Persistence Of Profits Research Articles

Profitability and Earnings Persistence Drive Earnings Management in Manufacturing Firms

General Background: Earnings management significantly impacts stakeholders' decisions based on reported profits. Specific Background: This study examines the effects of profitability, accounting conservatism, liquidity, and earnings persistence on earnings management in manufacturing companies listed on the Indonesia Stock Exchange (IDX) from 2019 to 2023. Knowledge Gap: Previous research shows inconsistent findings, particularly regarding accounting conservatism and liquidity's effects, highlighting a need for further investigation. Aims: This research aims to clarify these influences within the Indonesian manufacturing sector. Results: Using quantitative analysis of 135 firms, findings reveal that profitability and earnings persistence positively affect earnings management, while liquidity negatively impacts it. Accounting conservatism does not significantly influence earnings management. Novelty: This study incorporates earnings persistence as a critical factor, contributing to existing literature. Implications: The results suggest investors should exercise caution in their decisions due to potential financial reporting manipulation and emphasize the need for improved transparency in financial reporting practices. Highlights: Profitability and earnings persistence positively influence earnings management, indicating a tendency for managers to adjust earnings when profits are high. Liquidity shows a significant negative effect on earnings management, suggesting that firms with better liquidity are less likely to engage in earnings manipulation. Accounting conservatism does not significantly impact earnings management practices, highlighting a potential gap in the application of conservative accounting principles. Keywords: Earnings Management, Profit Persistence, Accounting Conservatism, Liquidity, Earnings Persistence

PENGARUH PRUDENCE, PERSISTENSI LABA, STRUKTUR MODAL DAN KEBIJAKAN DEVIDEN TERHADAP KUALITAS LABA

This research aims to provide empirical evidence regarding the influence of Prudence, Earnings Persistence, Capital Structure and Dividend Policy on Earnings Quality. The Quality of Earnings variable is measured by the Quality of Earnings Ratio, Prudence is measured by the KNSV Index, Earnings Persistence is measured by the Profit Persistence Index, Capital Structure is measured by DAR & Dividend Policy is measured by DPR. This type of research is quantitative research with a population of LQ45 companies registered on the IDX for 2018-2022. The sample in this study used a purposive sampling method, obtaining 17 companies. The data analysis technique uses multiple linear regression analysis methods using the Eviews 10 software program. The research results show that Prudence, Profit Persistence, Capital Structure and Dividend Policy simultaneously have a significant effect on Earnings Quality. Prudence partially has no effect on Earnings Quality. Partial Profit Persistence has no effect on Earnings Quality. Capital Structure partially has a significant positive effect on Earnings Quality. Dividend Policy partially has no effect on Earnings Quality.

The Influence of Profit Persistence, Capital Structure, and Dividend Policy on Earnings Quality

This research is motivated by the fact that currently profit is very important for investors and other users of financial reports to understand. Quality profits can be used to make the right decisions, therefore profits are still very important to discuss. This study aims to analyze the effect of profit persistence, capital structure, and dividend policy on earnings quality. This type of research is quantitative research with secondary data sources. The population in this study is 75 energy sector companies listed on the Indonesia Stock Exchange in 2018-2022. The sample selection method used in this study is purposive sampling so that the final sample obtained by this method is 14 companies with 5 years of research obtained 70 data. The research results show that simultaneously the variables of profit persistence, capital structure and dividend policy have an effect on earnings quality. Then, partially, the earnings persistence and capital structure variables have no effect on earnings quality. Meanwhile, the dividend policy variable influences earnings quality. Based on the research results, it can be concluded that companies that have increasingly consistent profits and companies that use funds originating from debt will not influence the high or low quality of the profits produced by the company, while companies that have a higher dividend policy will have a higher quality of profits produced by the company.

