Earnings Management: Disclosure Quality and Director Characteristics (original) (raw)
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ABSTRACT : Profit management is a condition in which management is embarrassing to intervene in the process of preparing financial reports for external parties so that it can increase or decrease profits. profit in manufacturing companies listed on the Indonesia Stock Exchange from 2017 to 2019. The research approach used in this study is a quantitative approach using secondary data. The sampling technique used is non probability sampling with purposive sampling method. The number of samples used in this study were 90 samples. The analysis technique used is multiple linear regression. Based on the results of the study, it shows that the variable company size, the size of the board of commissioners and the audit committee has an effect on earnings management while managerial ownership has no effect on earnings management. This research is expected to be able to provide additional empirical studies for future research that examines earnings management and makes a positive contribution to investors and companies. Keywords : Company Size, Good Corporate Governance, Earnings Management
Earnings management, board of directors, and earnings persistence: Indonesian evidence
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This research investigates the impacts of earnings management, both accrual earnings management (AEM) and real earnings management (REM), as well as Board of Directors (BOD) on earnings persistence. Accrual earnings management was measured using Modified Jone's Model, and real earnings management was assessed by three measures: abnormal cash flow, abnormal production expenditure, and abnormal discretionary expenditure. In addition, Board of Directors was measured using BOD size and BOD independence. Earnings persistence was measured based on the current year earnings to following year earnings regression coefficients. Using the samples consisting of the manufacturing companies listed at the Indonesia Stock Exchange 2016-2020, the study finds the evidence that accrual earnings management and cash flow of real earnings management negatively affect earnings persistence, while production expenditure, earnings management, discretionary expenditure, BOD size, and BOD independence po...
Earnings Management: Evaluation of Audit Committee Activity in Indonesia
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The paper is intended to provide evidence of the effect audit committee meeting, attendance meeting, size, appointment, audit quality, managerial ownership, firm size, leverage, profitability, operating cash flow and sales growth on earnings management. The population of the paper are public non financial companies from 2016 to 2018. The paper uses 85 samples selected through purposive sampling method, hence amounting to 255 firm year. The result indicates that audit committee size, managerial ownership, firm size, leverage, profitability, operating cash flow and sales growth statisticall influenced earnings management. Audit committee meeting, attendance meeting, appointment and audit quality have no influence toward earnings management. Audit committee size positively influenced earnings management by ineffeciency while they doing their task to monitor mangement when it is too large. Mangerial ownership positively influenced earnings management because manager have their self inte...
Good Corporate Governance and Earnings Management in Indonesia
2021
The purpose of this study was to analyze the effect of audit quality and audit committee on earnings management. The research population is manufacturing companies indexed on the Indonesia Stock Exchange (BEI) in the 2017-2019 period. The sample selection method used was purposive sampling. From population of 180 manufacturing companies, and by selecting certain criteria, a sample of 72 manufacturing companies was obtained. Hypothesis testing is performed using multiple linear regression using statistical software SPSS Version 26. The results of this study confirm that partially, audit quality affects earnings management and audit committee also affects earnings management. Then, hypothesis testing is also carried out simultaneously, and the result is that the quality of the audit and audit committee also affects earnings management. The practical implication of this research is that the quality of the audit and the audit committee can be a reference for investors that can be used a...
International Journal of Social Science and Business, 2020
The consistent implementation of good corporate governance based on fairness, transparency, and accountability is proven to improve the quality of financial statements.This study aims to determine the influence of indicators of good corporate governance indicators to earnings management in Manufacturing Companies listed in Indonesia Stock Exchange (IDX). The sampling method is porposive samling by taking a sample of 30 manufacturing companies in the consumer goods industry sector which publishes annual report complete year 2014-2018.The results showed that simultaneously and partially, managerial ownership, composition of board of commissioner, audit committee and audit quality of KAP size have a positive effect on earnings management.Variable composition of board of commissioner has the most dominant influence to earnings management, shown by value of Standardized efficients Beta 0,303 bigger of the value of Standardized Coefficients Beta of other independent variables.
