Executive equity incentives and opportunistic manager behavior: new evidence from a quasi-natural experiment

This study provides plausible causal evidence on the effect of executive equity incentives on opportunistic manager behavior. I exploit a unique setting created by the introduction of Financial Accounting Standard (FAS) 123R in 2005, which led to an exogenous increase in the cost of option pay, causing a substantial decline in option pay for some firms while leaving others largely unaffected. Using difference-in-differences analyses with a treatment group of firms that show a decline in option pay and two control groups, I find that the likelihood of a treatment firm meeting or beating analyst forecasts decreases by 14–20%. The results show that the relatively high levels of meet-or-beat before FAS 123R were largely driven by real activities manipulation such as abnormal asset sales and sales manipulation to beat analysts’ benchmarks, while accrual manipulation and analyst management were less relevant. Together, the results suggest that equity incentives encourage opportunistic actions to meet or beat earnings expectations, and a decline in option pay results in a decline in earnings management to meet earnings expectations.

Turnaround Initiatives and Going Concern Opinion

The main purpose of this study is to examine the role of Statement on Auditing Standards (PSA) No. 30 which requires an independent auditor to evaluate management actions to overcome the financial distress of the company to reduce the possibility of going concern opinion acceptance. Implementation of turnaround initiatives consists of additional capital, borrowing and debt restructuring, asset sales and cost reduction activities. The population of this research is 454 manufacturing companies listed on Indonesia Stock Exchange during 2011-2013. This study finds that borrowing and debt restructuring are positive information which reduces the probability of receiving going concern opinions. Whereas, cost reduction is the negative information that increases the probability of receiving going concern opinion. That shows there is no significant effect of withdrawal of capital and asset sales activities on the probability of going concern opinion acceptance.

Restructuring MSME Businesses Through the Use of Digital Marketing as a Reflection on the Economic Impact of the Covid-19 Pandemic

Micro, small and medium enterprises (MSMEs) are most affected by the Covid-19 pandemic. Therefore, the role of MSMEs is very strategic as it reduces unemployment and poverty in Indonesia, thus providing solutions to economic and social problems. This study analyzes efforts in rescuing MSMEs to maintain the stability of the national financial system affected by the Covid-19 pandemic. The study uses a qualitative descriptive approach with literature review and interviews. The interview's outcome was conducted to 100 MSMEs in Semarang City, Demak Regency and Kendal District shows the issues faced by MSMEs due to the Covid-19 pandemic are decreased sales and difficulty obtaining raw materials, business capitals and paying premises rents, also production and distribution disruption. The study concluded seven strategies for maintaining and increasing MSME sales: transforming its marketing and sales online, diverting products/services line, reallocation of the fund, hygiene, and halal assurance, providing vouchers or gift cards, accelerating asset sales, and reduction of labor. These seven scenarios are expected to encourage MSMEs to improve and develop their capacities to play the role of economic safety nets. However, the results of this study have limitations for MSMEs in areas that are still limited by internet networks, so that they have difficulty implementing digital-based marketing strategies.

ANALISIS PELUANG, MODAL DAN PENDAPATAN PADA USAHA JUICE GAUL DI KOTA SERANG

The purpose of this study was to determine the opportunities, capital and income of the slang juice business in the city of Serang. This study aims to find out the opportunities that are used as a reference to get the idea of ​​opening juice slang, to get the first capital and develop a juice slang business in the city of Serang, the amount of daily and monthly income for slang juice, the number of juice slang outlets spread across the city and district. This research method uses qualitative research methods with data collection techniques using observation, interviews and documentation techniques. Then presented descriptively. The analysis used is a SWOT analysis to formulate a strategy based on logic that can maximize strengths and opportunities but simultaneously minimize weaknesses and threats. The results showed that based on the results of the SWOT strategy to develop a slang juice business, maintaining and improving product quality, maintaining selling prices, and creating product innovations, then the material capital collected came from personal savings, asset sales and bank loans. which increased significantly from 2016 to 2020