Forecasting Future Cash Flows: The Moderating Role of Accounting Conservatism in Predictive Models
Abstract
This study aims to examine the extent to which operating cash flows, net income, and sales influence future cash flows, and whether accounting conservatism moderates these relationships. The research sample comprises companies listed in the Kompas100 index of the Indonesia Stock Exchange during the period 2015–2020. Employing a purposive sampling method, the study collected 320 firm-year observations from published financial statements. To assess the predictive ability of operating cash flows, net income, and revenue on future cash flows, multiple linear regression models were employed with accounting conservatism included as a moderating variable. The empirical results indicate that both operating cash flows and net income have a positive and statistically significant effect on future cash flows. Conversely, revenue does not exhibit a significant influence on future cash flows. Moreover, the findings suggest that accounting conservatism attenuates the relationship between operating cash flows, net income, and revenue with future cash flows, thereby underscoring its role in tempering managerial optimism in financial reporting.
Keywords: Cash Flow; Net Income; Revenue; Accounting Conservatism; Financial Statements
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References
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W, R. D. A., & Wirajaya, I. G. A. (2015a). Kemampuan Laba dan Arus Kas Operasi dalam Memprediksi Laba dan Arus Kas Masa Depan. E-Jurnal Akuntansi, 3, 882–896.
W, R. D. A., & Wirajaya, I. G. A. (2015b). Kemampuan Laba dan Arus Kas Operasi dalam Memprediksi Laba dan Arus Kas Masa Depan. E-Jurnal Akuntansi, 3, 882–896.
Ebaid, I. E. S. (2011a). Accruals and the prediction of future cash flows: Empirical evidence from an emerging market. Management Research Review, 34(7), 838–853.
Ebaid, I. E. S. (2011b). Accruals and the prediction of future cash flows: Empirical evidence from an emerging market. Management Research Review, 34(7), 838–853.
Finger, C. A. (1994a). The Ability of Earnings to Predict Future Earnings and Cash Flow. Journal of Accounting Research, 32(2), 210.
Finger, C. A. (1994b). The Ability of Earnings to Predict Future Earnings and Cash Flow. Journal of Accounting Research, 32(2), 210.
Handayani, M. I. (2007). Pengaruh Moderasi Konservatisma Akuntansi Terhadap Kemampuan Laba Dan Arus Kas Dalam Memprediksi Arus Kas Masa Yang Akan Datang. Jurnal Thesis, STIE Y, 1–16.
Ikatan Akuntan Indonesia. (2020a). PSAK No. 1 Tentang Laporan Keuangan (revisi 201). PT. Raja Grafindo.
Ikatan Akuntan Indonesia. (2020b). PSAK No. 2 Tentang Laporan Arus Kas. PT. Raja Grafindo.
Jemaa, O. Ben, Toukabri, M., & Jilani, F. (2015a). The Examination of the Ability of Earnings and Cash Flow in Predicting Future Cash Flows: Application to the Tunisian Context. Accounting and Finance Research, 4(1).
Jemaa, O. Ben, Toukabri, M., & Jilani, F. (2015b). The Examination of the Ability of Earnings and Cash Flow in Predicting Future Cash Flows: Application to the Tunisian Context. Accounting and Finance Research, 4(1).
Jordan, C. E., Waldron, M. A., & Clark, S. J. (2007). An analysis of the comparative predictive abilities of operating cash flows, earnings, and sales. Journal of Applied Business Research, 23(3), 53–60.
Kartikahadi, H., Sinaga, R. U., Syamsul, M., Siregar, S. V., & Wahyuni, E. T. (2020). Akuntansi Keuangan Berdasarkan SAK Berbasis IFRS Buku 1 (Edisi Keti). Ikatan Akuntan Indonesia.
