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CHAPTER III RESEARCH METHODOLOGY
A. Research Scope
The population in this study are the companies listed on the Indonesian Stock Exchange IDX. The object of this study is a LQ45 companies listed on
Indonesian Stock Exchange. The research period in 2011 - 2014
B. Sampling Method
Samples in this study are LQ45 companies listed on the Stock Exchange in the period 2011 - 2014. Companies sampled in this study were selected using
purposive sampling method, namely the collection of data by using terms and on certain criteria. So the sample is selected based on considerations directly
researcher with the terms sample represents the population and in accordance with the desired characteristics in the study, as follows:
1. The Company is engaged in LQ45, which is listed on the Indonesia Stock Exchange IDX in 2011 - 2014.
2. Companies were listed on LQ45 Companies at least 3 years in research period 3. The Company publishes its financial statements for the period 2011 - 2014.
4. The financial statements used are financial statements audited by independent auditors.
5. The financial statements used are expressed in Rupiahs. 6. There completeness of the data needed in a row from 2011 - 2014.
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C. Data Collection Method
In obtaining the data in this study, researchers used data that has been available. The data will be used in this research is secondary data taken from the
annual financial statements. The data used in this study comes from an external source, companies’s Financial Report listed on the Stock Exchange in the period
2011 - 2014 were obtained from the companys annual financial report obtained from the website Indonesian Stock Exchange IDX is
www.idx.co.id , Indonesian
Capital Market Directory ICMD.
D. Analysis Method
The analytical tool used in this research is multiple linear regression using SPSS, where the regression equation contains elements of interaction
Multiplication of two or more independent variables. This interaction test used to determine the extent of interaction variables can independent commissioner,
managerial ownership, growth opportunities and sales growth influencing Accounting Conservatism.
1. Desriptive Analysis
Descriptive Analysis were used to describe the variables in this study, the level of Accounting conservatism, good corporate governance, growth
opportunities and sales growth on companies listed on the Stock Exchange. Descriptive statistics will provide an overview of each of the variables. The
analytical tool used is the average value mean, distribution frequency, minimum and maximum values and standard deviation Ghozali, 2011
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2. Classic Assumption Test
Classic assumption test aims to obtain regression results can be accounted for and have results that are not biased or Best Linear Unbiased
Estimator BLUE. Assumptions that must be met, of the test are normality test, autocorrelation test, multicollinearity test and heterocedasticity test.
a. Normality Test Normality test aims to test whether the regression model, the
disturber variables or residuals have a normal distribution. There are two ways to detect whether or not residual normal distribution, namely by
looking at the analysis graph normal probability plot and statistical tests. The regression model that has a data distribution is normal or near-normal
regression model is said to be good Ghozali, 2011. In principle normality can be detected by looking at the spread of the data points on the
diagonal axis of the graph or to view the histogram of the residual. The basis for a decision as follows:
a. If the data is spread around the diagonal line and follow the direction of the diagonal line or histogram graph showing a normal distribution pattern,
then the regression model to meet the assumption of normality. b. If the data are spread far from the diagonal and does not follow the
direction of the diagonal line or histogram chart, present a normal distribution, then the regression model did not meet the assumption of
normality. b. Multicollinearity Test
Multicoloniarity test aims to test whether the regression model found a correlation between independent variables . Multicoloniarity occur
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in logistic regression analysis when the independent variables are correlated between. Mutikolonieritas can be seen from:
• The value of tolerance and the opponent • Variance Inflation Factor VIF
The results of these tests can be seen from VIF VIF using the equation = 1tolerance. If VIF 10 then there is no multicollinearity.
Ghozali, 2011 c. Heterocedasticity Test
Heterocedasticity test aims to test whether the regression model occurred inequalities residual variance from one observation to another
observation. If the variance of the residuals of the observations to other observations remain, then called Homoskedastisitas, and if different called
Heteroskidastity. This test can be done by looking at the graph plot between the predicted value of the variable ZPRED with residual value
SREID. A good regression model if the residual variance from one observation to another permanent, so that there is no identifiable
heteroskedastisitas Ghozali, 2011. d. Autocorrelation Test
Autocorrelation test whether a correlation exists between the regression model error bullies in the current period t with an error in the
previous period t-1. A good regression model is a regression that is free from autocorrelation. If there is a correlation, then there is a problem
called autocorrelation.
