IkaDiyahCandraArifah (2008) The Relationship of Income Smoothing and Market Reaction to Income Announcement in Agriculture, Mining, Property, and Finance Companies at Indonesia Stock Exchange. Sarjana thesis, Universitas Brawijaya.
English Abstract
The studies about information content of income have been developed. The previous study about market reaction upon income announcement has proved that information content in income announcement pushes market practitioners react. In Indonesia, some study have done to test the information content in income by seeing market reaction upon financial report in announcement event period. The objective of this study is to examine the relationship of income smoothing’s practice and market reaction to income announcement event in four sectors. There are agriculture, mining, property and finance sector that listed at Indonesia Stock Exchange. This study uses time series financial report which start from 2004-2006. The proxy of market reaction are cumulative abnormal return and abnormal return, while income announcement is proxied by unexpected return. The beta correction method is Fowler and Rorke with 4 lags and 4 lags corrections. The observation periods are 5 days before and 5 days after income announcement and each day around income announcement’s date. The relationship between income smoothing and market reaction is analyzed on income announcement event of smoother companies and non-smoothers companies, with 5 percent significance of difference test (T-test). The result of this study indicates that there is a significant market reaction in agriculture, mining, property and finance companies that listed at Indonesia Stock Exchange both on each observation day around event date and event period. There is market reaction upon income announcement in agriculture, mining, property and finance companies at Indonesia Stock Exchange which has negative earning surprise based on zero growth model operating income, market expectation model operating income, and market expectation model income after tax (IAT). But, there is no difference of market reaction on event period between agriculture, mining, property and finance companies at Indonesia Stock Exchange which practice income smoothing (smoothers) or not (non-smoothers) and also have positive or negative earning sur
| Item Type: | Thesis (Sarjana) |
|---|---|
| Identification Number: | SKR/FE/2008/331/050802034 |
| Subjects: | 600 Technology (Applied sciences) > 658 General management |
| Divisions: | Fakultas Ekonomi dan Bisnis > Manajemen |
| Depositing User: | Endang Susworini |
| Date Deposited: | 13 Aug 2008 16:18 |
| Last Modified: | 21 Oct 2021 06:10 |
| URI: | http://repository.ub.ac.id/id/eprint/103611 |
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