Earnings Management in Banking Industry And Its Impact on The Firm ValueDOI: 10.26740/jaj.v10n1.p69-84


This research investigates earnings management through discretionary accruals in pre and post period of convergence of IFRS and analyses its impact on the firm value in Indonesian banking industry. The sample of this research was 23 banks listed in Indonesia Stock Exchange over period of 2007-2014.  The method of this research is quantitative. The data are analyzed using the non-paramateric Wilcoxon Signed Ranks and the multiple regression. The result of this research found that accrual earnings management has no the mean difference in pre and post period of convergence of IFRS. Based on the effect of earnings management on banking firm value, it was found that banking earnings management has an impact on the increase of the firm value. This research further identifies the patterns in accrual earnings management including income-increasing and income-decreasing. Both patterns induced managers to increase the firm value. This research also found that that income-decreasing pattern has a stronger impact on the increase of the firm value than income-increasing pattern.

 Articles related

Syamsul Rijal    

Cash flow component prediction are useful for internal and external parties to minimize the risk when they make necessary economic decisions. Earnings and cash flow are indicators of the performance and quality of management in managing the company in a ... see more

Nuraisyah Nuraisyah    

Effect of Earnings Management and Corporate Profitability Ratios Against Ranked Bonds in the credit markets Indonesia. This study with the aim to (1) analyze the effect of earnings management on bond ratings, (2) analyze the effect of the ratio of profit... see more

Andi Syarifuddin    

The purpose of this research is to examine the influence of the structure of ownership managerial and good corporate governance mechanism about earnings management in manufacturing companies listed at Indonesian Stock Exchange during 2008 to 2010. The ex... see more

M. Wahyuddin Abdullah    

This writing intent describe manager behaviour does earnings management for sustainability of firm and words manager daring do profit management is turned back sustainability of firm.  Earnings management was regarded by conflict of interest among m... see more

Abdullah Abdullah    

Banking Financial Performance Assessment in Indonesia (Case Study on PT. BNI 46 Branch Makassar), this study analyzed the financial performance of banks by using CAMEL (Capital, Assets, Management, Earnings, Liquidity), in this study, the researchers onl... see more