Research Paper
Year: 2018 | Month: November | Volume: 5 | Issue: 11 | Pages: 85-97
An Analysis on the Influence of Fundamental Factors, Intellectual Capital and Corporate Governance on Bankruptcy Prediction Using Springate (S-Score) Method in the Mining Companies Listed on the Indonesian Stock Exchange
Samsuddin Muhammad1, Isfenti Sadalia2, Khaira Amalia Fachrudin2
1Postgraduate Students at University of North Sumatra, Indonesia
2Postgraduate Lecturer at University of North Sumatra, Indonesia
Corresponding Author: Samsuddin Muhammad
ABSTRACT
Stakeholders should understand bankruptcy prediction of a company as an early warning system for the possibility of bankruptcy or financial problem that will always be encountered by the company in the future. The objective of the research was to analyze the influence of the fundamental factors such as financial ratio (measured from liquidity, profitability, solvability, and activity), intellectual capital (measured from Value Added Intellectual Capital / VACA), Value Added Human Capital/VAHU, Structural Capital Value Added/ STAVA, and Corporate Governance Mechanism (measured through Board of Directors, Board of Commissionaires, Managerial Ownership, institutional ownership, independent commissionaire, and auditing committee) on the bankruptcy prediction of the mining companies listed on BEI (the Indonesian Stock Exchange). The analysis used to test the variables was Chow test (F-test) and Hausman test to test the significance and properness of the model as well as its fixed effect to influence financial ratio, intellectual capital and corporate governance on the chance of bankruptcy according to S-Score model. The samples consisted of 33 companies in mining sector listed on BEI. The data used and processed were the financial reports of the companies in the observation years from 2012 until 2016 with 165 analysis units. The results of this research demonstrated that, simultaneously, the fundamental factors such as financial ratio, intellectual capital, and Corporate Governance had some influence on the bankruptcy prediction. Partially, financial ratio (Liquidity, Solvability and Activity), Intellectual Capital (VACA and VAHU), and Corporate Governance (Director Size) had negative and significant influence on bankruptcy prediction. STVA and managerial Ownership had positive and significant influence on the bankruptcy prediction. Meanwhile, Profitability, Commissionaires Size, Institutional Ownership, and Auditing Committee did not have any significant influence on the bankruptcy prediction.
Key words: Fundamental Factors, Intellectual Capital, Corporate Governance, and Bankruptcy Prediction
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