Earnings Management Variables Research Articles

The Impact of Earnings Management, Leverage, and Profitability on Tax Avoidance in Mining Sector Companies

Taxes help the country develop in education, health, industry, and more. Since taxes are a major source of state revenue, the government prioritizes tax payment. Industrial taxpayers should follow appropriate norms and correct accounting principles to avoid violating government or country tax legislation. This research aims to study and assess the influence of profitability, leverage and earnings management on tax avoidance in mining companies listed on the Indonesia Stock Exchange (BEI). The focus of this research is on the group of companies in the mining sector listed on the BEI during the period 2019 to 2023. A saturated sampling technique, or often referred to as a census, is used in this research, where all 62 companies in the population are included as samples for a continuous period of 5 years. , resulting in a total of 310 observations. The results of hypothesis testing show that the earnings management, leverage and profitability variables together have a significant influence on tax avoidance. Earnings management, leverage, and profitability each have a large and positive impact on tax avoidance practices. This research is aimed at providing valuable insights and a complete understanding of tax evasion, with the aim of assisting stakeholders, including the government, in making the right decisions and formulating effective tax control laws.

ERP implementation and earnings management: The moderating effect of an independent board of commissioners

This research examines the moderating effect of the Independent Board of Commissioners on the relationship between implementing an enterprise resource planning system (ERP) and earnings management in non-financial companies in the Indonesia Stock Exchange. The earnings management variable is proxied through discretionary accruals, which refer to the calculation of the modified Jones model. This research used panel data from 85 companies from 2017 – 2020 to obtain a sample of 340. Employed the moderated regression analysis, the research finds that ERP implementation significantly influences the decline in earnings management. At the same time, the Independent Board of Commissioners can strengthen the relationship between the implementation of ERP systems and earnings management. This study contributes to expanding literature related to company information systems by providing evidence of the influence of ERP implementation on earnings management and how the Independent Board of Commissioner contributes to the relationship.

PENGARUH LOAN TO DEPOSIT RATIO, NON PERFORMING LOAN, DEBT TO EQUITY RATIO, MANAJEMEN LABA TERHADAP KINERJA KEUANGAN BPD 2018-2022

This research aims to analyze the influence of financial ratios and earnings management on bank financial performance which is projected using ROA. Financial ratios include LDR, NPL, DER. This research usesnon-probability sampling with typepurposive sampling to retrieve population data from the financial reports of Regional Development Banks registered with the OJK for 2018-2022. The data analysis methods used are descriptive statistics, classical assumption testing, multiple linear regression analysis, hypothesis testing and determinant coefficient analysis (R2). The results of this research show that the NPL variable partially influences financial performance, while the LDR, DER and earnings management variables have no influence on financial performance. Meanwhile, simultaneously the LDR, NPL, DER and earnings management variables have no effect on financial performance. Based on the results of the coefficient of determination (R2), the contribution of the independent variable to the dependent variable has a value of 34.1%.

Real earnings management, CEO experience, family ownership, and external audits: A meta-analysis

This article analyses the relationship between real earnings management (REM) and corporate governance variables, including family ownership, external audit quality, and CEO experience. The studies analysed were published between 2006 and 2021. The Sarbanes-Oxley Act of 2002 and the implementation of international financial reporting standards have led companies to reduce the use of accrual earnings management (AEM), and instead adopt real earnings management. However, many authors claim that using REM might harm a company’s long-term wellbeing, which accentuates the need to study the determinants of REM. The variables analysed in this paper are extensively covered in the literature, however, there is still ambiguity regarding their relationship with REM due to conflicting findings; some studies indicate a positive relationship, while others show a negative one. To resolve this ambiguity, meta-regression analysis is employed. The results indicate a positive relationship between family ownership and REM. This highlights the need to explore other forms of ownership to determine the most effective ownership structure that does not increase REM. This is of interest to legislators. The results provide no evidence to support the statistical or economic significance of CEO experience and external audit in relation to REM.

