board (IASB) dan Badan Pengawas Pasar Modal (BAPEPAM) atau Securities Exchange Committee (SEC).

DSAK merupakan lembaga privat yang bertanggung jawab untuk menyusun standar akuntansi di Indonesia.  Didukung oleh peraturan dan perundangan dan merupakan bagian dari penyusun peraturan (quasi lwa maker).  DSAK terdiri dari anggota profesi akuntansi, pakar peraturan yang terkait, dan institusi bisnis.

Peraturan Pendukung DSAK

Undang-Undang 8/1995 tentang Pasar Modal. Pada Pasal 69 (1) dinyatakan kepada Bapepam, bahwa laporan keuangan wajib disusun berdasarkan prinsip akuntansi yang berlaku umum (PABU). PABU adalah Standar Akuntansi Keuangan yang ditetapkan oleh Ikatan Akuntan Indonesia (IAI) dan praktek akuntansi lain yang lazim berlaku di pasar modal.

Undang-Undang 1/1995 tentang Perseoran Terbatas.  Pada Pasal 58 (1) menyatakan bahwa perhitungan tahunan dibuat sesuai dengan Standar Akuntansi Keuangan (SAK).  SAK adalah prinsip-prinsip akuntansi yang telah diakui dan disetujui oleh kalangan akuntan Indonesia bersama instansi pemerintah yang berwenang.

Dewan Konsultatif Standar Akuntansi Keuangan (DKSAK) merupakan bagian khusus yang menjadi bagian dari IAI untuk memberikan pandangan mengenai arah dan skala prioritas DSAK.  DKSAK berwenang memberikan pandangan-pandangan mengenai arah dan skala prioritas pemilihan standar dan interpretasi yang akan diberlalukan dalam profesi akuntansi di Indonesia.  Berwenang melakukan upaya penggalangan sumber dana bagi pengembangan standar dan interpretasi yang akan diberlalukan dalam profesi akuntansi di Indonesia.  Dibentuk oleh dan bertanggung jawab pada DPN.

Dewan Standar Akuntansi Keuangan (DSAK)

DSAK adalah badan yang menjadi bagian dari organisasi IAI yang memunyai otonomi untuk menyusun dan mengesahkan standar dan interpretasinya.  DSAK dibentuk oleh DPN dengan pembiayaan sepenuhnya diupayakan oleh DPN.  Pengawasan terhadap mekanisme dan kinerja DSAK dilakukan oleh DPN.  Tata kerja DSAK diatur lebih lanjut dalam PO yang dibuat oleh DPN.

Pemilihan anggoa DSAK diutamakan berdasarkan kompetensi, pengalaman, integritas, dan komitmen pada IAI serta komitmen untuk mencurahkan waktu dan perhatian pada tugas sebagai anggota DSAK.  Masa kerja anggota DSAK maksimum 4 tahun dan dapat diangkat kembali 1 kali saja.  Kesinambungan keanggotaan DSAK selalu dipelihara.  Ketua DSAK diangkat dari dan oleh anggota DSAK terpilih.  Dibentuk badan pekerja purna waktu (full timer management & staffs) sebagai tim teknis penyusunan PSAK dan ISAK.

Tugas utama DSAK adalah (1) menentukan materi serta skala prioritas pilihan topik untuk dijadikan angenda kerja; (2) mempertimbangkan masukan DKSAK mengenai hal-hal yang berkaitan dengan pengembangan SAK; (3) memberikan arahan serta supervisi badan pekerja teknis dan membahas hasil pekerja teknis.  Badan pekerja teknis dibentuk oleh dan bertanggung jawab kepada DSAK.  Proses penyusunan standar harus mengikuti due process procedures yang telah disetujui pengurus pusat.

Due process procedures harus disusun sedemikian rupa untuk menunjang kualitas PSAK dan ISAK yang diberlakukan.  Orientasi penyusunan standar berfokus pada kualitas.  Menjalin hubungan baik dengan (1) badan penyusun standar internasional seperti IASB, FASB dan lain-lainnya; (2) instansi pemerintah dan badan lainnya yang berkepentingan dengan pengembangan SAK; (3) KAP yang memunyai kapasitas teknis dalam pengembangan SAK.

Due Process Procedures

  1. Identifikasi isu untuk dikembangkan menjadi PSAK.
  2. Konsultasi isu dengan DKSAK.
  3. Membenttuk tim kecil dalam DSAK.
  4. Melakukan riset terbatas.
  5. Melakukan penulisan draf awal.
  6. Pembahasan dalam DSAK.

Draf hasil tim kecil dibahas lagi dalam DSAK.  Dilakukan pendekatan teoretikal dan non teoritikal.

  1. Peluncuran draf sebagai exposure draft dan pengedarannya.

ED dikirim langsung sebagai sisipan dari Media Akuntansi dan Web IAI.  Juga dikirim langsung sebanyak 1000—2000 eksemplar ke KAP, PT, IAI Wilayah, dan instansi terkait (Bapepam, BEI, BPKP), serta DKSAK.  Masa edar 2 bulan.

  1. Publlic hearing & limited hearing.

Limited hearing dilakuan hanya bila perlu, standar yang rumit, kontroversial dan banyak direspon.  Penekanannya untuk meminta tanggapan dan bukan memberikan penjelasan.

  1. Pembahasan tanggapan atas ED dan masukan public hearing.

Berupa tanggapan tertulis, ada yang dapat diakomodasi tetapi ada yang ditolak, setelah tanggapan diakomodasi, draf dimasukkan ke Pusat Bahasa.

