Company Characteristics and Earnings Quality

Abstract

This study aims to determine the effect of profitability, growth, leverage, and size on the earnings quality of Indonesian companies. It also shows that the preparation of financial reporting has referred to the International Financial Reporting Standards. However, capital market investments are being evaluated with an increasingly inadequate image of corporate earnings. The Indonesian Capital Market Supervisory Agency reported many cases of financial reporting indicating low earnings quality. Therefore, this study aims to analyze 556 non-financial companies that reported statements for 2017 -2019 and obtained 1280 data based on the unbalanced panel method. The results show that an increase in earnings quality is influenced by profitability, while a decrease is influenced by leverage, growth, and company size.