Abstract:
The objective of this study is to determine the influence of public ownership, leverage and audit tenure on accounting conservatism. Sample in this research is companies that consistently fall withing LQ45 Index for period 2010-2012. Number of sample is 29 companies with 87 observations. Public ownership is a measure of percentage of public ownership, while leverage is proxied by debt to asset ratio. Then, audit tenure is a measure of how long (t-6 - t) an public accounting firm performs audit services to particular companies. The accounting conservatism proxy by the difference between net income and operating cash flow divided by average total assets (ACC_CON). The results showed that public ownership, leverage and audit tenure give significant influence to accounting conservatism. Next researcher may use other proxy of accounting conservatisms or other independent variables. This research shows that 42.3% of dependent variable is explained by independent variables, the next researcher can search other independent variables that may affect accounting conservatism like growth opportunities, firm size, firm’s age, etc.
