Determinan Keberhasilan Turn Around pada Perusahaan yang Mengalami Financial Distress

Abstract

The global economic crisis in 2008 caused a lot of companies having financial performance decreased. Financial distress is a decline in the financial condition of the company before the bankruptcy. By these problems, it is important for researchers to examine the determinants of the success of the turnaround for a company obtaining financial distress. The study aims to analyze the influence of the factors which are the trend of severity health firm, the availability of free assets, firm size, and the asset retrenchment in the success of the turnaround to the manufacturing companies listed on the Indonesia Stock Exchange in 2007-2012. The sample in this study used secondary data obtained from the Indonesian Capital Market Directory (ICMD). Financial data from 2008-2010 were processed into the independent variable, and financial data on 2007-2012 werefunctioned as a benchmark to determine the status of recovery using the Z-score model of Altman (1984). The sample in this study took the 29 manufacturing companies consisting of 21 non-recovery and 8 recovery. The hypothesis was tested by using the analysis model of the independent variables in 2008-2010. The results of data analysis using logistic regression indicates that the model generates the prediction accuracy that is 80,5%. Variable of the trend of severity health firm and the firm size gave significant positive effect on the condition of recovery with a significance level of 5%. Keywords: Financial distress, turnaround, severity, free assets, firm size, asset retrechment, Altman's Z-score models.