Conservatism, Earnings Quality, and Stock Prices - Indonesian Evidence

Research aims: This research investigates the association of conservatism (both conditional and unconditional) with quality earnings as well stock prices on companies listed Indonesia Stock Exchange (IDX).Design/Methodology/Approach: The uses a sample 846 observations publicly Indonesian for fiscal year that ends December 31, 2016 through 2018. Conditional is measured by using an asymmetric timeliness measure from Basu (ATMB). Net income ratio (CFO/NI) proxy whereas between market value book (MTB) unconditional conservatism. data used in this study are obtained both database, company annual reports.Research findings: finds all analyzed implement conservative accounting policies practices. Besides, negatively associated also proves price conservatism, does not quality.Theoretical contribution/ Originality: enriches existing literature about especially emerging environment. Moreover, discusses set consist may give complete picture practices adopted companies.Practitioner/Policy implication: Since can solve agency cost problems, result affect way produce useful information interest parties.Research limitation/Implication: use purposive sampling method limits generalizations, because designs could be assumed to characterize IDX.