Relationship Between Financial Distress and Earnings Management
##plugins.pubIds.doi.readerDisplayName##
https://doi.org/10.32424/1.sar.2024.9.01.11891
Abstrak
Researchers in the study set out to the correlation between financial distress and the manipulation of financial statements using earnings management techniques. Additionally, it intends to uncover the connection between financial distress and earnings management. The Altman Z-score is applied for assessing financial situations. We apply the Beneish M-score and the modified Jones model to ensure timely implementation of earnings management strategies. The financial statements for the period 2018-2022 of 567 companies on the Indonesian Stock Exchange are used as a sample based on purposive sampling technique. The research uses Pearson's chi-square test, Cramer's V test, and correspondence analysis to test existing hypotheses. The outcomes of the research suggest that a connection exists between financial distress and earnings management practices. Furthermore, companies that are in the grey and healthy zones are more likely to manipulate. This research implies that financial and earnings management distress can be measured and detected by anyone so that the entire user of the financial report is not affected when there is fraud.
Referensi
Altman, E. I. (1983). Corporate financial distress : a complete guide to predicting, avoiding, and dealing with bankruptcy. https://api.semanticscholar.org/CorpusID:166991892
Bae, S. M., Masud, M. A. K., & Kim, J. D. (2018). A cross-country investigation of corporate governance and corporate sustainability disclosure: A signaling theory perspective. Sustainability (Switzerland), 10(8). https://doi.org/10.3390/su10082611
Beneish, M. D. (1999). The Detection of Earnings Manipulation. Financial Analysts Journal, 55(5), 24–36. http://www.jstor.org/stable/4480190
Boateng, S. L. (2019). Online relationship marketing and customer loyalty: a signaling theory perspective. International Journal of Bank Marketing, 37(1), 226–240. https://doi.org/10.1108/IJBM-01-2018-0009
Christian, N., Resnika, Yukie, H., Sitorus, R., Angelina, V., Sherly, & Febrika. (2022). Pendeteksian Fraudulent Financial Reporting dengan Earnings Manipulation Financial Shenanigans: Studi Kasus PT Envy Technologies Indonesia Tbk. Jurnal Ilmiah Akuntansi Dan Bisnis, 7(1), 2528–1216. https://doi.org/10.38043/jiab.v7i1.3543
Christy, Y. E., & Stephanus, D. S. (2018). Pendeteksian Kecurangan Laporan Keuangan dengan Beneish M-Score pada Perusahaan Perbankan Terbuka. Jurnal Akuntansi Bisnis, 16(1), 19–41. https://doi.org/10.24167/jab.v16i2.1560
CNN Indonesia. (2019, April 30). Kronologi Kisruh Laporan Keuangan Garuda Indonesia. CNN Indonesia. https://www.cnnindonesia.com/ekonomi/20190430174733-92-390927/kronologi-kisruh-laporan-keuangan-garuda-indonesia
Dechow, P. M., Sloan, R. G., & Sweeney, A. P. (1995). Detecting Earnings Management. The Accounting Review, 70, 193–225. https://www.jstor.org/stable/248303
Gavurova, B., Ivankova, V., Rigelsky, M., & Privarova, M. (2020). Relations Between Tourism Spending and Global Competitiveness: an Empirical Study in Developed OECD Countries. Journal of Tourism and Services, 11(21), 38–54. https://doi.org/10.29036/jots.v11i21.175
Hutagaol, Y. R. T., Sinurat, R. P. P., & Shalahuddin, S. M. (2022). Strategi Penguatan Keuangan Negara Dalam Menghadapi Ancaman Resesi Global 2023 Melalui Green Economy. Jurnal Pajak Dan Keuangan Negara, 4(1S), 378–385. https://doi.org/10.31092/JPKN.V4I1S.1911
Jensen, M. C., & Meckling, W. H. (1976). Theory Of The Firm: Managerial Behavior, Agency Costs And Ownership Structure. In Journal of Financial Economics (Vol. 3). Q North-Holland Publishing Company. https://doi.org/10.1016/0304-405X(76)90026-X
Kamau, C., Banafa, A., & Kariuki, S. (2022). Correlation between Earnings Management and Financial Distress among Selected Firms in Kenya. https://doi.org/10.21203/rs.3.rs-1643310/v3
Kristanti, F. T. (2019). Financial Distress : Teori dan Perkembangannya Dalam Konteks Indonesia. Inteligensia Media.
