FINANCIAL REPORTING INTEGRITY MODEL IN MANUFACTURING COMPANY
The purpose of this research is to analyze the influence of the variables Institutional Ownership (IO), Leverage (DER), Management Ownership (MO) on Earnings Management (EM) and on Financial Report Integrity (FRI). This is based on the phenomenon of inconsistency in various previous studies from what happened as a reality, thus encouraging researchers to carry out research again. This research is a type of quantitative descriptive research with a panel data multiple regression analysis method that uses 18 cross section samples and 5 years as a time series. This research formula is to maximize the value of FRI through EM as an intervening variable which is built into two research models and integrated into one research model using research objects in manufacturing sector companies listed on the Indonesia Stock Exchange. The results of the first research model; that MO can significantly explain the impact on EM with a positive correlation, which results confirm the current theory. Another result in the second research model is that DER and EM can each explain significantly their influence on FRI with a positive correlation in DER and negative in EM, which is a result that is in accordance with the applicable theory. The other variables cannot explain their influence on the endogenous variable EM in the first model and FRI in the second model. It is hoped that the results of this research can provide guidance for management practitioners and capital market players in Indonesia so that they can maximize the value of FRI.
Institutional Ownership, Leverage, Managerial Ownership, Earnings Management, Financial Report Integrity.