DETERMINANTS OF FIRM VALUE USING EARNINGS MANAGEMENT AS AN INTERVENING VARIABLE: AN EMPIRICAL STUDY OF FOOD & BEVERAGE CONSUMER INDUSTRY COMPANIES LISTED ON THE INDONESIA STOCK EXCHANGE

Abstract The study aims to analyze and address the research gap among previous researchers, as well as the phenomenon of firm value, with Tobin's Q as the proxy, using earnings management as an intervening variable. This research is a quantitative descriptive study using multiple regression analysis with panel data as the basis of analysis. The research object is food and beverage companies listed on the Indonesia Stock Exchange. A purposive sampling method was used to determine the sample size, resulting in a cross-section of twenty-six companies observed, with a five-year time series. Furthermore, this study did not produce firm value maximization through earnings management. This study uses a two-model integrated approach, each of which undergoes model selection testing: the Chow Test, the Hausman Test, and the Lagrange Multiplier Tests. The results of the first model, which uses endogenous earnings management variables, indicate that, in addition to institutional ownership and capital structure, all exogenous variables significantly explain earnings management, with the highest sensitivity to the profitability variable ROA. The results of the second model, which uses firm value as a proxy for Tobin's Q as an endogenous variable, show that profitability, ROA, and inflation significantly explain the effect on firm value. The highest sensitivity is found in ROA profitability, while other exogenous variables fail to explain the effect. These results are expected to serve as a guide for public companies in achieving market appreciation in firm value.