Autocorrelation arise
because successive
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observation at all times in relation to each other. This test uses a model Durbin Watson DW-Test. The hypothesis to be tested are:
Ho = no autocorrelation r = 0, Ha = no autocorrelation r ≠ 0
If the value of DW is greater than the upper limit or the upper bound du and less than 4- du means no autocorrelation Ghozali, 2011.
3. Hypothesis Testing
a. Coefficient of Determination
Cox and Snell R Square and Nagelkerke R Square is a measure that seeks to imitate the size of R2 in multiple regression based on Likelihood
estimation techniques. Nagelkerke R Square easier to interpret than Cox and Snell R Square so as to know how much variability in the dependent
variable that can be explained by the independent variables can be seen from the Nagelkerke R Square. Nagelkerkes R Square is a modification of
the coefficient Cox and Snell to ensure that its value varies from 0 zero to 1 one. This is done by dividing the value of Cox and Snell s R2 with
maximum value. Nagelkerkes R Square value can be interpreted as the value of R2 in the multiple regression. A small value means the ability of
the independent variables in explaining the variation of the dependent variable is very limited. Approximate value of the independent variables
provide almost all the information needed to predict the variation of the dependent variable.
b. Multiple Linear Regression Analysis
The analysis used in this research is multiple linear regression, namely by looking at the effect of Good Corporate Governance proxied by
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Independent Commissioner
and Managerial
ownership, Growth
Opportunities, and Sales Growth to Accounting Conservatism on the LQ 45 companies listed on the Indonesian Stock Exchange IDX , The
regression model in this study are as follows: CONS
it
= β0 + β1 Indepent
it
+ β2 Manag
it
+ β3 GO + β4 SG
it
+ e
Where :
CONS : The Level of the Accounting Conservatism are
measured using the Feltham and Ohlson Model Kootanaee, et al 2013
Indepent : The existence of independent commissioner is measured by
calculated number of independent commissioner divided by total number of commissioner in the company Padmawati and Fachrurrozie, 2015
Manag : Managerial Ownership, measured by the percentage of shares
owned by Management and actively participate in corporate decision
which includes commissioners, directors and its afiliation Padmawati and
Fachrurrpzie, 2015
GO :
To measure growth opportunities of the company by calculated market to book value of equity according to Novikasari and
Sofyan, 2013
SG :
to measure for sales growth ratio by calculated change of
sales divided by net sales Padmawati and Fachrurrozie, 2015 E
: error
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c. Simultaneous Significant Test F-Test
The statistical test F basically indicates whether all the independent variables included in the model have influence together on the dependent
variable. The null hypothesis Ho to be tested is whether all of the parameters in the model is equal to zero, or
H0: b1 = b2 = b ... = bk = 0 This means that if all the independent variables is not a significant
explanatory on the dependent variable. The alternative hypothesis Ha, not all parameters simultaneously equal to zero, or:
H a: b1 ≠ b2 ≠ ... ≠ bk ≠ 0
That is, all independent variables simultaneously is a significant explanatory on the dependent variable. Testing criteria used are:
-If F count F table then Ho is rejected -If F count f table then Ho is accepted
d. Significant Partial Test T-Test
T tests were used to determine the effect of independent variables X1, X2, X3, X4 alone or each dependent variable Y Ghozali, 2007: 84-85. The
null hypothesis Ho to be tested is whether a parameter bi is equal to zero or:
Ho: bi = 0 This means that if an independent variable is not a significant explanatory
on the dependent variable. The alternative hypothesis Ha, a variable parameter is not equal to zero, or:
Ha: bi ≠ 0
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This means that these variables are significant explanatory on the dependent variable. Testing criteria: -If t t table then Ho is rejected -If t
t table then Ho is accepted to measure the value t table, determined significance level of 5 percent with degrees of freedom df = 4 n is the
number of observations
.
E. Operational Research Variable
The data in this study can be grouped into two variables: 1. Dependent Variable
The dependent variable is the variable that is a major concern of researchers. In this study, researchers took the Accounting Conservatism
Y as the dependent variable component. In this study conservatism applied to the model of Feltham and Ohlson model 1995.