  1. Persetujuan ED PSAK menjadi PSAK.

Harus quorum untuk pengesahan oleh anggota DSAK.

  1. Optimal: final checking oleh full time staff.

Koherensi dan kelancaran kalimat atau paragraf, konsistensi istilah, ejaan dan lain sebagainya.

  1. Sosialisasi standar.

Sebagai bagian dari Program Pendidikan Profesional Berkelanjutan, melalui media masa, dan lain sebagainya.

Tantangan

  1. Keterbatasan pengetahuan terhadap standar, khususnya untuk standar yang kompleks.
  2. Kemudahan aplikasi dan penerimaan standar tidak sesuai harapan.
  3. Konsekuensi ekonomi naik pada standar-standar tertentu memengaruhi kualitas standar.
  4. Menuju standar tunggal dengan kualitas yang tinggi, IFRS.   

Exploring The Dark Side of Accounting (Fraud) (1) And Accounting Practice: Between Evil and Angel (2) By Hendrik Manurung ME (1) and Kevin D. Click (PT HM Sampoerna) (2) Note from Brawijaya Accounting Fair (BAF) 2008

•June 16, 2017 • Leave a Comment

Exploring The Dark Side of Accounting (Fraud)

What is Fraud?

Black Law Dictionary said “Fraud is intentional perversion of truth, false representation of a matter of fact, whether by words or conduct.  For the purpose of inducing another, in reliance upon perversion of truth.  To part with some valuable thing belonging to him or to surender a legal right.

Why Fraud is a Costly Business Problem

Fraud losses reduce net income.  If profit margin is 10%, revenues must increase by 10 times losses to recover affect on net income.  Fraud rob income.  To restore income to Rp10.000, need Rp10.000 more Rupiah of revenue to generate Rp1.000 more Rupiah of income.

These Are Inteeresting Time

Number and size of financial statements fraud are increasing.  Number and size of frauds against organization are increasing.  Some recent fraud include several people, as many as 20—30 peoples.  Seems to indicate moral decay).  Many investors have lost confidence in credibility of financial statements and corporate reports.  More interest in fraud than ever before, now a course on many college campuses.

Perspective on Fraud

Bad Fraud

Acquierer overpays.  Earnings management like false revuneu recognition schemes, costs and expenses schemes, understatement liabilities, and many more.  Illegal conduct like liablitiy for past conduct, impoct upon future earnings, and many more.

Good Fraud

Acquierer underpays.  Misconduct that if discovered, reduces costs, and increase earnings.

 

 

Why So Many Financial Statement Frauds All of a Sudden?

Good Economy was maskng many problems.  Moral deacy in society.  Executive incentives, to achieve the target.  Wall street expectation, reward for short term behavior.  Nature of accounting rules.  Behavior of CPA Firms like Arthur Andersen in the Enron case,  Greed by investment banks, commercial banks, and investor.  Educator failures, the fraud knowledge not deliver well to the student.

Types of Fraud

Employee fraud, vendor fraud, customer fraud, investment scams, bankrupty frauds, miscellaneous frauds.  The common element is deceit or trickery.

The 21st Century Landscape

Civil and crimina legislation like Sarbanes Oxley Act of 2002.  Professional standards like Committee of Standard Organinzation (COSO), Statement of Auditing Standards (SAS) 99, Public Company Accounting Oversight Board Standards Integrated Audit.  Institute for Internal Auditors (IIA) Standards, ABA Rules for Professional Responsibility.

Expenses Avoided by Fraud

Tax crimes, failure to pay, false statement, evasion.  Fraud against suppliers and customer.  Improper labor practtices.  Environmental, health, and safety violations.  Money Laundering.

Applying COSO Framework

Control Environment

Code of conducts or ethics; ethics hotline; hiring and promotion; audit committee oversight; investigative process; remedition.

Fraud Risk Assessment

Systematic process; level within organization; likelihood and significance.

Control Activities

Linking controls to identified fraud risks.

Information/Communication

Information systems and technology; knowledge management; training.

Monitoring

Ongoing monitoring by management; separate “after the fact” evaluations by internal aduit.

 

Educators

Need to teach ethics more.  Need to teach student about fraud and offer a fraud course.  Need to teah student ho to think.  Do analysis not do copy and memorize.

 

Accounting Practice: Between Evil and Angel

Company Overview

PT HM Sampoerna is the largest tobacco company in Indonesia.  In 2007 net sales is IDR29.8 Trillion, in 2008 (9 moths) growing 17.2%.  Approximately 30,000 employees.  Brand sold: A Mild, Dji Sam Soe, Marlboro.  Listed on Indonesian Stock Market.  Majority owned by Philip Morris International (PMI).  One of largest tobacco companies in the world.  Listed on New York Stock Exchane.

Tone at the Top

Nothing is more important than our commitment to integrity – no financial objective, no marketing target, no effort to outdo the competition.  No desire to please the boss outweighs that core commitment.  Our commitment to integrity must always come first (Louis Camilleri, CEO of PMI).

Company Culture

  • Establish compliance and integrity guidlines on business ethics;
  • integrity is one of the core performance competencies;
  • Promote “whistle blower” with free hotline number to report any suspected non compliances;
  • No tolerance for retaliation;
  • Stringent follow up and reporting of allegatios received;
  • Increase employees awareness on compliance and integrity through training and campaigns.

Resources Qualifications

  • Selective recruitment and placement process to ensure the right talents with high integrity.
  • Continuous training of soft and technical skills. In example GAAP Academy Programs, accounting technical updates. Developing PMI Managers.
  • Develop key employees to be member of professional accounting body (ACA, CIA).

