Volume 5, Issue 1, January – 2020 International Journal of Innovative Science and Research Technology

ISSN No:-2456-2165

The Influence of Investment Decisions and Funding

Decisions on the Value of Companies with Ownership
Structure as Moderated Variables in Manufacturing
Companies Listed in Indonesia Stock Exchange (BEI)
Aqimissolati Sulastri
Student, Magister of Management Science, lecturer of Magister of management Science,
Faculty of Economics, Sriwijaya University Faculty of Economics, Sriwijaya University

Isnurhadi Agustina Hanafi

lecturer of Magister of management Science, lecturer of Magister of management Science,
Faculty of Economics, Sriwijaya University Faculty of Economics, Sriwijaya University

Abstract:- decisions and funding decisions, especially in

manufacturing companies in Indonesia. Investors can
 Introduction choose a company that has good financial decisions and an
This study examines the effect of investment decisions appropriate portion of institutional ownership.
and funding decisions on firm value with institutional
ownership as a moderating variable. In this study, Keywords:- Current Asset to Total Assets, Fixed Asset to Total
investment decisions are measured by Current Asset to Assets, Debt Equity Ratio, Institutional Ownership, Multiple
Total Assets (CATA) and Fixed Assets to Total Assets EVs.
(FATA) while funding decisions are measured by Debt
Equity Ratio (DER), institutional ownership is measured I. INTRODUCTION
by (INST) and company value is measured by EV /
EBITDA. An agency in establishing a company must have a clear
purpose. The company's goals include getting maximum
 Purpose profit, wanting to prosper the owner of the company and
Analyzing the influence of investment decisions and optimizing the value of the company that can be seen from the
funding decisions on the company's value in the price of its shares. Company value reflects the current value of
manufacturing sector listed on the Indonesia Stock future desired income and indicators for the market in valuing
Exchange in 2014-2017. the company as a whole (Kusumadilaga, 2013). Carrying out
financial management functions is something that can be done
 Results to achieve company goals. The optimal combination of
The results showed that there was a positive and management decisions can optimize the value of the company
significant effect between CATA and DER on EV / which will affect the prosperity of shareholders.
EBITDA, while FATA had no effect on EV / EBITDA.

 Conclusions The market value of a company's shares plus market

The study was conducted on companies listed on the value is the value of the company. Where there is an amount
Indonesia Stock Exchange in the period 2014 to 2017. This of debt from the total equity, it can reflect the value of the
study used as many as 87 manufacturing companies that company (Fama, 2013). Based on the research of Khalisa
met the criteria of sampling. This study was analyzed using Rahmina (2016), there are several factors that can affect the
multiple regression analysis and interaction tests and study value of the company, so that the corporate ownership
also found that INST can strengthen the relationship structure consists of institutional ownership and managerial
between CATA and EV / EBITDA, weaken the ownership. The optimization of company value can be done
relationship of DER and EV / EBITDA, and INST does not through the implementation of financial management, where
moderate the relationship between FATA and EV / one financial decision taken will affect other financial
EBITDA. The results of this study can be used by investors decisions and the impact on company value (Fama & French,
as a material consideration in terms of investment 2018).

