Earnings Quality and Market Values of Indonesian Listed Firms

Hutagaol, Yanthi; Valentincic, Aljosa; Warganegara, Dezie Leonarda

doi:10.2139/ssrn.3128486

Cited by 2 publications

(2 citation statements)

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“…The results show a positive and meaningful relationship between EQ and business value, in which the aggregate income quality measure is based on seven income attributes (cumulative quality, sustainability, predictability, stability, relevance, timeliness and prudence). In that context, studies by Hutagaol, Valentincic, and Warganegara (2019) show that EQ is inversely significant to the market value of equity of companies listed on the Jakarta Stock Exchange. Latif, Bhatti, and Raheman, (2017) conducted a study of 214 non-financial listed companies in Pakistan between 2003-2014 that found that EQ affect is positive in maximizing the value of the company.…”

Section: Literature Reviewmentioning

confidence: 99%

Effects of Corporate Governance and Earning Quality on Listed Vietnamese Firm Value

Hung¹,

Pham²,

Nguyen³

et al. 2020

JAFEB

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The paper examines the influence of corporate governance (CG) and earning quality (EQ) on corporate value (FV) of Vietnamese enterprises. The study uses GLS regression and linear structure model using data collected from companies listing on the stock market in Vietnam during 2008-2018, with a total of 2,937 observations. The research results indicate that EQ and CG represented by the Integrated Board of Directors and the Integrated Supervisory Board have a positive effect on FV directly and indirectly. The results show that the Integrated Board of Directors has a positive effect on EQ, whereas the Integrated Supervisory Board has a negative effect on EQ. Based on the research results, we suggest that companies need to strictly comply and implement GC, so to bring down the agency cost and consequently to increase performance. The companies also should establish the Board of Director of a proper size, with financial and accounting specialty, and including women board members. The government also needs to improve the management mechanism asking for firms to prepare and publish financial statements with reliable company information, which could be provided to users. These recommendations are a useful basis to help businesses improve FV via changes in the corporate governance factors in each enterprise.

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Section: Literature Reviewmentioning

confidence: 99%

Effects of Corporate Governance and Earning Quality on Listed Vietnamese Firm Value

Hung¹,

Pham²,

Nguyen³

et al. 2020

JAFEB

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“…This study contributes to the IPO research area in two ways. Firstly, it expands upon the study by Hutagaol-Martowidjojo and Widyanto [17] by testing the impact of pre-IPO EQ, specifically accrual quality on IPO pricing during the early days of trading and secondly, it extends Boulton et al [16] study by providing evidence on EQ and underpricing at the firm level.…”

Section: Introductionmentioning

confidence: 78%

Pre-IPO Accrual Quality and Under-Pricing in the Indonesian Market

Hutagaol‐Martowidjojo¹,

Kim²

2021

Proceedings of the Conference on International Issues in Business and Economics Research (CIIBER 2019)

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This study investigates the relationship between pre-IPO firms' earnings quality that is proxied by accrual quality (AQ) prior to the IPO, and their underpricing degree in their early days of trading. Our main argument is that pre-IPO AQ is one source of information risk that affect the degree of information asymmetry among the issuing firms and potential investors. By the measurement, the higher AQ reflects lower quality of accrual. Using the regression models on a sample of 144 Indonesian IPO firms that went public during 2007-2017, this study finds that there is a positive relationship between the AQ and the underpricing degree. It implies that the higher the AQ (lower quality of accrual) of a firm, the higher the underpricing degree will be. In other words, the better the AQ of a firm, the lower the firm's information asymmetry will be in the market, resulting in a lower underpricing degree in the early trading days. Furthermore, our study extends and includes some control variables, namely market condition, public ownership, and underwriter reputation. The managerial implication of this study is that as firms prepare to go public it is important for the managers of firms to maintain a good accrual quality in order to decrease the market information asymmetry of their offerings.

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Earnings Quality and Market Values of Indonesian Listed Firms

Cited by 2 publications

References 0 publications

Effects of Corporate Governance and Earning Quality on Listed Vietnamese Firm Value

Effects of Corporate Governance and Earning Quality on Listed Vietnamese Firm Value

Pre-IPO Accrual Quality and Under-Pricing in the Indonesian Market

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