Policies and Procedures

Establish policies and procedures for all aspects of the business process.  Finance policies (50 policies); Accountting Guidelines (1); Capex/Lease/Disposal (10); Travel and Entertainment (2); Cash management (8); Credit controls (6); Equity investent/acquisition (7); other finance policies (8).  Information systems (11 policies).  Compliance (16 policies).  Other (procurement, human resource, CA, operations (17 policies).

Internal Processes

Adequates segregation of duties.  Supervisory review and approval.  Adequate approval authoriztions.  Comprehensive automated IT controls within applications.  Adequate control on user access to systems and applications.

Monthly reconciliation on balance sheet, income statement and cash flow against the underlying financial accounts.  Monthly review and analysis (Sampoerna & PMI). In example mojor balance sheet accounts, income statement (against budget, standards, and previous period), suspense, clearing and inter company account.  Regular independent counts of cash, inventory and fixed assets.  Job rotation of executives (averaging 3 years) to improve capacity and to prevent the abuse of power.

Internal Independent Review

Internal independet review by (1) Corporate Audit Department (repporting to PMI).  The audit based on risk assessment, covered revenue, disbursement, payroll, marketing expenses, procurement. And financial reporting.  (2) Internal Audit and Control Department (Sarbanes Oxley Act section 404), audit 18 major business process, document and test over 300 key controls, external auditor independently review SOX testing results. (3) Appoinment of Independent Audit Committees.  Sampoerna (3 qualified members: senior accounting lecture from state university, senior partner of local accounting firm, and ex managing director of HM Sampoerna).  Meet at least quarterly. PMI: Independent, experienced international business leader.

External Review

External auditors conduct comprehensive review to ensure true and fair reflection of financial statements.  Substantive review of key accounts, systems and controls.

Government & Shareholders

As listed company, sampoerna is required to comply with detailed and tranparent reporting requirement form BAPEPAM.  Published reporting in the company website.  As a subsidiary of a company listed in NYSE, meet the reporting requirements from NYSE SEC.  Government tax audit. Shareholders inquiries.

Summary

HM Sampoerna condutcs business using sound internal process and controls across all levels of the organization to ensure full compliance to (1) all applicable laws and regulations; (2) local and international accounting standards and best practices.  This has provided a solid platform to ensure the company’s financial statement are true reflection of business performance and actual financial results.

FORENSIC ACCOUNTING: Exploring the Dark Side and Strengtehing the Bright Side of Accounting. By I Gusti Agung Rai (The Board Member of BPK-RI). Note from Brawijaya Accounting Fair 2008

•June 16, 2017 • Leave a Comment

 

Indonesia is in high ranking position for the most corrupted countries.  Corruption has penetrated into all sectors and activites.  To combating the corruption, we need knowledge and experience in Forensic Accounting (FA).  FA is a good tool to overcome and disclose the impact of accounting fraud.

What is the Forensic Accounting and Accounting Fraud

Merriam Webster’s Collegiate Dictionary 10th Edition define that “forensic (1) used in or suitable to court or judicature or to public dicussion and debate; (2) argumentative  or rhetorical; (3) relating or dealing with the application of scientific knowledge to legal problems.  So, forensic covers the application of various knowledge and science into legal problems.  In fact, there are already many examples of the uses of forensic in other disciplines such as forensic anthropoloist, forensic chemist, and forensic dentist.  Forensic accounting in another example of the use of forensic that relates to accounting discipline.

Regarding the forensic in accounting discipline, D.L. Crumbley (Editor in Chief of Journal of Forensic Accounting) has written: “Simply put, forensic accounting is legally accurate accounting.  That is, accounting that is sustainable in some adversarial legal proceeding or within some judicial of administrative review.”  He used more general terms like legal proceeding and judicial or administrative review to describe the use of forensic in accounting discipline.  As such, Forensic Accounting involve three discipline like The Accountancy, The Law, and The Audit.

There are other terms that relate to be percieved to have the same meaning with Forensic Accounting like Fraud Auditing, Investigative Accounting, Ligitation Support, and Valuation Analysis.  However, there are no clear definintions regarding to these terms yet.

Bologna & Lindquist () explained tha some traditional accountants differentiated Forensic Accounting to Fraud Auditing. According to traditional group, The Forensic Auditing relates to the proactive methods and approach to investigate fraud.  The purpose of the Fraud Auditing is to obtain evidence to proof that fraud has happened.  Then, the Forensic Accountant will be called when evidence already gathered, or when the suspicions become allegations, complaints, or discovery.

The Associaon of Certified Fraud Examiners (ACFE) identified some differences between traditional Audit and Frauyd Examination (Forensic Accounting).

Issue Auditing Fraud Examination
Timing Recurring:

Audit are conducted on a regular recurring basis.

Non Recurring:

Fraud examinations are non recurring.  They are conducted only with sufficient predication.

Scope General:

The scope of the audit is a general examination of financial data.

Specific:

The fraud examination is conducted to resolve specific allegations.

Objective Opinion:

An audit is generally conducted for the purpose of expressing an opinion on the financial statement or related information.

Affix Blame:

The fraud examination’s goal is to determine whether fraud has/is occuring and to determine who is responsible.

Relationship No Adversial:

The audit process is non adversial in nature

Adversial:

Fraud examinations, because they involve efforts to affix blame are adversial in nature.

Methodology Audit techniques:

Audits are conducted primanly by examining financial data.

Fraud Examination:

Fraud examinations are condusted  by (1) document examination; (2) review of outside data such as public records; and (3) interviews.