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ISSN No:-2456-2165
The manufacturing industry sector records the The value of the company is often a reference to the
investment value of US $21.6 billion throughout 2017 with a shareholders before they invest in a company because the
total of 256 projects. Compared with other sectors, the higher the value of the company, the welfare of the company's
processing industry becomes the largest contributor to the total owners will be higher (Ansori & Denice, 2012). To obtain a
value of investment entered into Indonesia Seniali US $42.6 high stock market price is not detached from the decisions
billion or grew 23.7% compared to the previous year. I Gusti taken by shareholder parties especially the financial decision
Putu Suryawirawan, director general of Resilience and where Jensen & Mecklin (2016), explained that to maximize
development of international industrial Access (KPAII) of the the value of the company not only value Equity is to be
Ministry of Industry (Kemenperin), delivering the growth of considered, but also all financial claims such as debts,
the manufacturing sector experienced a significant increase. warrants, and other preferent stocks.
This is achieved by the increase in product demand both
domestically and globally (Bisnis Indonesia, 2018). Optimizing the value of the company can be achieved
through the implementation of financial management, where a
Manufacturing company is a large scale company when financial decision is taken will influence other financial
compared with other companies so it can do comparisons decisions and impact on the value of the company (Fama &
between companies one with other companies. Manufacturing French, 2018). According to Hasnawati (2015), financial
companies also have stocks that are resistant to economic management regarding the completion of important decisions
crises. This is because most of the manufacturing products are taken by the company, an optimal combination of the three
still needed, so it is very small likely to suffer losses will maximize the value of the company, among others,
(Devi,2016). investment decisions and funding decisions and proprietary
structures.
Decisions that can affect the value of the company are
investment decisions and funding decisions, doing investment The decision that could affect the company's value is one
activities is the hardest decision for corporate management of the investment decisions. Conducting investment activities
because it will affect the value of the company (Vranakis and is the hardest decision for the management of the company
Prodromos , 2012) and funding decisions is a very important because it will affect the value of the company (Vranakis and
decision for the company because it concerns the acquisition Prodromos, 2012). The purpose of the investment decision is
of funding resources for operational activities and for to gain a large profit with a risk that can be managed in hopes
operational activities and financing the Company's investment of optimizing the value of the company (Afzal and
activities and to achieve The company's objectives, the Abdul,2012). Investment decisions are decisions that reflect
principal has handed over the management of his company to future investments (investment opportunity), namely through
the manager. The manager is given power by the shareholders the introduction of new products or expansion of old products,
to make decisions to increase the shareholder's wealth (Arby, equipment replacement or building, research and development,
2015). This often poses a conflict of interest known as agency and exploration. The implications for companies are
theory. companies must plan to make investment decisions through
the introduction of new products or the expansion of old
Previous research according to Manurung (2013), the products, equipment replacement or building, research and
investment decision will impact the company's performance in development and exploration (Husnan, 2012).
the long term while management has enormous freedom in the
company's cash usage. Realizing this then some researchers Previous research that is in line with this has been done
try to develop a signaling model where capital investment is a by the researchers, resulting in various differences and
signal that the manager can use indicates that the company has equations in the results of research samples. Xun Li and
high performance prospects reflected through the value of the Zhenyu Wu (2018), found the result that there was a
company. significant positive relationship between the research variables
on the company's value, while in the Razali Haron (2018)
The prosperity of shareholders can be reached by influential investment decisions were not significant between
maximizing the current value of the company. Maximize the the variables Company's research and value.
prosperity of shareholders of all shareholders ' profits expected
to be gained in the future by maximising the current value. Based on research results of researchers J. Christopher
The prosperity of shareholders will increase when its share Hughen, Peter P. Lung (2017) showed that analysis conducted
price increases. If the company performs a speculative in his research considers no loss of value impairment between
investment, there is a tendency for the price to fall because the asset value and stock ownership structure against value The
risk of business is getting bigger. Thus, the higher the stock company is in its prokable use EV multiple. This is in
market price means the prosperity of shareholders is comparison to the research conducted by Norman Wong
increasing (Brigham and Houston, 2013). (2017) which demonstrates a significant influence between the

