EFFECT OF PROFITABILITY, LEVERAGE, AND FREE CASH FLOW ON EARNING MANAGEMENT WITH THE AUDIT COMMITTEE AS A MODERATION VARIABLE

Abstract

The purpose of this research is to examine the impact of Profitability, Leverage, and Free Cash Flow on Profit Management with the Audit Committee as a moderating variable. From a sample of 135 financial reports with high and low Profit Management categories. The sampling method used in the research was purposive sampling. Data analysis techniques for hypothesis testing in this research are descriptive analysis, classical assumption test, f test, t test, Moderated Regression Analysis, and coefficient of determination. Data analysis used in this research used the SPSS program. The results obtained after analysis are (1) Profitability does not significantly influence Profit Management, (2) Leverage significantly influences Profit Management, (3) Free Cash Flow does not significantly influence Profit Management, (4) The Audit Committee is unable to moderate the influence of Profitability on Earnings Management, (5) the Audit Committee is able to moderate the influence of leverage on Earnings Management, and (6) the Audit Committee is unable to moderate the influence of Free Cash Flow on Earnings Management.