Presumption Professional Skepticism:

Auditors are required to apporach audits with professional skepticism.

Proof:

Fraud examiners approach the resolution of a fraud by attempting to establish sufficient proof to support of refure an allegation of fraud.

Source: ACFE

In Indonesia, the development of forensic accounting got its momentum when we experienced financial crisis in 1998—1999. During this period, many forensic accountings have been undertaken as part of the loan provisions.  This development then accelerated when new elected government created Corruption Eradication Commission (Komisi Pemberantasan Korupsi).

In public sector, the pracitice forensic aacounting usually carried out by govermental institutions dealing with legal matter, such as the Police, the Attorney General, PPATK, and KPK.  In addition to the institutions, the BPK also has authority to perform and has performed forensic accounting for several years.  This authority stipulated in Law 15/2004 and Law 15/2006.  According to these laws, BPK has a mandate to conduct three types of audit: Financial Audit, Performance Audit, and Special Purpose Audit. The forensic accounting comes under the definition of Special Purpose Audit.

Similar to general practices, the practicie of forensic accounting in public sector deal with the fraud.  The already well known type of fraud is corruption.  There many examples of corruption that will be elaborated further in the following sessions.

What is Accounting Fraud

Our understanding about the nature of accounting is the services activities, which provide quantitative information regarding business or economic activities.  The objective of accounting is to provide management with financial-related information that will be used in decision making.  The information is provided through a set of financial reports, which are the output of series procedures to record, summarize, and report economic transactions and activities.  We might never imagine that such well-developed process of recording and reporting transactions could be used as a tool to commit fraud.

Simply defined, fraud is a violation of the laww, planned deceit, and dishonesty.  Its consists of various types of white collar crime, including embezzlement, larcerny, concealment of informataion, concealment of liabilities, concealment of facts, engineering of facts, and corruption (Rezaea, 2002).  In termes of business, frauds related to financial accounting sometimes referred to as occupational fraud and abuse.  The ACFE defined this type of raud as “The use of one’s occupation for personal enrichment through the deliberate misuse or misapplication of the employing organization’s resources or assets.”  Three major types of occupational fraud are corruption, asset misappropition, and fraudelents statements (which include financial statement schemes).

There are many theories explaining why people commit fraud.  One of them is agency problem that derived from the agency theory.  The agency theory, firstly intriduced by Jensen & Mackling (1976).  Explained the principal – agent relationship, relationship between management and the owners.  Referrinng to this theory, fraud happens becuase managements (the agents) behave not in the interest of the owners, but for his/her individual interest as opportunistic behaviors.

Another theory is called asymmtric information.  This theory is based upon the asymmetric access to information between the principals (owners) and the agents (management).  This differences generate two types of agent’s behaviors like hidden action and hidden information.  By hiddening some actions and/or information, managements could commit fraudulent activities for their benefit.

Cressey (Fraud Examiners Manuals, 2006) identified three common causes that trigger fraud.  He depicted the causes in a triangle, which then is known as the fraud triangel.  First, there is pressure engage in fraud, such as economical needs.  Second, there is opportunity that allows individual to commit fraud or to causal dishonest act.  Third, the ability to justify an act and to exploit legal loopholes to cover up/conceal fraud.

More over, ACFE has identified types of fraud and presented in a chart that is called fraud tree.

The Relation between Forensic Accounting and Accounting Fraud

Referrig to above explanations, we could see that forensic accounting is carried out to investigate financial statement related fraud, by using some investigative audit techniques.  Several traditional audit techniques can be used to perform investigative audit, such as physical examination, documentation review, reperformance, an inquiries.

With the increase in importance and demand, the forensic accounting and invesitigative audit har emerged to be a profession.  Being a certified fraud investigator, which is called Certified Fraud Examiner (CFE), give the accountants/auditors credentials that highly valued by business society.  However, to be a good fraud auditors/forensic accountants need additional skills and knowledge.  Davia (2010) advised five rules that should be followed when performing forensic accountants/audit:

  • Avoid becoming premturely entangled in developing endless facts and circumtances of a case of fraud, to the exclusion of identifying a perpetrator or perpetrators, and providing their involement.
  • Fraud auditors must constantly strive to prove perpetrator’s intent to commit fraud.
  • Be creative, think like perpetrator, do not predictable.
  • Fraud auditing detecting procedures must take into account that much fraud involves conspiracy.
  • Proactive fraud detection strategy must consider that fraud may appear accounting records as distinct entries or hosted entries, and in some instances may not appear in the records at all.

 

Frauds In Indonesia

Let’s see where Indonesia in Global Corruption Index.  One of the indicators of corruption index widely used is Corruption Perception Index (CPI).  This index is developed by Transparency Intenational 9TI), a Non Govermental Organization (NGO) concerned with the fighting against corruption in the world.  In 2007, Indonesia is number 143 from 179 countries in the world. Very low position, it’s mean corruption in Indonesia is very high.

Prof. Dr. Soemitro once estimated that the fraud procurement process in Indonesia could involve as much as 30% of procurement budget.  However, some procurement fraud cases bring into the court indicated that the amount of money involved could be much larger.

One of the largest fraud incdence is the distribution Bank Indonesia’s Liquidity Supports (BLBI) during and after crisis of 1997.  This fraud involved as large money as RP650 Trillion and spread over 10 years.  The natures od BLBI which involving large amount of money but lacking strong controls is good conditions for fraud to happen.

There are many other examples how fraud has penetrated deeply into sectors and segments in governement suc as (1) laws; (20 defence; (3) banking system; (4) local governemnets; (5) state owned enterprises; and (6) parlement.