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Volume 5, Issue 1, January – 2020 International Journal of Innovative Science and Research Technology
ISSN No:-2456-2165
value of assets and investments as well as the structure of II. TEORITICAL REVIEW
ownership of the value of the fund.
 Signalling Theory
The conditions that have been exposed are the primary Signal theory is one of the efforts that managers make to
consideration of researchers to select the manufacturing sector maximize the value of the company. The signal theory
as a research object. On the Indonesian Stock Exchange (IDX) according to Brigham and Houston (2013) is an action taken
registered 150 manufacturing companies. Researchers use the by the management of the company that instructs investors on
Puposive sampling method to focus on 87 manufacturing how management views the company's prospects.
companies located in IDX. This period of research was
conducted between 2014-2017, with the reason that the period The signal theory explains why the company has the urge
is closest to the time of research, availability and completeness to provide financial reporting information to external parties.
of data in this period is also one of the electoral variables The company's encouragement to provide information because
Period. there is an asymmetrical information between the company
and outside parties because the company and outside parties
The purpose of this research is to seek empirical because the company knows more about the company and
evidence by analyzing the influence of investment decisions future prospects from the parties (Investor and creditor)
and funding decisions on the company's value in (Jusriani, 2013).
manufacturing and ownership structures as a moderation
variation listed on the Exchange Indonesian securities in 2014- This signal theory is also reinforced by the opinions of
2017. Ikenbery et al (2017), explaining the signaling theory of
breakdown of stocks using asymmetric explanation of
Remarks Year information. Management has more information about the
2014 2015 2016 2017 company's prospects than the outside parties, i.e. investors.
CATA 13.92 13.83 13.55 13.63 The breakdown of stocks is an effort to attract the attention of
FATA 10.32 9.73 8.55 10.06 investors, giving signals that the company has a good
DER 0.99 1.02 0.95 0.90 condition. Based on signaling theory, the company's
KI 0.51 0.71 0.56 0.53 performance is a factor that motivates the company to make
EV/EBITDA 3.58 4.32 3.39 3.73 stock resolution decisions. This is because the market
Table 1:- Average investment decisions, funding decisions, responds positively to signals where the signals are about the
ownership structure and company value in the manufacturing future. Signals given by companies whose past performances
sector 2014-2017 are not good will be trusted by the market.
Source: www.idx.co.id (Processed by researchers, 2019)
Signal theory is one of the efforts that managers make to
The average investment decision that was proscribed maximize the value of the company. The signal theory
with the Current Asset to Total Asset Ratio (CATA) fluctuated according to Brigham and Houston (2013) is an action taken
from 2014 to 2017 that there was a decline in investment by the management of the company that instructs investors on
decisions annually beginning in 2014 to 2016, however There how management views the company's prospects. Companies
was an increase in 2017 by 0.59% while the investment with profitable prospects will try to avoid the sale of stocks
decision in Fixed Asset to Total Assets (FATA) had fluctuated and strive for any new capital needed in other ways, including
from the year 2015 to 2016 and the average funding decision the use of debts that exceed the target capital structure.
that was proscribed with the Debt Equity Ratio ( DER)
showed that the funding decision from 2014 to year 2015  Agency Theory
increased 3.03% despite a decline of 6.86% in 2016 and a Agency Theory is a model used to describe the problem
decrease in the amount of 5.26 in the year 2017. The between management and owners. The agency's theory
ownership structure that is proscribed with the percentage of according to Brigham and Houston (2013) is a relationship
institutional ownership (KI) is also subjected to significant where managers are empowered by the stockholders.
fluctuations and the average data of the company's value is
proscribed with Enterprise Value/Earning Before Interest, Tax, The main principle of agency theory is that there is a
Depreciation, and Amortization (EV/EBITDA) in the table working relationship between the authority of the owner or the
above showed that the increase in the year 2015 of 20.39%, shareholder with the agent who is the manager, in the form of
then a decline in 2016 as much as 21.34% but there was an cooperation contract (Primasari, 2014). Agency problems arise
increase in the back of the year 2017 of 10.2%. because there is a conflict of disagreements (interests) between
the owner (principle) and the management (Siallagan and
Machfoedz, 2016).