Kurniawan, F., Pusparini, N. O., Amanati, H. T., & Nugroho, A. H. L. (2022). A Cross Country Analysis of Financial Conditions and Earnings Management. Journal of Accounting and Strategic Finance, 5(1), 134–150. https://doi.org/10.33005/jasf.v5i1.256
Li, Y., Li, X., Xiang, E., & Geri Djajadikerta, H. (2020). Financial distress, internal control, and earnings management: Evidence from China. Journal of Contemporary Accounting and Economics, 16(3). https://doi.org/10.1016/j.jcae.2020.100210
Qisthi, D., Suhadak, & Handayani, S. R. (2013). Analisis X-Score (Model Zmijewski) untuk Memprediksi Gejala Kebangkrutan Perusahaan. Jurnal Administrasi Bisnis, 1(2), 68–77. http://administrasibisnis.studentjournal.ub.ac.id/index.php/jab/article/view/41
Rambe, D. N. S., & Aslami, N. (2022). Analisis Strategi Pemasaran Dalam Pasar Global. El-Mujtama: Jurnal Pengabdian Masyarakat, 1(2), 213–223. https://doi.org/10.47467/elmujtama.v1i2.853
Siekelova, A. (2021). The Impact of the Financial Stability on the Earnings Management Practices. SHS Web of Conferences, 129, 03028. https://doi.org/10.1051/shsconf/202112903028
Spence, M. (1973). Job Market Signaling. The Quarterly Journal of Economics, 87(3), 355–374. https://doi.org/10.2307/1882010
Sulistyanto, S. (2018). Manajemen Laba: Teori dan Model Empiris (Vol. 2). PT Grasindo.
Valaskova, K., Androniceanu, A. M., Zvarikova, K., & Olah, J. (2021). Bonds between Earnings Management and Corporate Financial Stability in the Context of the Competitive Ability of Enterprises. Journal of Competitiveness, 13(4), 167–184. https://doi.org/10.7441/JOC.2021.04.10
Wulandari, D. I. (2022). Peningkatan Perekonomian di Indonesia Melalui Pasar Bebas. Jurnal Inovasi Sektor Publik, 2(1). http://jurnal.uwp.ac.id/fisip/index.php/jisp/article/view/123
Bae, S. M., Masud, M. A. K., & Kim, J. D. (2018). A cross-country investigation of corporate governance and corporate sustainability disclosure: A signaling theory perspective. Sustainability (Switzerland), 10(8). https://doi.org/10.3390/su10082611
Beneish, M. D. (1999). The Detection of Earnings Manipulation. Financial Analysts Journal, 55(5), 24–36. http://www.jstor.org/stable/4480190
Boateng, S. L. (2019). Online relationship marketing and customer loyalty: a signaling theory perspective. International Journal of Bank Marketing, 37(1), 226–240. https://doi.org/10.1108/IJBM-01-2018-0009
Christian, N., Resnika, Yukie, H., Sitorus, R., Angelina, V., Sherly, & Febrika. (2022). Pendeteksian Fraudulent Financial Reporting dengan Earnings Manipulation Financial Shenanigans: Studi Kasus PT Envy Technologies Indonesia Tbk. Jurnal Ilmiah Akuntansi Dan Bisnis, 7(1), 2528–1216. https://doi.org/10.38043/jiab.v7i1.3543
Christy, Y. E., & Stephanus, D. S. (2018). Pendeteksian Kecurangan Laporan Keuangan dengan Beneish M-Score pada Perusahaan Perbankan Terbuka. Jurnal Akuntansi Bisnis, 16(1), 19–41. https://doi.org/10.24167/jab.v16i2.1560
CNN Indonesia. (2019, April 30). Kronologi Kisruh Laporan Keuangan Garuda Indonesia. CNN Indonesia. https://www.cnnindonesia.com/ekonomi/20190430174733-92-390927/kronologi-kisruh-laporan-keuangan-garuda-indonesia
Dechow, P. M., Sloan, R. G., & Sweeney, A. P. (1995). Detecting Earnings Management. The Accounting Review, 70, 193–225. https://www.jstor.org/stable/248303