 

How is the Forensic Accountant Disclose the Accounting Fraud

Every perpetrator always tries to find ways to commit fraud succesfully.  The scheme he/she used ussually follows the cycle of accountancy.  This cycle can be divided into three phases: input – process – output.

In the input phases, where transaction document are prepared and captures, the fraud scheme invlove such activities as forging documents, enginering fictitious documents, creating corroborating documents, and omitting illegal transactions.  In the process phases, ussualy committed by exploting the weakness in the internal control systems, issuing internal policies to justify committed planned fraud changing or manipulating financial records, and misapplication of accounting principles.  In the output phases, when the financial reports are produced, the fraud ussually committed by disclosing inadequately and by exploiting the loopholes in the Financial Accounting Standards.

For the govermental sector, the incidence of fraud also follows the same process.  It happens in all phases of budgeting cycle.  Some examples of fraud in govermental sector are (1) reallocating between expenditures account; (2) not recording revenue transactions; (3) recording fake transactions; (4) overlauing assets; and (5) inadequate disclosure.

The fundamental principle that has proven to be effective in conducting forensic accounting, that is follow the money.  One example of the application of this principes is in the Bank Bali Case.

 

How he Forensic Accounting Deal With Acccounting Fraud

The objective of the forensic accounting is to proof whether the incidence of fraud happened or not.  As such at the end of the audit, the forensic acccountant/investigative auditors should be able to provide adequate, sufficient, and reliable evidence o answer the audit objective.  If the auditors concluded that there is a incidence of fraud, the evidence obtained during the audit could be used for litigation.

In general, the process of identifying and the proofing the incidence of fraud is as follow (ACFE).

  • Develope fraud theory.
  • Who migh be involved?
  • What might have happened?
  • Where are the possible concealmnet places or methods?
  • When did this take place (past, present, or future)?
  • How is the fraud being perpetrated?
  • Determine where the evidence is likely to be.
  • On book versus off book.
  • Direct or circumstantial.
  • Identify potential witness.
  • What evidence is necessary to prove intent?
  • Number of occurences.
  • Other areas of impropnery.
  • Revise fraud theory
  • Prepare chart linking people and evidence
  • Determine defense to allegation
  • Is evidence sufficient to proceed? Yes!
  • Complete the investigation through interviews, document examination, observations.

Article 14 of Law 15/2004 stated, that should during the audit BPK found the indication of fraud, the BPK should report in appropiate time such incidences to the legal institutions authorized by law to deal with such incidences.

 

 

References

The Associaon of Certified Fraud Examiners (ACFE). (2006).  Fraud Examiners Manual.

Bologna, G.J. & Lindquist, R.J. (). Fraud Auditing and Forensic Accounting: New Tools and Technique.

Davia, H.D. (2010).  Fraud 101: Techniques and Stategies for Detection. John Wiley & Sons.

Jensen, M.C. & Meckling, W.H. (1976). Theory of the Firm: Managerial Behavior, Agency Costs and Ownership Structure.  Journal of Financial Economics. No. 3.

Merriam Webster’s Collegiate Dictionary 10th Edition

Zabihollah, R. (2002). Financial Statement Fraud Prevention and Detection.  Canada: John Wiley & Sons Inc.

TRIPLE BOTTOM LINE: TOWARD BUSINESS ACTIVITIES RESPONSIBLE TO EARTH, HUMAN, AND BUSINESS ENTITY

•June 16, 2017 • Leave a Comment

ABSTRACT

The purposes of the business activities is making profit and make the entity value grow from time to time.  But, business entity trapped to make profit and value grow at all cost.  Labor exploitation, ignore the externalities to environment, event sacrifice the customer.  The Triple Bottom Line concept (People, Planet, and Profit) from Elkington (1997) is different and because propose a holistic concept of business.

First, business entity should pay attention to empowering people like employee, customer, and community to keep the going concern.  If the people and community educated they will be loyal customer to the entity.  Educated employee will worked with high motivation to produce good product.  Educated customer will be loyal customer because they know the quality of the product and entity.  The community will be enjoy with the entity because the entity pay attention and taking care to them.

Second, the business entity should take care about the environment issues.  The entity should Keep the nature in the good condition and keep the environment secure to ensure their going concern.  Natural resources like water, energy, and raw materials should keep in the good condition to ensure the long term operational of the entity.  Minimize the externalities like garbage and pollution make the people live in the good condition and enjoy consume the entity’s product.

 

Third, if the business entity have educated and loyal consumers, taking care the community, pay attention to the environmental issues, and produced high quality product, sales will be high, profit will be high, and the value of the entity will be grow also.  So, the profit and the value of the entity are not just from operational matter only but from the responsibility to the people and planet.

The long term profit, value growth, and going concern of the entity are the purpose of the Triple Bottom Line Concept.  The Stakeholder Theory and the Legitimacy Theory are the basis theory of the Triple Bottom Line Concept.

Keywords: Triple Bottom Line, Going Concern, Value Growth, People and Planet Before Profit, Stakeholders Theory, Legitimacy Theory


INTRODUCTION

The environmental issues became the important agenda in the international forum since 1972.  After the International Conferrence on the Human Environment in Stockholm, Sweden and Earth Summit in Rio De Janiero, Brazil 1992, international community make sure that environmental issues are international responsibility.  Environmental conservation issue, developmental activity issue, and social issue are influenced one another. Sustainable development ensures economic activities, environmental conservation, and social empowerment running together (Nuraini, 2010).  People, Planet, and Profit from the Tipple Bottom Line is the concept that ensure the sustainable business should pay attention to the community empowerment to create the prosperity, environmental conservation keep the natural resources in the good condition, and making long term profit for growth of value of the entity.