Managerial Ownership as a Controller of Earnings Quality in Jakarta Islamic Index 70

Profit is declared quality if it is consistent, does not fluctuate, and can predict the following year's profit. Companies with low levels of profit fluctuation pose managerial challenges because various factors influence the rise and fall of profitability. This research aims to determine the effect of earning Management on Earning Quality with Managerial Ownership as a Moderating Variable in Jakarta Islamic Index 70 (JII70) Companies for the 2019-2021 Period. This research uses the Moderated Regression Analysis (MRA) method in the form of panel data with purposive sampling techniques. The sample used was 18 companies registered in JII70 for the 2019-2021 period. The analytical methods used include descriptive statistical tests, stationarity tests, panel data regression tests, coefficient of determination (R2), F tests, T tests, classical assumption tests, and MRA tests. The research results show that the Earnings Management variable has a negative and significant effect on Earnings Quality. and the Managerial Ownership variable can moderate the influence of Earnings Management on Earnings Quality.

Earnings Management, Leverage, Good Corporate Governance, And Tax Avoidance

The purpose of this research is to analyze the influence of earnings management, leverage and good corporate governance against tax avoidance. The sample used in this research is raw materials sector companies listed on the Indonesia Stock Exchange (IDX) during the period 2019 until 2022. The population of this research is 97 companies in the raw materials sector. The sampling technique used is purposive sampling So the total sample used in this research was 16 companies in the raw materials sector. The design of this research is causality which looks for the influence of cause and effect relationships. The data analysis technique in this research uses multiple linear regression analysis. The results of the research indicate that partially the earnings management and good corporate governance has no effect on tax avoidance, while the variable leverage has a positive effect on tax avoidance. Earnings management variables, leverage, and good corporate governance simultaneously influences tax avoidance.
 
 Keywords: Earnings Management, Leverage, Good Corporate Governance, Tax Avoidance

The Influence of Financial Performance And Earning Management on Firm Value (Case Study in the Food And Beverage Industry)

This study aims to analyzes the influence of financial performance and earnings management on company value with the research object being food and beverage companies listed on the Indonesia Stock Exchange (BEI) with an observation period of 2017-2021 Secondary data was obtained from the IDX website, five periods of financial reports were obtained from 41 companies, using a purposive sampling technique, only 24 companies remained. The analysis method uses multiple linear regression with the help of the SPSS program. The independent variables in this research are financial performance and earnings management, with firm value as the dependent variable. The results of this research indicate that the financial performance variable has a significant positive effect on firm value. Likewise, the earnings management variable has a significant positive effect on firm value. Companies need to maintain performance and carry out good earnings management so that firm value is also good.

Income smoothing in Brazilian credit unions: the effects of default

Purpose: This research aims to analyze whether credit unions manage their accounting results in order to smooth them through the provision for doubtful accounts (income smoothing), from a default perspective.
 Methodology: The sample reaches 938 unique cooperatives considering the period from December 2010 to December 2018, with data from the Central Bank of Brazil, tested using the multiple regression statistical technique, in quarterly panels.
 Results: The variation in the stock of credit operations and the adjusted net income were not statistically significant in the model, however it was not possible to accept the hypothesis that credit unions use the allowance for loan losses (PCLD) as a mechanism for managing results. The interest rate implicit in the result of income from credit operations was significant, and therefore related to the PCLD variation, while the condition of free admission did not show statistical significance. The variation in default was significant in the model, with a negative coefficient, implying consistency with the earnings management hypothesis, since in a scenario of higher default (risk) the relationship is negative and, therefore, PCLD levels are lower, avoiding potential negative results.
 Contributions of the Study: The results indicate the absence of earnings management by PCLD in the sample and period, contributing to the discussion of the relationships between earnings management variables. This enables credit unions to reflect on their internal corporate governance structure. In addition, the evidence contributes to the progress of the literature on earnings manipulation in credit unions, for which there are few studies available and play an important role in the Brazilian market, ensuring funding flows to economic sectors not served by traditional banking institutions.

