Effects of Earning Manipulation, Strength of Financial Position and Financial Distress on Firm Value (Case of Listed Manufacturing Firms in Indonesia)

Financial accounting information is often used by researchers and investors to measures firms value. The objective of this research is to investigate whether earning manipulation, strength of financial position and financial distress effect firm value. In this research earning manipulation is measured using Beneish M-Score, strength of financial position is measured using Piotroski F - Score, Financial distress measured using Altmann Z-score, and firm value is measured using Price Book Value (PBV). We used 125 observations from publicly listed manufacturing companies in Indonesia Stock Exchange (Bursa Efek Indonesia) in 2014, 2015, and 2016. Our research uses panel data analysis, and as the hypothesis test using E-VIEW. Results of our research show that only financial distress influences firm value. However, all independent variables simultaneously influence firm value. This finding also indicates that financial distress is more important than the other earning manipulation and strength of financial position in determining firm value.