THE EFFECT OF CORPORATE GOVERNANCE MECHANISM ON EARNINGS MANAGEMENT PRACTICE (Case Study on Indonesia Manufacturing Industry) (original) (raw)
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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.
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...
Good Corporate Governance And Earnings Management Practices: An Indonesian Cases
2009
This research is done for the purpose of finding out the effect of Good Governance practice can reduce earnings management practice done by company. This research uses companies registered in manufacture sector in Indonesia Stock Exchange observation period 2005-2007 as samples. Last sample used in this research is 384 years of observation. This research uses OLS method. The result shows that only two variables have significant effect to Earning Management practice which is CEO Duality and controlling shareholder existence. Other independent variables such as independent commissioner and audit committee and also shareholder coalition outside the controlling shareholder don't have any effect to earning management practice in the company. Control variable like coverage analyst and debt don't have any effect either, to earning management practice existence.
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
Effects of Corporate Governance Variables on Earnings Management in Indonesia
2012
To determine the effects of corporate governance on earnings management, this paper analyzed 171 annualreports from issued 2006 to 2009 by 57 non-financial, joint stock companies implementing GCG (GoodCorporate Governance) practices, which were listed on the Indonesia Stock Exchange (IDX). Six corporategovernance variables (board composition, independent commissioners, separate chairman/CEO roles, auditcommittee, managerial share ownership, and audit quality) as well as three control variables (leverage, size,and ROA) were used. The results showed that two corporate governance variables significantly influencedearnings management practices (separate chairman/CEO roles and managerial share ownership); the othervariables had no effect because these companies used GCG practices only to follow regulations rather than tomonitor and control.
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.
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.
Earnings Management: Evaluation of Audit Committee Activity in Indonesia
Substansi: Sumber Artikel Akuntansi Auditing dan Keuangan Vokasi
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...
Corporate Governance: Actors & Players eJournal, 2017
In the preparation of accrual basis accounting financial statements are selected because it can reflect the company's financial condition directly. Policymakers provide flexibility for management to be able to choose the accounting standards applied to the company. Management takes advantage of the freedom of selection of certain accounting policies in order to provide good earnings reporting in the financial statements. This study aims to analyze the effect of firm size and good corporate governance (GCG) to earnings management with moderation variables that is audit quality. This research is a quantitative research using secondary data. The sample selection was done by purposive sampling method and the data processing method using hypothesis analysis and multigroup analysis. The data used is obtained from Indonesia Stock Exchange and processed by using Smart PLS. The results showed that firm size variables did not significantly influence positively to earnings management but t...
Humanities and Social Sciences Letters, 2022
The issue of misreporting financial data and earnings management has become more prominent in recent years. Several studies have been conducted determining the influences of the mechanisms of corporate governance and earnings management in various countries. In this study, it was proven that the existence of a good corporate governance (GCG) mechanism did not suppress earnings management practices in the banking sector industry in Indonesia. However, another factor, dividend policy, can prove effective in suppressing earnings management. The measurement of earnings management in this study was carried out using the Modified Jones model with a population of 43 conventional banks from which research data were taken using a purposive sampling technique sourced from the Indonesia Stock Exchange (IDX). The analysis was carried out using multiple linear regression. The implication of this research is that the implementation of good corporate governance by an entity must be considered give...