analysis audited financial statement of distress …

ANALYSIS AUDITED FINANCIAL STATEMENT OF

DISTRESS COMPANIES TOWARDS ACCOUNTING

DISTORTION LISTED ON INDONESIA STOCK

EXCHANGE

COVER PAGE SKRIPSI

By

Anju Lio

008201400012

Presented to

Faculty of Business, President University

In Partial Fulfillment of the Requirements for

Bachelor’s Degree in Accounting

President University

Cikarang Baru – Bekasi

Indonesia

2018

iii

CONSENT OF INTELLECTUAL PROPERTY RIGHT

Title of Skripsi:

Analysis Audited Financial Statement of Distress

Companies towards Accounting Distortion Listed on

Indonesia Stock Exchange

1. The Author hereby assigns to President University the copyright to the

Contribution named above whereby the University shall have the

exclusive right to publish the Contribution and translations of it wholly or

in part throughout the world during the full term of copyright including

renewals and extensions and all subsidiary rights.

2. The Author retains the right to re-publish the preprint version of the

Contribution without charge and subject only to notifying the University

of the Intent to do so and to ensuring that the publication by the University

is properly credited and that the relevant copyright notice is repeated

verbatim.

3. The Author retains moral and all proprietary rights other than copyright,

such as patent and trademark rights to any process or procedure described

in the Contribution.

4. The Author guarantees that the Contribution is original, has not been

published previously, is not under consideration for publication elsewhere

and that any necessary permission to quote or reproduce illustrations from

v

PLAGIARISM CHECK

ix

ACKNOWLEDGMENT

In the name of God,

First of all, the researcher would like to deliver the highest gratitude to the

Almighty God for His blessing during the completion of this research. The

research entitled “Analysis Audited Financial Statement of Distress

Companies towards Accounting Distortion Listed on Indonesia Stock

Exchange” is submitted as the final requirement in accomplishing undergraduate

degree at Accounting Study Program Faculty of Business in President University.

During the process of this research, a lot of people provided their help in

motivation, advice, and support. With honor, the researcher would like to express

his appreciation and gratitude to these distinctive people who have given their

support in making this study completed.

1. Researcher’s beloved parents, Paris Silaen and Derma Sihite. Researcher’s

supportive brothers and sister, Hulman Soaloon, Ananda Partohap, Citra

De Vegarini, for their endless prayers, love and encouragement for all the

time being.

2. Researcher’s skripsi advisor Dr. Josep Ginting, CFA, for his guidance and

patience in supporting this study. The success of this research is built

within his constructive feedbacks and mentoring during the research.

3. The head of Accounting Study Program Mrs. Andi Ina Yustina,

M.Sc.,CMA.,CIBA, for the support and patience given to the researcher.

x

4. Researcher’s best friends; Dicky Leonardo and Antonius Adi Prasetya

who gave a lot of suggestions, encouragement, and patience for the

completion of this research.

5. Researcher’s close friends, Ricky Arya .P, Septria .R, Ghifari .F, Rafael .P,

Riano .R, Melisa .G, Natasha .J, Irana .H, Diffa .D, Tsur .I, Janitra .G,

Indah .S, Dzalika .A, Ricky. A, Daniel .R, Robert .A, Krisno .A, Ari .I,

Octa .Y, Wendo .G, Rizky .H for the relief and accompany the researcher

during this study.

6. All cheer squad 2015, and 2016 for always cheering the researcher on and

off the court.

7. President University Major Association of Accounting 2014-2015, and

fellows’ students from President University especially Accounting Study

Program.

This research is far from perfect, but researcher expect this research to be useful

for all parties. Therefore, any suggestion and critics for development purposed are

welcomed.

xii

TABLE OF CONTENT

COVER PAGE ....................................................................................................... i

PANEL OF EXAMINER APPROVAL SHEET ... Error! Bookmark not defined.

CONSENT OF INTELLECTUAL PROPERTY RIGHT ................................. ii

PLAGIARISM CHECK ....................................................................................... v

ACKNOWLEDGMENT ..................................................................................... ix

DECLARATION OF ORIGINALITY .................. Error! Bookmark not defined.

TABLE OF CONTENT ...................................................................................... xii

ABSTRACT ........................................................................................................ xiv

INTISARI ............................................................................................................. xv

CHAPTER I ........................................................................................................... 1

INTRODUCTION ................................................................................................. 1

1.1. Background of the Study .............................................................................. 1

1.2. Research Questions ...................................................................................... 4

1.3. Research Objectives ..................................................................................... 5

1.4. Significance of Study ................................................................................... 5

1.5. Writing system ............................................................................................. 6

CHAPTER II ......................................................................................................... 8

LITERATURE REVIEW ..................................................................................... 8

2.1. Agency Theory ............................................................................................. 8

2.2. Accounting Distortion .................................................................................. 9

2.3. Financial Distress ....................................................................................... 12

CHAPTER III ..................................................................................................... 15

METHODOLOGY .............................................................................................. 15

3.1. Research Design ......................................................................................... 15

3.2. Sample and Timeframe............................................................................... 16

3.3. Research Instrument ................................................................................... 16

3.4. Multiple Regression Analysis .................................................................... 18

CHAPTER IV ...................................................................................................... 20

RESULT AND DISCUSSION ............................................................................ 20

xiii

4.1. Data Description ......................................................................................... 20

4.2. Results ........................................................................................................ 23

4.2.1. PT. BAKRIELAND DEVELOPMENT Tbk .................................. 23

4.2.2. PT. BUMI RESOURCE Tbk .......................................................... 25

4.2.3. PT. GOZCO PLANTATIONS Tbk ................................................ 29

4.2.4. PT. INDOSAT Tbk ......................................................................... 30

4.2.5. PT. LEYAND INTERNATIONAL Tbk ......................................... 31

4.2.6. PT. MAHAKA MEDIA Tbk ........................................................... 32

4.2.7. PT. PRIMARINDO ASIA INFRASTRUCTURE Tbk ................... 34

4.2.8. PT. RATU PRABU ENERGI Tbk .................................................. 34

4.2.9. PT. RIG TENDERS INDONESIA Tbk .......................................... 37

4.2.10. PT. TIGA PILAR SEJAHTERA FOOD Tbk ............................... 39

4.2.11. PT. ACE HARDWARE INDONESIA Tbk .................................. 40

4.2.12. PT. SEPATU BATA Tbk .............................................................. 40

4.2.13. PT. UNILEVER INDONESIA Tbk .............................................. 41

4.3. Discussion .................................................................................................. 42

4.3.1. Receivable ....................................................................................... 42

4.3.2.Inventory .......................................................................................... 44

4.3.3. Net Sales .......................................................................................... 45

4.3.4. Depreciation .................................................................................... 47

4.4. Regression Analysis ........................................................................... 50

CHAPTER V ....................................................................................................... 57

CONCLUSION AND RECOMMENDATION ................................................ 57

5.1. Conclusion .................................................................................................. 57

5.2. Recommendation ........................................................................................ 59

REFERENCES .................................................................................................... 60

APPENDICES ..................................................................................................... 64

xiv

ABSTRACT

This research is conducted in order to analyze accounting distortion that

occurs in financial distressed companies. The researcher would like to analyse

what changes in financial statement that often caused the accounting distortion,

how did accounting distortion occurred in financial statement of distressed

companies, and how financial distress cause company distortion based on the new

modified research model. Financial distress companies is measured by Altman Z

Score Model, and financial distortion is measured by changes in receivable,

inventory, net sales, and depreciation expense.

The data used in this research is from companies listed on Indonesia Stock

Exchange from the period 2011-2015. There are ten companies selected as

financial distress based on Altman Z Score Model that are analyzed by comparing

the first audited financial report with the revised financial report in order to find

the indication of accounting distortion. As an output, a new modified model based

on the ten financial distressed companies to represent data between financial

distress and accounting distortion.

The findings from this research shows that from ten companies of distress,

there are eight companies indicated with accounting distortion. Compared to the

healthy companies, the distortion occurred mainly because of the changes in

accounting standards and changes in accounting estimation.

Keyword: Accounting distortion, financial distress

xv

INTISARI

Penelitian ini bertujuan untuk menganalisis distorsi akuntansi yang terjadi

dalam laporan keuangan perusahaan financial distress. Peneliti ingin menganalisis

penyebab perubahan yang sering mengakibatkan distorsi akuntansi, bagaimana

distorsi akuntansi dapat terjadi dalam laporan keuangan perusahaan distress, dan

bagaimana financial distress mengakibatkan distorsi akuntasi berdasarkan

pengembangan model penelitian yang baru. Perusahaan financial distress diukur

dengan menggunakan Altman Z Score Model, dan distorsi akuntansi diukur

dengan perubahan piutang, persediaan, penjualan, dan beban penyusutan

Data yang digunakan dalam penelitian ini diambil dari perusahaan

terdaftar dalam Bursa Efek Indonesia pada periode 2011-2015. Sebanyak sepuluh

perusahaan terpilih dalam perusahaan financial distress berdasarkan Altman Z

Score Model yang akan dianalisis dengan membandingkan laporan keuangan

pertama yang sudah di audit dengan laporan keuangan yang sudah direvisi dengan

tujuan untuk menemukan indikasi distorsi akuntansi. Sebagai hasi akhir,

pengembangan model baru dengan menggunakan sepuluh perusahaan financial

distress untuk menyajikan data antara financial distress dan distorsi akuntansi.

Hasil dari penelitian ini menunjukkan bahwa dari sepuluh perusahaan

financial distress, terdapat delapan perusahaan yang terindikasi dengan distorsi

akuntansi. Dibandingkan dengan perusahaan sehat, distorsi sebagian besar terjadi

akibat perubahan standard akuntansi dan perubahan estimasi akuntansi.

Kata kunci: Distorsi akuntansi, financial distress

1

CHAPTER I

INTRODUCTION

1.1. Background of the Study

Financial statement is an important instrument for a company to present

their company condition in one period of time. This financial report contains the

capability of the company to use their resources in producing business income. It

is a must that every listed company to present the financial statement in order to

give information for public to know the condition of a company. As the

instrument for public, it helps public to take the right action for evaluating and

planning related to financial position, performance and financial changes (IAI,

2007). Public or users can be owners and investors, where they need to know

company capability in making profit. Lenders, or financial institution that

interested with the capability of the company to pay their liabilities. Government

and state authority, that need information for tax purposes (Darsono & Ashari,

2005). In using financial statement as decision making, it must give consistency in

order to convince and present reliable data for users. Yet in their practical

condition in giving information to public, few companies might give financial

statement that not present the real condition of the company which could lead to

accounting distortion.

2

Accounting distortion is a term where the financial statement show

differences in information that not represent the reality of the company business.

This distortion may occur from any specific reasons such as accounting standards,

errors in accounting estimation, earning management, conservatism, or even

fraudulent act in the company such as Enron, WorldCom, Global Crossing, and

Tyco cases that made public lose their trust in financial statement. These cases

became the main reason market share of 25 companies fall for more than 75% in

January 1999 until May 2002 which made loss of 23 billion US dollar (Fortune

2002).