Peran Kepemilikan Manajerial Memoderasi Tingkat Hutang, Ukuran Perusahaan, Arus Kas Operasi Terhadap Persistensi Laba

This study uses management ownership as a moderating variable to examine the effects of debt levels, firm size, and operating cash flow on earnings persistence. Quantitative approaches are employed in this study. Up to 80 samples were selected via purposive selection, with the population of this study consisting of industrials sector companies listed on the Indonesia Stock Exchange in 2019–2022. Multiple linear regression analysis models and moderated regression analysis (MRA) were used for the hypothesis testing, with the moderator variables being tested. The results of this research based on partial testing (t test) probability value of the debt level variable is 0.008. The firm size variable is 0.032. The operating cash flow variable is 0.160. The managerial ownership variable is 0.014. The degree of debt and management ownership have an interaction variable of 0.016. The interaction variable between firm size and managerial ownership is 0.010. Additionally, managerial ownership and operating cash flow interact with a coefficient of 0.132. Known that debt levels and firm size have positive effect on profit persistence, while operating cash flow has no effect on profit persistence. The moderating effect of managerial ownership can amplify the favorable impact of debt levels on earnings persistence. However, the favorable impact of company size and operating cash flow on earnings persistence cannot be amplified by managerial ownership

Do Institutional Ownership, Managerial Ownership, Independent Commissioners and Audit Committees Affect Earnings Persistence of Listed Manufacturing Companies Listed in Indonesia?

The issue of earnings persistence refers to the company's challenges in maintaining stable and consistent profits over time, especially in business. This research examines the influence of institutional ownership, managerial ownership, independent commissioners and audit committees on the persistence of profits of manufacturing companies listed on the Indonesia Stock Exchange (BEI). The sample in this research was 26 manufacturing companies from 2014 - 2022. A purposive sampling method was used to determine the quantitative research sample. The data analysis technique in this research uses descriptive statistical analysis and partial hypothesis testing. The analytical method in this research is by using multiple linear regression analysis. This research shows that institutional ownership, managerial ownership, independent commissioners, and audit committees significantly affect earnings persistence. The discussion of this research will be explained further in the following description.

DETERMINANTS OF EARNINGS PERSISTENCE LITERACY STUDY MANUFACTURING IN INDONESIA

This research aims to analyze the impact of industry type, debt levels, and sales volatility on a company's ability to predict and maintain profits over time. Because profit persistence is the main determinant of the sustainability of a company's profitability and the quality of its financial reporting, this research is very important. The research population is manufacturing companies listed on the Indonesia Stock Exchange in 2019 and 2022. Purposive sampling is the approach used for sampling, and a total of 23 companies or 83 observations for the sample were selected. Multiple linear regression analysis is the analysis method used. The research results show that company size, as a control variable, has a positive impact on earnings persistence, sales volatility has a negative impact, while debt level and industry type have a positive effect on earnings persistence. Overall, this research has significant consequences for decision making, financial statement analysis, and profit prediction for future periods.

Pengaruh Book Tax Differences Dan Tingkat Hutang Terhadap Persistensi Laba Pada Perusahaan Sektor Perbankan Yang Terdaftar Di Bursa Efek Indonesia Periode 2019 - 2023

In the decision-making process, information about profits plays an important role. The right decision often depends on the quality of the earnings information itself. Quality profits are profits that can provide an accurate indication of future porfit estimates. Consistency in earnings indicates superior earnings quality over time. In addition, differences between recorded profits in books and profits subject to tax (book tax differences) can affect profit persistance due to differences in the recognitions of incopme and costs according to accounting standards and tax regulations. Apart from that, another factor that also has the potential to influence profit persistence is the company’s debt level. In an effort to explore the impact of book tax differences, as well as debt levels on earnings persistence, this research was conducted with a clear aim. The method in used is a careful quantitative approach. The population studied included companies in the banking sector listed on the Indonesia Stock Exchange (BEI) during the period 2019 to 2023. The sample selection procedure was carried out using SPSS 26 software to analyze the patterns that emerged. From the results of the analysis that has been carried out, it was found that there is a significant and positive influence between the difference between profit recognition in financial statements and tax imposition on the resilience of company profits. On the other hand, ther is no significant relationship between the level of company debt and earnings resilience measured in this research.

