CONCLUSIONS AND SUGGESTIONS EARNINGS MANAGEMENT DURING GLOBAL FINANCIAL CRISIS 2008-2009: EVIDENCE FROM LISTED MANUFACTURING COMPANIES IN INDONESIA.
57
CHAPTER V
CONCLUSIONS AND SUGGESTIONS
5.1
Research Conclusions
The objective of this research is to test whether companies engage in
income decreasing earnings management during global financial crisis or not.
This study uses data on a sample of 154 manufacturing companies listed on
the Indonesia Stock Exchange 2008-2009 period and meets the criteria.
This research used Modified Jones model to determine earnings
management and one sample t-test (one-tailed test) to test the hypothesis.
Results of analysis of the study show that hypothesis null is accepted. It
means that companies do not engage in income decreasing earnings
management during global financial crisis 2008-2009. It could happen
because companies have several motivations and considerations in earnings
management.
5.2
Research Limitations
This research has limitation, which is short period of observations and
limited samples. This research only observed earnings management in 20082009 due to the crisis only occurred in that period. So, the period of
observations can not be extended. Besides that, Modified Jones model, which
is being used in this research, is best used for manufacturing companies.
57ii
44
58
45
Therefore, this research only used the samples from manufacturing
companies.
5.3
Suggestion for Future Research
Suggestion that could be given for future research is to combine with
the other crises events. Here, the meaning of combine is by using several
crises events as sample, for instance Asian financial crisis in 1998 and Persian
Gulf crisis. So, a research about earnings management can be conducted by
comparing earnings management during Asian financial crisis, Persian Gulf
crisis, and global financial crisis 2008-2009. As long as the data is available
and freely accessible, future research about the other crises can be conducted.
Therefore, in the future, researcher can use several crises events
together and combine them in his/her research for better understanding of
earnings management during financial crisis (but it depends on the availability
of the data).
58ii
59
No
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
29
30
31
32
33
34
35
36
37
38
39
Symbol
SMCB
INTP
SMGR
ARNA
MLIA
TOTO
BTON
CTBN
INAI
JKSW
JPRS
LION
LMSH
PICO
BUDI
DPNS
EKAD
ETWA
SRSN
AKPI
APLI
BRNA
DYNA
IGAR
TRST
JPFA
SIPD
SULI
FASW
SPMA
SAIP
AUTO
GJTL
GDYR
INDS
LPIN
MASA
PRAS
SMSM
Appendix 1: Lists of Samples
Name
Holcim Indonesia Tbk
Indocement Tunggal Prakasa Tbk
Semen Gresik (Persero) Tbk
Arwana Citramulia Tbk
Mulia Industrindo Tbk
Surya Toto Indonesia Tbk
Betonjaya Manunggal Tbk
Citra Tubindo Tbk
Indal Aluminium Industry Tbk
Jakarta Kyoei Steel Works Tbk
Jaya Pari Steel Tbk
Lion Metal Works Tbk
Lionmesh Prima Tbk
Pelangi Indah Canindo Tbk
Budi Acid Jaya Tbk
Duta Pertiwi Nusantara Tbk
Ekadharma International Tbk
Eterindo Wahanatama Tbk
Indo Acidatama Tbk
Argha Karya Prima Ind. Tbk
Asiaplast Industries Tbk
Berlina Tbk
Dynaplast Tbk
Kageo Igar Jaya Tbk
Trias Sentosa Tbk
JAPFA Comfeed Indonesia Tbk
Sierad Produce Tbk
Sumalindo Lestari Jaya Tbk
