The Influence of Good Corporate Governance, Free Cash Flow and Leverage Factors on Earnings Management with Audit Quality as Moderating Variable

Abstract

The purpose of this study is to amass data on the impact of good corporate governance, free cash flow, and debt on profit management, with audit quality serving as a moderating variable. Thirteen firms were included in the sample, and data were acquired through judicious selection and documentation. (1) The data are evaluated for normality, multicollinearity, heteroscedasticity, and autocorrelation using traditional assumption tests. (2) hypothesis testing entails doing an F-test and a T-test concurrently. The audit committee's capacity, institutional support, and management ownership all serve as indicators of good corporate governance in this study. Audit quality moderates the role in the business world effect of audit committee size, independent commissioner share, and leverage. It is impossible to reduce the influence on profit management of institutional ownership, managerial ownership, and free cash flow. While free cash flow and leverage do not affect profit management, the changing percentage of independent commissioners does.