Could Fixed Asset Revaluation Encourage Investment?  Study Case in Indonesia

Irma Sari Permata, Gunawan Baharuddin

doi:10.32038/NCAF.2023.10.01

European KnowledgeDevelopment Institute

Original Research

Could Fixed Asset Revaluation Encourage Investment? Study Case in Indonesia

Irma Sari Permata

Gunawan Baharuddin

New Challenges in Accounting and Finance, Volume 10, Pages 1-13, https://doi.org/10.32038/NCAF.2023.10.01

Abstract
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After the COVID-19 Global Pandemic, most firms in Indonesia required a significant enough money injection to improve their value and encourage investors to make investments. The research seeks to assess which determinants are most relevant and significant in promoting the value of the company. This study examined 288 samples with three independent variables: liquidity via the quick ratio indicator (QR), ownership structure via the majority ownership indicator, and corporate size via the total asset natural logarithm indicator. Structural Equation modelling is utilized during the analysis stage to determine the strength of the association between independent and dependent variables. The results revealed that liquidity and the size of the firm have an impact on the increase in the company’s value through asset revaluation; however, ownership structure has no impact. The research suggests that companies listed at the EIB should pay special attention to the variables of investment opportunity and size if they want to increase their investments in the future.

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Keywords

Company’s Value; Fixed Asset Revaluation; Investment Opportunity; Indonesia

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Author(s) Information

Irma Sari Permata

Irma Sari Permata has been a lecturer at Pancasila University's Faculty of Economics and Business in Indonesia since 1997. She has received many research grants, including (1) Class Action (PTK), Application of the Student Centered Learning Method Problem Based Learning, and "Increasing Academic Achievement through Application of Problem-Centered Learning Model Based on Problems". (2) In 2018, she received the Pancasila University-Indonesia Inhouse Research Grant. (3) Team for Creating Accreditation Forms for Peer Assessment of Technical Competence in the Field of "Level 5 Industrial Entrepreneurship", Pancasila University Professional Certification Institute, July 1, 2020. He received the Bima research grant from the Indonesian Ministry of Education and Culture in 2023.

Gunawan Baharuddin

Dr. Gunawan Baharuddin is a dedicated researcher in the field of Islamic economics and human capital development. Holding a Ph.D. in Islamic Economics from University of Malaya Malaysia, his research focuses on the intersection of entrepreneurship, Islamic philanthropy and the enhancement of human capital in Muslim-majority societies. Dr. Gunawan's work involves exploring how Islamic finance can be utilized to foster human capital growth and economic development in accordance with Islamic ethics. Through his publications and collaborations with international research groups, he seeks to promote sustainable and ethical economic practices grounded in Islamic principles. Dr. Gunawan is committed to contributing valuable insights to the field and empowering individuals through knowledge and skills development in the context of Islamic economics and human capital development.

How to cite this article

Permata, I. S., & Baharuddin, G. (2023). Could fixed asset revaluation encourage investment? Study case in Indonesia. New Challenges in Accounting and Finance, 10, 1-13. https://doi.org/10.32038/NCAF.2023.10.01

Acknowledgments

The highest appreciation is sent to the Government of Indonesia especially KEMDIKBUDRISTEK for the HIBAH BIMA DIKTI 2023 and those involved in this program.

Funding

This research is financed by the Government of Indonesia through KEMDIKBUDRISTEK and this article is one of the outputs to be required

Conflict of Interests

No, there are no conflicting interests.

Open Access

This article is licensed under a Creative Commons Attribution 4.0 International License, which permits use, sharing, adaptation, distribution and reproduction in any medium or format, as long as you give appropriate credit to the original author(s) and the source, provide a link to the Creative Commons license, and indicate if changes were made. You may view a copy of Creative Commons Attribution 4.0 International License here: http://creativecommons.org/licenses/by/4.0/