Fajar Surya Wisesa Tbk
Suparma Tbk
Surabaya Agung Industry Pulp Tbk
Astra Otoparts Tbk
Gajah Tunggal Tbk
Goodyear Indonesia Tbk
Indospring Tbk
Multi Prima Sejahtera Tbk
Multistrada Arah Sarana Tbk
Prima Alloy Steel Tbk
Selamat Sempurna Tbk
59ii
60
40
41
42
43
44
45
46
47
48
49
50
51
52
53
54
55
56
57
58
59
60
61
62
63
64
65
66
67
68
69
70
71
72
73
74
75
76
77
78
79
80
MYTX
ARGO
ESTI
MYRX
KARW
PBRX
PAFI
RICY
BIMA
BATA
SIMM
KBLM
IKBI
PTSN
ADES
AISA
AQUA
CEKA
HMSP
INAF
INDF
KAEF
KDSI
KICI
KLBF
LMPI
MERK
MLBI
MRAT
MYOR
PSDN
PYFA
RMBA
SCPI
SKLT
SQBI
STTP
TCID
TSPC
ULTJ
UNVR
Apac Citra Centertex Tbk
Argo Pantes Tbk
Ever Shine Textile Industry Tbk
Hanson International Tbk
Karwell Indonesia Tbk
Pan Brothers Tex Tbk
Panasia Filament Inti Tbk
Ricky Putra Globalindo Tbk
Primarindo Asia Infrastructur Tbk
Sepatu Bata Tbk
Surya Intrindo Makmur Tbk
Kabelindo Murni Tbk
Sumi Indo Kabel Tbk
Sat Nusapersada Tbk
Akasha Wira International Tbk
Tiga Pilar Sejahtera Food Tbk
Aqua Golden Mississippi Tbk
Cahaya Kalbar Tbk
HM Sampoerna Tbk
Indofarma Tbk
Indofood Sukses Makmur Tbk
Kimia Farma Tbk
Kedawung Setia Industrial Tbk
Kedaung Indah Can Tbk
Kalbe Farma Tbk
Langgeng Makmur Industri Tbk
Merck Tbk
Multi Bintang Indonesia Tbk
Mustika Ratu Tbk
Mayor Indah Tbk
Prasidha Aneka Niaga Tbk
Pyridam Farma Tbk
Bentoel International Investama Tbk
Schering-Plough Indonesia Tbk
Sekar Laut Tbk
Taisho Pharmaceutical Indonesia (PS) Tbk
Siantar Top Tbk
Mandom Indonesia Tbk
Tempo Scan Pacific Tbk
Ultra Jaya Milk Tbk
Unilever Indonesia Tbk
60ii
61
61ii
62
62ii
63
63ii
64
64ii
65
65ii
66
66ii
67
67ii
68
Appendix 3: Descriptive Statistics
One-Sample Kolmogorov-Smirnov Test
N
Normal Parameters a,b
Most Extreme
Dif f erences
Mean
Std. Dev iat ion
Absolute
Positiv e
Negativ e
Kolmogorov -Smirnov Z
Asy mp. Sig. (2-tailed)
a. Test distribution is Normal.
b. Calculated f rom data.
68ii
DAitdurin
gcrisis
154
.0509
.13977
.109
.109
-.078
1.353
.051
69
Appendix 4: Normality Test
Normality Test Result of Discretionary Accruals
One-Sample Kolmo gorov-Smirnov Test
N
Normal Parameters a,b
Most Extrem e
Dif f erences
Mean
Std. Dev iat ion
Absolute
Positiv e
Negativ e
Kolmogorov -Smirnov Z
Asy mp. Sig. (2-tailed)
DAit0809
160
.1016
.54692
.331
.331
-.262
4.192
.000
a. Test distribution is Normal.
b. Calculated f rom data.
Normality Test of Discretionary Accruals after Trimming
One-Sample Kolmogorov-Smirnov Test
N
Normal Parameters a,b
Most Extrem e
Dif f erences
Mean
Std. Dev iat ion
Absolute
Positiv e
Negativ e
Kolmogorov -Smirnov Z
Asy mp. Sig. (2-tailed)
a. Test distribution is Normal.
b. Calculated f rom data.
69ii
DAit0809
154
.0509
.13977
.109
.109
-.078
1.353
.051
70
Appendix 5: One Sample T-Test
One-Sample Statistics
N
DAit0809
154
Mean
.0509
St d. Dev iation
.13977
St d. Error
Mean
.01126
One-Sample Test
Test Value = 0
DAit0809
t
4.517
df
153
Sig. (2-tailed)
.000
70ii
Mean
Dif f erence
.05088
95% Conf idence
Interv al of the
Dif f erence
Lower
Upper
.0286
.0731
CHAPTER V
CONCLUSIONS AND SUGGESTIONS
5.1
Research Conclusions
The objective of this research is to test whether companies engage in
income decreasing earnings management during global financial crisis or not.
