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Growing Science » Accounting » Characteristics of banks as determinants of profit management for Islamic and conventional banks in ASEAN

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Accounting

ISSN 2369-7407 (Online) - ISSN 2369-7393 (Print)
Quarterly Publication
Volume 7 Issue 5 pp. 1179-1188 , 2021

Characteristics of banks as determinants of profit management for Islamic and conventional banks in ASEAN Pages 1179-1188 Right click to download the paper Download PDF

Authors: Suripto Suripto, Supriyanto Supriyanto

DOI: 10.5267/j.ac.2021.2.020

Keywords: Earnings management, Sharia bank, Multiple discriminant analysis

Abstract: This study aims to analyze company characteristics as a determinant of conventional and Islamic bank earnings management in several ASEAN countries (Association of South East Asian Nations). The Multiple Discriminant Analysis was applied to determine the differences between Islamic and Conventional Banks. This test was conducted based on Capital Adequacy Ratio, Income Before Tax and Interest, Non-Performing and Changing Loans, and Company's Size in the banks of Indonesia, Malaysia, and Brunei Darussalam from 2014 to 2018. The data obtained from 200 banking entities were analyzed discriminatively. The results showed that there were simultaneous differences between Capital Adequacy Ratio, Earnings Before Tax, Loan Loss Provision, Non-Performing and Changing Loans, and Company's Size as determinants of earnings management between Islamic and conventional banks. Also, it was found that Company's Size was the dominant variable determining the management differences. Based on Discriminant Analysis, there were significant differences in the determinants of conventional and Islamic earnings management. The Changing Loan variable showed the highest contribution in determining earnings management in Islamic banks. Overall, this study found that conventional banks dominated Islamic system in practicing earnings management.

How to cite this paper
Suripto, S & Supriyanto, S. (2021). Characteristics of banks as determinants of profit management for Islamic and conventional banks in ASEAN.Accounting, 7(5), 1179-1188.

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Journal: Accounting | Year: 2021 | Volume: 7 | Issue: 5 | Views: 1325 | Reviews: 0

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