Title:
FIRM SIZE MODERATES THE EFFECT OF INSTITUTIONAL OWNERSHIP, AND FINANCIAL INDICATORS ON FINANCIAL DISTRESS

Authors:
Justina Laurena and I Wayan Ramantha ,Indonesia

Abstract:
This study aims to examine and analyze the effect of good corporate governance with one of the indicators consisting of institutional ownership, financial indicator with one of the indicators the liquidity ratio and leverage ratio on financial distress in manufacturing companies listed on the Indonesia Stock Exchange and also to test and analyze whether firm size can moderate the relationship between institutional ownership variables, liquidity ratios, leverage ratios in manufacturing companies listed on the Indonesia Stock Exchange. The population in this study are all manufacturing companies listed on the Indonesia Stock Exchange. Of the 175 companies registered as a population, a sample of 77 companies was taken, with 2 data outliers determined using the purposive sampling method. Based on the analysis results obtained as many as 73 companies are in financial distress, 3 companies are in gray area conditions, and 1 company is in non-financial distress conditions. The analytical technique used in this study is multinomial logistic regression. The results of testing the first hypothesis to the third hypothesis partially show that institutional ownership, liquidity ratios, and leverage ratios have no significant effect on financial distress. Testing the fourth hypothesis shows that firm size is not able to moderate the relationship between institutional ownership variables and financial distress. that the size of the company is able to moderate the relationship between the liquidity ratio and financial distress, and testing the sixth hypothesis that the size of the company is not able to moderate the relationship between the variable leverage ratio and financial distress in manufacturing companies listed on the Indonesia Stock Exchange.