Factors Influencing Financial Distress : Evidence from Indonesia Consumer Cyclical Companies
DOI:
https://doi.org/10.61132/ijema.v2i2.620Keywords:
Company, Size, Current, Ratio, FinancialAbstract
This research investigates the key factors influencing companies registered on the Indonesia Stock Exchange (IDX) that is experiencing financial distress between the years 2021 to 2023. In this study, 353 data points were selected from the target population using purposive sampling. Three key financial ratios were utilized as indicators of financial distress: Profitability can be measured by Return on Assets (ROA), while the Current Ratio (CR) is used to measure liquidity. Meanwhile, The Logarithm of Natural to Total Assets (LnTA) is a metric for evaluating a company’s size. Multiple regression analysis is performed utilizing SmartPLS 4.0 software to analyze the connection between these factors and the probability of experiencing financial distress. The findings indicate a significant negative association between liquidity (CR) and company size (LnTA) with financial distress. In contrast, profitability (ROA) demonstrates an insignificant negative correlation with financial distress. This study contributes to the literature by providing a comprehensive analysis of the factors influencing financial distress in Indonesia consumer cyclical companies employs signaling theory to interpret the relationships discovered.
Downloads
References
M. H. Junaidi and T. D. Widajantie, “Analysis of Financial Ratio on Financial Distress in Consumer Cyclical Sector Companies,” Int. J. Econ. Educ. Entrep., vol. 3, no. 3, pp. 772–782, 2023, [Online]. Available: https://ije3.esc-id.org/index.php/home/article/view/205
J. Wijaya and R. Suhendah, “Pengaruh Likuiditas, Leverage, Dan Arus Kas Terhadap Financial Distress,” J. Ekon., vol. 28, no. 2, pp. 177–196, 2023, doi: 10.24912/je.v28i2.1468.
I. C. Wangsih, D. R. Yanti, Yohana, N. Kalbuana, and C. I. Cahyadi, “Influence of Leverage, Firm Size, and Sales Growth on Financial Distress (Empirical Study on Retail Trade Sub-Sector Companies Listed in Indonesia Stock Exchange Period 2016-2020),” Int. J. Econ. Bus. Account. Res., vol. 5, no. 4, pp. 180–194, 2021, [Online]. Available: www.ceicdata.com
R. A. Mujianto and D. Hariyanto, “The Influence Of Earnings Per Share, Return On Equity, Return On Assets, And Net Profit Margin On Financial Distress In The Consumer Cyclicals Sector On The Indonesian Stock Exchange,” EKOMBIS Rev. J. Ilm. Ekon. dan Bisnis, vol. 12, no. 3, pp. 2621–2632, 2024, doi: 10.37676/ekombis.v12i3.6030.
R. Aryani and D. Saputra, “PENGARUH PROFITABILITAS , LEVERAGE , DAN FINANCIAL DISTRESS TERHADAP NILAI PERUSAHAAN PADA PERUSAHAAN SEKTOR CONSUMER NON-CYCLICALS YANG TERDAFTAR DI BEI PERIODE 2020-2022,” J. Islam. Financ. Account. Res., vol. 3, no. 2, pp. 169–186, 2024.
Patmawati, M. Hidayat, and M. Farhan, “Model Altman Score Dan Grover Score : Mendeteksi Financial Distress Pada Perusahaan Ritel Di Indonesia,” Akuntabilitas, vol. 14, no. 1, pp. 133–154, 2020, doi: 10.29259/ja.v14i1.11525.
A. Dirman, “Financial distress: The impacts of profitability, liquidity, leverage, firm size, and free cash flow,” Int. J. Business, Econ. Law, vol. 22, no. 1, p. 1, 2020.
M. Z. Hakim, A. T. Wiyanti, I. Hidayat, J. E. Pambudi, D. S. Abbas, and S. Alamsyah, “Determinan Finansial Distress Pada Perusahaan Sektor Consumer Cyclicals Yang Terdaftar Di Bursa Efek Indonesia,” J. Ekon. Manaj. Pariwisata dan Perhotelan, vol. 2, no. 1, pp. 470–475, 2022, doi: 10.55606/jempper.v2i1.1056.