Gavurova, B., Ivankova, V., Rigelsky, M., & Privarova, M. (2020). Relations Between Tourism Spending and Global Competitiveness: an Empirical Study in Developed OECD Countries. Journal of Tourism and Services, 11(21), 38–54. https://doi.org/10.29036/jots.v11i21.175
Hutagaol, Y. R. T., Sinurat, R. P. P., & Shalahuddin, S. M. (2022). Strategi Penguatan Keuangan Negara Dalam Menghadapi Ancaman Resesi Global 2023 Melalui Green Economy. Jurnal Pajak Dan Keuangan Negara, 4(1S), 378–385. https://doi.org/10.31092/JPKN.V4I1S.1911
Jensen, M. C., & Meckling, W. H. (1976). Theory Of The Firm: Managerial Behavior, Agency Costs And Ownership Structure. In Journal of Financial Economics (Vol. 3). Q North-Holland Publishing Company. https://doi.org/10.1016/0304-405X(76)90026-X
Kamau, C., Banafa, A., & Kariuki, S. (2022). Correlation between Earnings Management and Financial Distress among Selected Firms in Kenya. https://doi.org/10.21203/rs.3.rs-1643310/v3
Kristanti, F. T. (2019). Financial Distress : Teori dan Perkembangannya Dalam Konteks Indonesia. Inteligensia Media.
Kurniawan, F., Pusparini, N. O., Amanati, H. T., & Nugroho, A. H. L. (2022). A Cross Country Analysis of Financial Conditions and Earnings Management. Journal of Accounting and Strategic Finance, 5(1), 134–150. https://doi.org/10.33005/jasf.v5i1.256
Li, Y., Li, X., Xiang, E., & Geri Djajadikerta, H. (2020). Financial distress, internal control, and earnings management: Evidence from China. Journal of Contemporary Accounting and Economics, 16(3). https://doi.org/10.1016/j.jcae.2020.100210
Qisthi, D., Suhadak, & Handayani, S. R. (2013). Analisis X-Score (Model Zmijewski) untuk Memprediksi Gejala Kebangkrutan Perusahaan. Jurnal Administrasi Bisnis, 1(2), 68–77. http://administrasibisnis.studentjournal.ub.ac.id/index.php/jab/article/view/41
Rambe, D. N. S., & Aslami, N. (2022). Analisis Strategi Pemasaran Dalam Pasar Global. El-Mujtama: Jurnal Pengabdian Masyarakat, 1(2), 213–223. https://doi.org/10.47467/elmujtama.v1i2.853
Siekelova, A. (2021). The Impact of the Financial Stability on the Earnings Management Practices. SHS Web of Conferences, 129, 03028. https://doi.org/10.1051/shsconf/202112903028
Spence, M. (1973). Job Market Signaling. The Quarterly Journal of Economics, 87(3), 355–374. https://doi.org/10.2307/1882010
Sulistyanto, S. (2018). Manajemen Laba: Teori dan Model Empiris (Vol. 2). PT Grasindo.
Valaskova, K., Androniceanu, A. M., Zvarikova, K., & Olah, J. (2021). Bonds between Earnings Management and Corporate Financial Stability in the Context of the Competitive Ability of Enterprises. Journal of Competitiveness, 13(4), 167–184. https://doi.org/10.7441/JOC.2021.04.10
Wulandari, D. I. (2022). Peningkatan Perekonomian di Indonesia Melalui Pasar Bebas. Jurnal Inovasi Sektor Publik, 2(1). http://jurnal.uwp.ac.id/fisip/index.php/jisp/article/view/123
Diterbitkan
2024-06-11
##submission.howToCite##
AZAHRO, Inayatul Sabilla; SURYANINGRUM, Diah Hari.
Relationship Between Financial Distress and Earnings Management.
SAR (Soedirman Accounting Review) : Journal of Accounting and Business, [S.l.], v. 9, n. 01, p. 76 - 87, june 2024.
ISSN 2598-0718.
Tersedia pada: <https://jos.unsoed.ac.id/index.php/sar/article/view/11891>. Tanggal Akses: 14 sep. 2025
doi: https://doi.org/10.32424/1.sar.2024.9.01.11891.
Terbitan
Bagian
Articles