기업의 ESG 활동이 이익조정에 미치는 영향

[Purpose]This study emphasizes the importance of ESG (Environmental, Social, and Governance) management, proposing that it provides incentives for companies to achieve transparent and sustainable management. The study aims to analyze the impact of ESG management on corporate earnings management, particularly focusing on the effect of one financial characteristic, the Return on Sales (ROS), and how ESG influences this relationship. [Methodology]The study utilizes ESG rating data publicly disclosed by the Korea ESG Standards Authority from 2015 to 2022, focusing on manufacturing companies with available ESG ratings. The discretionary accruals were measured using the Jones model as the earnings management variable, and ROS was used to reflect financial characteristics. [Findings]The study found that ESG management tends to reduce corporate earnings management activities. Moreover, while companies with higher ROS were found to engage in more earnings management, the interaction between ROS and ESG management, particularly in terms of ESG integration, environmental (S), and governance (G) components, showed a negative relationship with earnings management. This suggests that ESG management contributes to reducing earnings management. [Implications]The study suggests that ESG management plays a crucial role in enhancing financial transparency and ethical standards in corporations. It was observed that companies with higher total sales profitability, when implementing ESG management, tend to show a decrease in earnings management activities. This indicates that ESG management can be a vital tool for enhancing financial soundness and transparency.

What Drives the Impact of Corporate Governance on Firm Value? Evidence from Earnings Management at Indonesian Sharia Stock Index (ISSI)

Purpose: This study sought empirical evidence on the impact of corporate governance as proxied by the board of commissioner's size, managerial ownership, and audit quality on firm value using earnings management as an intervening variable in energy sector companies indexed by the ISSI and listed on the Indonesia Stock Exchange from 2014 to 2022. Methodology: This study uses purposive sampling technique and panel data, resulting in 171 selected sample data units that will be processed using eviews. Findings: Managerial ownership, audit quality, and earnings management all have a significant and beneficial impact on firm value. However, the board of commissioners has a negative impact. Aside from that, the board of commissioners's size and managerial ownership do not affect earnings management, but audit quality has a negative effect. Earnings management as an intervening variable influences corporate governance variables. Novelty: This research attempts to provide a novel viewpoint on how political instability in a country can affect the investment climate in the Indonesian energy sector, which has received little attention previously. This study also acknowledges the inconsistency of previous research findings regarding the relationship between corporate governance and firm value, paving the way for incorporating earnings management variables as mediators and ultimately contributing to our understanding of the complex dynamics between these elements.

The Effect of Corporate Social Responsibility on Tax Avoidance: The Moderating Role of Earnings Management

This research was conducted to analyze and prove the partial effect of corporate social responsibility on tax avoidance and to analyze and prove the effect of earnings management variables in moderating corporate social responsibility on tax avoidance. The research design is a multiple linear regression analysis and Moderated Regression Analysis (MRA) using the SPSS version 25 program. The subjects are the food and beverage sub-sector companies listed on the Indonesia Stock Exchange (BEI). 19 companies meet the criteria to be used as a sample. The results show that: corporate social responsibility has no significant effect on tax avoidance. Meanwhile, Earnings Management significantly strengthens the moderate effect of corporate social responsibility on tax avoidance.

THE INFLUENCE OF INDEPENDENT COMMISSIONERS, AUDIT QUALITY, AND FINANCIAL DISTRESS ON EARNINGS MANAGEMENT

Earnings management is a series of actions taken by company management to increase reported earnings in a certain accounting period, without corresponding growth in the company's long-term earnings. This is done by managers to satisfy personal interests or boost the market value of the company so that it will look profitable for users of financial information. This study aims to empirically examine the effect partially and simultaneously between the independent variables of independent commissioners, audit quality, and financial distress with the dependent variable of earnings management. The population of this study are manufacturing companies listed on the Indonesia Stock Exchange for the period 2021-2022. The sampling technique used is simple random sampling method with the final sample being 100 sample companies with a total of 200 observational data. The data analysis technique in this study used multiple linear regression analysis and the data was processed with the help of the SPSS Version 25 program. The results of this study indicate that independent commissioners partially had a significant negative effect on earnings management, audit quality partially had no effect on earnings management, and financial distress partially had a significant positive effect on earnings management. The results of research by independent commissioners, audit quality, and financial distress simultaneously have an influence on earnings management.