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ISSN No:-2456-2165
Jensen and Meckling (1976) argue that agency (Syamsudin, 2017). According to Weston and Brigham (2015)
relationship is a relationship where the owner of the company The measurements of this indicator are as follows:
entrust the management of the company by another person that
is the manager (agent) in accordance with the interests of the Current Assets
owner (principle) with Delegate several decision-making
CATA = Total Asset
authority to the agent. The manager in running the company
has the obligation to manage the company as mandated by the Fixed asset to total assets (FATA) is defined as the ratio
principle of increasing the principal prosperity by increasing of fixed assets to total asset. Firdaus (2010), said the fixed
the value of the company, in return the manager (agent) will assets were assets acquired for use in the company's activities
be Bonuses or other compensation. for a period of more than one year, not intended for resale in
the company's normal activities, and constitute expenditure A
Management as a manager of the company has more large value or material.
information about the company, know more about internal
information, and know the prospects of the company in the Reviewed from the length of the turnover of fixed assets
future compared to the owner or shareholder, therefore the is an asset that is experiencing the process of turnover in the
manager obligation to provide information or signals about the long term "according to Weston and Brigham (2015) The
company's condition to the owner (scout, 2017). But the percentage of fixed assets to total assets was found using the
information submitted sometimes does not correspond to the following formula:
actual company's condition. These conditions are known as
unsymmetrical information or information asymmetry. In fact, Fixed Assets
in carrying out its obligations the manager has another purpose FAT Total Asset
that is concerned with their own interests, making the most A=
profit to improve their welfare, so that in the end Creating a  Funding Decision
conflict of agency, which is a conflict of interest between the The funding decision is a decision regarding the source
management (agent) with the owner or the principle of funds to be used by the company. Funding sources are
(Haruman,2017). divided into two, namely internal funding sources and external
funding sources. Sources of external funds used by companies
 Investation decision are debt and own capital.
Investment decisions are decisions regarding the
investment in the present to get a return or profit in the future. The funding that is sourced on the issuance of new stocks
and bonds is often referred to as the external funding, while
Investments are expected to provide a higher level of the retained earnings are referred to as internal funding. The
return (internal rate of returns) than the cost of capital, said to funding decision will be related to determining the optimal
be profitable. The higher the profit rate resulting from the combination of the use of various sources of funds which can
company's investment activities, it will increase the stock price basically be divided into two of them related to the transfer of
of the company. Higher stock prices have an impact on the Extenern because it will lead to the retrieval A decision on the
company's increased value (Fama, 2015). capital structure, i.e. will determine the proprsi between the
long-term debt and its own capital. This will be seen in Debt
In determining the investment decision, prospective to Equity Ratio of the Company (Husnan, 2013).
shareholders as principal see the opportunities that will be
obtained from investing in a company. In addition, prospective This is equivalent to the theory (Brigham and Houston,
shareholders will also see the management performance of the 2013) stating that the higher the ratio means that the more
company. According to Wahyudi and Pawestri (2016), the effective the use of these fixed assets will increase the value of
value of the company formed through the indicator of the the company, assuming that cash flows from the decision
stock market value is strongly influenced by investment Fixed operations and cash flows from declining investments
opportunities. Investment opportunities are formed from the caused by the purchase of fixed assets for the addition of fixed
investor's response to the company's value. This is in assets within the company.
accordance with the signal theory stating that investment
expenditure gives a positive signal of future friendship growth. A proxy used to measure funding decisions is to use a
Current Asset to Total Asset Ratio (CATA) reflects the Debt to Equity Ratio (DER). This ratio shows the comparison
proportion of the company's investments in current assets between financing and funding through debt with funding
versus Total assets. To some extent CATA is increasingly through equity. This ratio is usually used to measure the
higher reflects the better investment decision. The greater the financial leverage of a company (Brigham and Houston,
ratio is getting better because it shows the availability of cash, 2012).
receivables and supplies that are the most liquid current
property compared to the total assets owned by the company

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According to Brigham and Houston (2012), DER can be tend to try to improve its performance for shareholders '
calculated using the following formula: interests and for its successful importance. With increased
performance it will increase the value of the company.
Total Hutang
DER = Total Ekuitas ownership by institutional
KI Total company
 Institutional Ownership =
Institutional ownership is the proportion of share  Corporate values
ownership by institutional investors. Institutional investors are The company's main objective is to maximize the value
believed to have the ability to monitor management actions of the firm (Salvatore, 2011). Maximizing the value of the
better than individual investors. Institutional as a shareholder company is very important meaning for a company, because
is considered capable of detecting errors that occur Jensen and by maximizing the value of the company means also
Meckling (2013). maximizing the prosperity of shareholders who are the main
objectives of the company. The value of the company is the
Value is created when a company gives returns to its price willing to be paid by prospective buyers when the
investors exceeding the cost of capital. Value for corporate company is sold.
investors can be achieved only by donating value to customers
(Sudana, 2018). One of the new paradigms that develops in The value is created when the company returns to its
management to deal with the global, competitive and turbulent investors exceeding the cost of capital. Value for corporate
business environment is with the customer value strategy investor can be achieved only by donating value to Customer
(Sartono, 2013). (Sudana, 2018). One of the new paradigms that thrive in
management to deal with the global, competitive and turbulent
The existence of shareholders such as institutional business environment is with the customer value strategy
ownership has an important meaning in monitoring (Sartono,2013).
management. The existence of ownership by institutional such
as manufacturing companies, insurance, banks, investment According to Sartono (2013) The value of the company
firms and ownership by other institutions will drive improved is the selling value of a company as a business that is in
institutional oversight ownership more optimally. The operation. The excess selling value above the liquidation value
monitoring mechanism will ensure increased prosperity of is the value of the management organization that runs the
shareholders. Institutional significance ownership as company. The value of the company is very important because
supervisory agents are emphasized through their considerable with the high value of the company will be participated by the
investment in the capital market. When institutions are high prosperity of shareholders. The higher the value of the
dissatisfied with managerial performance, they will sell their company describing the more prosperous owners. The
shares to the markets (Abeysekera, I. and Guthrie, J. 2015). company's value will be reflected in its stock market price.
According to Christiawan and Tarigan (2017) There are
According to Smith (2013), the change of behavior from some concepts that explain the value of the company:
passive to active can increase managerial accountability so
that managers will act more carefully in decision-making. The Nominal value is the value listed formally in the
increased institutional activity ownership in monitoring is due company's Articles of association. Intrinsic value is the most
to the fact that the existence of significant stock ownership by abstract concept, because it refers to the approximate real
institutional ownership has increased their ability to act value of a stock as a representative of the value of the
collectively. At the same time, the cost of getting out of their company. This value relates to a specific condition where a
investments becomes increasingly expensive because the risk company should be able to consolidate part or all of its assets
of stocks will be sold at a discounted price. This condition will and billing bills. The liquidation value can only be used for
motivate institutional ownership to be more serious in limited use. The value of the book is a corporate value
supervising or correcting all managers ' behaviour and calculated on the basis of accounting concepts. Market value is
extending the investment timeframe. Surveillance mechanisms often called the exchange rate, is the price that is so from the
can be done by placing an expert board that is not financed by bargain process in the market. Also known as fair market
the company so that its position is not under the supervision of value, i.e.
managers. Thus, an expert board can effectively perform its
functions to control all managers ' actions. Maximizing the value of the company is very important
meaning for a company, because by maximizing the value of
Managerial work will encourage management to improve the company means also maximizing the prosperity of
its performance, because they also have a company (Dinar and shareholders who are the company's objectives. There are
Widanar, 2015). Ross (2014) stated that the larger the several research concepts:
management work in the company then the management will

