PROFIT QUALITY BEFORE AND AFTER APPLICATION OF PSAK 69

PSAK 69 Agriculture regulates the accounting treatment of agricultural activities in Indonesia. Measurement of biological assets is the most important part of the regulation of PSAK 69. PSAK 69 regulates biological assets measured at fair value less costs to sell at the beginning and end of the reporting period. Characteristics of growing biological assets will have an impact on the growth of the fair value of assets, so that there will be differences in fair value at the beginning and balance of the financial reporting period. This difference in fair value of biological assets, whether or not they have been realized is recognized as profit in the current period. This will have an impact on the quality of the company's profits. This study aims to examine differences in earnings quality before and after the adoption of PSAK 69 in agricultural sector companies listed on the Indonesia Stock Exchange. The study was conducted on agricultural companies listed on the Indonesia Stock Exchange. Earnings quality is measured by earnings response coefficient. This study measures earnings quality before and after the adoption of PSAK 69. The quality of earnings before and after the adoption of PSAK 69 is tested by means of the two different test of paired samples. 

Keywords: earnings quality, fair value, biological assets, PSAK 69