Influence of Firm size on Audit Quality and Earnings Management Relationship: Evidence from Listed Manufacturing Firms in Nigeria

The study investigated the influence of Firm size on the relationship between Audit quality and Earnings Management of listed Consumer Goods Manufacturing firms in Nigeria. This study tested a number of audit quality indicators (auditor’s tenure, Audit firm size and joint audit) and earnings management proxies that is (earnings restatement and discretionary accruals), using 26 listed consumer-goods manufacturing firms as the study population. Secondary data were extracted from the annual report of 13 listed consumer-goods manufacturing firms while judgmental sample from the population, covering the study period from 2012 to 2018 using historical data were adopted. The data were tested through the use of Univariate, Bivariate and Multivariate analysis. Univariate/descriptive, Bivariate, Pearson Product Moment Correlation (PPMC) techniques by use of E-view 10 Econometric software and Multivariate – regression model. The findings of the study showed that firm size variability does not influence every aspect of the Firm's attributes. Some aspects of Firms' characteristics are influenced by the size of the Firm whereas some other aspects do not respond to size variability. As was indicated by the Firm size analyses, earnings restatement of consumer-goods manufacturing firms does not respond to Firm size attribute while their discretionary accrual practices significantly depend on their size attributes. The study concludes that firm size is a significant moderator between the use of audit quality and earnings management, however it depends of the variable of earnings management used. In the light of these, it is the recommendation of this study that to ensure positive significant relationship with earnings management, the firms should voluntary engage two audit firms in all to other to allow for effective comparison, so that hidden information in financial statement could be dictated or revealed; the total assets as a dimension of firm size should be r

The Association Between Changes in Key Audit Matters and Earnings Management Behavior in Companies

Abstract Auditing Standards No. 58 “Communication on Critical Audit Issues in Auditing Report” in April 12, 2016. These new standards effect and regulate public listed companies to keep step with international auditing standards starting from Year 2016. The purpose of this study is to explore the relationship between the changes in key audit matters and earnings management, and to understand the relationship between the changes in key audits and the degree of corporate earnings management. The results of the study show that after controlling the endogenous nature of earnings management variables through the two-stage method of instrumental variables, the degree of earnings management is significantly negatively correlated with the change in the number of accounting items disclosed in the key audits of the auditor's audit report. That is to say, when the degree of management of earnings management is higher, the possibility that the number of items of key check items increases is lower, When the degree of management of earnings management is higher, the probability of the number of items for key check items is reduced. and the tendency is not to change the disclosure items of key check items. Keywords: Key audit matters, Endogeneity, Earnings management.

Analysis of Profit Management in Agricultural Companies in the Plantation Sub Sector Listed on the Indonesia Stock Exchange, Through PPH Rates and Tax Planning

This study aims to determine whether the corporate income tax rate and tax planning have a significant effect on earnings management in agricultural companies in the plantation sub-sector listed on the Indonesia Stock Exchange. The population in this study are plantation sub-sector companies listed on the Indonesia Stock Exchange as many as 19 companies. The research sample was 6 companies with purposive sampling technique. The results showed that corporate income tax rates had no significant effect on earnings management in plantation sub-sector companies listed on the Indonesia Stock Exchange, while tax planning had a significant effect on earnings management in plantation sub-sector companies listed on the Indonesia stock exchange. The results of the F test show that the variables of Corporate Income Tax Rate and Tax Planning have a significant effect on Earning Management in plantation sub-sector companies listed on the Indonesia Stock Exchange. The results of the coefficient of determination test indicate that the Earnings Management variable can be explained by the Corporate Income Tax Tariff and Tax Planning variables, while the remaining Earnings Management variables can be explained by other variables not examined in this study such as Leverage and Financial Performance.

