The Effect of Managerial Ownership, Debt Angreements and Litigation Risk on Accounting Conservatism

Abstract

The purpose of this study was to examine the effect of managerial ownership, debt covenants, financial distress and litigation risk on accounting conservatism. The population in this study consists of manufacturing companies, and consumer goods industry sub-sectors listed on the Indonesia Stock Exchange in 2015-2018. A sample of 12 companies used in this study was determined by the purposive sampling method. The data used is secondary data. Data analysis was carried out with descriptive statistics using panel data regression analysis techniques. The empirical results of this study indicate that independent debt covenants do not have a statistically significant effect on accounting conservatism, while managerial ownership and litigation risk have a negative significant effect on accounting conservatism. The results show that managerial ownership has a significant positive effect on accounting conservatism and litigation risk. significant positive effect on Accounting Conservatism, debt covenants do not have a significant effect on Accounting Conservatism, and managerial ownership, and litigation risk, together have an effect on Accounting Conservatism.