Pengaruh Firm Size, Financial Leverage, dan Institutional Ownership pada Praktik Income Smoothing

Abstract

Income smoothing is one form of which profit management conducted by corporate management on earnings that is produced on a certain period. Income smoothing performed with the purpose of reducing the level of fluctuations of profit generated between a period so that the financial condition of the company would be visible stable and risky low. Income smoothing can result in the content of information in a financial statements become less accurately. The goal of this research was to test whether there is influence of firm size, financial leverage, and institutional ownership in income smoothing practice.

Sector f&b companies listed on the Indonesia Stock Exchange during the period 2009 until 2011 set as population research. For sample research, selected by as much as 14 companies that are set up as a sample number of observations so that total with a three-year research period is as much as 42 observation. Logistic regression was used as the data analysis techniques in this research. Based on data analysis techniques, namely a logistic regression was done in this research, the results of the research had finally been obtained. Firm size and financial leverage gives a positive influence on the income smoothing practice, while institutional ownership gives a negative influence.