This study uses data on a sample of 154 manufacturing companies listed on
the Indonesia Stock Exchange 2008-2009 period and meets the criteria.
This research used Modified Jones model to determine earnings
management and one sample t-test (one-tailed test) to test the hypothesis.
Results of analysis of the study show that hypothesis null is accepted. It
means that companies do not engage in income decreasing earnings
management during global financial crisis 2008-2009. It could happen
because companies have several motivations and considerations in earnings
management.
5.2
Research Limitations
This research has limitation, which is short period of observations and
limited samples. This research only observed earnings management in 20082009 due to the crisis only occurred in that period. So, the period of
observations can not be extended. Besides that, Modified Jones model, which
is being used in this research, is best used for manufacturing companies.
57ii
44
58
45
Therefore, this research only used the samples from manufacturing
companies.
5.3
Suggestion for Future Research
Suggestion that could be given for future research is to combine with
the other crises events. Here, the meaning of combine is by using several
crises events as sample, for instance Asian financial crisis in 1998 and Persian
Gulf crisis. So, a research about earnings management can be conducted by
comparing earnings management during Asian financial crisis, Persian Gulf
crisis, and global financial crisis 2008-2009. As long as the data is available
and freely accessible, future research about the other crises can be conducted.
Therefore, in the future, researcher can use several crises events
together and combine them in his/her research for better understanding of
earnings management during financial crisis (but it depends on the availability
of the data).
58ii
59
No
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
29
30
31
32
33
34
35
36
37
38
39
Symbol
SMCB
INTP
SMGR
ARNA
MLIA
TOTO
BTON
CTBN
INAI
JKSW
JPRS
LION
LMSH
PICO
BUDI
DPNS
EKAD
ETWA
SRSN
AKPI
APLI
BRNA
DYNA
IGAR
TRST
JPFA
SIPD
SULI
FASW
SPMA
SAIP
AUTO
GJTL
GDYR
INDS
LPIN
MASA
PRAS
SMSM
Appendix 1: Lists of Samples
Name
Holcim Indonesia Tbk
Indocement Tunggal Prakasa Tbk
Semen Gresik (Persero) Tbk
Arwana Citramulia Tbk
Mulia Industrindo Tbk
Surya Toto Indonesia Tbk
Betonjaya Manunggal Tbk
Citra Tubindo Tbk
Indal Aluminium Industry Tbk
Jakarta Kyoei Steel Works Tbk
Jaya Pari Steel Tbk
Lion Metal Works Tbk
Lionmesh Prima Tbk
Pelangi Indah Canindo Tbk
Budi Acid Jaya Tbk
Duta Pertiwi Nusantara Tbk
Ekadharma International Tbk
Eterindo Wahanatama Tbk
Indo Acidatama Tbk
Argha Karya Prima Ind. Tbk
Asiaplast Industries Tbk
Berlina Tbk
Dynaplast Tbk
Kageo Igar Jaya Tbk
Trias Sentosa Tbk
JAPFA Comfeed Indonesia Tbk
Sierad Produce Tbk
Sumalindo Lestari Jaya Tbk
Fajar Surya Wisesa Tbk
Suparma Tbk
Surabaya Agung Industry Pulp Tbk