Gray, el al., (1995) stated that social and environmental responsibility are business entity responsibility, to ensure the accountable to all stakeholders,  The social responsibility and environmental responsibility report should embedded to the yearly report of the entity.  The comprehensive report will bring the legitimating to the entity about social and environmental activities.  The legitimation ensures the support from community and makes the going concern of the entity created.

Prior, et al., (2008) stated that social and environmental responsibility performance in the yearly report can be the insurance for the management in front of stockholders.  Social and environmental performance can be another appraisal beside the financial or profit performance.  The management have more information from stakeholders and use it for their benefit, as the Agency Theory stated.

 

The Tipple Bottom Line Concept

Elkington (1997) stated that Triple Bottom Line in the principal bases of the Corporate Social Responsibility.  The three purposes are one purpose of the entity.

  1. People

People and community are the stakeholders of the entity.  Entity should pay attention to the prosperity of the people and community to ensure the going concern of the entity.  Educate and empower the people and community will make the long term commitment and good relationship with the entity.  Educate and empower the people and community are a long term investment to ensure the long term life and going concern of the entity.

  1. Planet

Environmental is the habitat and resources of the entity.  Nature conservation will ensure the natural resources (energy, water, etc.) available for long term.  Minimize the externalities (garbage and pollution) ensure clean and safe habitat for people and entity.

  1. Profit

Profit is the main purpose of the entitiy or business activities.  Profit is the extended wealth to keep the long term activity of entity, to ensure the going concern of the entity.

Triple Bottom Line (People, Planet, and Profit) is important for entity.  Triple Bottom Line ensure long term life or going concern of the entity.  The comprehensive and holistic peformances that entity should preformed.

 

THE BASIC THEORY OF TRIPLE BOTTOM LINE

Stakeholders Theory

The social responsibility concept established since 1970, known as the stakeholder theory.  The theory are talking about the values and practices about stakeholders.  Values, concepts, rules, implementation, and commitment that contribute to the prosperity for stakeholders and sustainable development.  The stakeholder theory is the important part of the business or entity activities (Freeman, et al., 2014).

Ghozali & Chariri (2007) stated that the stakeholders theory mean that entity is not operational just for their benefit.  The entity should make benefit for stakeholders like employees, creditor, supplier, customer, government, community, and many else.  The entity going concern influenced by the support from the stakeholders.  Deegan (204) stated that stakeholders theory are a theory that ensure all stakeholders have right to know the information about the operational of the entity for the decision usefulness.  The stakeholders can choose to use the information for their decision in the entity.

Budimanta, et al., (2008) stated there are two kind of the stakeholders approaches, the old corporate relation and new corporate relation.  The old corporate relations concentrate to the form of entity activities, the separated form of entity activities, internal and external.  The relationship among the internal and external are short time and transactional only.  There is no long term relationship and no joint benefit, conflict among internal dan external entity happened.  The new corporate relation make collaboration among the stakeholders.   Entity is not separated from social system, entity is part of social system.  The relationship among stakeholders builds from the togetherness, partnership, collaboration, and benefit for all.  Entity did not gain wealth for their own but build the quality of life of stakeholders.

Tunggal (2008) stated that stakeholders theory can be explain in the 3 approaches.

  1. Descriptive approach

The stakeholder theory descripts the reality about the operational of the entity.  The purpose of the stakeholder theory is to understand the stakeholders need and interest.  Managers should performance for stakeholders not just for shareholders.

  1. Instrumental approach

The stakeholder theory stated that the management’s strategy for high performance is pay attention to the stakehoder’s interest.  Lawrence & Weber (2008) descript that 450 entities that committed to the stakeholders have a high financial performance.  The instrumental approach purposed is to study the consequences of relationship among entity and their stakeholders also relationship among the corporate governance and multi stakeholders relationship governance.

  1. Normative approach

The stakeholders theory stated that every people and community already giving their contribution to the value of the firm.  Firm of entity should give back rewards to the stakeholders.   The normative approach purposed are identify the moral or philosophy rule with the entity activities,

So, the stakeholder theory is a theory that concern to the need and interest of the stakeholders that influenced the entity’s strategy.  Stakeholders are part of the entity that influenced the uses of resources in the entity’s activities.  The stakeholder strategy is not for financial performance but for social performance also.  The corporate social responsibility (CSR) is the strategy to fulfill the need and interest of stakeholders.  The disclosure of social (CSR) performance is to satisfy the stakeholders and bring support to the entity activities to make higher performance for entity.  The stakeholders theory stated that entity is not perform just for their selves but perform for all stakeholders.  Freeman (1984) stated that stakeholders (individual and group) affect to the entity’s purposes.  .

Roberts (1992) stated that stakeholders influenced the entity, direct or indirect way.  The development of the stakeholder concept are three stages (entity planning, business planning, and CSR).  The disclosure of the social and environmental performance is part of the communication among the entity and the stakeholders.  So, when stakeholders control the economic resources, entity should find the way to satisfy the stakeholder’s need and interest.

Gray, et al., (1995) stated that the going concern of an entity depend on the support of the stakeholders.  Support from stakeholders should build to make entity’s performance high.  The stakeholders theory explicitly consider to the impact of entity performance disclosure to the stakeholder.  The information disclosure is a tool for management to control the information for the stakeholders.  Thus, management should to disclose the social and environmental performance to gain support from the stakeholders to gain the going concern.

