PROFITABLITY AND LIQUIDITY ON CORPORATE VALUE THROUGH DIVIDEND POLICY AS INTERVENING VARIABEL: EMPIRICAL STUDY ON ISLAMIC CAPITAL MARKET Sutrisno1

Profitablity and Liquidity on Corporate Value Through Dividend Policy as Intervening Variabel: Empirical Study on Islamic Capital Market. The purpose of this study is to examine the effect of profitability and liquidity on dividend policy and firm value. It also examines the role of dividend policy as an intervening variable between profitability and liquidity on firm value. The population of this study is companies registered in List of Sharia Securities consisting of more than 300 companies. Samples were taken as many as 100 companies with a purposive sampling method. The observation period is 3 years (2016-2018). To test hypotheses using multiple regression analysis. The result shows that profitability is significant and positively effect on dividend policy, while liquidity does not affect on dividend policy. Profitability and dividend policy have a positive and significant effect on firm value, while liquidity has no effect on firm value. Another result of dividend policy is able to be as an intervening effect on profitability of firm value but not as an intervening liquidity relationship to firm value.


INTRODUCTION
The Islamic capital market is still interesting to study because of its increasingly Companies that are included in the List of Sharia Securities are also profit-oriented, the difference is that the types of business of companies listed in sharia securities must not violate Islamic sharia. In addition, the company's debt may not exceed 41% of its total assets. They are also demanded to be able to improve the welfare of shareholders. Thus, companies in the Islamic capital market must be able to increase the value of the company as a general corporate goal.
Company value is investors' perception of the level of success of a company that is often associated with stock prices. High stock prices will increase investor confidence in the company's current performance and future prospects. Fundamentally, the value of the company will be affected by the company's financial performance (profitability), because with high profitability the company is expected to be able to pay dividends, thereby increasing share prices (Fajaria & Isnalita, 2018). Therefore, it is the duty of management to continuously improve company performance through profitability. Tahu & Susilo (2018) also revealed that profitability will increase the value of the company, because investors have more confidence in company shares that are able to generate profits. As found by Jaara et al., (2018); ; Malik et al.,(2013 Company value is inseparable from the liquidity owned by the company. Liquidity is the company's ability to fulfill its financial obligations which must be fulfilled immediately. A company that has high liquidity is expected to be able to pay off its current debt, as well as indicate that it has funds to pay dividends (Malik et al., 2013). Liquidity must be a serious concern because it plays a very important role in maintaining company operations (Sondakh, 2019). Companies that have high liquidity are considered to have good performance by investors. This will attract investors to invest their capital in the company. Malik et al., (2013); Sondakh (2019); Gunawan & Tobing (2018) in their research found a positive and significant effect between liquidity and firm value. But there are other researchers who find that liquidity has no effect on firm value (Fajaria & Isnalita, 2018;Tahu & Susilo, 2018).
Another factor that influences the company's supply rate is the dividend policy.
Dividend policy is a financial decision whether the profits obtained will be distributed to shareholders as dividends or retained as retained earnings. Dividend policies often lead to conflicts between company management and shareholders. This happens because company managers often have different interests from shareholders (Triani & Tarmidi, 2019). The company management considers the profits derived by the company should be used for company operations. Shareholders consider the profits derived by the company should be distributed to shareholders as dividends. Problems between management and shareholders will result in not achieving one of the company's objectives, namely increasing the value of the company . Payment of dividends is a positive signal for investors that the company has a good performance, thus encouraging investors to buy company shares which will ultimately increase the value of the company.  Dividends paid also depend on the availability of funds that will be used to pay dividends. Liquidity as a measure of the availability of current assets is a measure of the availability of these funds. Better company liquidity allows companies to pay large amounts of dividends. Malik et al., (2013) argues that large liquidity is mainly liquid assets in the form of cash, while there is no good business opportunity, there is a tendency to distribute more dividends. This is supported by the results of research by Gunawan & Tobing (2018); Ahmed (2015) who found a positive and significant effect between liquidity and dividend policy. Instead Mehta (2012) found that liquidity had no effect on dividend policy.