Analisis Determinan Tax Avoidance Pada Perusahaan Sub Sektor Farmasi

Purpose: Tax avoidance is a legal practice because it is carried out using procedure that do not violate tax law and regulation. Even so, wen companies implement tax avoidance, the state revenue can be reduced from the intended target. The study aimed to determine the effects of Profitability, Earnings Management, Solvency; Capital Intensity; and Inventory Intensity on Tax Avoidance. Methodology/Approach: Quantitative data were used in study. The samples used were 7 pharmaceutical subsector manufacturing companies listed on the IDX 2017-2022 with purposive sampling techniques, so that 42 data were obtained. The analysis technique used multiple linear regression with the SPSS program version 25. Findings: The results partially show that Profitability, Capital Intensity, and Inventory Intensity affect Tax Avoidance. The Earnings Management and Solvency variables had not affect on Tax Avoidance. Simultaneously the variables of Profitability; Earnings Management; Solvency; Capital Intensity; and Inventory Intensity affect Tax Avoidance.

PENGARUH LEVERAGE, UKURAN PERUSAHAAN, DAN PERGANTIAN CEO TERHADAP MANAJEMEN LABA PERUSAHAAN PERBANKAN

This study analyzes the effect of Leverage, Firm Size, and CEO Turnover on Earnings Management. This study took sample data from the financial reports and notes on the financial statements of banking companies listed on the Indonesia Stock Exchange (IDX) in the period 2017-2021, with a total sample of 195 samples from 39 companies. Discretionary accruals with the Modified Jones Model measure earnings management variables. The analytical method used in this research is panel regression and uses the EViews analysis program. The study results show that the variables of leverage and CEO turnover have no effect on earnings management. Meanwhile, the firm size variable significantly negatively affects earnings management.

Pengaruh Free Cash Flow dan Financial Distress Terhadap Manajemen Laba pada Perusahaan Infrastruktur, Utilitas, dan Transportasi Terdaftar Di Bursa Efek Indonesia

Financial reports that show company profits and performance are profit and loss reports that are useful for stakeholders and investors to use in considering and estimating an investment or even in making contracts and estimating the viability of a company. Earnings management is one way that can be done. Manager intervention to carry out earnings management by increasing or decreasing profits to achieve a certain profit level to benefit himself or the company. This study aims to determine the effect of free cash flow and financial distress on earnings management. The sample for this study is infrastructure, utilities, and transportation companies listed on the Indonesia Stock Exchange for the 2019-2021 period. The total sample used was 29 companies with 87 observational data obtained. The sampling technique used was the purposive sampling method and testing was carried out with the help of Eviews software. The research results from the data used, for the classic assumption test, have passed the test and have met the established criteria. The results of the F test show that the earnings management variable is influenced simultaneously by the free cash flow and financial distress variables. The results of the t-test show that free cash flow and financial distress have a significant value on earnings management. This study concludes that free cash flow and financial distress have a positive effect on earnings management.

Are Chinese or US Institutional Investors Better at Monitoring Corporate Earnings Management? Evidence from Chinese Stocks in the US Cross‐Listing Market

AbstractIn this study, we empirically analyze Chinese firms listed on US exchanges to examine the standalone effects of geographic and market proximity on equity performance. In this regard, we find a negative association between Chinese institutional investors domiciled in the same country where investee firms are incorporated and improved earnings management. However, we find no significant relationship between US institutional ownership and earnings management. Hence, our findings support the geographic rather than the market proximity advantage. Furthermore, the geographic proximity advantage is more substantial in firms with high information opacity, and the results are not altered by choice of earnings management variables.

Pengaruh Asimetri Informasi, Ukuran Perusahaan dan Kepemilikan Manajerial Terhadap Manajemen Laba

This study aims to determine the effect of information asymmetry, firm size and managerial ownership on earnings management. This research uses quantitative research. The data analysis technique used descriptive statistical analysis, data quality test and hypothesis testing. Earnings management variable is measured using Discretionary Accruals, information asymmetry is measured by bid-ask spread, firm size is measured using the natural logarithm of total assets, managerial ownership is measured by the percentage comparison of the number of managers' shares with the number of shares outstanding in the company. The population in this study are manufacturing companies listed on the Indonesia Stock Exchange in 2018-2020. Sampling was done by purposive sampling method, with a total sample of 237 data. The results of this study indicate that information asymmetry has no effect on earnings management, while firm size and managerial ownership have a negative and significant effect on earnings management.