Ghozali & Chariri (2007) stated that the stakeholder controlled the uses of economic resources of an entity.  The stakeholder influenced by the power of the control to the economic resources.  The control to the capital resources, human resources, access to media, will be influenced the ability of the entity to create profit.  So, the entity’s performance influenced by the support of the entity’s stakeholders

 

The Agency Theory

The agency theory is explaining the conflict of interest between agent or management and principal or shareholders.  The separation among the principle and agent create a conflict, the agency theory arise to cope and manage the conflict in the agency relationship.  The agency theory says when principal give the mandate to agent, principle delegate the authority to make decision to agent.  In the agency contract, agent should make benefit to the principal’s prosperity (Jensen & Meckling, 1976)

Principal want to know the agent’s activity information about investment or fund in the company.  The principal ask the responsibility reporting from agent.  The principal use the report for agent’s performance appraisal.  But agent tends to make the report well.  Agent use the report to make benefit for their selves like maximize the profit or other earnings management.  The action makes the wrong economics decision.

Gray et al., (1995) stated that corporate social and environmental disclosure (CSED) is a signal to distract the shareholders from the earnings management or other issues that impact the share price.  But the disclosure of social and environmental performance gives accurate information about risk to the investors.  So, when agent does earnings management they will disclose the social and environmental report very well.

                                                

Legitimacy Theory

 The legitimacy theory came from organization legitimating from Dowling & Pfeffer (1975).  The legitimacy theory stated that legitimacy is a condition or status when entity value system congruence with the community values system.  When the differences arise, potentially or manifest, will be influence to the entity.  O’Donovan (2002) stated that legitimacy is an idea to ensure the success of an entity when the entity value and operation inline whit the community value.  Deegan (2004) stated legitimacy theory is a theory about entity going concern. Entity value should harmonize with the community value and voluntary disclose and share their performance to community.

Ghosali & Chariri (2007) stated that the basis of the legitimacy theory is social contract among the entity and community in the operational area and uses of economic resources.  Every entity should have a real contract with community to operate in line with the community value.  If the entity operates in line with the value the community will support the operational of the entity.  Ahmad, et al., (2004) stated that the social and environmental report is the mechanism tool to communicate among the entity and community also as the entity’s legitimacy mechanism.  Disclose the social and environmental report is the way to synchronize the entity value and activities to the value of the community.  Entity should disclose the social and environmental reporting for the positive reaction from community and stakeholders for the entity legitimacy.

Saidi (2004) stated that entity should disclose the social and environmental performance reporting to get the benefit in the future.

O’Donovan (2002) stated that legitimacy theory as the idea that in order for an organization to continue operating successfully, it must act in a manner that society deems socially acceptable. Barkemeyer (2007) stated that legitimacy is sought by organizations as it affects understanding and actions of people towards the organization. People perceive a legitimate organisation as more trustworthy. Organizational legitimacy is a generalized perception or assumption that the actions of an entity are desirable, proper, or appropriate within some socially constructed system of norms, values, beliefs, and definitions.

Legitimacy is action or activitiies inline with community value, norms, ethics, and laws.  Ghozali & Chariri stated that one of many motive of social and environmental disclosure is the legitimating of the entity operational.  Legitimacy is the legality expression of the entity from community.  O’Donovan (2002) stated that organization legitimating is one of the benefit and potential resource for the entity to survive and going concern.  Organization legitimating is legalization from community to entity.  The existency of an entity influenced by the legitimacy from the community.

Gray, et al., (1995) stated that entity will survive and going concern when their operational dan value in line with the community value.  The legitimacy theory stated that entity activities and values should be in line with the community values.  The entity top management should make the entity operational and values in line with public values and stakeholder interest.

Ahmad & Sulaiman (2014) stated that legitimacy theory based on the social contrat among entity and community.  Entity needs legitimacy from community for going concern.  Gray, et al., (1996) stated that legitimacy theory based on the going concern of the entity founded from the congruence value of entity and community.  Entity discloses their report not only financial performance but social and environmental performance also.  The report describes the position of the entity among the community. The investor needs the information to make their investment decision.

Ghozali & Chariri (2007) stated that legitimacy theory is important to analyzed entity behavior.  Legitimacy theory has comprehensive perspective of entity’s performance disclosure, social, environment, and financial performance.  Reverte (2008) stated that legitimacy theory explicitly describe that business should have social contract to ensure the support from the community for their going concern.  Lindblom (1994) stated that legitimacy theory ensure the congruence of the entity and community.  Conflict among entity and community value will threatening the entity’ s going concern.  So, the social and environmental report disclosure is legitimacy for entity that their activities are supported by the community.

 

Hasibuan (2001) stated that pracitices of corporate social and environmental disclosure (CSED) is effort from entity to fulfill the expectation of the community.  Corporate social and environmental responsibility rises up the relationship among entity and their stakeholders (shareholders, supplier, creditor, etc.).  Social and environmental performances have positive relationship with financial performance.  So, the social and environmental disclosure is a communication mechanism of entity to their stakeholders.

Gray et al., (1995) stated that social and environmental disclosures are part of financial disclosure.  Social and environmental disclosures ensure the entity’s reputation especially relations with the community.  Legitimacy theory describes the relation mechanism social and environmental performance with corporate governance and profitability.  The legitimacy from community will increase the entity’s governance and profitability.

 

CORPORATE SOCIAL AND ENVIRONMENTAL RESPONSIBILITY

 Triple Bottom Line

Elkington (1997) stated the concept of the triple bottom line in term social justice, environmental quality, and economic prosperity or people and planet before profit or 3P.  The going concern of corporate depends on the 3P.  Before corporate earn the profit, they should actively contributing to the community prosperity and actively support the environmental conservation.

