Determinants of Earnings Management in Indonesian Manufacturing Companies

Abstract

This study aims to prove the factors that affect earnings management in manufacturing companies that go public on the IDX for the 2017-2021 period. The population of this study is 214 companies. The research sample was selected using the purposive sampling method, with certain criteria. A sample of 60 companies with a research period of 5 years was obtained, resulting in a total of 300 research samples. The analysis technique used is multiple linear regression analysis using IBM SPSS 26 Software. The results of this study conclude that the variables of accounting conservatism and profit persistence have a negative effect on profit management. While the profitability and liquidity variables have no effect on profit management. The general implication is that the issue of profit management in companies will have a negative impact on the company's reputation and investor confidence. If this practice is exposed, it could lead to a decline in stock prices, sanctions from regulators, and even lawsuits. Therefore, it is important for companies to maintain the transparency and integrity of their financial statements to ensure the trust of stakeholders. Each profit management case has a unique context and details, and it is important to conduct a more in-depth analysis to fully understand its implications and impact on the company and the market as a whole.