In Indonesia, distortion case occurred in PT Kimia Farma for the 2001

audit period. According on Tempo (2003), the management reported that the

company received net profit amounted Rp 132 billion which the financial

statement was audited by Hans Tuanakotta & Mustofa (HTM). Yet in October

2002, there was a re-audit for their 2001 financial statement by Ministry of State

Owned Enterprise and BAPEPAM because the net profit considered too big and

indicated financial statement manipulation. The findings of this re-audit was the

net profit for 2001 only Rp 99.56 billion which the difference was 24.7% from

first report. The difference came from overstated of sales Rp 2.7 billion in raw

materials industry, overstated of inventory Rp 23.9 billion in central logistic unit,

overstated of inventory and sales amounted Rp 8.1 and Rp 10.7 billion

respectively in pharmaceutical wholesaler unit. This overstatement was done in

order to attract investors in PT Kimia Farma.

3

Users must have strong evaluation in order to take decision regarding the

distortion that occurs in every company especially public companies. Even though

for some companies, it takes more attention because of lack of capital factor,

excessive liabilities, and also continuous loss within years which describe a

company that face financial distress (Rodoni & Ali, 2010).

Financial distress is a condition when the company has difficulty in paying

all of their obligation and facing losses in recent years. The liquidity problem can

affect the company in running the operation. This condition make the company

must take cautious action especially for the management in order to overcome the

condition that may lead to bankruptcy. One of the option for the company in

solving this condition are rely on their third parties such as investors and lenders

in order to increase the condition of their financial condition. Yet while this

signaling occur, financial report reliability of the company might be questioned by

investors, lenders, and government since stability became the most important.

This condition also creates the problem between investors and other third parties

which is how they predict future economic condition of their company. While the

management struggles with their company condition, they think for the financial

distortion that can be one of the option in order to solve this uncontrollable

condition.

According to Bisogno and De Luca (2015), there is strong relationship

between distressed companies in Italy and earnings manipulation. Earnings

management practice is not only to fulfill the user expectation, but also to keep

financial source flow within the company.

4

The problem of accounting distortion is important to be noticed especially

since distortion can create accounting risks where there is uncertainty in the

analysis of financial statements for users. The main objective in the analysis of

financial statements is to evaluate company data to determine firm performance

and reduce financial risk. Yet if the company data is not reliable, how the user can

evaluate actual company conditions? Especially for some companies that are

facing financial distress. Conditions that can disrupt the sustainability of the

company are necessary to be noticed by management and some options can be

done by management but some of these options can harm investors.

Having this in mind makes researcher eager to analyze how financial

distress company see toward accounting distortion and analyze how accounting

distortion occurs in financial distress company.

1.2. Research Questions

What changes in financial statement often caused the accounting

distortion?

How did accounting distortion occur in financial statement of

distressed companies?

How does financial distress cause company distortion based on the

modified model?

5

1.3. Research Objectives

To analyze accounting distortion in financial distress companies, and to

modify the extant model to shows the changes in accounting distortion with

the condition of financial distress companies.

1.4. Significance of Study

This research was expected to give contribution for several parties, such

as:

Academic community

This research was expected to give knowledge regarding

accounting distortion and how accounting changes may affect

financial statements.

Investors and other users

This research was expected to give better awareness about

accounting distortion that may reduce the quality of financial

statement as one of the important financial information especially

in financial distress company.

6

1.5. Writing system

This thesis consist of five chapters and the organization of this research

are,

Chapter 1: Introduction

This chapter discusses about the background of the research. How accounting

distortion in financial distress became one of the problem that users faced, the

research question, the research objectives, significant of study, and the writing

system of the thesis.

Chapter 2: Literature Review

This chapter discusses about theory that the researcher uses in this thesis such

as agency theory, accounting distortion theory, and financial distress theory.

Chapter 3: Methodology

This chapter discusses about how researcher carry out the research regarding

accounting distortion in financial distress company.

Chapter 4: Result and Discussion

This chapter discusses about the findings based on the observation of all

financial distress sample regarding the distortion that happen. In this particular

chapter, researcher look for the source of distortion that happened in the

companies and their effect in financial statement.

7

Chapter 5: Conclusion and Recommendation

This chapter draws a conclusion based on the findings. Beside it provides for

some recommendations for the future research on accounting distortion, and the

implication of the study.

8

CHAPTER II

LITERATURE REVIEW

2.1. Agency Theory

Agency theory occurred because of the conflict of interest between the

agent and the principal. It describes how the agent performs on behalf of the

principal and how the principal wants to decide the operation of the company

(Jensen & Meckling, 1976). As a result of the human nature in self-interest

behavior, agency theory created asymmetry information between agent and

principal in which agent has potential to do improper act against the principal.

This does not rule out the possibility for the management to get more

compensation from shareholders which can harm since it can be motivated by

management self-interest.

Principals toward company risk can be neutral because they can diversify

their risk across firms and other investments (Eisenhardt, 1989). But from the

perspective of the agents, they still have tendency to differ the goals to the

principal. If the principal does not pay attention with the company operation, the

agent will manage the firm according to their own goals (Donaldson, 1990).

Because of this self-interest behavior, management have tendency to do earning

management and distort the financial statement in order to achieve management

goals. This situation created asymmetry information where the principal do not

know the condition of the company compared to agent.

9

2.2. Accounting Distortion

There are a lot of distortion cases in financial statement. For example,

Enron case in the year 2000 is the most recognized case regarding with financial

statement manipulation in order to keep shareholders trust. How could this

happen? Accounting information according to FASB (1978) must indicate the

factors of relevance and reliability. Relevance is defined as an information that

can affect financial decision of users in evaluating past event, present, or future.

While reliability defined as the quality of information that gives assurance that it

is reasonably free of error and bias and is a faithful representation. Financial

statement is a very important tool for internal and external parties that contain

financial condition of a company to see and take decisions (Horngren et al.,

2011). If the financial statement does not describe aspects of relevance and

reliability, how can investors evaluate the company? The differences in reported

financial statement with the reality condition of a company is an indication of

accounting distortion (Gandevani, 2010).

In fact, accounting distortion occurs because there are some alternative

that company can choose to improve or lower the performance of their company

in income statement (Tosen, 2006). Specific reasons such as changes in

accounting standards, error in accounting estimation, earnings management,

conservatism, or even fraudulent act in the company can be the indication of

accounting distortion.

10

Based on accounting standards, company can choose accounting standards

that applicable and most appropriate to describe the current condition of the

company (PSAK 1, 2014). But in this option, company can have tendency to

speeding up or slowing down the flow of income statement especially in net sales

with the intention to adjust the income statement as management desired, the use

of FIFO to increase the value of inventory or the use of LIFO to increase the cost,

and the use of depreciation method over the value of assets that the company

have.

The company’s requirement to report the financial statement in timely

manner makes the accrual basis to be a preferred reporting method. But according

to Sloan (1996), although the use of accrual basis is more preferable in presenting

the financial statement over the historical basis, the assessment should be based on

appropriate consideration because there is a subjective estimation that

management might take. Distortion might happen here because this accrual basis

is hard to track since it came from the estimation that transaction, with or without

cash as soon it occur, should be recorded (Richardson et al., 2006). And manager

may conceal the inability when the estimation does not meet, for example is credit

sales that the company records as revenue in accordance with the accrual basis.

There is a possibility that the credit cannot be fulfilled by the customer but due to

the subjective assessment that can be done by the company, the recognition can

still be done by raising the estimated sales of the credit.

Earnings management can occur in preparation for providing information.

Scott (2000) defined earnings management is a choice in accounting standard by

11

the manager in order to achieve specific goals. Although managers has an

important role in providing relevant and reliable information, in preparation

managers can use this opportunity to a reporting that can benefit the company.

Managers can make an accrual estimation using their experience to create

financial statements that are preferable to the company but on the other hand

reduce the quality to the users. The role of earnings management can be indicated

with changing in accounting standard and changing in accounting estimation

where it can change the financial reporting amount so it can be seen to meet user's

expectation.

Conservatism can also influence management in presenting financial

statements where companies take prudent reactions to recognize potential losses

and do not rush to record earnings future gain (Watts, 2003). This is aiming to

keep the company be careful and reduce the risk of uncertainty but for the

valuation of earnings, the fluctuating income will decrease the profitability and

cash flow valuation of the company (Sari & Adhariani, 2009).

12

2.3. Financial Distress

Financial distress is a condition when the company has difficulty in paying

all of their obligation resulting a decline in financial condition which leading to

bankruptcy or liquidity (Platt & Platt, 2002). This condition make the company

must take cautious action especially for the management in order to overcome the

condition that may lead to bankruptcy. Conditions that require companies to get

income, making the company must think of the best option to get out of distress

condition. One of the way for the management is to get financial help from the

third parties such as stakeholders in order to help the company's continuity in

operating capital that leads to income for the company. However, distress

conditions in the company can affect the company's relationships with

stakeholders, one of the reason is financial statement reliability. Distress condition

that being faced by the company are more likely to report manipulated financial

statement with the aim to fulfil shareholders expectancy to keep obtaining credit

as source of funds (Bisogno & De Luca, 2015). Then how can a user indicate a

company experiencing financial distress? It needs a financial analysis that can be

done with financial ratios.

In predicting financial distress, financial ratios are instrument that

generally used since its one of the way in interpreting financial report. There are

so many ratios that can be used but above all of that, users can use Z Score

Analysis method which is an instrument in determining whether the company

facing financial distress or not created by Dr. Edward I. Altman in the year 1968.

Z score is prediction method by using five financial ratios which are, EBIT to total

13

asset, net sales to total assets, market value of equity to total liabilities, working

capital to total assets, retained earnings to total assets ratio. These ratios generally

used in indicating financial distress of a company, since it accurately interpret

company performance, and predicting condition of the company whether the

company faced bankruptcy, indicated as grey area, or the company is currently

healthy in financial aspects.

EBIT to total assets

Calculation that can assess the company's ability to make profit through all

assets owned by the company before the calculation of interest and tax are

included.

Net sales to total assets

Calculation that can assess the company's ability to earn revenue from the

use of assets.

Market value of equity to total liabilities

Calculation that can assess the ability of financing companies in buying

assets. Rather using equity financing or debt financing.

Working capital to total assets

Calculation that assesses the ability of a company's liquidity in settling the

current obligation using their assets.

14

Retained earnings to total assets

Calculation that assesses how company relies on debt, or leverage.

15

CHAPTER III

METHODOLOGY

3.1. Research Design

This research uses inductive reasoning, which is the research process using

observation of the researcher, headed to the pattern of the data and explanation,

resulting a new theory as the output of the research. The data for this research was

gathered from Indonesia Stock Exchange by observing the financial report of the

companies. In order to find how much distortion occurs in financial distressed

companies, the researcher follows these steps:

1. Selecting companies that categorized as financial distress company using

Altman Z Score model which showed the index ≤ 1.8.

