The Usefulness of Unrealized Earnings in the Macroeconomic Conditions of the Covid-19 Period: Evidence From Indonesia Marhaendra Kusuma
University of Islamic Kadiri, Indonesia
Abstract
The purpose of this study is to prove the usefulness of unrealized earnings information during the Covid-19 era and the moderating role of macroeconomic fundamentals. Research so far in measuring the usefulness of unrealized earnings information only uses aggregate numbers from Others Comprehensive Income (OCI) and is disaggregated into groups that will be reclassified and will not be reclassified, not much has been tested for the relevance value of each item partially, as well as the role of macro moderation economy. The test results on a sample of 531 companies listed on the IDX during the period 2020 - 2021 (n=1,062) show that unrealized income from adjusting the fair value of ^available-for-sale^ financial assets is most reacted by the market and is most capable of acting as a predictor of comprehensive income the future, this shows that this item has the most usability value compared to the other four items. The results of the Moderated Regression Analysis show that exchange rates, inflation and interest moderate the utility value. The originality (novelty) of this study is a test of the usefulness of unrealized earnings from the application of fair value accounting and the moderating role of macroeconomic fundamentals during the Covid-19 period.
