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The Influence of Financial Leverage, Information Asymmetry, and Profitability on Income Smoothing with Good Corporate Governance as a Moderation Variable

In: Proceedings of the 8th International Conference on Accounting, Management, and Economics (ICAME 2023)

Author

Listed:
  • Muhammad Satria

    (University, Master of Accounting, Faculty of Economics and Business)

  • Amiruddin

    (University, Master of Accounting, Faculty of Economics and Business)

  • Syarifuddin Rasyid

    (University, Master of Accounting, Faculty of Economics and Business)

Abstract

“This study aims to examine the effects of financial leverage, information asymmetry, and profitability on income smoothing, and how the effects of financial leverage, information asymmetry, and profitability on income smoothing are moderated by good corporate governance. The sample in this study is mining sector companies listed on the Indonesia Stock Exchange (IDX) from 2018 to 2021. Data collection was carried out by tracing annual financial statements, total revenue, total debt, total assets, or related information that were selected as samples in this study. The population size in this study was 63 mining companies”. After being selected using purposive sampling methods, a sample of 29 companies was obtained for 5 years, so that the total observation of this study was 145 financial statements. The data analysis used was with the help of the Statistical Product and Service Solutions (SPSS) Ver. 25 program. The results of the study showed that: 1) Financial leverage has a positive effect on income smoothing. 2) Information asymmetry has a positive effect on income smoothing. 3)Profitability has a negative effect on income smoothing.4) Good corporate governance can weaken the effect of financial leverage on income smoothing.5) Good corporate governance can weaken the effect of information asymmetry on income smoothing.6) Good corporate governance can strengthen the effect of profitability on income smoothing.

Suggested Citation

  • Muhammad Satria & Amiruddin & Syarifuddin Rasyid, 2024. "The Influence of Financial Leverage, Information Asymmetry, and Profitability on Income Smoothing with Good Corporate Governance as a Moderation Variable," Advances in Economics, Business and Management Research, in: Arianto Patunru & Mubariq Ahmad & Mursalim Nohong & Arifuddin Arifuddin & Anas Iswanto Anwar & Rakhm (ed.), Proceedings of the 8th International Conference on Accounting, Management, and Economics (ICAME 2023), pages 989-1006, Springer.
    • Handle: RePEc:spr:advbcp:978-94-6463-400-6_76
    DOI: 10.2991/978-94-6463-400-6_76
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