Kieso, D. E., Weygandt, J. J., & Warfield, T. D. (2016). Intermediate Accounting 16E. John Wiley & Sons, Inc., 1–1556. http://www.wiley.com/go/permissions
Krismiaji, & Sururi. (2021). Conservatism, Earnings Quality, and Stock Prices - Indonesian Evidence. Journal of Accounting and Investment, 22(1), 37–50. https://doi.org/10.18196/jai.v22i1.9419
Kusuma, I. L. (2021). INFLUENCE OF OPERATING PROFIT, NET PROFIT, AND PROFIT GROSS IN PREDICTING FUTURE CASH FLOWS IN FOOD COMPANIES AND DRINK LISTED IN THE IDX 2016-2018. Business and Accounting Research (IJEBAR) Peer Reviewed-International Journal, 5.
Lumbantoruan, F. A. D. (2018). Kemampuan Laba dan Arus Kas Operasi dalam Memprediksi Laba dan Arus Kas Masa Depan. E-Jurnal Akuntansi, 23(1), 60–79.
Maretha, D., & Puspita Sari, N. (2021). Analisis Persediaan dan Penjualan Terhadap Arus Kas Operasi Pada PT. Smart, Tbk. In Jurnal Akuntansi FE-UB (Vol. 15, Issue 1).
Moeinaddin, M. (2012a). Examination The Ability of Earning and Cash Flow in Predicting Future Cash Flow. Interdisciplinary Journal of Cintemporary Reasearch in Business, 4(6), 94–101.
Moeinaddin, M. (2012b). Examination The Ability of Earning and Cash Flow in Predicting Future Cash Flow. Interdisciplinary Journal of Cintemporary Reasearch in Business, 4(6), 94–101.
Mulenga, M. J., & Bhatia, M. (2017). The Review of Literature on the Role of Earnings, Cash Flows and Accruals in Predicting of Future Cash Flow. Accounting and Finance Research, 6(2), 59.
Pangestu, M. (2020a). Analisis Kemampuan Informasi Laba dan Arus Kas dalam Memprediksi Arus Kas Masa Depan. Berkala Akuntansi Dan Keuangan Indonesia, 5(2), 132.
Pangestu, M. (2020b). Analisis Kemampuan Informasi Laba dan Arus Kas dalam Memprediksi Arus Kas Masa Depan. Berkala Akuntansi Dan Keuangan Indonesia, 5(2), 132.
Senan, N. A. M. (2019a). Ability of earnings and cash flows in forecasting future cash flows: A study in the context of Saudi Arabia. Academy of Accounting and Financial Studies Journal, 23(1), 1–13.
Senan, N. A. M. (2019b). Ability of earnings and cash flows in forecasting future cash flows: A study in the context of Saudi Arabia. Academy of Accounting and Financial Studies Journal, 23(1), 1–13.
Supriyadi. (1999a). The Predictive Ability of Earnings Versus Cash Flow Data To Predict Future Cash Flows: a Firm-Specific Analysis. Gadjah Mada International Journal of Business, 1(2), 113–132.
Supriyadi. (1999b). The Predictive Ability of Earnings Versus Cash Flow Data To Predict Future Cash Flows: a Firm-Specific Analysis. Gadjah Mada International Journal of Business, 1(2), 113–132.
W, R. D. A., & Wirajaya, I. G. A. (2015a). Kemampuan Laba dan Arus Kas Operasi dalam Memprediksi Laba dan Arus Kas Masa Depan. E-Jurnal Akuntansi, 3, 882–896.
W, R. D. A., & Wirajaya, I. G. A. (2015b). Kemampuan Laba dan Arus Kas Operasi dalam Memprediksi Laba dan Arus Kas Masa Depan. E-Jurnal Akuntansi, 3, 882–896.
Published
2024-12-05
How to Cite
BURROHMAN, Muji; M. HELMI, Syarif; HERNAWAN, Hernawan.
Forecasting Future Cash Flows: The Moderating Role of Accounting Conservatism in Predictive Models.
E-Jurnal Akuntansi, [S.l.], v. 34, n. 12, dec. 2024.
ISSN 2302-8556.
Available at: <https://ojs.unud.ac.id/index.php/akuntansi/article/view/120048>. Date accessed: 25 apr. 2025.
doi: https://doi.org/10.24843/EJA.2024.v34.i12.p10.
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