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E. Definition of Operational Research
Operational variable is a way to set up a concept and how the concept should be measured so that there are variables that can lead to other problems
of a variable depends on the situation and condition of other variables. Operational variables based on the nature of the attributes of the object
observed in the study, can form both qualitative and quantitative researchers made merely for the purpose of research, after understanding the attributes
based on the support of various runway.
1. Independent Variables
The independent variable is the type of variables that explain or influence another variable or variables suspected as the caue of the
dependent variable Indriantoro and Supomo, 2009: 64. The independent variables in this research is earnings management thet proxy by
discretionary accrual using Jones model that modified Dechow et.al Dechow et.al in Herawaty, 2008 with the following step :
a Total Accrual TAC = NIit
– CFOit
Description : NIit = Net income company i on periode t
CFOit = cash flow of operation company i on periode t
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b Total accruals are estimated with a regression equation OLS Ordinary Least Square
TAitAit- 1 = β1 1Ait-1 + β2 Δ RevitAit-1 + β3 PPEitAit-
1 + e
Description : TA
it =
Total accrual in period t A
it-1 =
Total asset period t-1 ΔRev
it
= Changes in income net sales in period t PPE
it
= Property, plant and equipment period t β
1
β
2
β
3
= Koefisien correllation.
c Non accrual discretionary
NDA
it
= β
1
1A
it-1
+ β
2
ΔRev
it
A
it-1
- ΔRec
it
A
it-1
+ β
3
PPE
it
A
it-1
+ e
Description : ΔRec
it
= Changes in net debt in period t β
1
β
2
β
3
= Fitted coefficient obtained from the regression results in the calculation of total accrual.
d Discretionare total accrual
DA
it
= TA
it
A
it-1
– NDA
it
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Description : TA
it
= Total accrual year t NDA
it
= Non accrual discretionare in year t
2. Dependent Variable
Dependent variable is type of variables that explained or influenced by other variables or variable expected as a result of the
independent variable Indriantoro and Supomo, 2009:159. Dependent variable used in this research is firm value.
Tobin’s Q is used to measure firm value. According to Ma Tian 2009, Tobin
’s Q has the advantage of reflecting the fir
m’s current value and future profitability potential. According to Vinola Herawati 2008, firm value can be measured by
Tobin Q which is formulated as :
Q = EMV + D
EBV + D
Description : Q
= Firm value EMV = Equity Market Value
EBV = Equity Book Value D
= The book value of the total debt.
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3. Moderating Variable
The moderating variable is the one that has strong contingent effect on the independent variable-dependent variable relationship. That is, the
presence of a third variable the moderating variable modifies the original relationship between the independent and the dependent variables
Sekaran 2010:73. a. Board of Directors BOD is fully responsible for the management of
the company effective and efficient in order to achieve the companys goals. Therefore, According to Linck et al 2008 Board of Directors
size measured by the number of Board of Directors member in the company.
b. Managerial ownership MO is the ownership by the shareholders who have a management position in the company like directors and
commissioners. According to Setyawan, 1999 in Faisal, 2004 The Managerial ownership measured by the total percentage of managerial
ownership in a company. c. Institutional Ownership IO is ownership by the government, financial
institutions, incorporated institutions, foreign institutions, and other institutions in a company. According to Muwaningsari 2007 stated
that the Institutional ownership is measured by the total percentage of institutional ownership in a company.