The idea underlying the use of MTB or BTM as a measure of accounting conservatism is that, ceteris paribus, a conservative accounting
system tends to depress the net book values of a firm relative to the firm economic value. Therefore, a higher MTB and a lower BTM implies a
higher degree of accounting conservatism, and vice versa. The MTB measure is strongly rooted in the analytical work based on the Residual
Income Valuation Model RIVM. Feltham and Ohlson first introduced accounting conservatism in the RIVM context, and characterize
conservatism as a tendency to bias downwards the book value of a firm relative to its market value. This manifestation of conservatism has been
carried into later analytical works on conservatism such as Beaver and Ryan Wang, 2009. Thus, this study was calculated to summarize the
degree of conservatism:
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CONS
it
=
In this relationship: MV it: The market value of equity of firm i in the end of year t.
- Where MV were formulated from : MV = Outstanding shares x Stock Price
BV it: The Book value of equity of firm i in the end of year t. - Where BV were formulated from :
BV = Outstanding shares x nominal value of shares
2.
Independent Variables Independent variables are variables that affect the dependent variable,
either positively or negatively. If there is a dependent variable, the independent variables must also be present, and in each unit increase in the
independent variable nature there will be also an increase or decrease in the dependent variable.
a.
Independent Commissioner Independent commissioner is a commissioner who is not
affiliated with management, other board members and controlling shareholders, as well as free of a business relationship and other
relationships which may affect its ability to act independently or act solely semi interests of the company NCG, 2004 in Guna and
Herawaty, 2010: 6. In this research The existence of independent commissioner is measured by calculated number of independent
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commissioner divided by total number of commissioner in the company Wardhani, 2008 on Padmawati, 2015
Independent commissioner
=
∑ ∑
b.
Managerial Ownership Managerial Ownership Measured by the percentage of shares
owned by Management and actively participate in corporate decision
which includes commissioners, directors and its afiliation Padmawati
and Fachrurrozie, 2015 Managerial Ownership =
∑ ∑
c.
Growth Opportunities Growth Opportunities is an opportunity to grow the company to
expand the company by investing or by creating hidden reserves. Calculations using the opportunity to grow with the market-to-book
value of equity according to research conducted by Astarini 2011. The scale of this variable data is the ratio. To measure the growth
opportunities of the company Market to book value of equity :
d.
Sales Growth Sales growth is defined as the change in sales per year.
Sales growth ratio is used to measure changes in the companys sales per year. High sales growth often increases the market
expectation of future cash flows that will affect the market
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conservatism Ahmed and Duellman, 2007. To measure the sales growth ratio used the following formula:
Sales growth =
TABLE 3.1 VARIABLE OPERATIONALITATION
NO Variable
Type of Variable
Indicator Measurement
Scale
1 X1
Independent commissioner
indepent
Padmawati, 2015 Independent Independent commissioner divided
by total members of board commissioner
Ratio
2 X2
Managerial Ownership
Manag Padmawati and
Fachrurrozie, 2015 Independent The percentage ownership of
shares held by management Ratio
3 X3
Growth Opportunities
GO Novikasari and
Sofyan, 2013 Independent Shares outstanding multiply by
closing price divided by total equity
Ratio
4 X4
Sales Growth SG
Padmawati and Fachrurrozie, 2015
Independent Yearly change on sales measured by change in sales divided by net
sales t-1 Ratio
5 Y
Accounting Conservatism
Cons Kootanaee, et al,
2013 Dependent
Conservatism index MTB model by Feltham and Ohlson Market
value divided by Book value Ratio
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CHAPTER IV FINDING AND ANALYSIS
A. General Description of Research Object
The study used a population of LQ 45 companies listed on the Indonesia Stock Exchange IDX in the period 2011-2014. The sample used in this study were selected
by purposive sampling. LQ 45 companies selected in this study because it has a high level of liquidation, market capitalization, and the prospects of sales growth. Based on
data obtained from the Indonesia Stock Exchange through its official website www.idx.co.id
only as many as 21 companies that meet the criteria of the study sample had been applied. Here is a summary of the acquisition of samples of the study
:
Table 4.1 Detail of samples
No Details
Amount
1 LQ45 companies listed on IDX
45
2 LQ45 companies listed three consecutive years in the
year of observation
25
3 LQ45 companies which publish its financial
statements in denominations other than the rupiahs
4
4 Company used as sample of observations
21
Years of observation 2011 – 2014
4
The number of research samples 84
Source : Data Processed Based on purposive sampling method, acquired 21 companies that meet the
specified criteria so that it can be used as a sample in this study during the 4 years of observation, in order to obtain as many as 21 x 4 = 84 observation data. The list of
companies sampled in this study as follows:
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