2. Gathering the data of four components distortion which are receivable,

inventory, net sales, and depreciation from ten distressed companies for

the period of five fiscal years.

3. Compare the components of distortion from the first report and revised

report to know the difference between two reporting system.

4. Analyze the source of differences in financial report of the first reporting

(audited) and revised reporting.

5. Construct the modified model using Altman Z Score component as

financial distress determinant with components of distortion.

16

3.2. Sample and Timeframe

The sample for this research is ten companies listed on Indonesia Stock

Exchange which show audited financial statement from 2011 to 2015 that are

categorized as financial distressed companies according to Altman Z Score model.

The researcher use five-year period with the intention to analyse how companies

treat accounting distortion in their financial reports.

3.3. Research Instrument

This research uses secondary data gathered from Indonesia Stock

Exchange. The data required for this research are EBIT/Total Assets ratio, Net

Sales/Total Assets ratio, Market Value of Equity/Total liabilities ratio, Working

Capital/Total Assets ratio, Retained Earnings/Total Assets ratio, Receivable,

Inventory, Net Sales, and Depreciation reported from 2011 until 2015.

17

The Altman Z Score Model as financial distress determinant,

Table 3.1 Altman Z Score Model

RATIO WEIGHTAGE

A EBIT / Total Assets x 3.3

B Net Sales / Total Assets x 0.999

C Market Value of Equity / Total liabilities x 0.6

D Working Capital / Total Assets x 1.2

E Retained Earnings / Total Assets x 1.4

Source: Adjusted by researcher, 2018

Where the result of calculation present the financial condition of the companies,

Table 3.2 Altman Z Score Model Interpretation


Z Score Interpretation

Z > 3.0 The companies is safe based on financial figures

1.81 < Z < 2.99

Grey Zone, where there should be exercise caution for

the company

Z < 1.8

Distress Zone, where company headed to bankruptcy

because of financial embarrassment

18

3.4. Multiple Regression Analysis

Researcher uses Eviews in making regression model in order to determine

distortion in receivable, inventory, net sales, and depreciation of financial

distressed company using Altman Z Score components.

Analysis Model:

Y1 = Cons1 + X1A + X2B + X3C + X4D + X5E + X6Z + ε1




From this model, it is expected to show the relationship based on four independent

variables which are receivable, inventory, net sales, and depreciation.

Whereas:

Y1: Receivable

Y2: Inventory

Y3: Net sales

Y4: Depreciation

X1A: Coefficient of EBIT/Total Assets ratio

X2B: Coefficient of Net sales/Total assets ratio

X3C: Coefficient of Market Value of Equity/Total liabilities ratio

19

X4D: Coefficient of Working Capital/Total Assets ratio

X5E: Coefficient of Retained Earnings / Total Assets ratio

X6Z: Coefficient of Altman Z Score

ε : Error

20

CHAPTER IV

RESULT AND DISCUSSION

4.1. Data Description

The research data were collected from the financial statement for public

listed companies on the Indonesia Stock Exchange (IDX), for the period of five

years from 2011 to 2015. The companies being used are categorized as ten

financial distressed companies and three healthy companies as the comparison.

These public listed companies were categorized as having financial distress

are,

Table 4.1 Distressed Companies

No. Stock Code Company Name

1. ELTY PT. BAKRIELAND DEVELOPMENT Tbk

2. BUMI PT. BUMI RESOURCES Tbk

3. GZCO PT. GOZCO PLANTATIONS Tbk

4. ISAT PT. INDOSAT Tbk

5. LAPD PT. LEYAND INTERNATIONAL Tbk

6. ABBA PT. MAHAKA MEDIA Tbk

7. BIMA PT. PRIMARINDO ASIA INFRASTRUCTURE Tbk

8. ARTI PT. RATU PRABU ENERGI Tbk

9. RIGS PT. RIG TENDERS INDONESIA Tbk

10. AISA PT. TIGA PILAR SEJAHTERA FOOD Tbk

21

As a comparison between financial distress companies toward accounting

distortion, this research also presented companies that shown healthy in financial

aspect and scored above 3.0 in a term of Altman Z Score, which is categorized as

healthy in their financial.

These healthy companies are,

Table 4.2 Healthy Companies

No. Stock Code Company Name

1 ACES PT. ACE HARDWARE INDONESIA Tbk

2 BATA PT. SEPATU BATA Tbk

3 UNVR PT. UNILEVER INDONESIA Tbk


22

Ten selected companies are categorized as financial distress based on the

Altman Z Score Model. The result for all ten companies are,

Table 4.3 Distressed Companies Z Score


Data description will be presented by the accounts of Altman Z Score

Components and the changes of Receivable, Inventory, Net Sales, and

Depreciation Expense for each company within five years.

2011 2012 2013 2014 2015

Bakrieland Develoment 0.63 0.3 0.5 0.53 0.01

Bumi Resource 1.65 0.68 -0.03 -0.65 -3.11

Gozco Plantations 1.37 1.17 0.85 0.94 0.61

Indosat 1.43 1.48 0.91 0.81 0.98

Leyand International 1.03 1.23 0.99 0.03 -0.17

Mahaka Media 1.16 0.98 1.46 1.39 0.71

Primarindo A.I -2.18 -1.07 -0.88 0.19 -0.51

Ratu Prabu Energi 0.54 0.8 0.87 0.54 1.48

Rig Tenders 1.8 1.45 0.91 0.93 0.28

Tiga Pilar 1.57 2.34 2.56 2.64 1.8

23

4.2. Results

4.2.1. PT. BAKRIELAND DEVELOPMENT Tbk

Table 4.4 Bakrieland Differences


For the year of 2011, Bakrieland had a difference in net sales for Rp

89,788,811,900 or 4% from Rp 2,017,319,021,475 in the first report, which

revised to Rp 1,927,530,209,575. This difference came from estimation of toll

road revenue but the operation was discontinued regarding the planning of selling

subsidiary company named PT Bakrie Toll Road. The purpose of the selling was

to pay debts toward PT Panca Utama Niaga and PT Gemilang Sukses Creative

Sinergy.

For the year of 2012, Bakrieland also had a difference in net sales for Rp

23,271,600,912 or 1% from Rp 2,949,585,801,725 in the first report, which

revised to Rp 2,926,314,200,813 in the next report. The difference came

considering the sale of their ownership in PT Samudra Asia Nasional. Showing

Year ∆ Receivable ∆ Inventory ∆ Net sales ∆ Depreciation

2011 0 0 -0.04450898 0

2012 0 0 -0.00788979 0

2013 0 0 -0.03752147 0

2014 0.086865116 -0.0313622 0 0

2015 0 0 0 0

24

the source of differences was the income from asset classified as held for sale

from PT Samudra Asia Nasional.

In 2013 there was also a difference in net sales for Rp 124,753,385,530 or

4% from Rp 3,324,852,984,839. In the first report, net sales of Bakrieland in 2013

was Rp 3,324,852,984,839 but regarding the sales their ownership of PT Nirwana

Legian Hotel, the net sales was decreased to Rp 3,200,099,599,309 in financial

statement where it contributed Rp 124,753,385,530 in Bakrieland net sales for the

first report.

In the 2014 there were differences in receivable and inventory. The

difference in receivable was amounted Rp 200,000,000,000 or 9% from Rp

2,302,420,227,104, which was revised to Rp 2,502,420,227,104 in the next report.

This difference came from the agreement for transfer ownership of PT Bukit

Jonggol Asri on October 14, 2014 amounted Rp 200,000,000,000 to PT Sentul

City Tbk.

The difference in inventory came from inventory of apartment where it

first reported Rp 840,308,083,496 but it was revised to Rp 782,607,439,541. The

Rp 57,700,643,955 differences was incurred because there was the deduction of

land inventory and building ready-for-sale included assets of PT Mutiara Masyhur

Sejahtera (MMS) which were acquisition of PT Bakrie Swasakti Utama (BSU).

25

4.2.2. PT. BUMI RESOURCE Tbk

Table 4.5 Bumi Resource Differences


2011 0.00150013 0.0017832 -0.001698 0.3661628

2012 0 0 0 0

2013 -0.63998498 0 0 -0.307533268

2014 -0.51760814 -1 -0.97777209 -0. 951115557

2015 0 0 0 0


For the year 2011, Bumi Resource have differences in Receivable,

Inventory, Net Sales, and Depreciation. These differences was incurred because of

the change of subsidiaries presentation currency from Rupiah / Yen to USD which

had been accounted accordance to PSAK No. 10 (Revised 2010).

Receivable in 2011 have differences amounted $ 1,018,682 or 0.15% from

$ 679,062,573 in first report, and it was revised to $ 680,081,255. Inventory of

Bumi Resource in 2011 also have difference which amounted $ 280,230 or 0.18%

from first report which was $ 157,151,642 but after revised, it was $ 157,431,872.

For Net Sales, there was a difference amounted $ 67,946 or 0.0017% from $

4,001,058,461 in the first report, and it was revised to $ 4,000,990,515.

But for Depreciation in 2011, there was a big difference amounted $

38,318,833 or 37% from $ 104,649,716 in the first report, and it was revised to $

142,968,549. The difference came from Depreciation in Cost of Revenues from

26

first report $ 106,668,580 revised to $ 138,739,245. It also came from

Depreciation in Operating Expenses which was $ 9,102,495 in first report then

revised to $ 4,229,304. This difference happened because some fixed assets of

subsidiaries which are PT Kaltim Prima Coal and PT Arutmin Indonesia, are

owned by the government and under the agreement term of the Coal Contract of

Work (CCoW) where they both have exclusive right to use the assets over their

useful lives. Changes in expected level of usage and technological development

could impact the economic useful lives and the residual values of these assets, and

therefore future depreciation charges could be revised. While there is an addition

in leased assets which in the financial statement 2012 the fixed asset was revised

from $ 904,419,560 to $ 1,650,928,140, the change could indicate a motive that

the company wants to under-stated the depreciation expense in order to make the

profitability of the company looks preferable.

In 2013 Bumi Resource have differences in receivable and depreciation.

The difference came because of in the year 2015, there was an application of

PSAK No. 66 “Joint Arrangements” which superseded PSAK No. 12 (Revised

2009) “Interests in Joint Ventures” and ISAK No. 12 “Jointly Controlled Entities

– Non-monetary Contributions by Venturer”. Prior to application of PSAK No.

66, the Group classified their subsidiary entities as jointly controlled entities and

accounted its interests using proportionate consolidation method. Following the

application of PSAK No. 66, the Group assessed that its joint arrangements should

be classified as joint venture thus accounted its interests in those entities using the

equity method.