DETERMINASI PERSISTENSI LABA: Peran Volatilitas Penjualan, Arus Kas Operasi, dan Tingkat Hutang pada Sektor Properti dan Real Estate di Indonesia

Profit persistence can be interpreted as the possibility that a company's profit level will repeat itself in the future. This study aims to determine the effect of sales volatility (X1), operating cash flow (X2) and debt levels (X3) on profit persistence (Y) in Properties and Real Estate companies listed on the Indonesia Stock Exchange for the 2017-2021 period. Sampling in this study used a purposive sampling technique and obtained 13 sample companies. The data analysis method used is quantitative data analysis, namely using panel data regression analysis and using the EViews 12 tool. The results of this study indicate that partially operating cash flow has an effect on earnings persistence. Meanwhile, sales volatility and debt levels partially have no effect on earnings persistence. Meanwhile, simultaneously sales volatility, operating cash flow and debt levels affect earnings persistence with an R2 contribution of 21.35%.

Momentum Investment Strategies across Time and Trends: A Review and Preview

Background: This study provides a bibliometric analysis of momentum investment strategies, examining their historical evolution, behavioral dynamics, and the challenges faced by professionals in equity markets. It aims to explore the persistent profitability of momentum strategies amidst market fluctuations and the significant influence of behavioral biases on trading decisions. Methods: Employing a Bibliometric Analytical framework, the study systematically maps the knowledge structure of momentum investment strategies. It utilizes the Dimensions database for scholarly journal searches and examines peer-reviewed research publications spanning from 1993 to 2024. This method enables the identification of key research works, emerging trends, and an assessment of the literature's impact. Results: The research reveals the persistent profitability of momentum strategies despite market changes, highlighting the significant role of behavioral biases in trading decisions. This work contributes to both academic discourse and practical investment strategy development, offering insights into exploiting momentum's transformative potential in dynamic equity markets. Conclusion: This study contributes to both academic discourse and practical investment strategy development by offering evidence-based insights into the effectiveness of momentum strategies. It identifies research gaps, suggests new directions for future studies, and analyzes collaboration networks to enhance interdisciplinary research efforts. Novelty: The utilization of a Bibliometric Analytical framework in studying momentum investment strategies brings a novel approach to the field. This method not only offers a systematic mapping of knowledge but also facilitates the identification of influential research works and emerging trends, guiding both academic research and practical applications.

The Influence of Book Tax Gap and Sharia-Compliant Tax Planning on Profit Persistence in Halal Consumer Goods Companies Listed on the Indonesian Stock Exchange

The Influence of Book Tax Gap and Sharia-Compliant Tax Planning on Profit Persistence in Halal Consumer Goods Companies Listed on the Indonesian Stock Exchange

Market Structure, Profitability and Regulation of Telecommunication Industry in India

The telecom industry in India has witnessed exponential growth in the past decade; however, its profitability has been on the decline post 2008. This study analyzes the determinants of profitability of the industry during 2010–2022 using the conventional structure-conduct-performance paradigm. We estimate a dynamic panel data model to understand the role of endogeneity and profit persistence in the industry. Our findings are contrary to what the theory predicts and highlight the importance of the regulatory and institutional framework of the industry. Results suggest that there is profit persistence in the industry. The study finds that among conduct variables, export intensity has a positive impact while selling intensity has a negative impact on profitability. While size is not significant, concentration has a negative impact on profitability. Import has a negative impact on profitability. These results suggest that as the telecom industry transitioned from a monopoly to an oligopolistic market with players competing in different domains and services, selling and advertisement intensity has diminishing returns to profitability while export intensity emerges as an important driver of profitability. Results also suggest the importance of the production-linked incentive scheme encouraging exports and the need for regulating concentration and encouraging import substitution.

PENGARUH PERSISTENSI LABA, INVESTMENT OPPORTUNITY SET, DAN STRUKTUR MODAL TERHADAP KUALITAS LABA PADA PERUSAHAAN SEKTOR FOOD AND BEVEREGAE YANG TERDAFTAR DI BURSA EFEK INDONESIA

The purpose of this study is to test and analyze the effect of Earnings Persistence, Investment Opportunity Set ̧ and Capital Structure on Earnings Quality directly or through earnings quality variables. Quantitative research method, with the type of secondary data source obtained from the company's annual financial statements and sampling techniques using purposive sampling. The population in this study is food and beverage sector companies in 2019-2022 with a total population of 88 companies. The results of this study show that Earnings Persistence has no effect Earnings Quality, Investment Opportunity Set has a positive effect on Earnings Quality, Capital Structure has a positive effect on Earnings Quality, and Profit Persistence, Investment Opportunity Set, and Capital Structure simultaneously effect Earnings Quality.

