Cost of Financial Distress and Firm Performance

Widarwati, Estu; Sartika, Dewi

doi:10.21002/icmr.v10i2.10831

Cited by 3 publications

(3 citation statements)

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“…Perusahaan harus menanggung biaya-biaya ketika mengalami kesulitan keuangan (financial distress). Berbagai upaya dilakukan perusahaan saat mengalami kesulitan keuangan (financial distress), mendorong perusahaan memilih cara tertentu untuk mendapatkan dana dengan mengandalkan aset likuid perusahaan maupun melakukan pinjaman (leverage) serta melakukan restrukturisasi keuangan baik investasi, asset likuid maupun utang (debt) (Widarwati & Sartika, 2019).…”

Section: Pendahuluanunclassified

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Analisis penentu biaya kesulitan keuangan

Hendi

Jessica

2021

MBR

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Empirical studies aims to prove that the selected independent and control variables are indicators of determining the cost of financial distress. The object of research is all public companies listed on the Indonesia Stock Exchange (IDX) which are classified into 8 (eight) sectors, except for the financial sector. Data analysis uses Panel Regression analysis on secondary data samples obtained from the company's annual financial statements for the period of 2016-2020. The findings found that there is a significant negative effect between change in investment, return on assets and firm size on the cost of financial distress. The variables of probability of financial distress, holding of liquid assets, liquidity ratio, change in employment, leverage, return on equity, tobin's q, average profitability of its sector do not have a significant relationship to the cost of financial distress. Recommendations for future researchers are suggested for future research coverage not to occur during a pandemic. It is advisable for the next research to separate research that occurred during the pandemic period or the time range during normal conditions so that the sample comparison is fairer.

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Section: Pendahuluanunclassified

“…Aktivitas investasi membuat kemungkinan besar terjadinya risiko ketidakpastian ekonomi yang akan mempengaruhi kinerja keuangan perusahaan. Perusahaan berpotensi mengalami penurunan jika manajemen tidak mampu mengantisipasi dampaknya (Widarwati & Sartika, 2019).…”

Section: H3unclassified

Analisis penentu biaya kesulitan keuangan

Hendi

Jessica

2021

MBR

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“…Group 2 shows that there are conditions in the direction of the 5 companies. Widarwati and Sartika (2018) explain that a company is experiencing financial difficulties with a certain valueThis will be followed by a weakening in share prices and the attitude of investors to sell shares due to fears of a further decline in share prices. This condition negates that the decline in the company's performance, which is reflected in the financial difficulties of "liquidity", can give a signal to investors to sell shares, where in the secondary market when there is a stock release, the share price will decrease.…”

Section: Financial Distress Relationship With Stock Returnsmentioning

confidence: 99%

Financial Distress Analysis of The Sminfra18 Index Share Return on Indonesia Stock Exchange

Yuliandi¹,

Hakim

Sasongko

2021

JPK

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The construction sector in Indonesia has a strategic contribution to the national economy. This can be seen clearly by the increasing development of office buildings, hotels, apartments and malls as well as road construction projects, toll roads, flyovers, and so on, this will have an impact on improving Indonesia's infrastructure. Along with the increase in market capitalization on the SMinfra18 Index, it becomes ironic when it is not accompanied by the performance, volume and value of the SMinfra18 Index which is still volatile. It is feared that this will lead to financial distress as a result of the Global Financial Crisis, so that many companies cannot fulfill their obligations to banks. Basically, financial distress becomes an interesting thing that business stakeholders need to know, especially management and investors. For management to be able to manage and maintain business performance, while for investors as an indicator of investment activities. The purpose of the study is related to 1) The condition of the financial performance of companies listed in SMInfra18. 2) Factors that affect SMInfra18 financial distress and 3) The relationship between financial distress and stock returns in SMInfra18. The analysis method used is panel data regression using Debt Service Coverage Ratio, Profitability Ratio (ROE), Liquidity Ratio (WC / TA), Activity Ratio (TATO), Efficiency Ratio (EBITDA / TA) and Leverage Ratio (DAR). The results provide an illustration that there are differences and financial distress conditions in each company and the grouping and conditions of financial distress and stock returns have not been able to have a unidirectional relationship from time to time.

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