Proceedings of the International Colloquium on Business and Economics (ICBE 2022)

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Real Earnings Management and Capital Structure Decision: The Role of Minority Interest

Authors
Ade Imam Muslim1, *, Doddy Setiawan2, Y. Anni Aryani2, Evi Gantyowati2
1Economics and Business Faculty, Sekolah Tinggi Ilmu Ekonomi Ekuitas, Bandung, Indonesia
2Economics and Business Faculty, Universitas Sebelas Maret, Surakarta, Indonesia
*Corresponding author. Email: imam.muslim@ekuitas.ac.id
Corresponding Author
Ade Imam Muslim
Available Online 26 December 2022.
DOI
10.2991/978-94-6463-066-4_2How to use a DOI?
Keywords
Capital Structure; Earnings Management; Family Firm; Minority Interest
Abstract

The corporate governance literature has widely recognized the role of debt contracts as a mechanism that can minimize agency problems arising from conflicts of interest between managers and capital owners and between minority and majority ownership. Our research seeks to investigate capital structure decisions in family firms. Our research involves earnings management proxies and minority interests. The main research question is whether minority interests play a role in influencing the earnings management and financing decisions of family firms. We use the panel data method and involve 90 family companies listed on the Indonesia Stock Exchange for the period 2010–2020. The results of the study prove that minority ownership plays a role in encouraging earnings management practices and capital structure decisions in family companies. The governance of family companies in Indonesia has allowed minority ownership to act as an external control mechanism. Even in family firms, our research proves that the presence of minority ownership remains an important part of family management decision making.

Copyright
© 2022 The Author(s)
Open Access
Open Access This chapter is licensed under the terms of the Creative Commons Attribution-NonCommercial 4.0 International License (http://creativecommons.org/licenses/by-nc/4.0/), which permits any noncommercial use, sharing, adaptation, distribution and reproduction in any medium or format, as long as you give appropriate credit to the original author(s) and the source, provide a link to the Creative Commons license and indicate if changes were made.

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Volume Title
Proceedings of the International Colloquium on Business and Economics (ICBE 2022)
Series
Advances in Economics, Business and Management Research
Publication Date
26 December 2022
ISBN
978-94-6463-066-4
ISSN
2352-5428
DOI
10.2991/978-94-6463-066-4_2How to use a DOI?
Copyright
© 2022 The Author(s)
Open Access
Open Access This chapter is licensed under the terms of the Creative Commons Attribution-NonCommercial 4.0 International License (http://creativecommons.org/licenses/by-nc/4.0/), which permits any noncommercial use, sharing, adaptation, distribution and reproduction in any medium or format, as long as you give appropriate credit to the original author(s) and the source, provide a link to the Creative Commons license and indicate if changes were made.

Cite this article

risenwbib
TY  - CONF
AU  - Ade Imam Muslim
AU  - Doddy Setiawan
AU  - Y. Anni Aryani
AU  - Evi Gantyowati
PY  - 2022
DA  - 2022/12/26
TI  - Real Earnings Management and Capital Structure Decision: The Role of Minority Interest
BT  - Proceedings of the International Colloquium on Business and Economics (ICBE 2022)
PB  - Atlantis Press
SP  - 4
EP  - 12
SN  - 2352-5428
UR  - https://doi.org/10.2991/978-94-6463-066-4_2
DO  - 10.2991/978-94-6463-066-4_2
ID  - Muslim2022
ER  -