27

Receivable in 2013 have difference amounted $ 473,681,994 or 64% from

$ 740,145,487 which was stated in first report, and it was revised to $

266,463,493 in 2015 financial report. It came from Trade Receivable of the third

parties amounted $ 429,997,779 and other receivable amounted $ 43,684,215.

This difference happened because of payment of their liabilities since there was an

indication of revised current liabilities from $ 4,719,914,333 in the first report to $

2,969,429,996 and revised current assets from $ 1,944,236,777 in the first report

to $ 424,504,684.

Depreciation in 2013 also have a big difference amounted $ 70,492,515 or

31% from $ 229,219,152 which was stated in first report, and it was revised to $

158,726,637. It came from depreciation in cost of revenue which was stated

218,636,211 in the first report, which revised to 148,143,696. The difference of $

70,492,515 was added to amortization of mining properties which were classified

to depreciation in the first report.

For 2014 there were differences in Receivable, Inventory, Net Sales, and

Depreciation. These difference also happened from the application of PSAK No.

66 “Joint Arrangements” which superseded PSAK No. 12 (Revised 2009)

“Interests in Joint Ventures” and ISAK No. 12 “Jointly Controlled Entities – Non-

monetary Contributions by Venturer”.

For Receivable, the difference amounted $ 692,792,256 or 52% from $

1,338,449,297 in the first report, then it revised to $ 645,657,041. This was caused

by trade receivable amounted $ 644,357,259 and other receivable amounted $

28

48,434,997 which also indicate the payment of their current liabilities from $

6,798,673,348 in the first report to $ 4,938,951,428.

For the Inventory, difference amounted was $ 119,465,537 or 100%

because of the application of PSAK No. 66 “Joint Arrangements”

Net Sales for 2014 have difference amounted $ 2,724,138,640 or 98%

from $ 2,786,067,095 in the first report, where it was revised to $ 61,928,455.

These difference came from in the first report, Bumi Resource reported their coal

sales from export of the third parties amounted 1,801,253,378 but after the revised

they didn’t include this sales because the changes from jointly controlled entity to

joint ventures.

Depreciation in 2014 also have big difference amounted $ 132,877,707 or

95% from $ 142,479,889 in the first report, and it was revised to $ 6,965,050.

The difference came from the revised in cost of revenue depreciation from $

133,744,860 to $ 3,078,927, and operating expense depreciation from $ 7,537,063

to $ 3,886,123.

29

4.2.3. PT. GOZCO PLANTATIONS Tbk

Table 4.6 Gozco Differences


2011 0 0 0 0

2012 0.0000419 0.00000272 -0.000000740 -0.00000192

2013 0 0 0 0

2014 0 0 0 0

2015 0 0 0 0


Through 5 years, Gozco Plantation does not have any differences in their

Receivable, Inventory, Net Sales, or Depreciation. Even though in 2012 there was

a slight differences in all variable, it doesn’t have significant effect toward

company distortion. The differences only happen because of in 2012 reporting

Gozco expressed Rupiah in full amount, while in 2013 reporting they expressed

Rupiah in millions.

30

4.2.4. PT. INDOSAT Tbk

Table 4.7 Indosat Differences


2011 0.04080032 0 -0.002313323 -0.003439993

2012 0 0 0 0

2013 0 0 0 0

2014 0 0 0 0

2015 0 0 0 0


Through 5 years, Indosat only have a difference in 2011 which was in

Receivable, Net Sales, and Depreciation. Indosat have difference Rp 59,027

million in Receivable or 4% from Rp 1,446,729 million in the first report, which

was revised to Rp 1,505,756 million. The difference came from the application of

PSAK 30 (Revised 2011) “Rent”, where the main impact is the recognition of

asset and the liability of rent regarding the building and land. ISAK 16 “Service

Concession Agreement” and ISAK 22 “Service Concession Agreement:

Disclosure”, where in concession agreement the company has a right to receive

rewards from service provider, which it is recognized as receivable.

31

4.2.5. PT. LEYAND INTERNATIONAL Tbk

Table 4.8 Leyand Differences


2011 0 0 0 0

2012 0 0 0 0

2013 0 0 0 0

2014 0 0 0 0

2015 0 0 0 0


Through five years, Leyand International doesn’t have any differences in

all Receivable, Inventory, Net Sales, or Depreciation.

32

4.2.6. PT. MAHAKA MEDIA Tbk

Table 4.9 Mahaka Media Differences


2011 0 0 0 0

2012 -0.09326893 0 0 0

2013 0.07114936 0 0.146936173 0.035546042

2014 0 0 0 0

2015 0 0 0 0


All differences of Mahaka Media that happened in 2012 and 2013 was

caused by the result of PT Kalyanamitra Adhara Mahardika (KAM) accusation

and subsidiary transaction that being adapted from PSAK No. 38 (2012 Revision)

about “Business Combination Under-Common Control” that been adopted in

2014, that replace PSAK No. 38 (2004 Revision) about Accounting for

Restructuring Under-Common Control Entities. Making the subsidiary investment

in 2014 as if it also happened in 2013 and 2012.

Mahaka Media in 2012 have difference in their Receivable amounted Rp

12,006,757,236 or 9% from Rp 128,732,660,279 in the first report, which was

revised to Rp 116,725,903,043. It was caused by the write-off of other receivable

amounted Rp 15,291,314,931 from the first report.

In 2013 Mahaka Media have differences in Receivable, Net Sales, and

Depreciation. In 2013 Receivable there was difference amounted Rp

33


revised to Rp 132,697,328,098. The increase of the third parties receivable came

from Rp 111,828,000,722 in the first report to Rp 117,352,985,428, increase of

related parties from Rp 10,757,645,548 in the first report to Rp 15,344,342,670,

but there was a write-off of other receivable amounted Rp 1,297,477,433 in

revised report.

For the Net Sales of 2013, Mahaka Media have difference amounted Rp


revised to Rp 309,160,119,685. It was caused by the difference in newspaper and

advertisement sales, newspaper advertisement, and TV broadcasting.

For the difference in Depreciation, it was amounted Rp 686,036,014 or 4%

from Rp 19,299,926,966 in the first report, which was revised to Rp

19,985,962,980. It was caused by the increased of assets due to the application of

PSAK No. 38.

34

4.2.7. PT. PRIMARINDO ASIA INFRASTRUCTURE Tbk

Table 4.10 Primarindo Differences


2011 0 0 0 -0.694514505

2012 0 0 0 0

2013 0 0 0 0

2014 0 0 0 0

2015 0 0 0 0


Primarindo have a big difference in Depreciation for the year of 2011. The

difference amounted Rp 5,259,315,083 or 69% from Rp 7,572,649,734 in the first

report, which was revised to Rp 2,313,334,651. It came from the manufacturing

cost depreciation that reported first as Rp 6,931,712,133 in the first reporting, but

revised to Rp 1,672,397,050.

35

4.2.8. PT. RATU PRABU ENERGI Tbk

Table 4.11 Ratu Prabu Differences


2011 0 0 0 0.017882051

2012 0 0 0 -0.419371274

2013 -0.064055089 0 0 0

2014 0 0 0 0

2015 0 0 0 0.057650529


Ratu Prabu in 2011 only have difference in Depreciation amounted Rp

737,015,224 or 2% from Rp 41,215,363,549 in the first report, which was revised

to Rp 41,952,378,773. It was came from operating expense that was Rp

8,631,320,177 in the first report, which was revised to Rp 9,368,335,401.

In 2012, Depreciation have a big difference amounted Rp 17,630,092,040

or 42% from Rp 42,039,341,111 in the first report, which was revised to Rp

24,409,249,071. It was caused by the difference was excluded from fixed asset to

property investment and made the depreciation in fixed asset decreased 42%. But

it didn’t change the amount in cost of goods sold since the total depreciation was

the same. Although if it is seen from only fixed asset depreciation, the amount had

changed.

In 2013, receivable have difference amounted Rp 17,133,058,530 or 6%

from Rp 267,473,808,571 in the first report, which was revised to Rp

250,340,750,041. It was caused by the third parties other receivable was extended

36

into non-current receivable. The revised of accounting estimation made the

receivable decreased for 6% in 2013.

In 2015, the only difference came from Depreciation which amounted Rp


revised to Rp 22,480,340,851. The difference came from the increase in cost of

goods sold depreciation amounted Rp 17,744,924,052 in the first report, which

revised to Rp 18,970,285,222.

37

4.2.9. PT. RIG TENDERS INDONESIA Tbk

Table 4.12 Rig Tenders Differences


2011 1.01569335 0.69814801 1.275653116 0.987912448

2012 0 0 0 0

2013 0 0 0 0

2014 0 0 0 0

2015 0 0 0 0


Rig Tenders in 2011 have differences in receivable, inventory, net sales,

and depreciation. All differences in Rig Tenders for 2011 was the result of

acquisition of CH Ship Management Pte Ltd, CHLPL, Sea Master Pte Ltd,

GMPL, and BAL (together called “Target Companies”), which were previously

owned by Scomi Marine Service Pte Ltd. With using PSAK No. 38 (Revised

2004) “Accounting for Restructuring of entities under Common Control” the

agreement was executed in 12 April 2012 and accounted using as-if-pooling-of-

interests method as required under PSAK 38. Based on this event, the report was

revised as if the subsidiaries had been combined from the January 2011.

38

In receivable, there was a big difference amounted $ 17,503,212 or 102%

from $ 17,232,772 in the first report, which was revised to $ 34,735,984. It was

caused by the revised of third parties receivable amounted from $ 14,022,537 to $

32,721,944 which increased from local debtors.

In inventory there was a difference for $ 1,328,938 or 70% from $

1,903,519 in the first report, which was revised to $ 3,232,457. It was caused by

the method for determining the value of inventory was average cost so further

revision might needed.

For the net sales, it was the biggest difference for Rig Tenders amounted $

63,779,806 or 128% from $ 49,997,766 in the first report, which was revised to $

113,777,572 in the next year. This was caused by the increased of net sales from

charter of vessels from the third parties such as from PT Adaro Indonesia that

increased from $ 4,226,161 to $ 66,162,009 and other parties that increased

company revenue from $ 2,918,691 to $ 21,765,816.

And for depreciation, the difference amounted $ 7,629,471 or 99% from $

7,722,821 in the first report, which was revised to $ 15,352,292. It was caused by

the increased of vessels depreciation from $ 7,648,982 to $ 15,170,308.

Rig Tenders in 2013 didn’t have any differences, although they changed

the end of fiscal year from 31 December to 31 March in order to follow similar

change by the parent company. This made the reporting for the year 2013 had 15

months which usually 12 months.

39

4.2.10. PT. TIGA PILAR SEJAHTERA FOOD Tbk

Table 4.13 Tiga Pilar Differences


2011 0 0 0 0

2012 0 0 0 0

2013 0 0 0 0

2014 0 0 0 0

2015 0 0 0 0


For Tiga Pilar, they only have difference in receivable amounted Rp 791

million but it didn’t change the balance of total current assets considering the first

report amounted Rp 474,549 million and it was revised to Rp 473,758 million in

the next report. The difference was caused by changes of account name to other

financial assets.