C. Christella and M. S. Osesoga, “Pengaruh Leverage, Profitabilitas, Kepemilikan Institusional, Likuiditas, Dan Ukuran Perusahaan Terhadap Financial Distress: Studi Pada Perusahaan Manufaktur yang Terdaftar di Bursa Efek Indonesia Periode 2014-2016,” Ultim. J. Ilmu Akunt., vol. 11, no. 1, pp. 13–31, 2020, doi: 10.31937/akuntansi.v11i1.1092.
D. A. S. W. Hadi, M. Miqdad, and S. M. Wardayati, “Effects of Profitability, Liquidity, Leverage, and the Pandemic on Financial Distress,” Wiga J. Penelit. Ilmu Ekon., vol. 13, no. 1, pp. 1–9, 2023, doi: 10.30741/wiga.v13i1.876.
K. P. Tumbelaka, E. Imelda, and J. Simina, “Factors Affecting Financial Distress in the Consumer Industry Sector During the Covid-19 Pandemic,” Int. J. Appl. Econ. Bus., vol. 2, no. 2, pp. 3510–3517, 2024, doi: 10.24912/ijaeb.v2i2.3510-3517.
A. Hocky and N. Renaldo, “THE EFFECT OF PROFITABILITY, FIRM SIZE, AND LEVERAGE ON LIQUIDITY OF COMPANIES LISTED IN THE LQ45 INDEX OF INDONESIAN STOCK EXCHANGE IN THE PERIOD OF 2017-2022,” Bilancia J. Ilm. Akunt., vol. 8, no. 3, pp. 295–301, 2024, doi: 10.35145/bilancia.v8i3.4515.
G. Friska and D. E. Pudjolaksono, “the Effect of Profitability, Liquidity, Leverage, Sales Growth on Financial Distress in Consumer and Non-Consumer Cyclicals Companies Listed on the Idx During the 2019-2021,” J. Entrep., vol. 2, no. July, pp. 93–106, 2023, doi: 10.56943/joe.v2i3.355.
E. I. Altman, Corporate Financial Distress : A Complete Guide to Predicting, Avoiding, and Dealing with Bankruptcy. 1983.
Mihelle and H. Lukman, “The Influence of Profitability, Liquidity and Leverage on Financial Distress in General Insurance Companies During The COVID-19 Pandemic,” Int. J. Appl. Econ. Bus., vol. 2, no. 3, pp. 408–416, 2024.
H. Jenifer and Muhyarsyah, “Factors Affecting Financial Distress with Managerial Ownership as a Moderating Variable,” Budapest Int. Res. Critics Institute-Journal, vol. 6, no. 2, pp. 672–684, 2023, [Online]. Available: https://doi.org/10.33258/birci.v6i2.7534
Ciptawan and J. L. Angeline, “The Effect Of Leverage, Liquidity And Profitability Toward Financial Distress On Food And Beverage Companies Listed On The Indonesia Stock Exchange,” Int. J. Soc. Policy Law, vol. 4, no. 1, pp. 22–31, 2023, [Online]. Available: https://doi.org/10.8888/ijospl.v4i1.119
D. S. Arifin, A. Masud, U. Kalsum, and A. R. Makkulau, “The Influence of Liquidity, Leverage, Company Size and Profitability on Financial Distress,” Int. J. Bus. Soc. Sci. Res., vol. 2, no. 6, pp. 11–17, 2021, doi: 10.47742/ijbssr.v2n6p2.
I. A. Fatmayuni, S. D. A. Ambarwati, and H. Widjanarko, “Determinan Financial Distress: Evidence Manufacture Company in Indonesia Stock Exchange 2018 – 2022,” Account. Financ. Stud., vol. 4, no. 1, pp. 1–16, 2024, doi: 10.47153/afs41.8502024.
