Sample selection
| Description | Total |
|---|---|
| All listed firms in the IDX as of 2020 with audited financial statements | 716 |
| Less: firms in the financial industries | (95) |
| Less: new listing firms during 2018–2020 | (151) |
| Less: firms with non-IDR presentation in the financial statements | (79) |
| Less: firms without complete financial statements during 2018–2020 | (51) |
| Total number of companies | 340 |
| Total firm-year observations during 2018–2020 | 1,020 |
| Less: data outliers from observations during 2018–2020 | (43) |
| Final observations in firm-years | 977 |
Correlation analysis
| Variable | CAR | UE | ARL | Size | LEV | Grow | Loss | Big4 | COVID |
|---|---|---|---|---|---|---|---|---|---|
| CAR | 1.0000 | ||||||||
| UE | 0.0543* | 1.0000 | |||||||
| ARL | 0.1092*** | 0.0069 | 1.0000 | ||||||
| Size | −0.0122 | 0.0054 | 0.2038*** | 1.0000 | |||||
| LEV | −0.0579* | 0.0111 | 0.0088 | 0.0001 | 0.1278*** | 1.0000 | |||
| Grow | 0.0341 | 0.1252*** | 0.0143 | 0.0479 | −0.0113 | 1.0000 | |||
| Loss | −0.0147 | 0.0328 | 0.3111*** | −0.2570*** | 0.1117*** | −0.0989*** | 1.0000 | ||
| Big4 | 0.0534* | 0.0127 | 0.1474*** | 0.4159*** | 0.0438 | 0.0186 | −0.1282*** | 1.0000 | |
| COVID | −0.2058*** | 0.1738*** | 0.1896*** | 0.0054 | 0.0307 | −0.2018*** | 0.1651*** | 0.0345 | 1.0000 |
Descriptive statistics
| Variable | Median | Mean | Standard deviation | Minimum | Maximum |
|---|---|---|---|---|---|
| CAR | 0.2832 | 2.8348 | 9.1412 | −2.3455 | 91.6957 |
| UE | 0.0001 | 0.0038 | 0.1565 | −1.9196 | 1.8267 |
| ARLD | 87 | 97.2036 | 35.9895 | 29 | 330 |
| ARL | 4.4659 | 4.5156 | 0.3474 | 3.3672 | 5.7990 |
| Assets (millions, IDR) | 2,316,065 | 9,975,840 | 2.76e+07 | 3,266 | 3.52e+08 |
| Size | 14.6553 | 14.6636 | 1.7849 | 8.0913 | 19.6790 |
| LEV | 0.7373 | 1.2276 | 3.0730 | −19.5617 | 39.0320 |
| Grow | 0.0032 | 0.0146 | 0.6570 | −2.6167 | 8.5745 |
| Loss | 0 | 0.3275 | 0.4695 | 0 | 1 |
| Big4 | 0 | 0.2620 | 0.4399 | 0 | 1 |
| COVID | 0 | 0.3439 | 0.4752 | 0 | 1 |
Hypothesis H2 testing result
| Model 2 | ||||
|---|---|---|---|---|
| Independent variable | Dependent variable: CAR | |||
| Prediction | Coefficient | t-test | Probability | |
| Constant | ? | 21.35*** | 4.66 | 0.000 |
| UE | + | 150.17* | 1.84 | 0.067 |
| UE*ARL | − | −33.44* | −1.88 | 0.060 |
| UE*ARL*COVID | − | 36.60* | 1.69 | 0.092 |
| UE*COVID | − | −184.07* | −1.76 | 0.079 |
| ARL*COVID | − | 2.61*** | 2.88 | 0.004 |
| UE*Size | + | 1.29 | 1.08 | 0.279 |
| UE*LEV | − | −0.47 | −1.48 | 0.139 |
| UE*Grow | + | 2.33 | 1.35 | 0.178 |
| UE*Loss | − | 3.07 | 0.73 | 0.466 |
| UE*Big4 | + | 17.34 | 1.26 | 0.208 |
| ARL | − | −3.16*** | −3.62 | 0.000 |
| COVID | − | −15.85*** | −3.79 | 0.000 |
| Size | + | −0.22* | −1.69 | 0.090 |
| LEV | − | −0.01 | −0.12 | 0.907 |
| Grow | + | −0.03 | −0.07 | 0.943 |
| Loss | − | 0.54 | 0.88 | 0.380 |
| Big4 | + | 0.85 | 1.08 | 0.279 |
| F-value | 5.48 | |||
| Probability > F | 0.0000 | |||
| R-squared | 0.0933 | |||
| Adjusted R-squared | 0.0772 | |||
| n | 977 | |||
Hypothesis H1 testing result
| Model 1 | ||||
|---|---|---|---|---|
| Independent variable | Dependent variable: CAR | |||
| Prediction | Coefficient | t-test | Probability | |
| Constant | ? | 19.27*** | 5.32 | 0.000 |
| UE | + | 15.36 | 0.50 | 0.616 |
| UE*ARL | − | −5.28 | −1.26 | 0.206 |
| UE*Size | + | 0.77 | 0.75 | 0.455 |
| UE*LEV | − | −0.24 | −1.45 | 0.148 |
| UE*Grow | + | 0.63 | 0.97 | 0.333 |
| UE*Loss | − | 3.84 | 0.85 | 0.394 |
| UE*Big4 | + | 14.71 | 0.82 | 0.411 |
| ARL | − | −2 84*** | −4.85 | 0.000 |
| Size | + | −0.26** | −1.97 | 0.049 |
| LEV | − | −0.16** | −2.50 | 0.013 |
| Grow | + | 0.67 | 1.56 | 0.120 |
| Loss | − | 0.32 | 0.52 | 0.604 |
| Big4 | + | 1.12 | 1.42 | 0.157 |
| F-value | 3.88 | |||
| Probability > F | 0.0000 | |||
| R-squared | 0.0351 | |||
| Adjusted R-squared | 0.0220 | |||
| n | 977 | |||