Astra Otoparts Tbk
Gajah Tunggal Tbk
Goodyear Indonesia Tbk
Indospring Tbk
Multi Prima Sejahtera Tbk
Multistrada Arah Sarana Tbk
Prima Alloy Steel Tbk
Selamat Sempurna Tbk
59ii
60
40
41
42
43
44
45
46
47
48
49
50
51
52
53
54
55
56
57
58
59
60
61
62
63
64
65
66
67
68
69
70
71
72
73
74
75
76
77
78
79
80
MYTX
ARGO
ESTI
MYRX
KARW
PBRX
PAFI
RICY
BIMA
BATA
SIMM
KBLM
IKBI
PTSN
ADES
AISA
AQUA
CEKA
HMSP
INAF
INDF
KAEF
KDSI
KICI
KLBF
LMPI
MERK
MLBI
MRAT
MYOR
PSDN
PYFA
RMBA
SCPI
SKLT
SQBI
STTP
TCID
TSPC
ULTJ
UNVR
Apac Citra Centertex Tbk
Argo Pantes Tbk
Ever Shine Textile Industry Tbk
Hanson International Tbk
Karwell Indonesia Tbk
Pan Brothers Tex Tbk
Panasia Filament Inti Tbk
Ricky Putra Globalindo Tbk
Primarindo Asia Infrastructur Tbk
Sepatu Bata Tbk
Surya Intrindo Makmur Tbk
Kabelindo Murni Tbk
Sumi Indo Kabel Tbk
Sat Nusapersada Tbk
Akasha Wira International Tbk
Tiga Pilar Sejahtera Food Tbk
Aqua Golden Mississippi Tbk
Cahaya Kalbar Tbk
HM Sampoerna Tbk
Indofarma Tbk
Indofood Sukses Makmur Tbk
Kimia Farma Tbk
Kedawung Setia Industrial Tbk
Kedaung Indah Can Tbk
Kalbe Farma Tbk
Langgeng Makmur Industri Tbk
Merck Tbk
Multi Bintang Indonesia Tbk
Mustika Ratu Tbk
Mayor Indah Tbk
Prasidha Aneka Niaga Tbk
Pyridam Farma Tbk
Bentoel International Investama Tbk
Schering-Plough Indonesia Tbk
Sekar Laut Tbk
Taisho Pharmaceutical Indonesia (PS) Tbk
Siantar Top Tbk
Mandom Indonesia Tbk
Tempo Scan Pacific Tbk
Ultra Jaya Milk Tbk
Unilever Indonesia Tbk
60ii
61
61ii
62
62ii
63
63ii
64
64ii
65
65ii
66
66ii
67
67ii
68
Appendix 3: Descriptive Statistics
One-Sample Kolmogorov-Smirnov Test
N
Normal Parameters a,b
Most Extreme
Dif f erences
Mean
Std. Dev iat ion
Absolute
Positiv e
Negativ e
Kolmogorov -Smirnov Z
Asy mp. Sig. (2-tailed)
a. Test distribution is Normal.
b. Calculated f rom data.
68ii
DAitdurin
gcrisis
154
.0509
.13977
.109
.109
-.078
1.353
.051
69
Appendix 4: Normality Test
Normality Test Result of Discretionary Accruals
One-Sample Kolmo gorov-Smirnov Test
N
Normal Parameters a,b
Most Extrem e
Dif f erences
Mean
Std. Dev iat ion
Absolute
Positiv e
Negativ e
Kolmogorov -Smirnov Z
Asy mp. Sig. (2-tailed)
DAit0809
160
.1016
.54692
.331
.331
-.262
4.192
.000
a. Test distribution is Normal.
b. Calculated f rom data.
Normality Test of Discretionary Accruals after Trimming
One-Sample Kolmogorov-Smirnov Test
N
Normal Parameters a,b
Most Extrem e
Dif f erences
Mean
Std. Dev iat ion
Absolute
Positiv e
Negativ e
Kolmogorov -Smirnov Z
Asy mp. Sig. (2-tailed)
a. Test distribution is Normal.
b. Calculated f rom data.
69ii
DAit0809
154
.0509
.13977
.109
.109
-.078
1.353
.051
70
Appendix 5: One Sample T-Test
One-Sample Statistics
N
DAit0809
154
Mean
.0509
St d. Dev iation
.13977
St d. Error
Mean
.01126
One-Sample Test
Test Value = 0
DAit0809
t
4.517
df
153
Sig. (2-tailed)
.000
70ii
Mean
Dif f erence
.05088
95% Conf idence
Interv al of the
Dif f erence
Lower
Upper
.0286
.0731