DAMPAK MANAJEMEN LABA AKRUAL DAN MANAJEMEN LABA UNIVERSITAS DIPONEGORO RIIL TERHADAP KINERJA PASAR

Abstract

This research is a replication of the Oktorina’s research (2008), by adding a measurement of earnings management accruals and real earnings management through three activities. This research aims at identifying firm’s tendency to execute earnings management throught accruals and real earnings management and its impact to market performance. This study uses data from 86 manufacturing companies listed in Indonesia Stock Exchange during 2007 to 2009. Accrual earnings management is measured by discretionary accruals based on modified Jones model’s (1991), whereas real earnings management used is based on the Roychowdhury model’s (2006), there is real earnings management through operating cash flow, production costs, and discretionary costs. Market performance is measured by cummulative abnormal return (CAR) with a market adjusted model’s. Then, testing of hypotheses to analized impact of earnings management on market performance using multiple regression analysis. The results show that the manufacturing companies listed in Indonesia Stock Exchange tend to execute accruals earnings management and real earnings management throught the production cost. Moreover, accruals earnings management and real earnings management through production costs effect market performance. The research is expected to be information for business people about the existence of accrual earnings management and real earnings management and its impact to market performance, so it can be a consideration in making investment decisions.