40

4.2.11. PT. ACE HARDWARE INDONESIA Tbk

Table 4.14 Ace Hardware Differences


2011 0 0 -0.00689 0

2012 0 0 0 0

2013 0 0 0 0

2014 0 0 0 0

2015 0 0 0 0


In Ace Hardware, the only changes was in net sales for 2011 amounted

16,577,475,000 or only 0.7% from the first report which wasn’t significant. This

changes came from sales of home improvement products which reclassified

because of ISAK 10.

4.2.12. PT. SEPATU BATA Tbk

Table 4.15 Bata Differences


2011 0 0 0 0

2012 0 0 0 0

2013 0 0 0 0

2014 0 0 0 0

2015 0 0 0 0


For Bata, there wasn’t any changes of amount for the 5 years period from

2011 until 2015, and doesn’t show any changes in accounting standards or

accounting estimation.

41

4.2.13. PT. UNILEVER INDONESIA Tbk

Table 4.16 Unilever Differences


2011 0 0 0 0

2012 -0.24218 0 0 0

2013 -0.18736 0 0 0

2014 0 0 0 0

2015 0 0 0 0


Unilever had revision in their financial statement in the year of 2012 and

2013. The changes was happened because of in 2014 the management found that

the trade term balance wasn’t reported correctly in the year 2012 and 2013.

Therefore restatement was occur in 2014. Even though the difference was Rp

645,868 or 24% and Rp 644,720 or 19% in the year 2012 and 2013 respectively,

the restatement doesn’t affect retained earnings or profit for the year ended.

42

4.3. Discussion

From all ten companies that indicated financial distress, eight of them

show distortion in financial report. Majority of the differences came from changes

of accounting policy that company adapt.

4.3.1. Receivable

Receivable as a part of accrual accounting shows a lot changes in financial

statements. Bakrieland in 2014 shows that the agreement for selling subsidiaries

which was PT Bukit Jonggol Asri on October 14, 2014 to PT Sentul City Tbk can

increase receivable amounted 9%. The sales occurred because the company

intended to buy another ownership of PT Jungleland Asia.

There was also the case of changes in accounting standards which in Bumi

Resource for the year 2013 where they decided to use PSAK No. 66 about “Joint

Arrangements” in 2015 which Bumi Resource must assessed that its joint

arrangements should be classified as joint venture and its interest in those entities

should use equity method, while prior to the application, the company used to

classified their subsidiaries as jointly controlled entities and accounted its interest

using proportionate consolidation method. While this standard being adopted, the

December 2013 and December 2014 financial statements had been revised as if

the changes already happened in 2013 and 2014. This revision made the

receivable for the 2013 and 2014 decreased 64% and 52% respectively.

The adaptation of PSAK also happened in Indosat where there was a

changes in accounting standard which the company did in 2011 which is PSAK

43

30 about “Rent”, where the company must take evaluation regarding rent of land

and building recognition. And ISAK 16 “Service Concession Agreement”, and

ISAK 22 “Service Concession Agreement: Disclosure”. Where it discuss about

right in receiving reward from concession contract which recognized as

receivable. Because of the application of these accounting standards, Indosat

increased their receivable in 2011 as much 4%.

There were some changes in accounting standards of Mahaka Media in

2012 and 2013 that affect receivable, which was PSAK No. 38 about “Business

Combination Under-Common Control”. As a method in combining ownership of

entities where the component of financial report represented as if the combination

has occurred since the starting period of common-control. This application made

the receivable in 2012 decreased 9% and receivable in 2013 increased as much

7%.

Ratu Prabu showed changes in receivable in 2013 because of the changes

of accounting estimation where the other receivable from the third parties was

extended from current receivable to non-current receivable. The revised of

accounting estimation made the current receivable decreased as much 6%.

And the last is occurred in Rig Tenders for the year 2011 which happened

because of the adaptation of PSAK No. 38 about “Business Combination Under-

Common Control” regarding the acquisition of CH Ship Management Pte Ltd,

CHLPL, Sea Master Pte Ltd, GMPL, and BAL (together called “Target

44

Companies”), which were previously owned by Scomi Marine Service Pte Ltd.

The result is an increase of receivable from local debtors as much 102%.

For the receivable, six of the distress companies show significant changes

in amount. Four of them occurred because of the changes in accounting standard

such as the application of PSAK and two of them because of the extended

receivable into non-current receivable and an agreement for selling subsidiaries.

The biggest changes in accounting standard occurred in Rigtenders where the

application of PSAK No. 38 about “Business Combination Under-Common

Control” can increase the company receivable as much 102% by acquisition of a

company or business combination.

4.3.2. Inventory

The differences in inventory indicated in Bakrieland financial statement

for the year of 2014. Which happened because of deduction of land inventory and

building ready-for-sale. It made the decrease in revised financial statement as

much 3%.

The difference also happened in Bumi Resource for the year of 2014,

where the application of PSAK No. 66 about “Joint Arrangements” making the

inventory amounted zero in the revised financial statement. This application

making the inventory amounted $ 119,465,537 wasn’t reported in revised

financial statement of Bumi resource.

The application of PSAK No. 38 about “Business Combination Under-

Common Control” created difference in inventory of Rig Tenders in 2011. Which

45

the acquisition of CH Ship Management made the inventory increase as much

70%.

For the inventory, three of the distressed companies show changes in

amount. Changes in Rig Tenders and Bumi Resource occurred because of the

application of PSAK while Bakrieland shows changes because of the deduction of

their ready-for-sale inventory. The biggest changes was in Rig Tenders because of

the application of PSAK No 38 about “Business Combination Under-Common

Control” can increase the inventory 70% because of acquisition of a company or

business combination.

4.3.3. Net Sales

For the net sales of Bakrieland in 2011, there was an error in accounting

estimation regarding discontinued operation due to the selling of subsidiaries

which was PT Bakrie Toll Road. The decision in selling subsidiaries was to fulfil

the payment of debt to Panca Utama Niaga and PT Gemilang Sukses Creative

Sinergy. Because of this, there were a decrease in net sales as much 4%. In 2012

Bakrieland had a difference regarding the net sales because of the sale of their

ownership in PT Samudra Asia Nasional which the source of income from assets

that classified as held from sale even though the difference only decreasing the net

sales of Bakrieland as much 1%. But for the year of 2013, Bakrieland also sold

their ownership in PT Nirwana Legian Hotel which decreased their net sales as

much 4% because they loss the contribution of PT Nirwana Legian Hotel in their

net sales.

46

Difference in net sales also happened in Bumi Resource for the year of

2014 where it caused by the application of PSAK No. 66 “Joint Arrangements”

which Bumi Resource must assessed that its joint arrangements should be

classified as joint venture and its interest in those entities should use equity

method. It happened that the decrease of net sales as much 98% because of in

revised reporting, they didn’t report the coal sales from export of the third parties.

In Mahaka Media, because of the acquisition of PT Kalyanamitra Adhara

Mahardika (KAM) under PSAK No. 38 (2012 Revision) about “Business

Combination Under-Common Control”. There was some difference in the year of

2013 regarding receivable which they recognized more sales such as newspaper

sales, advertisement sales, and TV broadcasting. It increase the net sales of the

year as much 15% compared to the first reporting of the company.

The event of acquisition also happened in Rig Tenders for the year 2011.

They acquired CH Ship Management under PSAK No. 38 (Revised 2004)

“Accounting for Restructuring of entities under Common Control” which

increased the net sales of the company 128% from the first reporting. Due to the

adaptation of the standard, Rig Tenders reported an increased from chartered of

vessels from the third party such as PT Adaro Indonesia and the other third

parties.

For the net sales, four of distress companies show changes in their amount.

In Bumi Resource, Mahaka Media, and Rig Tenders changes occurred because of

the changes in their standard, while in Bakrieland changes occurred because of

47

discontinued operation due to sale of subsidiaries and sale of their ownership. The

biggest changes was occurred in Bumi Resource because application of PSAK 66

about “Joint Arrangements” which they must assessed their joint arrangements

should be classified as joint venture using equity method. It decreased their net

sales 98% because they didn’t report the coal sales from export of the third

parties.

4.3.4. Depreciation

The increase of depreciation in Bumi Resource for the year of 2011

because of there are some of the subsidiaries fixed assets were owned by the

government and under the agreement of Coal Contract of Work (CCoW) where

they both have exclusive right over the use of assets. Having this exclusive right

in using assets, there can be a changes in expected usage of the assets which can

affect in the reporting of the depreciation. With the difference of 37% that came

from depreciation in cost of revenue, there was an indication of the company

under-stated their depreciation. This changes also happened in 2013 where the

company reclassified their mining properties from depreciation to amortization.

Which made the depreciation decrease 31%. But for the year of 2014, there were

some significant changes regarding the application of PSAK No. 66 about “Joint

Arrangements”. In 2014 the depreciation decreased as much 95% because of the

difference that came both from cost of revenue depreciation and operating

expense depreciation show significant differences due to changes in accounting

standards.

48

Difference of depreciation also happened in Mahaka Media for the year

2013 due to the application of PSAK No. 38 (2012 Revision) about “Business

Combination Under-Common Control” which increase the amount of assets that

also increase the amount of depreciation as much 4%.

Primarindo has difference in depreciation for the year 2011 which came

from the manufacturing cost depreciation that decreased in the revised report.

Which also decreased the depreciation for 69% from the first reporting.

In Ratu Prabu, there was differences for the year of 2011 which came from

increased operating expense depreciation created an increase in depreciation as

much 2%. For the next year, 2012 had a decreased in depreciation which came

from reclassification of fixed asset depreciation to property investment as much

42%. Even though there is no difference in cost of goods sold but it is seen from

fixed asset depreciation, the amount had changed. And in 2015, the difference

came from the increased in cost of goods sold depreciation or 6% in the total

depreciation for the year 2015.

Rig Tenders in 2011 also shows the increased in depreciation which the

result of PSAK No. 38 (Revised 2004) application about “Accounting for

Restructuring of entities under Common Control”. This application result in

increased of financial statement for the year 2011 especially in depreciation since

it increased 99% from the first report since the application of PSAK No. 38

increased vessels depreciation.

49

For depreciation, five distress companies show changes in amount.

Differences in Bumi Resource, Mahaka Media, and Rig Tenders happened

because of changes in accounting standard or changes in application of PSAK.

While in Primarindo the difference came from revised manufacturing cost

depreciation, and in Ratu Prabu the difference came from cost of goods sold and

operating expense depreciation. The biggest changes was happened in Bumi

Resource because of the application of PSAK No. 66 about “Joint Arrangements”

because due to changes to joint venture, there was significant decreased in

company assets that affect the estimates lives of the assets.

