GOOD CORPORATE GOVERNANCE MECHANISMS AS A MODERATING VARIABLE OF IFRS ADOPTION TO EARNING MANAGEMENT: CASE IN BANKING LISTED IN INDONESIA STOCK EXCHANGE Hamidah; Annisa Rahmah
Faculty of Economic and Bussines, Universitas Airlangga, Surabaya
Abstract
Corporate governance is a system that directs and controls the company (FCGI, 2001). By implementing corporate governance, it is expected to reduce the manipulation of financial statements by managers. The purpose of this study is to provide empirical evidence of the influence of the adoption of the International Financial Reporting Standard (IFRS) on earnings management and the Good Corporate Governance (GCG) mechanism in moderating the relationship between IFRS adoption and earnings management. This research used data of Banking companies listed on the Indonesia Stock Exchange (IDX) during 2007 to 2014 with a total of 120 companies. Hypothesis testing in this research using moderated regression analysis test. The results show that there is a decrease in the level of earnings management at the time of the adoption of IFRS in Banking companies in Indonesia. However, GCG mechanisms can not moderate the influence of IFRS adoption on earnings management.
Keywords: IFRS; profit management; good corporate governance; Banking industry, Indonesia