The Effect of Profit Persistency, Business Risk and Capital Structure on Earnings Return Coefficient with Good Corporate Governance as Moderating Variable

This research aims to analyze the impact of profit persistence, business risk, and the form of capital on the earning return coefficient. This research attempted to quote inferior information from the Indonesian Stock Exchange for the 2014-2020 period. The population in this research is the industrial zone listed on the Indonesian Stock Exchange throughout the 2016-2020 period. The research population is 56 industries. The sample collection method used was purposive sampling. The research sample consisted of 40 industries. The analysis used in this research uses multiple linear regression using SPSS. The research results prove that profit persistence and business risk have no effect on ERC, on the contrary, DER has an effect on ERC. The GCG variable weakens the relationship between profit persistence and business risk on ERC, but GCG strengthens the influence of DER on ERC.

PENGARUH PERSISTENSI LABA, KUALITAS AUDITOR, DAN TATA KELOLA PERUSAHAAN TERHADAP BIAYA UTANG BUMN SEKTOR NON-KEUANGAN

This research purposes to ascertain how corporate governance, auditor quality, and profit persistence affect cost of debt. The information used in this study comes from the annual reports of non-financial sector state-owned companies that were included on the IDX between 2017 and 2022. Purposive sampling was used to choose the sample for this investigation, yielding up to 52 data points from a total of 102 data points. Multiple linear regression analysis was employed in this study's data analysis. The findings revealed that corporate governance has a negative impact on the cost of debt whereas earnings persistence has a positive impact. Meanwhile, the quality of auditors has no influence on the cost of debt.

Analysis Of Discretionary Accrual, Differences In Profits, Cash Flow And Fiscal Profits On Profits Persistence Of National Manufacturing Companies Listed In Indonesian Stock Exchange

This study examines the effects of cash flow, discretionary accruals, and accounting profit on the persistence of profits in manufacturing enterprises. Manufacturing firms registered on the Indonesian Stock Exchange make up the study's population. Purposive sampling was the technique employed for sample selection. Secondary data, specifically financial reports of manufacturing firms that have gone public and are listed on the IDX, is the type and source of data used in this study. Descriptive statistics and multiple regression are the statistical techniques used to examine data and test hypotheses. Profit persistence is significantly harmed by the discrepancy between accounting profit and fiscal profit, which serves as a stand-in for deferred tax expense. Earnings permanence is significantly harmed by discretionary accrual. Profit persistence is significantly influenced favorably by operating cash flow. We can draw the conclusion that a company's earnings will last longer the higher its operating cash flow.

The Effect of Book Tax Differences, Operational Cash Flow to Earnings Persistence

One of the crucial functions of financial reports is to serve as a basis for evaluating performance and representing the condition of financial performance in an organization or company. Accrual financial reports are prepared based on established standards based on accounting principles, while fiscal financial reports are reports prepared based on tax regulations and used by parties with an interest in the tax collection process. The difference in the value of profit in the financial statements after the fiscal reconciliation is carried out for tax purposes based on the provisions of the tax regulations is what gives rise to the term book tax differences in tax analysis. Earnings persistence is current period earnings which reflects earnings in future periods. This study aims to analyze the effect of Book Tax Differences, Operating Cash Flow and Accrued Profits on Profit Persistence in Manufacturing Companies listed on the Indonesia Stock Exchange. The research object for manufacturing companies listed on the IDX for 2017-2021 is with a sample of 10 manufacturing companies selected using the Purposive Sampling technique. The results showed that the higher the large positive book tax differences, the better the company's profit persistence, while for large negative book tax differences, the higher the large negative book tax differences, the lower the earnings persistence. The higher the company's operating cash flow, the higher the profit persistence. the higher the accrual profit, it will not affect the persistence of earnings.

