The Determinant Factors of Earnings Quality and Economic Consequences

Abstract

Penelitian ini bertujuan untuk mendiskusikan faktor-faktor penentu kualitas laba dan konsekuensi ekonomi di pasar modal Indonesia. Faktor-faktor tersebut adalah bawaan, kinerja, risiko perusahaan, dan risiko industri. Kualitas earning diukur menggunakan atribut kualitas akrual, persistensi, prediktabilitas, kelancaran, dan kualitas earning faktorial, sedangkan konsekuensi ekonomi diukur menggunakan varians residual sekuritas. Penelitian ini menggunakan data sekunder berupa laporan keuangan perusahaan mulai tahun 2005 hingga 2010. Penelitian menggunakan tiga langkah pengujian, yaitu (1) pengujian atribut kualitas earning yang berbeda satu sama lain, (2) menganalisis faktor-faktor penentu kualitas earning dan (3) menguji pengaruh kualitas earning di pasar saham dalam konteks hubungan antara informasi asimetris dan kualitas earning. Hasil pengujian pertama menunjukkan bahwa semua dari empat atribut kualitas earning berbeda satu sama lain. Analisis faktor-faktor penentu menunjukkan bahwa variabel leverage memiliki hubungan yang signifikan dengan lima atribut kualitas earning, daripada penjualan dan ukuran perusahaan yang menunjukkan hubungan signifikan dengan empat atribut kualitas informasi earning. Variabel lain seperti siklus operasi, kinerja, dan klasifikasi industri menghasilkan dua atribut kualitas earning. Pengujian konsekuensi ekonomi menghasilkan tiga atribut kualitas laba yang memiliki hubungan signifikan dengan varians residual sekuritas yaitu atribut kualitas akrual, kelancaran, dan kualitas laba faktorial.

Effect of Audit Quality on Earnings Quality: Evidence From Indonesia Stock Exchange

“…The data were obtained from annual reports published by the Indonesia Stock Exchange and other supporting data sources. This research used the confirmatory factor analysis to determine the composite variable from four earnings quality attributes, made up of accrual quality, persistence, predictability, and income smoothing (Fanani, 2011;Francis et al, 2004;Pagalung, 2006). The regression analysis was conducted to test the influence of the independent variable on the dependent variable after performing tests for normality, autocorrelation, multicollinearity, and heteroscedasticity (Santoso, 2015).…”

“…Earnings quality refers to the capability of reported earnings to reflect the actual earnings of the company, as well as the usefulness of reported earnings to predict future earnings (Bellovary et al, 2005;Francis et al, 2004). Earnings quality is determined based on the results of confirmatory factor analysis of the four attributes of earnings quality in accounting base, made up of accrual quality, persistence, predictability, and income smoothing (Fanani, 2011;Francis et al, 2004;Pagalung, 2006).…”

Earnings and cash flow persistence: Case of medium agriculture enterprises in Serbia

“…The higher the regression beta coefficient of current earnings towards the future earnings shows the earnings persistence and the smaller the beta coefficient can mean the lower the earnings quality or, the higher the transitory earnings. The higher beta coefficient is closer to one, the smaller beta is closer to zero (Pagalung and Sudibdyo, 2018).…”

“…Earnings quality measures that we used refers to earnings persistence. Persistence is one of accounting-based earnings quality attributes, and it was measured by the regression coefficient of current earnings towards future earnings (Pagalung and Sudibdyo, 2018). "Greater earnings persistence is a meaningful definition for earnings quality only if earnings truly reflect performance during the period and if current-period performance persists in future periods" (Dechow and Schrand, 2004).…”

“…used residuals from accruals models approach to capture earnings management in Serbian agricultural companies. In the research ofPagalung and Sudibdyo (2018), the earnings quality, among other things, was measured by accrual quality Francis et al (2008). use absolute abnormal accruals for constructing earnings quality measure too, but also three other measures such as accruals quality, earnings variability, and a combined measure.MethodologyWe tested the persistence of selected earnings and cash flow-based indicators on the sample that includes the medium-sized agriculture enterprises.…”