The effect of profitability and liquidity on company value can be directly, but also indirectly through dividend policy. Investors who buy company shares expect the company to have good performance and be able to achieve optimum profits with the hope that large profits will provide large individuals. However, this expectation could not have happened, because it was possible at the RUPS that there was a small dividend distribution decision. This is possible if there are profitable investment opportunities so that most of the profits are not distributed but to fund these investment opportunities. Such conditions certainly disappoint investors, so it is likely that many will sell the company's shares. As a result, stock prices can go down and company value will also go down. Ananda et al., (2018) in his research found the effect of profitability on firm value through dividend policy. Likewise, Martini (2015) found that profitability affected company value through dividend policy. In contrast, Tahu & Susilo (2018) found that dividend policy cannot moderate the effect of profitability on firm value.
Liquidity is important information for investors to assess the ability of companies to pay dividends. High liquidity allows companies to pay dividends. Thus, high liquidity will be preferred by investors if the liquidity is used to pay dividends thereby increasing share prices. The company's management is chosen by the shareholders to be able to operate the company effectively and efficiently, with the hope that the company will be able to make a profit. From this amount of profit, it will be decided how much will be distributed to shareholders as dividends and how much profit is not distributed as retained earnings.
Dividend policy can be done after the company has sufficient profitability. Thus, the dividend policy will be influenced by the company's ability to make a profit. The results of research by Gunawan & Tobing (2018); Mehta (2012) reinforce the notion that profitability influences dividend policy. Malik et al.,;(2013)   In executing the dividend policy, it is necessary to have sufficient cash flow that must be provided by the company. Availability of funds in the company will be reflected in the level of liquidity they have. If liquidity is low, the company cannot afford to pay a sufficient amount of dividends, but if liquidity is high, the company has the opportunity to pay dividends. Thus the dividend policy will be influenced by the level of company liquidity (Griffin, 2010). This is in line with research by Malik et al., (2013); Gunawan &Tobing (2018)  Profitability is information that is often used by investors to assess whether the company has good prospects, and as one of the basic decisions to buy shares. High profitability will increase investor confidence in the company's current performance and future prospects. Management is required to continuously improve company performance through profitability. According to Tahu & Susilo (2018)  Liquidity shows the company's ability to fulfill its financial obligations that must be fulfilled immediately or the obligation to pay its current debt. A company that has high liquidity is expected to be able to pay off its current debt, as well as indicate that it has funds to pay dividends (Malik et al., 2013). Liquidity must be a serious concern because it plays a very important role in maintaining the company's operations (Sondakh, 2019). Companies that have high liquidity are considered to have good performance by investors. This will attract investors to invest their capital in the company.  Tahun and Susilo found liquidity had no effect on firm value. High liquidity if it will be used to pay dividends will be preferred by investors so that it will increase stock prices. Therefore,   The following is the definition of variables and how they are measured.

Variables and Measurement
To test the hypothesis a partial test (t test) will be used using a 95% confidence level or a 5% significance level. Statistical tools to test variables that affect firm value using multiple

