Abstract
The purpose of this study is to investigate the relationship between earnings quality and financing approach. In this study, target financial leverage surplus is as independent variables and earnings quality, financing through stocks, financing through debt as dependent variables and company size, growth opportunities of company and systematic risk are as control variables. The statistical population of the present study is companies active in Jakarta Stock Exchange according to the subject and its application. In this study, 90 companies were selected. The data of this study were collected annually using information from companies listed in Jakarta Stock Exchange from the beginning of 2014 to the end of 2016 and the results of hypotheses' test were presented. In this study, multivariate regression analysis with panel data with fixed effects was used to investigate the hypotheses. The results show that there is no significant relationship between leverage companies with high earning quality and equity financing and financing through stocks and there is no significant relationship between non-leverage companies with low earning quality and financing through stocks.
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