Earnings Management: The Impact of Cost of Goods Sold Increase on Gross Profit Decline (A Study on Waskita Karya (Persero) Tbk for the Period 2015-2023)

This study analyzes the impact of increasing cost of goods sold (COGS) on the decline in gross profit at PT Waskita Karya (Persero) Tbk during the period 2022-2023. Earnings management is often applied to adjust financial statements to achieve certain targets, especially in the face of changes in production costs and revenue. Using a quantitative descriptive approach, this research examines quarterly financial statements of the company. The results of the study show that the increase in COGS has a significant impact on the decline in the company's gross profit. The main factors contributing to this condition include increasing raw material prices, increasing labor costs, and government policies that affect the efficiency of construction projects. Based on the data analyzed, the company's gross profit decreased by 41.23% in 2023 compared to the previous year. This finding emphasizes the importance of implementing a more effective financial management strategy in dealing with increasing production costs. Optimizing selling prices and managing resources more efficiently can be a solution for companies to maintain profitability. In addition, transparency in financial reports is a key factor in helping stakeholders make better decisions.