Descriptive Statistics
Profitability and dividend policy. Table   3 shows that profitability calculated by ROA results in a significance level of 0,000 greater than the significance level set at 0.05, so it can be concluded that the ROA statistically has a significant effect on dividend policy, meaning that an increase in ROA will increase the dividend policy adopted by the company.
Profitability is the main indicator of financial performance, because with profitability it shows that management has put maximum effort into managing the company. Return on assets (ROA) is the company's ability to generate profits with all assets owned, the higher the ROA is the higher the ability to generate profits. The profit obtained will be decided in the General Meeting of Shareholders (AGM) whether to be divided as dividends or not divided as retained earnings which is used for investment (Mehta, 2012). The higher the profit, the more likely it will be distributed as a dividend. For investors, profitability is a signal that the company has a good performance which is expected to be distributed as dividends. These results are consistent with the findings of Tamrin et al.,  dividend policy show a significance value of 0.165 greater than the significance level of 0.05, so it can be concluded that liquidity has no effect on dividend policy. The policy of giving cash dividends is of course very dependent on the availability of money in the company (Malik et al., 2013). Liquidity shows the ability of a company to meet its short-term financial obligations, meaning that the higher the liquidity, the more available funds for payment of short-term obligations, including to pay dividends (Ahmed, 2015). But apparently dividend payments are not based on the availability of good liquidity. This is possible because the company has good liquidity, which can be seen in the data that the average liquidity is 2.71. Thus the company in distributing dividends relies more on profitability than liquidity (Mehta, 2012). This is consistent with the results of the study by Mehta (2012)  for shares. The more shares requested the higher the price. Investors will look for companies that have good prospects, and one of the signals is profitability. The higher the profitability will affect investor interest in these shares, and the more interested in the stock will increase the stock price. Jacob and Taslim (2017) also revealed that profitability will increase the value of the company, because investors have more confidence in company shares that are able to generate profits. As found by Jaara et al.,(2018), , Ananda et al., (2018) and Malik et al.,(2013) that profitability has a positive effect on firm value.

Liquidity and company value.
Hypothesis test results of the effect of liquidity on firm value indicate a significance value of 0.067 greater than the significance level of 0.05 meaning liability does not affect the firm value. Liquidity is the company's ability to fulfill its financial obligations that must be fulfilled immediately or the obligation to pay its current debt. In addition to paying off debt, the availability of liquidity can also be used as an indicator of ability to pay dividends. Liquidity is indeed very important for the company in order to maintain trust in its creditors. However, for investors liquidity information is not so necessary. Investors prioritize profitability information and dividend policy. Therefore liquidity has no effect on firm value. These results support the study of Tahu and Susilo (2018) which also found that liquidity had no effect on firm value. Likewise, Fajaria et al., (2018) also found that liquidity had no effect on firm value. However. Malik et al.,(2013), Gunawan and Tobing (2018) found a positive and significant effect between liquidity and firm value.
Dividend policy and company value.
The results of the hypothesis test dividend policy on firm value produces a significance value of 0.010 smaller than the significance requirement of 0.05. Thus the dividend policy has a significant positive effect on the value of the company, meaning that the higher the dividend distributed will increase the value of the company.
According to Triani and Tarmidi (2019) Lintner (1956) in his theory Bird in Hand said that investors preferred dividends over capital gains. Therefore, dividend policy will positively affect the value of the company. The dividend policy is a positive signal for investors that the company is in a good performance condition, therefore some companies tend to distribute dividends even though the profits are not large.
The results of this study support the research of , Jaara et al.,(2018) and do not consider company liquidity (Malik et al.,2013;Sondakh, 2019;and Gunawan and Tobing, 2018). This also confirms this research that liquidity has no effect on dividend policy.
These results support Jacob and Taslim (2017) who found dividend policy unable to be an intervening effect of liquidity on firm value.
Likewise, Tahu and Susilo (2018) also found dividend policy unable to be an intervening effect of liquidity on firm value.

CONCLUSION
Based on the results of hypothesis testing using multiple regression, it can be concluded that profitability has a significant and positive effect on dividend policy while liquidity has no effect on dividend policy. Profitability also directly influences company value. Likewise, the dividend policy also has a direct influence on the value of the company, while liquidity has no direct effect on the company's value. Dividend policy is able to be an intervening variable on the effect of profitability on firm value, while the effect of liquidity on firm value cannot be intervened by the dividend policy.
The results of this study are expected to contribute to the company's management in making decisions, especially in the context of increasing company value. It can also be used by investors in making investment decisions.
Research is expected to be a contribution of thought to science, especially relating to dividend policy and corporate value, so that researchers can continue to be asked to develop it further, so that they can perfect the results of this study which still has many weaknesses.