Determinants of Corporate Earnings Management on the Indonesian Stock Exchange: An Empirical Study of Fraud and Corruption

This study aims to examine the phenomenon of corruption fraud which is proxied by earning management in companies listed on the Indonesia Stock Exchange. This study uses the variables of leverage, capital expenditure, and profitability as key variables that influence earning management practices that lead to fraud and corruption. This study uses time-series data from 2017 to 2021 and selects a sample by purposive sampling of as many as 28 companies listed on the Indonesia Stock Exchange. The results of the study found that the key variables of leverage, capital expenditure, and profitability, turned out to have a positive and significant effect on corruption fraud which was proxied by earning management. The contribution of this research is mainly to the management of shareholders, practitioners, and investors to predict the possibility of earning management practices that lead to corruption fraud committed by the company. The originality of this research is mainly in measuring corruption fraud which is projected by earning management, thus providing a reference for future research.