International Differences in Profitability*

We examine the global distribution of company profitability over the 30 years from 1989 to 2018 focusing on the international dimension. We find the international component of profitability differences first declines and then rises. Regression analysis of time‐series data shows that transitory shocks to international profitability differences mostly dissipate over a few years, although there is evidence of persistent profitability differences for many countries. Dividing the sample to accommodate a structural break, the rate of dissipation declines between 1989–2002 and 2003–2018 subperiods. The extent of persistent differences also declines, suggesting convergence of international differences in profitability may have reached its limit.

The Influence of Profitability, Company Size, and Profit Persistence on Earning Response Coefficient

This study aims to determine the effect of Profitability, Firm Size, and Earnings Persistence on the Earning Response Coefficient. The sample used in this study is the consumer goods sector companies listed on the Indonesia Stock Exchange from 2017- 2021, with a total sample of 16 companies that meet the sample criteria determined through the purposive sampling method. The independent variables of this study are profitability as proxied by the ratio of Return on Assers, firm size as measured by Natural Logarithms, and earnings persistence as measured by using the regression coefficient between earnings in the current period and earnings in the period that has passed. The dependent variable of this study is the Earning Response Coefficient as measured by Abnormal Return and several other stages. The results showed that : (1) Profitability has no significant positive effect on earning response coefficient, (2) the size of the company has a negative and significant effect on earning response coefficient, (3) Earnings persistence has a negative and significant effect on earning response coefficient.

Identification the Factors that Influence Profit Persistence

Profit quality is able to predict earnings in the future. Earnings persistence is an important topic of discussion because the information generated can be used by investors in determining earnings quality and firm value, thereby facilitating decision making. This study aims to determine the factors that influence profit persistence from the point of view of Audit Fee, Managerial Ownership and Institutional Ownership. The population of this study is all LQ45 companies registered at Indonesia Stock Exchange Period 2016-2022. Researchers used purposive sampling in the sampling technique so that 7 LQ45 companies were obtained with a total data of 49 data. The data used is secondary data. The analysis techniques in this study are descriptive analysis techniques, verification analysis with the classical assumption test, multiple linear analysis, analysis of the coefficient of determination, and hypothesis testing. The analytical tool in this study uses SPSS. The results of the study show that partially Audit Fee and Institutional Ownership has no effect on Profit Persistence, while Managerial Ownership has an effect on Profit Persistence. Simultaneously Audit Fees, Managerial Ownership and Institutional Ownership have no effect on Profit Persistence.

Uncovering genetic parameters and environmental influences on fertility, milk production, and quality in autochthonous Reggiana cattle

Reggiana is a local cattle breed from northern Italy known for its rusticity and profitability, due to the production of branded Parmigiano Reggiano cheese. To ensure the persistence of such profitability in the long term, an adequate breeding program is required. To this aim, in the present study we estimate the genetic parameters of the main productive and reproductive traits, and we evaluate the effect of genotype by environment interaction (GxE) on these traits using 2 environmental covariates: (1) productivity and (2) temperature-humidity index (THI). Milk, fat, protein, and casein yield were considered as daily production traits, whereas protein, fat, casein percentage, casein index, and somatic cell score were considered as milk quality traits. Finally, reproductive traits such as the number of inseminations, days open, calving interval, and calving-to-first-insemination interval were evaluated. Reggiana cattle produce an average of 19 kg of milk per day with 3.7% fat and 3.4% protein content and have excellent fertility parameters. Compared with other breeds, they have slightly lower heritability for production and quality for production traits (e.g., 0.12 [0.09; 0.15] for milk yield), but similar heritability for fertility traits. Milk, protein, and fat daily yields are highly correlated but negatively correlated with the percentage of protein, fat, and casein, whereas fertility traits have an unfavorable genetic correlation with daily production traits. When considering productivity, a consistent amount of variability due to GxE was observed for all daily production traits, somatic cell count, and casein index. A modest amount of GxE was observed for fertility parameters, while the percentage of solid content showed almost no GxE effect. A similar situation occurred when considering the THI, but no GxE interaction was observed for reproduction traits. In conclusion, this study provides useful information for the implementation of accurate selection plans in this local breed, accounting for environmental plasticity measured through the consistent GxE interaction observed.