The Effect of Company Growth, Dividend Policy, Leverage, Capital Intensity On Accounting Conservatism

Abstrak

Objective - This research aims to obtain empirical evidence about the effects of Company Growth, Dividend Policy, Leverage, and Capital Intensity on Accounting Conservatism.

Purpose – This research discusses Accounting Conservatism and other factors such as Company Growth, Dividend Policy, Leverage and Capital Intensity which focuses on energy sector companies. The research employs the Conservatism Accounting (CONACC) model as a measure of Accounting Conservatism.

Design/methodology/approach – This research adopts a quantitative approach. The sample comprises 18 Energy sector companies listed on the Indonesia Stock Exchange (IDX) over the period 2019-2023. To examine the proposed hypotheses, the study employs panel data regression analysis, utilizing Eviews 9 Software for the estimation and testing procedures.

Findings – The results of this study found that Company Growth has a positive but statistically insignificant effect on Accounting Conservatism. Similarly, Leverage has a positive but statistically insignificant effect on Accounting Conservatism. In contrast, Capital Intensity has positive and significant effect on Accounting Conservatism. However, Dividend Policy has a negative and statistically insignificant effect on Accounting Conservatism.

Research limitations/implications – The findings offer valuable insights for investors, creditors, and corporate managers in enhancing their understanding and application of accounting conservatism, particularly within the energy sector, thereby supporting more informed investment, financing, and reporting decisions. This study is constrained by the use of only four independent variables Company Growth, Dividend Policy, Leverage, and Capital Intensity with a sample limited to 18 energy sector firms listed on the IDX. The observation period also covers only five years (2019–2023), which may restrict the generalizability of the findings. Furthermore, the coefficient of determination is relatively low (0.3%), suggesting that additional factors beyond the proposed model may significantly influence accounting conservatism.