Cash flow analysis, corporate governance and financial distress

Chasanatul Hamdiyah, Amalia Rizki

Research output: Contribution to journalArticlepeer-review


Using a sample of mining companies listed on the Indonesia Stock Exchange (BEI) over the period of 2014-16, this study aims to investigate the relationship of cash flow analysis and good corporate governance with financial distress. The cash flow analysis ratio includes CFFO / TL; CFFI / TL; CFFF / TL; CFFO / TR; and CFFO / CL. Good corporate governance is the composition of the board of commissioners, the ownership of institutional shares to the total shares, the ownership of shares of internal parties to the total shares and the composition of the audit committee. The target of observation in this research is all mining sector companies based on set criteria. The logistic regression method, G-test and t-test are used to analyse the relationship between the variables. Our results show that one ratio of cash flow analysis shows the relationship between cash flow analysis and financial distress. This study did not find any relationship between good corporate governance and financial distress. The results of this study contribute to investors and users of financial statements to consider the company's financial performance, especially regarding the solvency of the company, because it is able to provide information on whether the company's long-term financial condition is healthy.

Original languageEnglish
Pages (from-to)745-761
Number of pages17
JournalInternational Journal of Innovation, Creativity and Change
Issue number4
Publication statusPublished - 2020


  • Cash flow analysis
  • Financial distress
  • Good corporate governance


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