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Volume 5, Issue 1, January – 2020 International Journal of Innovative Science and Research Technology
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Values are defined for the specific time and period.Value No Criteria Amount
must be specified at a reasonable price And assessments are
not influenced by certain buyer groups. 1. Manufacturing companies listed on the 150
Indonesia Stock Exchange 2014-2017
According to Peter P. Lung (2018), Enterprise 2. Manufacturing companies that do not 19
Value/Earning Before Interest, Tax, Depreciation, and have institutional ownership data from
Amortization (EV/EBITDA) assessed the company by looking 2014-2017
for market prices from the left side of the company balance, 3. Manufacturing companies which do not 44
i.e. equity value and debt value, and then Minus the company's have complete reports related to
cash position, which is intended to find the net value of the research variable data from 2014-2017
debt. EV size is more fair in valuing reasonable prices Number of Final Samples 87
(Instrinsik stock value) companies. The relevant EV/EBITDA Observation Year 4
assesses the operational performance of the company Number of Observations 348
compared to PER because of its EBITDA. This measurement Table 2. Research Sample Selection Process
with EV/EBITDA is more popular among analysts because it Source: Developed for this research, 2019
is very suitable compared between Apples to Apples even
between Oranges to Apples, as it is suitable compared between Based on the sample selection process above, obtained
one company with another company that has treatment and 87 companies that meet the criteria to be sampled in this study
different accounting systems (Kaplan and Ruback 2014). and 348 observations.
EV Multiple = Enterprise Value This research analyses the influence of investment
EBITDA decisions, funding decisions on the company's value by being
examined as a moderation variable in manufacturing
III. RESEARCH METHOD companies on the Indonesia Stock Exchange. The variables
used in the study were: Investment decision X1 (CATA), X2
The types of data used in this study are quantitative data, (FATA), funding decision X3 (DER), working institutionally
a data collection method used in this research is to conduct a Z (KI), and company Y value (EV/EBITDA). The
documentation study conducted by collecting secondary data phenomenon occurring in this study can be described through
related to the variables needed for this research data through data analysis in the sequence of data gathering, processing
the Indonesia Stock Exchange website, www.idx.co.id and the data and analyzing data.
company's official website.
According to the source, the data used in this study is The company manufactures as a research agency because
external secondary data, i.e. data that is not directly obtained the manufacturing company is from a business that is moving
from the source, but obtained in a form that is collected, in the real sector that has the most number of companies
processed, and published by other parties outside the compared from other businesses that are lacte of several
Company in question. The data used in this study are the industries. Despite the lacte of a wide range of industries,
company's publications in the form of financial statements, manufacturing companies have similar characteristics. The
annual reports and sample company performance summaries largest company of liquid manufacturing companies in the
during the observation period. number of issuers listed on the Indonesia Stock Exchange in
2014-2017 SKPLBI as many as 150 manufacturing
Population is a collection of individuals with predefined companies.
characteristics. The company's research population in the
manufacturing industry group listed on the Indonesia Stock Independent variables (X) Independent variables are
Exchange in 2014-2017. Samples are part of the amount and variables that are due to the occurrence or change of
characteristics owned by the population (Sugiyono, 2017). In dependent variables (Sugiyono: 2013). Independent variables
this case the population framework amounted to 150 in this study were investment decision variables X1 (CATA),
manufacturing companies and the selection of research X2 (FATA), funding decision X3 (DER).
samples was based on the purposive sampling method. The
criteria used to select samples on this research are as follows. Moderation Variables (Z) Moderator variables are
variables that affect (strengthen or weaken) the relationship
between independent variables with the dependent (Sugiyono:
2013). The moderation variables in this study are the
institutional ownership of Z (KI).

