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Impact of family control on the relationship between earning management and future performance in Indonesia

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  • Edy Suprianto
  • Doddy Setiawan

Abstract

This study attempts to examine whether the family control has an impact on the relationship between earnings management and future performance. We also will assess whether the auditor has the important role in family firms. The total sample in this study has covered 918 firm-years or observations. We suggest that the average value of the future performance of family-based firms is better than the one of non-family firms. We also show that accrual earnings management in Indonesia is more opportunistic than efficiency. Finally, bigger auditor firms which selected by family firms have the positive effect on future performance.

Suggested Citation

  • Edy Suprianto & Doddy Setiawan, 2018. "Impact of family control on the relationship between earning management and future performance in Indonesia," Business and Economic Horizons (BEH), Prague Development Center, vol. 14(2), pages 342-354, April.
    • Handle: RePEc:pdc:jrnbeh:v:14:y:2018:i:2:p:342-354
    DOI: 10.15208/beh.2018.25
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    More about this item

    Keywords

    Accrual-based earning management; future performance; family firms;
    All these keywords.

    JEL classification:

    • M40 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Accounting - - - General

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