PENGARUH CORPORATE GOVERNANCE DAN KUALITAS AUDITOR TERHADAP MANAJEMEN LABA PADA PERUSAHAAN MANUFAKTUR YANG TERDAFTAR DI BURSA EFEK INDONESIA

Abstract

The aims of this research is examining the influence of corporate governance mechanisms, such as, managerial ownwership, institutional ownership, size of board of commissioner, composition of independent board of commisioner, size of audit committee and quality of auditor independence on the probability of earnings management practice in manufacture public companies listed in Indonesia Stock Exchange. The sample of this research is all of public manufacture companies existed in Indonesia in the year of 2007-2008 which were listed in Indonesia Stock Exchange. The research data were collected from public manufacture’s financial statement for the period of 2007 until 2008, from company’s websites. Earning Management is proxied by Descretionary Accruall model from jones (1991) which is divided into three Categories, High negative DA, High Positive DA and Low DA. By using Regression Logistic analysis as the research method, the results shown that corporate governance mechanisms, namely, managerial ownwership, institutional ownership, size of board of commissioner,composition of independent board of commisioner, size of audit committee and quality of auditor independence  influence the probability of earnings management practice of public manufacture companies in income decreasing and income increasing condition. The variables  influence  the probability of decreasing earning management practice is 61,7% while the left 38,3% influenced by the other factor, and for the increasing earning management, the value is 47,4% while the left 52,6% influenced by the other factor. But Only quality of auditor independence influences the probability  of earnings management practice in  income decreasing condition.