50

4.4. Regression Analysis

As the output of the Eviews, the researcher got 4 models which are,

Model 1. Receivable

Y1 = −0.068211 + 1.035189𝐴 + 0.691355𝐵 + 0.480472𝐶 + 0.877454𝐷 +

0.836284𝐸 − 0.612764𝑍

The receivable model explain that every increasing of,

A: 1 in receivable can be caused by the increase of 1.035189 in EBIT/Total Assets

ratio. Either the EBIT is increasing or decreasing because of the ability of the

company in generate profit, or the Total Assets is increasing or decreasing

because of operation activities.

B: 1 in receivable can be caused by the increase of 0.691355 in Net Sales/Total

Assets ratio. Either the Net Sales is increasing or decreasing because of the

ability of the company in generate sales, or the Total Assets is increasing or

decreasing because of operation activities.

C: 1 in receivable can be caused by the increase of 0.480472 in Market Value of

Equity/Total Liabilities ratio. Either the Market Value is increasing or

decreasing because company performance, or the company Total Liabilities is

increasing or decreasing because of the company obligation.

D: 1 in receivable can be caused by the increase of 0.877454 in Working

Capital/Total Asset ratio. Either the Working Capital is increasing or

51

decreasing because of position of current asset and current liabilities, or the

Total Assets is increasing or decreasing because of operation activities.

E: 1 in receivable can be caused by the increase of 0.836284 in Retained

Earnings/Total Asset ratios. Either the Retained Earnings is increasing or

decreasing because of company performance, or the Total Assets is increasing

or decreasing because of operation activities.

Z: 1 in receivable can be caused by the decrease of 0.612764 in Z score. The value

of Z score is determined by the value of its components.

Model 2. Inventory

Y2 = −0.047319 + 0.052875𝐴 + 0.28115𝐵 + 0.230552𝐶 + 0.467438𝐷 +

0.285945𝐸 − 0.238675𝑍

The Inventory model explain that every increasing of,

A: 1 in Inventory can be caused by the increase of 0.052875 in EBIT/Total Assets




B: 1 in Inventory can be caused by the increase of 0.28115 in Net Sales/Total




52

C: 1 in Inventory can be caused by the increase of 0.230552 in Market Value of




D: 1 in Inventory can be caused by the increase of 0.467438 in Working




E: 1 in Inventory can be caused by the increase of 0.285945 in Retained




Z: 1 in Inventory can be caused by the decrease of 0.238675 in Z score. The value


Model 3. Net Sales

Y3 = −0.078312 − 0.633339𝐴 + 0.283559𝐵 + 0.212587𝐶 + 0.336279𝐷 +

0.222028𝐸 − 0.151262𝑍

The Net Sales model explain that every increasing of,

A: 1 in Net Sales can be caused by the decrease of 0.633339 in EBIT/Total Assets


53



B: 1 in Net Sales can be caused by the increase of 0.283559 in Net Sales/Total




C: 1 in Net Sales can be caused by the increase of 0.212587 in Market Value of




D: 1 in Net Sales can be caused by the increase of 0.336279 in Working




E: 1 in Net Sales can be caused by the increase of 0.222028 in Retained




Z: 1 in Net Sales can be caused by the decrease of 0.151262 in Z score. The value


54

Model 4. Depreciation

Y4 = −0.098183 + 1.599979𝐴 + 0.696457𝐵 + 0.409424𝐶 + 0.796645𝐷 +

0.9149𝐸 − 0.558933𝑍

The Depreciation model explain that every increasing of,

A: 1 in Depreciation can be caused by the increase of 1.599979 in EBIT/Total

Assets ratio. Either the EBIT is increasing or decreasing because of the ability

of the company in generate profit, or the Total Assets is increasing or


B: 1 in Depreciation can be caused by the increase of 0.696457 in Net Sales/Total




C: 1 in Depreciation can be caused by the increase of 0.409424 in Market Value

of Equity/Total Liabilities ratio. Either the Market Value is increasing or



D: 1 in Depreciation can be caused by the increase of 0.796645 in Working




55

E: 1 in Depreciation can be caused by the increase of 0.9149 in Retained




Z: 1 in Depreciation can be caused by the decrease of 0.558933 in Z score. The

value of Z score is determined by the value of its components.

Based on the findings, researcher can conclude that accounting distortion

happened in financial distress companies especially for receivable, inventory, net

sales, and depreciation. The company intend to improving or lowering the

performance since there is an alternative such as changes in accounting standards

that almost all the distress companies in this research use this alternative.

Compared to healthy companies, there is no significant changes or even no

changes at all in these companies. Some mistakes and changes in accounting

standard can occurred in healthy companies but it doesn’t affect company

economic value like distress companies did.

In order to find resources for distress companies due to continuous loss, it

makes the company wants their financial statement looks preferable to meet

stakeholders expectation. Because of that, changes in financial statement often

occurred. But even though the changes occurred, it affects the quality of financial

statement itself where the factors of relevance and reliability is being questioned.

56

The changes in PSAK usually being used by financial distress company to

increase their amount of financial statement. For example the acquisition of

certain company can increase their inventory and net sales. But for some cases,

like Bumi Resource, the application of PSAK reduced their amount of financial

statement because the joint arrangement should be joint venture with equity

method instead of joint controlled with proportionate consolidation method.

57

CHAPTER V

CONCLUSION AND RECOMMENDATION

5.1. Conclusion

The objectives of this research is to analyze accounting distortion that

happened in financial distress companies, and to create analysis model that shows

changes in accounting distortion with the condition of financial distress

companies. Findings are summarized as below,

Changes in financial statement that shows accounting distortion were

caused mainly from the changes in accounting standards and changes in

accounting estimation. The changes in PSAK caused major distortion

especially in receivable, inventory, net sales, and depreciation.

In financial distress companies, the distortion mainly happened when the

companies apply changes in PSAK such as acquisition of a company,

business combination, and changes in joint arrangement. These changes

caused differences in prior year that might affect the comparison of related

years.

Based on the model, there are four modified models of distortion in

financial distress

Model 1. Receivable

Y1 = −0.068211 + 1.035189𝐴 + 0.691355𝐵 + 0.480472𝐶 +

0.877454𝐷 + 0.836284𝐸 − 0.612764𝑍

58

Model 2. Inventory

Y2 = −0.047319 + 0.052875𝐴 + 0.28115𝐵 + 0.230552𝐶 +

0.467438𝐷 + 0.285945𝐸 − 0.238675𝑍

Model 3. Net Sales

Y3 = −0.078312 − 0.633339𝐴 + 0.283559𝐵 +

0.212587𝐶 + 0.336279𝐷 + 0.222028𝐸 − 0.151262𝑍

Model 4. Depreciation

Y4 = −0.098183 + 1.599979𝐴 + 0.696457𝐵 +

0.409424𝐶 + 0.796645𝐷 + 0.9149𝐸 − 0.558933𝑍

59

5.2. Recommendations

Given the result of this research, there are some of considering based from

this research,

1. Investors and other users

- Despite the condition of certain company, investor should take

further evaluation regarding the management that might take

subjective estimation and could cause harm to investors.

2. Researcher for future research

- The analysis of accounting distortion in financial distress

companies only use ten companies with the time period from 2011-

2015. Further research may use more company with longer period

in order to find better understanding regarding accounting

distortion.

- This research only use receivable, inventory, net sales, and

depreciation as distortion determinants. Future research may add

more components to accounting distortion determinant in order to

find further changes in financial report.

- This research only use ten financial distress companies without

segmented industry. Future research may categorized the financial

distress companies based on their industry to get a deeper

knowledge in their business activities.

