Abstract
Empirical studies aims to prove that the selected independent and control variables are indicators of determining the cost of financial distress. The object of research is all public companies listed on the Indonesia Stock Exchange (IDX) which are classified into 8 (eight) sectors, except for the financial sector. Data analysis uses Panel Regression analysis on secondary data samples obtained from the company's annual financial statements for the period of 2016-2020. The findings found that there is a significant negative effect between change in investment, return on assets and firm size on the cost of financial distress. The variables of probability of financial distress, holding of liquid assets, liquidity ratio, change in employment, leverage, return on equity, tobin's q, average profitability of its sector do not have a significant relationship to the cost of financial distress. Recommendations for future researchers are suggested for future research coverage not to occur during a pandemic. It is advisable for the next research to separate research that occurred during the pandemic period or the time range during normal conditions so that the sample comparison is fairer.
Highlights
Abstrak: Studi empiris pada penelitian bertujuan membuktikan variabel independen serta variabel kontrol terpilih merupakan indikator penentu biaya kesulitan keuangan
The findings found that there is a significant negative effect between change in investment, return on assets and firm size on the cost of financial distress
Pengaruh signifikan negatif return on asset (ROA) sebagai representasi dari profitability ratio dikarenakan ketika perusahaan mengalami penurunan kinerja dengan akibat terburuk mengalami financial distress hingga kebangkrutan, hal ini akan memicu keputusan perusahaan untuk mengupayakan segala cara melewati masa kesulitan
Summary
Abstrak: Studi empiris pada penelitian bertujuan membuktikan variabel independen serta variabel kontrol terpilih merupakan indikator penentu biaya kesulitan keuangan. Sedangkan keuntungan dari leverage bagi perusahaan untuk bertahan di masa kesulitan keuangan, merupakan gambaran atas pengaruh yang tidak signifikan antara leverage dengan biaya kesulitan keuangan, hasil ini ditemukan pada penelitian Bulot et al (2014), Bulot et al (2017); dan John (2014).
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