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Dependent variable (Y) Dependent variables are tolerance value equals the high VIF value (due to VIF =
variables obtained from the magnitude of the independent 1/Tolerance). A commonly used cut off value to indicate the
variable. According to (Sugiyono: 2013) A bound variable is a presence of multicolinearity is the value of Tolerance ≤ 1.10
variable that is influenced or which is due to the presence of a or equal to the value of VIF ≥ 10. Each researcher must
free variable. The dependent variables in this study are the determine the level of colinearity that can still be tolerated.
company's value (EV/EBITDA) registered in the IDX period For example the value tolerance = 0.10 equals the level of
2014-2017. colinearity 0.95. Although multicholeinearity can be detected
with tolerance and VIF values, we still know which
IV. ANALYSIS METHOD independent variables are correlated. (Ghozali, 2016).

The data that has been collected in the study, is processed  Autocorrelation Test Analysis
using statistical data processing applications, namely Eviews Autocorrelation can be defined as a correlation between
software use multiple linear regression with descriptive interference variables one with other variable disorders
research, normality test analysis, multicollinearity test (Ghozali, 2016). The autocorrelation test aims to test whether
analysis, heteroskedasticity test analysis, autocorrelation test in a linear regression model there is a correlation between
analysis, multiple regression analysis, coefficient of disruptor errors in certain periods with disruptor errors in the
determination (R2), simultaneous regression analysis, previous period. If there is a correlation between disruptor
individual parameter significant test. errors, it can be said that in a linear model there is an
autocorrelation. The autocorrelation test in this study uses the
The data analysis methods used in this study use multiple LM-Test test where there is no autocorrelation if the
linear regression with the help of Eviews programs. Based on significance value of Obs * Square is greater than 0.05.
the hypothesis in this study the method of data analysis used is
quantitative analysis to calculate or estimate quantitatively  Heteroskedasticity Test Analysis
from several factors individually – alone or together – equal to The heteroskedastisity test aims to test whether in a
variables Related. The functional relationship between a single regression model there is a variance inequality of the residual
variable associated with a free variable can be done with (error) observation to another observation. If the variance of
multiple linear regression. The method of data analysis in this the residual from one observation to another remains, it is
study uses deskriftive statistics with quantitative data aimed at called homoskedastisity, and if different is called
obtaining a comprehensive picture of the direct or indirect heteroskedastisity. A good regression Model is that
influence between variables in this study. homoskedastisity does not happen heteroskedastisity (Ghozali,
2016) Heteroskedastitas test is done to test regression model in
The classic assumption test in the study used a classical case of variance inequality from the residual of one
assumption test before testing the hypothesis using multiple observation to another observation. If variance occurs
regression analyses. Test the classic assumptions to be used in differences then it is called Heteroskedastitas and if the
this study include: variance is fixed then it is called Homoskedastitas. The
Heteroskedastitas test in this study used the White test where
 Normality Test Analysis there is no heterogeneity if the significance value of Obs *
Test data normality is performed to determine whether Square is greater than 0.05.
the residual regression model that is researched is distributed
normally or not. A good regression Model is that has a normal  Regression Analysis
or close data distribution. This normality test aims to test Regression analysis is essentially a study of the
whether in a variable regression model bonded and free dependency of dependent variables with one or more
variables have a normal distribution or not. In this study the independent variables with the aim to estimate and predict the
normality test was done using the Jarque-Bera method where average population or average value of dependent variables
the data was said to be a normal distribution if the value of based on value Known independent variables (Ghozali,2013).
significance was greater than 0.05.
Moderated Regression Analysis (MRA) or interaction
 Multicollinearity Test Analysis test is a special application of linear multiple regression where
Then the assumption of normality was met The the regression equation contains interaction elements
multicolinearity test aims to test whether a regression model is (multiplication of two or more independent variables) with the
found to be correlated between free (independent) variables following equation formula (Liana, 2013):
(Ghozali, 2016). In case of strong correlation, there is a
problem with multicolinearity to know the presence or absence Y = 𝛼 + 𝛽1 CATA + 𝛽 2 FATA + 𝛽 3 DER + 𝛽 4 CATA* KI +
of multicolinearity in the regression model can be seen from: 𝛽 5 FATA* KI+ 𝛽 6 DER* KI + ê
oth of these sizes indicate each of the independent variables
described by another independent variable. So the low

