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Analysis of the Relationship Between Financial Distress and Manipulation in Islamic Commercial Banks After COVID-19

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Purpose: This study aims to analyse financial distress and potential financial
statement manipulation in Islamic commercial banks. In addition, this study
analyses the relationship between the two. Financial distress is measured by Altman
Z-Score model and potential financial statement manipulation is measured by
Beneish M-Score.
Methodology: This research uses a descriptive quantitative approach by analysing
the results of the Pearson Correlation Coefficient. The data from this study were
obtained from the financial statements of Islamic Commercial Banks in Indonesia
for the period 2020 - 2022. The results of the Altman Z-Score calculation show that
Islamic commercial banks in Indonesia are financially healthy. This indicates the
effectiveness of Islamic banks' business strategies, especially in facing the Covid19 pandemic.
Findings: The results of the Beneish M-Score calculation prove that Islamic banks
are not included in the manipulator category. The Pearson Correlation Coefficient
shows that there is no significant relationship between financial distress and
financial statement manipulation at Islamic Commercial Banks in Indonesia. The
tight supervision by regulators closes the opportunity for manipulation of financial
statements. In addition, the characteristics of Islamic banks that are dominated by
funds from retail customers can explain the insignificance of the relationship
between financial distress and financial statement manipulation

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Availability

Detail Information

Series Title

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Call Number

REF 332.1 ARY a

Publisher

Bogor : IAI Tazkia., 2024

Collation

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Language

English

ISBN/ISSN

NIM.2010102054

Classification

332.1

Content Type

text

Media Type

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Carrier Type

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Edition

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Subject(s)

Z-Score
M-Score
Finacial Distress
Manipulation
Correlation

Specific Detail Info

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Statement of Responsibility

Ichsan Arydani

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