PENENTU KONDISI FINANCIAL DISTRESS (STUDI PADA PERUSAHAAN PERBANKAN YANG TERDAFTAR, PADA BURSA EFEK INDONESIA)

Abstract

A decline fluctuation in financial condition is one of the company’s indications which may cause financial distress or unpredictable financial difficulties is a prelude to bankruptcy for a company if it cannot adapt well. Financial distress is cash flow difficulties, the amount of debt, and losses experienced by the company in operational activities for several years. From the definition, this research aimed to find out and examine the effect of liquidity, profitability, leverage, and cash flow on financial distress. The research was quantitative, with examining some hypotheses which were proposed. Moreover, the instrument in data collection technique used observation, in which the data were taken from Indonesia Stock Exchange. Furthermore, the data sampling technique used purposive sampling. Additionally, the data analysis technique used multiple linear regression. The research result concluded that liquidity had a negative effect on financial distress. Likewise, profitability had a negative effect on financial distress. On the other hand, leverage had a positive effect on financial distress. In contrast, cash flow did not affect financial distress.