60

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64

APPENDICES

Appendix 1: PT. BAKRIELAND DEVELOPMENT Tbk

1st Report Revised Differences Diff Percentage

Receivable 2011 Rp 1,996,244,967,031 Rp 1,996,244,967,031

- 0%

2012 Rp 1,301,971,943,657 Rp 1,301,971,943,657

- 0%

2013 Rp 1,212,478,478,561 Rp 1,212,478,478,561

- 0%

2014 Rp 2,302,420,227,104 Rp 2,502,420,227,104 200,000,000,000 9%

2015 Rp 2,432,257,917,802 Rp 2,432,257,917,802

- 0%

Inventory 2011 Rp 1,816,318,578,119 Rp 1,816,318,578,119

- 0%

2012 Rp 1,695,358,232,356 Rp 1,695,358,232,356

- 0%

2013 Rp 1,079,412,659,448 Rp 1,079,412,659,448

- 0%

2014 Rp 1,839,816,748,788 Rp 1,782,116,104,833 (57,700,643,955) -3%

2015 Rp 1,883,801,982,677 Rp 1,883,801,982,677

- 0%

Net Sales 2011 Rp 2,017,319,021,475 Rp 1,927,530,209,575 (89,788,811,900) -4%

2012 Rp 2,949,585,801,725 Rp 2,926,314,200,813 (23,271,600,912) -1%

2013 Rp 3,324,852,984,839 Rp 3,200,099,599,309 (124,753,385,530) -4%

2014 Rp 1,579,947,206,733 Rp 1,579,947,206,733

- 0%

2015 Rp 1,395,603,904,262 Rp 1,395,603,904,262

- 0%

Depreciation 2011 Rp 10,789,713,213 Rp 10,789,713,213

- 0%

2012 Rp 14,600,344,784 Rp 14,600,344,784

- 0%

2013 Rp 22,590,516,413 Rp 22,590,516,413

- 0%

2014 Rp 20,491,206,168 Rp 20,491,206,168

- 0%

2015 Rp 18,498,381,483 Rp 18,498,381,483

- 0%

65

Appendix 2: PT. BUMI RESOURCE Tbk

1st Report Revised Differences %

Receivable 2011 $ 679,062,573 $ 680,081,255 $ 1,018,682 0.15%

2012 $ 450,847,488 $ 450,847,488 $ - 0%

2013 $ 740,145,487 $ 266,463,493 $ (473,681,994) -64%

2014 $ 1,338,449,297 $ 645,657,041 $ (692,792,256) -52%

2015 $ 516,359,893 $ 516,359,893 $ - 0%

Inventory 2011 $ 157,151,642 $ 157,431,872 $ 280,230 0.001783182

2012 $ 274,653,620 $ 274,653,620 $ - 0%

2013 $ 187,716,172 $ 187,716,172 $ - 0%

2014 $ 119,465,537 $ - $ (119,465,537) -100%

2015 $ - $ - $ - 0%

Net Sales 2011 $ 4,001,058,461 $ 4,000,990,515 $ (67,946) -0.0017%

2012 $ 3,775,518,192 $ 3,775,518,192 $ - 0%

2013 $ 3,547,424,427 $ 3,547,424,427 $ - 0%

2014 $ 2,786,067,095 $ 61,928,455 $ (2,724,138,640) -98%

2015 $ 40,506,538 $ 40,506,538 $ - 0%

Depreciation 2011 $ 104,649,716 $ 142,968,549 $ 38,318,833 37%

2012 $ 251,867,032 $ 251,867,032 $ - 0%

2013 $ 229,219,152 $ 158,726,637 $ (70,492,515) -31%

2014 $ 142,479,889 $ 6,965,050 $ (135,514,839) -0.951115557

2015 $ 1,848,745 $ 1,848,745 $ - 0%

66

Appendix 3: PT. GOZCO PLANTATIONS Tbk

1st Report Revised Diff %

Receivable 2011 Rp 1,246 Rp 1,246 Rp - 0%

2012 Rp 3,622 Rp 3,622 Rp 0 0%

2013 Rp 5,724 Rp 5,724 Rp - 0%

2014 Rp 4,225 Rp 4,225 Rp - 0%

2015 Rp 7,131 Rp 7,131 Rp - 0%

Inventory 2011 Rp 19,916 Rp 19,916 Rp - 0%

2012 Rp 36,928 Rp 36,928 Rp 0 0%

2013 Rp 16,700 Rp 16,700 Rp - 0%

2014 Rp 15,866 Rp 15,866 Rp - 0%

2015 Rp 50,089 Rp 50,089 Rp - 0%

Net Sales 2011 Rp 492,947 Rp 492,947 Rp - 0%

2012 Rp 405,328 Rp 405,328 -Rp 0 0%

2013 Rp 427,623 Rp 427,623 Rp - 0%

2014 Rp 462,840 Rp 462,840 Rp - 0%

2015 Rp 491,605 Rp 491,605 Rp - 0%

Depreciation 2011 Rp 36,808 Rp 36,808 Rp - 0%

2012 Rp 39,479 Rp 39,479 -Rp 0 0%

2013 Rp 40,834 Rp 40,834 Rp - 0%

2014 Rp 34,218 Rp 34,218 Rp - 0%

2015 Rp 34,752 Rp 34,752 Rp - 0%

67

Appendix 4: PT. INDOSAT Tbk

1st reporting Revised Differences %

Receivable 2011 Rp 1,446,729 Rp 1,505,756 Rp 59,027 4%

2012 Rp 2,061,160 Rp 2,061,160 Rp - 0%

2013 Rp 2,284,633 Rp 2,284,633 Rp - 0%

2014 Rp 2,101,127 Rp 2,101,127 Rp - 0%

2015 Rp 2,741,407 Rp 2,741,407 Rp - 0%


2012 Rp 52,556 Rp 52,556 Rp - 0%

2013 Rp 36,004 Rp 36,004 Rp - 0%

2014 Rp 49,408 Rp 49,408 Rp - 0%

2015 Rp 39,346 Rp 39,346 Rp - 0%

Net Sales 2011 Rp 20,576,893 Rp 20,529,292 -Rp 47,601

-

0.23%

2012 Rp 22,418,812 Rp 22,418,812 Rp - 0%

2013 Rp 23,855,272 Rp 23,855,272 Rp - 0%

2014 Rp 24,085,101 Rp 24,085,101 Rp - 0%

2015 Rp 26,768,525 Rp 26,768,525 Rp - 0%

Depreciation 2011 Rp 6,563,095 Rp 6,540,518 -Rp 22,577

-

0.34%

2012 Rp 8,256,605 Rp 8,256,605 Rp - 0%

2013 Rp 8,940,554 Rp 8,940,554 Rp - 0%

2014 Rp 8,208,719 Rp 8,208,719 Rp - 0%

2015 Rp 8,754,346 Rp 8,754,346 Rp - 0%

68

Appendix 5: PT. LEYAND INTERNATIONAL Tbk


Receivable 2011 Rp 28,130,943 Rp 28,130,943 Rp - 0%

2012 Rp 27,120,262 Rp 27,120,262 Rp - 0%

2013 Rp 18,207,265 Rp 18,207,265 Rp - 0%

2014 Rp 11,555,119 Rp 11,555,119 Rp - 0%

2015 Rp 21,263,986 Rp 21,263,986 Rp - 0%

Inventory 2011 Rp 2,864,643 Rp 2,864,643 Rp - 0%

2012 Rp 4,368,374 Rp 4,368,374 Rp - 0%

2013 Rp 5,117,738 Rp 5,117,738 Rp - 0%

2014 Rp 24,866,700 Rp 24,866,700 Rp - 0%

2015 Rp 23,268,628 Rp 23,268,628 Rp - 0%

Net Sales 2011 Rp 359,115,637 Rp 359,115,637 Rp - 0%

2012 Rp 336,920,981 Rp 336,920,981 Rp - 0%

2013 Rp 301,179,957 Rp 301,179,957 Rp - 0%

2014 Rp 167,429,045 Rp 167,429,045 Rp - 0%

2015 Rp 158,437,640 Rp 158,437,640 Rp - 0%

Depreciation 2011 Rp 86,379,573 Rp 86,379,573 Rp - 0%

2012 Rp 84,799,485 Rp 84,799,485 Rp - 0%

2013 Rp 84,286,000 Rp 84,286,000 Rp - 0%

2014 Rp 84,005,467 Rp 84,005,467 Rp - 0%

2015 Rp 83,806,986 Rp 83,806,986 Rp - 0%

69

Appendix 6: PT. MAHAKA MEDIA Tbk


Receivable 2011 Rp 96,075,333,290 Rp 96,075,333,290 Rp - 0%

2012 Rp 128,732,660,279 Rp 116,725,903,043 -Rp 12,006,757,236 -9%

2013 Rp 123,883,123,703 Rp 132,697,328,098 Rp 8,814,204,395 7%

2014 Rp 125,743,479,202 Rp 125,743,479,202 Rp - 0%

2015 Rp 120,350,014,802 Rp 120,350,014,802 Rp - 0%

Inventory 2011 Rp 16,552,605,478 Rp 16,552,605,478 Rp - 0%

2012 Rp 14,532,752,189 Rp 14,532,752,189 Rp - 0%

2013 Rp 10,113,311,861 Rp 10,113,311,861 Rp - 0%

2014 Rp 8,517,313,675 Rp 8,517,313,675 Rp - 0%

2015 Rp 8,064,431,461 Rp 8,064,431,461 Rp - 0%

Net Sales 2011 Rp 248,135,253,137 Rp 248,135,253,137 Rp - 0%

2012 Rp 264,525,408,474 Rp 264,525,408,474 Rp - 0%

2013 Rp 269,553,029,186 Rp 309,160,119,685 Rp 39,607,090,499 15%

2014 Rp 318,915,901,895 Rp 318,915,901,895 Rp - 0%

2015 Rp 290,556,699,926 Rp 290,556,699,926 Rp - 0%

Depreciation 2011 Rp 16,817,297,697 Rp 16,817,297,697 Rp - 0%

2012 Rp 17,988,605,840 Rp 17,988,605,840 Rp - 0%

2013 Rp 19,299,926,966 Rp 19,985,962,980 Rp 686,036,014 4%

2014 Rp 19,806,280,891 Rp 19,806,280,891 Rp - 0%

2015 Rp 19,856,344,725 Rp 19,856,344,725 Rp - 0%

70

Appendix 7: PT. PRIMARINDO ASIA INFRASTRUCTURE Tbk


Receivable 2011 Rp 10,525,988,272 Rp 10,525,988,272 Rp - 0%

2012 Rp 13,054,382,935 Rp 13,054,382,935 Rp - 0%

2013 Rp 17,770,602,672 Rp 17,770,602,672 Rp - 0%

2014 Rp 14,178,332,149 Rp 14,178,332,149 Rp - 0%

2015 Rp 16,100,398,616 Rp 16,100,398,616 Rp - 0%


2012 Rp 61,645,598,104 Rp 61,645,598,104 Rp - 0%

2013 Rp 59,234,716,981 Rp 59,234,716,981 Rp - 0%

2014 Rp 56,268,118,693 Rp 56,268,118,693 Rp - 0%

2015 Rp 34,651,722,560 Rp 34,651,722,560 Rp - 0%

Net Sales 2011 Rp 184,387,175,932 Rp 184,387,175,932 Rp - 0%

2012 Rp 243,531,037,253 Rp 243,531,037,253 Rp - 0%

2013 Rp 279,150,207,182 Rp 279,150,207,182 Rp - 0%

2014 Rp 286,688,094,220 Rp 286,688,094,220 Rp - 0%

2015 Rp 222,363,830,677 Rp 222,363,830,677 Rp - 0%

Depreciation 2011 Rp 7,572,649,734 Rp 2,313,334,651 -Rp 5,259,315,083 -69%

2012 Rp 2,774,313,078 Rp 2,774,313,078 Rp - 0%

2013 Rp 2,400,708,004 Rp 2,400,708,004 Rp - 0%

2014 Rp 2,047,149,264 Rp 2,047,149,264 Rp - 0%

2015 Rp 1,781,729,874 Rp 1,781,729,874 Rp - 0%

71

Appendix 8: PT. RATU PRABU ENERGI Tbk


Receivable 2011 Rp 175,063,338,890 Rp 175,063,338,889 -Rp 1 0%

2012 Rp 225,160,414,041 Rp 225,160,414,041 Rp - 0%

2013 Rp 267,473,808,571 Rp 250,340,750,041 -Rp 17,133,058,530 -6%

2014 Rp 246,768,906,663 Rp 246,768,906,663 Rp - 0%

2015 Rp 199,125,248,396 Rp 199,125,248,396 Rp - 0%


2012 Rp 9,049,758,362 Rp 9,049,758,362 Rp - 0%

2013 Rp 12,411,948,278 Rp 12,411,948,278 Rp - 0%

2014 Rp 11,855,521,388 Rp 11,855,521,388 Rp - 0%

2015 Rp 11,365,750,458 Rp 11,365,750,458 Rp - 0%

