The Influence of Internal Bank Characteristics on Profitability with PSAK 71 as a Moderating Variable in Selected Banks Listed on the IDX (Panel Study: Q3 2017 - Q1 2025)
Year: 2026
Type: article
Abstract: This study analyzes the transition in accounting standards from PSAK 55, which applies the Incurred Loss model (reactive), to PSAK 71, which is based on the Expected Credit Loss model (proactive), as a response to weaknesses revealed during the 2008 global financial crisis. The implementation of PSAK 71 triggers the phenomenon known as the Cliff Effect, referring to a sharp increase in loan loss provisioning expenses (CKPN) from the initial recognition of financial instruments. This may significantly pressure banks’ net income and equity within a relatively short period. The primary issue examined in this study is whether the implementation of the new standard moderates the influence of banks’ internal characteristics, namely Capital Adequacy Ratio (CAR), Non-Performing Loans (NPL), Operational Margin (OM), and Net Interest Margin (NIM), on profitability measured by Return on Equity (ROE). This document gives formatting instructions for authors preparing papers for publication in the Recent Science Journals. The authors must follow the instructions given in the document for the papers to be published. You can use this document as both an instruction set and as a template into which you can type your own text.
Institution: Pancasila University
Language: English
Subfield: Accounting
Domain: Social Sciences
Open Access status: diamond
OpenAlex ID: W7201999256