Title: CORPORATE GOVERNANCE STRUCTURE, FINANCIAL RATIO AND FINANCIAL DISTRESS (Study of Non-Financial Companies listed on the Indonesian Stock Exchange for the 2011-2014 Period)
Author: Farah Faidah Ayudyani
Item Type: Thesis (Thesis)
Affiliations: Master of Management Science Study Program, Faculty of Economics and Business, Universitas Airlangga , Surabaya, Indonesia
Publisher: Universitas Airlangga
Abstract
This research aims to test and analyze the influence of corporate governance structure and financial conditions on financial distress. Corporate governance structure includes independent commissioners, institutional ownership and managerial ownership. Financial condition is calculated using financial ratios, including debt ratio, current ratio, operating profit margin and sales to total assets. The sample used is non-financial companies listed on the Indonesia Stock Exchange (BEI) in 2011-2014. This research used a purposive sampling method involving 588 observations using binary logistic analysis techniques. Binary logistic analysis shows that independent commissioners do not have a significant influence on financial distress, while institutional ownership and managerial ownership have a significant negative influence on financial distress. The results for financial condition calculated using financial ratios show that the debt ratio has a significant positive influence, the current ratio does not have a significant influence, while the operating profit margin and sales to total assets have a significant negative influence on financial distress.
Keywords: Corporate Governance Structure, Financial Condition, and Financial Distress