Net Sales 2011 Rp 309,744,775,918 Rp 309,744,775,918 Rp - 0%

2012 Rp 449,486,392,992 Rp 449,486,392,992 Rp - 0%

2013 Rp 404,543,663,558 Rp 404,543,663,558 Rp - 0%

2014 Rp 357,566,721,199 Rp 357,566,721,199 Rp - 0%

2015 Rp 225,794,233,032 Rp 225,794,233,032 Rp - 0%

Depreciation 2011 Rp 41,215,363,549 Rp 41,952,378,773 Rp 737,015,224 2%

2012 Rp 42,039,341,111 Rp 24,409,249,071 -Rp 17,630,092,040 -42%

2013 Rp 11,652,976,244 Rp 11,652,976,244 Rp - 0%

2014 Rp 15,847,398,268 Rp 15,847,398,268 Rp - 0%

2015 Rp 21,254,980,018 Rp 22,480,340,851 Rp 1,225,360,833 6%

72

Appendix 9: PT. RIG TENDERS INDONESIA Tbk


Receivable 2011 $ 17,232,772 $ 34,735,984 $ 17,503,212 102%

2012 $ 20,554,581 $ 20,554,581 $ - 0%

2013 $ 16,401,370 $ 16,401,370 $ - 0%

2014 $ 17,615,340 $ 17,615,340 $ - 0%

2015 $ 15,540,458 $ 15,540,458 $ - 0%

Inventory 2011 $ 1,903,519 $ 3,232,457 $ 1,328,938 70%

2012 $ 1,811,952 $ 1,811,952 $ - 0%

2013 $ 1,223,565 $ 1,223,565 $ - 0%

2014 $ 715,727 $ 715,727 $ - 0%

2015 $ 601,965 $ 601,965 $ - 0%

Net Sales 2011 $ 49,997,766 $ 113,777,572 $ 63,779,806 128%

2012 $ 89,911,956 $ 89,911,956 $ - 0%

2013 $ 63,497,478 $ 63,497,478 $ - 0%

2014 $ 42,710,738 $ 42,710,738 $ - 0%

2015 $ 29,608,622 $ 29,608,622 $ - 0%

Depreciation 2011 $ 7,722,821 $ 15,352,292 $ 7,629,471 99%

2012 $ 12,768,338 $ 12,768,338 $ - 0%

2013 $ 15,818,972 $ 15,818,972 $ - 0%

2014 $ 12,573,716 $ 12,573,716 $ - 0%

2015 $ 12,540,860 $ 12,540,860 $ - 0%

73

Appendix 10: PT. TIGA PILAR SEJAHTERA FOOD Tbk


Receivable 2011 Rp 474,549 Rp 473,758 Rp (791) 0%

2012 Rp 560,046 Rp 560,046 Rp - 0%

2013 Rp 904,695 Rp 904,695 Rp - 0%

2014 Rp 1,344,109 Rp 1,344,109 Rp - 0%

2015 Rp 1,978,613 Rp 1,978,613 Rp - 0%


2012 Rp 602,660 Rp 602,660 Rp - 0%

2013 Rp 1,023,728 Rp 1,023,728 Rp - 0%

2014 Rp 1,240,358 Rp 1,240,358 Rp - 0%

2015 Rp 1,569,104 Rp 1,569,104 Rp - 0%

Net Sales 2011 Rp 1,752,802 Rp 1,752,802 Rp - 0%

2012 Rp 2,747,623 Rp 2,747,623 Rp - 0%

2013 Rp 4,056,735 Rp 4,056,735 Rp - 0%

2014 Rp 5,139,974 Rp 5,139,974 Rp - 0%

2015 Rp 6,010,895 Rp 6,010,895 Rp - 0%

Depreciation 2011 Rp 59,087 Rp 59,087 Rp - 0%

2012 Rp 79,440 Rp 79,440 Rp - 0%

2013 Rp 84,877 Rp 84,877 Rp - 0%

2014 Rp 99,480 Rp 99,480 Rp - 0%

2015 Rp 127,454 Rp 127,454 Rp - 0%

74

Appendix 11: PT. ACE HARDWARE INDONESIA Tbk


Receivable 2011 Rp 52,394,099,235 Rp 52,394,099,235

Rp

- 0

2012 Rp 54,554,647,948 Rp 54,554,647,948

Rp

- 0

2013 Rp 28,554,250,458 Rp 28,554,250,458

Rp

- 0

2014 Rp 25,826,689,128 Rp 25,826,689,128

Rp

- 0

2015 Rp 17,760,396,887 Rp 17,760,396,887

Rp

- 0

Inventory 2011 Rp 290,356,324,286 Rp 290,356,324,286

Rp

- 0

2012 Rp 619,804,268,196 Rp 619,804,268,196

Rp

- 0

2013 Rp 1,112,546,445,586 Rp 1,112,546,445,586

Rp

- 0

2014 Rp 1,295,681,754,349 Rp 1,295,681,754,349

Rp

- 0

2015 Rp 1,522,348,116,750 Rp 1,522,348,116,750

Rp

- 0

Net Sales 2011 Rp 2,406,033,973,944 Rp 2,389,456,498,944

-Rp

16,577,475,000 -1%

2012 Rp 3,193,282,818,586 Rp 3,193,282,818,586

Rp

- 0

2013 Rp 3,850,300,588,204 Rp 3,850,300,588,204

Rp

- 0

2014 Rp 4,492,197,911,790 Rp 4,492,197,911,790

Rp

- 0

2015 Rp 4,694,947,302,382 Rp 4,694,947,302,382

Rp

- 0

Depreciation 2011 Rp 51,282,522,383 Rp 51,282,522,383

Rp

- 0

2012 Rp 66,344,736,046 Rp 66,344,736,046

Rp

- 0

2013 Rp 79,842,380,474 Rp 79,842,380,474

Rp

- 0

2014 Rp 78,890,929,363 Rp 78,890,929,363

Rp

- 0

2015 Rp 82,058,581,724 Rp 82,058,581,724

Rp

- 0

75

Appendix 12: PT. SEPATU BATA Tbk

In thousand Rupiah

1st Report Revised Diff

Receivable 2011 Rp 29,719,350 Rp 29,719,350 0

2012 Rp 33,773,117 Rp 33,773,117 0

2013 Rp 43,299,158 Rp 43,299,158 0

2014 Rp 40,711,116 Rp 40,711,116 0

2015 Rp 39,539,376 Rp 39,539,376 0

Inventory 2011 Rp 193,997,433 Rp 193,997,433 0

2012 Rp 221,854,075 Rp 221,854,075 0

2013 Rp 281,405,718 Rp 281,405,718 0

2014 Rp 314,628,156 Rp 314,628,156 0

2015 Rp 282,546,591 Rp 282,546,591 0

Net Sales 2011 Rp 678,591,535 Rp 678,591,535 0

2012 Rp 751,449,338 Rp 751,449,338 0

2013 Rp 902,459,209 Rp 902,459,209 0

2014 Rp 1,008,727,515 Rp 1,008,727,515 0

2015 Rp 1,028,850,578 Rp 1,028,850,578 0

Depreciation 2011 Rp 20,292,153 Rp 20,292,153 0

2012 Rp 21,054,386 Rp 21,054,386 0

2013 Rp 22,976,212 Rp 22,976,212 0

2014 Rp 34,843,949 Rp 34,843,949 0

2015 Rp 32,697,926 Rp 32,697,926 0

76

Appendix 12: PT. UNILEVER INDONESIA Tbk

In million Rupiah


Receivable 2011 Rp 2,188,280 Rp 2,188,280 Rp - 0

2012 Rp 2,666,875 Rp 2,021,007 -Rp 645,868

-

0.24218

2013 Rp 3,441,068 Rp 2,796,348 -Rp 644,720

-

0.18736

2014 Rp 3,052,260 Rp 3,052,260 Rp - 0

2015 Rp 3,602,272 Rp 3,602,272 Rp - 0

Inventory 2011 Rp 1,812,821 Rp 1,812,821 Rp - 0

2012 Rp 2,061,899 Rp 2,061,899 Rp - 0

2013 Rp 2,084,331 Rp 2,084,331 Rp - 0

2014 Rp 2,325,989 Rp 2,325,989 Rp - 0

2015 Rp 2,297,502 Rp 2,297,502 Rp - 0

Net Sales 2011 Rp 23,469,218 Rp 23,469,218 Rp - 0

2012 Rp 27,303,248 Rp 27,303,248 Rp - 0

2013 Rp 30,757,435 Rp 30,757,435 Rp - 0

2014 Rp 34,511,534 Rp 34,511,534 Rp - 0

2015 Rp 36,484,030 Rp 36,484,030 Rp - 0

Depreciation 2011 Rp 278,811 Rp 278,811 Rp - 0

2012 Rp 292,000 Rp 292,000 Rp - 0

2013 Rp 457,046 Rp 457,046 Rp - 0

2014 Rp 354,454 Rp 354,454 Rp - 0

2015 Rp 483,303 Rp 483,303 Rp - 0

77

Appendix 13: RECEIVABLE

Dependent Variable: RECEIVABLE

Method: Panel Least Squares

Date: 04/23/18 Time: 19:29

Sample: 2011 2015

Periods included: 5

Cross-sections included: 10

Total panel (balanced) observations: 50 Variable Coefficient Std. Error t-Statistic Prob. C -0.068211 0.063859 -1.068153 0.2914

A 1.035189 3.218934 0.321594 0.7493

B 0.691355 0.986722 0.700659 0.4873

C_ 0.480472 0.566097 0.848745 0.4007

D_ 0.877454 1.178797 0.744364 0.4607

E 0.836284 1.385381 0.603649 0.5492

ZSCORE -0.612764 0.976437 -0.627551 0.5336 R-squared 0.183569 Mean dependent var -0.001977

Adjusted R-squared 0.069648 S.D. dependent var 0.188226

S.E. of regression 0.181552 Akaike info criterion -0.445368

Sum squared resid 1.417335 Schwarz criterion -0.177684

Log likelihood 18.13419 Hannan-Quinn criter. -0.343432

F-statistic 1.611377 Durbin-Watson stat 1.427183

Prob(F-statistic) 0.167283

78

Appendix 14: INVENTORY

Dependent Variable: INVENTORY


Date: 04/23/18 Time: 19:33

Sample: 2011 2015

Periods included: 5



A 0.052875 3.029119 0.017456 0.9862

B 0.281150 0.928537 0.302789 0.7635

C_ 0.230552 0.532715 0.432787 0.6673

D_ 0.467438 1.109286 0.421387 0.6756

E 0.285945 1.303687 0.219336 0.8274




Sum squared resid 1.255108 Schwarz criterion -0.299241

Log likelihood 21.17311 Hannan-Quinn criter. -0.464989



79

Appendix 15: NET SALES

Dependent Variable: NETSALES


Date: 04/23/18 Time: 19:34

Sample: 2011 2015

Periods included: 5



A -0.633339 4.010146 -0.157934 0.8752

B 0.283559 1.229258 0.230675 0.8187

C_ 0.212587 0.705243 0.301438 0.7645

D_ 0.336279 1.468545 0.228988 0.8200

E 0.222028 1.725907 0.128644 0.8982

ZSCORE -0.151262 1.216445 -0.124348 0.9016 R-squared 0.155872 Mean dependent var 0.007018



Sum squared resid 2.199727 Schwarz criterion 0.261870

Log likelihood 7.145319 Hannan-Quinn criter. 0.096123



80

Appendix 16: DEPRECIATION

Dependent Variable: DEPRECIATION


Date: 04/23/18 Time: 19:35

Sample: 2011 2015

Periods included: 5



A 1.599979 4.049030 0.395151 0.6947

B 0.696457 1.241177 0.561126 0.5776

C_ 0.409424 0.712082 0.574968 0.5683

D_ 0.796645 1.482785 0.537263 0.5939

E 0.914900 1.742642 0.525008 0.6023



S.E. of regression 0.228371 Akaike info criterion 0.013487

Sum squared resid 2.242592 Schwarz criterion 0.281170

Log likelihood 6.662835 Hannan-Quinn criter. 0.115422



analysis audited financial statement of distress …

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