Y. I. Savery, H. Haninun, and R. Riswan, “Financial Performance To Determine Financial Distress Conditions,” Marg. J. Manag. Account. Gen. Financ. Int. Econ. Issues, vol. 3, no. 2, pp. 598–611, 2024, doi: 10.55047/marginal.v3i2.1077.
Y. A. Indrawan and S. Sudarsi, “Pengaruh Profitabilitas, Likuiditas, dan Struktur Modal Terhadap Financial Distress pada Perusahaan Manufaktur yang Terdaftar di BEI 2019-2021,” Kompak J. Ilm. Komputerisasi Akunt., vol. 16, no. 1, pp. 61–69, 2023, doi: 10.51903/kompak.v16i1.1043.
E. Purwaningsih and I. Safitri, “Pengaruh Profitabilitas, Likuiditas, Leverage, Rasio Arus Kas dan Ukuran Perusahaan Terhadap Financial Distress,” Jae (Jurnal Akunt. Dan Ekon., vol. 7, no. 2, pp. 147–156, 2022, doi: 10.29407/jae.v7i2.17707.
S. Mevania, S. Wahyuni, E. J. Setyadi, and N. I. Inayati, “The Effect of Managerial Ownership, Company Size, Liquidity, and Profitability on Financial Distress,” J. Manaj. Bisnis, Akunt. dan Keuang., vol. 1, no. 2, pp. 127–142, 2022, doi: 10.55927/jambak.v1i2.1796.
T. Utami, I. Y. Rahmawati, B. Fatmah, and R. F. Utami, “Unravelling Financial Distress: The Impact of Profitability, Leverage, Liquidity, Operating Capacity and Company Size,” Asian J. Econ. Bus. Account., vol. 23, no. 24, pp. 168–179, 2023, doi: 10.9734/ajeba/2023/v23i241195.
F. H. Asysyafa and E. Putri, “Analisis Pengaruh Kinerja Keuangan, Ukuran Perusahaan dan Umur Perusahaan terhadap Financial Distress (Studi Kasus Perusahaan Manufaktur Sub Sektor Makanan dan Minuman Tahun 2018-2021),” JIMPS J. Ilm. Mhs. Pendidik. Sej., vol. 8, no. 4, pp. 3559–3570, 2023, [Online]. Available: https://jim.usk.ac.id/sejarah
S. A. Asmarani and D. estari Purbawati, “Analisis Pengaruh Likuiditas, Leverage dan Profitabilitas Terhadap Financial Distress (Studi Pada Perusahaan Manufaktur Sektor Industri Barang Konsumsi Yang Terdaftar di BEI Pada Periode Tahun 2014-2018),” J. Ilmu Adm. Bisnis, vol. 9, no. 3, pp. 369–379, 2020, doi: 10.14710/jiab.2020.28140.
S. Aslamiah, S. Karyatun, and K. Digdowiseiso, “The Influence of Return on Assets, Current Ratio and Debt to Asset Ratio on Financial Distress in Consumption Goods Industry Sector Companies Listed on The Indonesia Stock Exchange in 2017-2021,” J. Syntax Admiration, vol. 4, no. 4, pp. 583–596, 2023, doi: 10.46799/jsa.v4i4.843.
T. Hidayat, M. D. Permatasari, and T. Suhamdeni, “Analisis Pengaruh Rasio Keuangan Terhadap Kondisi Financial Distress Perusahaan Manufaktur yang Terdaftar di Bursa Efek Indonesia,” J. Akunt. Bisnis Pelita Bangsa, vol. 5, no. 2, pp. 93–108, 2020.
S. L. Y. Prastyatini and E. Novikasari, “Pengaruh Profitabilitas dan Ukuran Perusahaan Terhadap Financial Distress,” Ekon. J. Econ. Bus., vol. 7, no. 1, p. 109, 2023, doi: 10.33087/ekonomis.v7i1.810.
Downloads
Published
How to Cite
Issue
Section
License
Copyright (c) 2025 International Journal of Economics, Management and Accounting
This work is licensed under a Creative Commons Attribution-ShareAlike 4.0 International License.
