The Effect of Intellectual Capital, Firm Size, and Capital Structure on Financial Performance Mediated by Exchange Rate in Personal Care and Household Companies

Abstract

This study aims to examine the effect of intellectual capital (VAICTM), firm size (Ln(TA)), and capital structure (DER) on financial performance (ROA) mediated by exchange rate in personal care and household companies listed on the Indonesia Stock Exchange (IDX) during the period 2016-2021 with a population of 9 companies. This study uses a comparative causal research type. The sampling technique of this study uses a non-probability sampling method using a saturation sample type, which is formed homogeneously by being selected based on predetermined criteria so that as many as five personal care and household companies for the 2016-2021 period were obtained. This study uses a quantitative data analysis technique to acquire secondary data from the company's financial statements using the SPSS application program version 25. The results of this study show that intellectual capital (VAICTM) has a positive and significant effect on the financial performance of personal care and household companies, the firm size (Ln(TA)) has a positive and significant effect on the financial performance of personal care and household companies, while capital structure (DER) has a negative and insignificant effect on the financial performance of personal care and household companies. Moreover, intellectual capital (VAICTM) mediated by exchange rate has a positive and significant effect on the financial performance of personal care and household companies, the firm size (Ln(TA) mediated by exchange rate has a positive and significant effect on the financial performance of personal care and household companies, while capital structure (DER) mediated by exchange rate has a negative and insignificant effect on the financial performance of personal care and household companies.