Wibisono (2007) stated the aspects of the triple bottom line:

  1. Profit

Profit is the most important thing for the corporate.  The main focus of the corporate activities is earn profit to increase the stock price.  Profit is the adding of corporate income to ensure the going concern.  The activities to leverage the profit are productivity (effective) and cost efficiency to ensure the corporate competitive advantage and create the maximum value added.

  1. People

Community around the corporate is one of the stakeholders, so corporate should give them attention.  Support from community is needed, because make the activities run well and ensure the corporate going concern.  Corporate should create many activities to fulfill the community’s need like community development and other social programs.  So, corporate going concern influenced by the corporate social responsibility.

  1. Planet

Corporate should pay attention to the environmental issue.  The environmental conservation ensure the corporate going concern, because it’s make sure the natural resources enough for long time.  The corporate environmental responsibility also minimize the externalities of corporate activities to prevent from sue against the environmental protection law.  The disclosure of corporate environmental responsibility is communication mechanism from corporate to the stakeholders about the corporate attention about the environmental issues.

 

Concept and Definition of the Corporate Social and Environmental Responsibility

Siregar (2010) stated that Global Reporting Initiative (GRI) corporate social and environmental responsibility as corporate social reporting/sustainability reporting is a process for publicly disclosing an organization’s economic, environmental, and social performance. World Bank (2003) stated as the commitment of business to contribute to sustainable economic development, working with employees, their families, the local community and society at large to improve their quality of life.  Untung (2008) stated as corporate commitment to contribute in sustainable economic development with the balance of economic, social, and environmental aspect,

Corporate social and environmental responsibility should make sure the balance of economic, social, and environmental aspects.  Corporate social responsibility (CSR), corporate environmental responsibility (CER), and corporate financial responsibility (CFR) cannot separated.  Wineberg (2004) stated that corporate social responsibility (CSR) is corporate contribution to the social investment, philanthropy programs, and obligation to public services.  European Commission (2001) stated CSR as a concept where by companies integrate social and environmental concerns in their business operations and in their interaction with their stakeholders on a voluntary basis.  CSR Asia (2008) stated CSR is a company’s commitment to operating in an economically, socially and environmentally sustainable manner whilst balancing the interests of diverse stakeholders.  Heals (2004) stated that goals of CSR and CER are responsibilities of corporate to cope the social and environmental externalities from the corporate activities and to ensure the corporate going concern.

CSR is corporate commitment in the 3 elements: economic, social, and environmental.  CSR ensure that corporate going concern depend on the relationship among corporate and community and other stakeholders.  In line with legitimacy theory that stated company has social contract with community to ensure the conqruences among corporate activities with the community values and justice value.  Haniffa and Cooke (2005) stated that conflict among corporate activities and values with the community and justice values influenced the corporate going concern because lost of the legitimacy.

CSR and CER are the corporate responsibility to the social and environmental issues, the corporate concern to the public issues.  CSR and CER are corporate commitment to responsible on externalities of corporate activities with or without regulation.  Corporate should operate with ethics and morality principles, make sure benefit and prosperity for all.

 

Corporate Social and Environmental Disclosures

Suwardjono (2005) stated that disclosure is important part of the financial reporting.  Disclosure is the lass step of accounting process to present the information in the form of financial report.  Hendriksen (1991) stated that disclosure is presentation of information to ensure the optimal operation of capital market.  Ghozali and Chariri (2007) stated that disclosure is information and explanation of financial report to describe the activities of an entity.

Suwardjomo (2005) stated that disclosure as information presentation should serve all stakeholders with many interest.  Chrismawati (2007) stated that Security Exchange Committee (SEC) demands more disclosure because financial report have social and public aspect.  The disclosure of financial report is not financial reporting only but quantitative and qualitative information also, mandatory and voluntary.

Anggraeni (2006) stated that corporate sholud disclose about the good corporate governance.  The corporate should disclose the social and environmental responsibility.  Community needs the information about the corporate social and environmental performance to ensure the corporate concern and attention to the public issues.  Nurlaela and Islahuddin (2008) stated that social and environmental responsibility disclosure is important for employee prosperity and justice and for consumer safety when consume the corporate product.

Event the corporate social and environmental responsibility reporting are voluntary, unaudited, and unregulated, the information from the report is very important to the stakeholder. The information is about the corporate atention to the public issues and long term perspective.  Corporate social and environmental responsibility makes sure that corporate concern to the community value and justice value to ensure the corporate going concern.

 

CONCLUSION                               

The triple bottom line show that corporate should be pay atention to multiple aspects, not single aspect, financial only.  Corporate should pay attention and concern to the social aspect and environmental aspect first before earn the profit.  Corporate should concern to all stakeholder prosperity before corporate prosperity itself.  Triple bottom line is the long term perspective, not short term perspective.  Corporate should not make profit only without concerning the going concern.  To ensure the going concern, corporate activities and values should conqruence to the community values and common justice values.  Corporate should minimize and cope the externalities of their activities to ensure that social and environmental safe and conserve for long time.

Stakeholders and regulators demanding the disclosure of the corporate performance report not financial report only.  The triple bottom line performance or sustainable report, corporate social performance, corporate environmental performance, and corporate financial performance became the mandatory report.  Stakeholder needs the comprehensive report as information to make economic decision.  The information that guarantees entity going concern is the most important information.  Triple bottom line or sustainable report is the only comprehensive and long term perspective report.  Thus, corporate should disclose their triple bottom line or sustainable report to ensure stakeholder attention to the corporate.

 

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