Earnings Management and Corporate Governance Case in Indonesia

This research attempts to analyze the impact of corporate governance mechanisms to earnings management and the consequence of earnings management to company's value. We use 679 financial reporting companies years of manufactured company include in BEI for 2008-2014 year. The research data is a panel data that obtained from measurement repeatability over the same variable in over time, and the variables change from one size to another size. Company that being as sample of this research is manufacturing company. The result shows that audit committee, institutional ownership, and managerial ownership effect to earnings management. Other variable such as size of board, independent commissioners ratio to all of the board, and size of independent commissioners have not effect in management motivation doing earnings management. Firm value was influenced by the existence of audit committee, institutional ownership, managerial ownership, size of board commissioners, and earnings management. Earnings management gives contribution to firm value but not as strong as that four variables.