Does Corporate Governance as a Moderating Variable Influence the Relationships Between Asmmetry Information and Earning Management?

The purposes of this research are twofold: to examine the effect of information asymmetry on earnings management and to examine the influence of mechanism of corporate governance related to information asymmetry and earnings management. Information asymmetry is measured by relative bid-ask spread, earnings management is measured by discretionary revenues model and mechanism of corporate governance as moderating variables is measured by size of commissioner, size of audit committee and audit quality. Size of company is used as control variable in this research. The samples consists of 24 companies included in LQ-45 over 3 year (2009-2011). Results show that information asymmetry has positive effect on earnings management. Size of commissioner is able to moderate relation between information asymmetry and earnings management. While size of audit committee and audit quality have no effect on relation between information asymmetry and earnings management. In addition, the company size as control variable has positive effect on earnings management