Pengaruh Kualitas Audit Terhadap Manajemen Laba Melalui Aktivitas Riil

Abstract

This study examines the impact of audit quality on Real Earnings Management (REM). Real earnings management is defined as management actions that deviate from normal business practices, undertaken withthe primary objective of meeting certain earnings thresholds (Roychowdhury, 2006). One proxy is taken for real earnings management, while abnormal operating cash flows and proxy for audit quality are taken as the size of audit firm. Research samples are selected from the population of manufacturing companies listed in Bursa Efek Indonesia from year 2007 to 2011. Sample criteria is companies which have strong incentive to engage in real earnings management and 126 companies are selected. Multiple Regression Model has been applied for data analysis. It is found that impact of audit quality on real earnings management is positive. This result concludes that audit quality is not a warranty that a company’s financial statement is free from earnings management.Keywords: audit quality, earnings management, real earnings management, abnormal cash flow operation.

The Effect of Good Corporate Governance and Financial Distress on Real Earnings Management

“…The auditor's ability is always seen because it can weaken the quality of the company's financial statements. Boedhi & Ratnaningsih (2017) research shows a significant positive on real earnings management. This situation proves that good quality auditors will encourage companies to bring out real earnings management.…”

“…A better quality auditor can reduce accrual earnings management and switch to real earnings management when the company has a strong urge to require earnings management. According to research by Boedhi & Ratnaningsih (2017) and Lestari & Aeni (2019), these results showed that there is a significant positive impact on real earnings management.…”

“…The quality of good financial statements describes a good auditor. Audit quality is an effort or ability of the auditor to catch material misstatements and report these errors simultaneously (Boedhi & Ratnaningsih, 2017). Audit quality is measured using a dummy variable equal to '1' if a company employs Big 4 auditors and '0' otherwise.…”

Analysis of Company's Strategy and Characteristics of Earnings Quality

“…Keberadaan auditor big 4 bukan untuk mengurangi manajemen laba, tetapi lebih kepada peningkatan kredibilitas laporan keuangan dengan mengurangi ganggguan yang ada didalamnya sehingga bisa menghasilkan laporan keuangan yang handal. Hasil penelitian ini sesuai dengan penelitian yang dilakukan oleh Sudjatna dan Muid (2015), Boedhi dan Ratnaningsih (2015), dan Aryanti et al (2017) yang menunjukkan bahwa kualitas audit berpengaruh negatif terhadap kualitas laba.…”

Effect of Good Corporate Governance and Investor Protection on Real Activity Manipulation (RAM) in Three ASEAN Countries (Indonesia, Malaysia, and Singapore)

“…Earnings management through real activity manipulation is earnings management that starts from normal operating practices, motivated by the desire of managers to trick stakeholders into believing that some financial statement objectives have been achieved through normal functional activities. Real earnings management may have a higher long-term cost to stakeholders than accrual earnings management, as real earnings management has a detrimental effect on cash flow and firm value over time [4] [6].…”