The Indonesian Journal of Accounting Research, 2022
This study examines the factors influencing earnings management practices in state-owned companies and their subsidiaries on the Indonesia Stock Exchange. The samples used in this study were nine state-owned companies and subsidiaries listed on the IDX for 2013-2019, totaling 63 samples. The analytical tool used to analyze the hypothesis is Eviews 11.0. The results showed that the director's expertise significantly positively affects earnings management. However, the director's remuneration and audit fee do not affect earnings management. Sales growth did not moderate the relationship between director remuneration, audit fees, and the director's expertise in earnings management. This research has important implications for building informal control over an action that the directors will take through the perspective of religiosity in influencing the behavior and decisions that the directors will take.
Jurnal Bisnis dan Akuntansi
The purpose of the research is to get empirical evidence about institutional ownership, management ownership, directors’ size, audit committee, independent commissioner, leverage, profitability, firm size, auditor’s independency and auditor’s reputability on earnings management practice. This research used 53 manufacturing companies listed in Indonesia Stock Exchange and the data were collected through purposive sampling method during the research period 2009 until 2011. The result of the research showed that audit committee, independent commissioner and debt to equity ratio had influence on earnings management practice. The results of this study indicate that the audit committee and independent commissioner overseeing management in reporting of company performance through financial statements. In addition, companies that source of funding more debt than equity is more likely to make an earnings management.
2021
This study provides evidence about underlying motivation the director encouraged practice of earnings management. Directors of manufacturing companies in Indonesia was to be sample in this research whose companies are listed on the Indonesia Stock Exchange (IDX). This research explores fourth types of motivation where are bonus motivation, political motivation, debt covenant motivation, and taxation motivation. The research method carried out using quantitative methods by questionnaire. Sample study used board of directors in Indonesia Stock Exchange (IDX). Research method analyzed by multiple regression. The results of this study reveal that the four of motivations have effect on earnings management practices. The evidence also shows that the highest directors motivation for earning management is come from political cost motivation. Then, it followed by bonus motivation, taxation motivation and debt covenant motivation. The fact is an overview the regulation condition in Indonesia...
The Influence of Good Corporate Governance toward Earnings Management
Sustainable Competitive Advantage, 2021
The purpose of this research is to find out whether some element of good corporate governance can affect the occurrence of earnings management with audit quality as a moderating variable in manufacturing companies listed in Indonesian Stock Exchange during 2017-2019. The independent variables include institutional ownership, independent board of commissioner, and audit committee with audit quality as a moderating variable. The dependent variable is earnings management which is measured by discretionary accrual with Modified Jones Model. The population of this research is 193 samples from companies listed at Indonesian Stock Exchange during 2017-2019. The sampling method used in this research is purposive sampling method. In addition, the data analysis method used is descriptive statistics, classical assumption test, multiple regression analysis, and subgroup moderated regression analysis. The result of this research indicates that the good corporate governance, which is represented by independent board of commissioner and audit committee have a negative effect while institutional ownership has effect on earnings management. Audit Quality strengthens the influence of independent board of commissioner on earnings management. However, audit quality cannot strengthen the influence of institutional ownership and audit committee on earnings management.
Objective-The purpose of this research is to empirically examine how company characteristics, corporate governance and audit quality affect earnings management. Methodology/Technique-The population used for this research is manufacturing companies listed on the Indonesian Stock Exchange between 2013 and 2015. The sampling method used in this research is purposive sampling. 64 companies are examined, with 192 items of data being obtained. Findings-This research also uses statistical testing through a multiple regression. The results show that return on assets, financial leverage, free cash flow, and sales growth all have an influence on earnings management. Meanwhile, other variables such as managerial ownership, institutional ownership, board size, the presence of an audit committee, firm size, and audit quality have no significant effect on earnings management. Novelty-In this research, company characteristics are proxied with the return on assets, financial leverage, firm size, free cash flow, and sales growth, while corporate governance is proxied with managerial ownership, institutional ownership, board size, and the presence of an audit committee.