The Effect of Earnings Management on Firm Value before and When IFRS Implementation, Modereted Life Cycle Company 

Sunardi 
(Faculty of Economic and Business Universitas Muhammadiyah Palembang, Indonesia)

Abstract: The Purpose of this study was to test empirically the effect of earnings management on firm value before and when IFRS implementation was moderated by the life cycle of firm. The study population was 127 manufacturing companies that go public and listed on the BEI 2010-2016. The sample of this study was the number of firms as much as 192 firms completed financial report year 2010-2016, financial report year 2010-2011 (96 observation) was to explain before applying of IFRS while financial report (96 observation) year 2012-2016 explained when application of IFRS, Research results, before the implementation of IFRS earnings management did not affect on firm value, then when the implementation of IFRS earnings management affected positively and significantly firm value. While the moderate variables of percentage of sales growth and age of firm strengthen the influence of earnings management on firm value before implementation of IFRS, but variable of capital expenditure weaken. On the other hand, the percentage variable of sales growth, capital expenditure value and age of firm strengthens the influence of earnings management on company value during company implementation. Limitations, this study was not associated with the quality of financial reports, so the value of firm was high but low quality or otherwise.

Key words: earnings management; firm value; IFRS; sales growth; capital expenditure value

JEL codes: M