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Information: V. RESULT AND ANALYSIS
Y = Company Value
𝛼 = Constant Minimu Maximu Std.
𝛽1 = Regression coefficient for CATA Variabel Mean
m m Dev
𝛽2 = Regression coefficient for FATA 10.4200 13.614 1.3876
𝛽3 = Regression coefficient for DER 0 63 55
𝛽4 = Coefficient Regression moderation for CATA * KI CATA 7.05000 11.661 1.5211
𝛽5 = Coefficient Regression moderation for FATA * KI 17.52000
FATA 0 15 45
𝛽6 = Coefficient Regression moderation for DER * KI 14.93000
DER 0.02000 0.7702 0.5182
ê = Residual Value 2.410000
KI 0 87 36
0.980000
EV/EBIT 0.01000 0.3828 0.3859
 Research Hypothesis Test 3.990000
DA 0 38 79
Testing the hypothesized variables in this study with a 0.01000 1.5893 1.1208
multivariate regression with a level of profitability (α = 0.05). 0 10 60
This test is performed to determine whether independent Table 3:- Descriptive Research Variable Data
variable changes have an effect on dependent variables or not. Source: Secondary data processed in years 2019
The hypothesis of this research will be accepted if there is one
among the free variables to have an influence on the bound There are five research variables: Current Asset to Total
variables (Ghozali,2013). Asset (CATA), Fixed Asset to Total Assets (FATA), Debt
Equity Ratio (DER), institutional ownership (KI), and EV
 Coefficient of Determination (R2) multiple (EV/EBITDA). The minimum value is the lowest
Coefficient of determination testing is used to explain value for each variable, the maximum value is the highest
how large variations of dependent variables can be described value for each variable in the study, the mean value represents
by variations of independent variables. A R2 value that detects the average value, and the standard deviation for each variable
1 (one) means that its independent variables provide almost all in the study.
the information needed to predict the variation of an
independent variable. The coefficient of determination aims to Shows that the average CATA of a sample of
know the magnitude of the influence of variables independent manufacturing companies observed was 13.61, where the
of dependent variables. standard deviation of 1.39 means that CATA of total assets
has a portion of 13.61% compared to the value of total assets.
 Statistical Test (F)
Test F statistics are used to measure the goodness of fit The minimum value of 10.42 at PT Pabrik Kertas Tjiwi
of a regression equation or to find out if all the free Kimia Tbk in 2015 and a maximum value of 17.52 at PT
(independent) variables included in the model have a common Surya Toto Indonesia Tbk in 2016. Shows that the average
influence on the dependent variables (Ghozali, 2016). FATA of the sample of manufacturing companies observed
Hypothetical no (Ho) states that all independent variables was 11.66, where the standard deviation of 1.52 means that
included in the model do not have a shared effect on the FATA of total assets has a portion of 11.66% compared to the
dependent variables, whereas Hα states that all independent total value of assets. The minimum value of 7.05 at PT
variables have an influence to dependent variables. Asahimasflat Glass Tbk in 2015 and a maximum value of
14.52 at PT Duta Pertiwi Nusantara Tbk in 2014. Shows that
The acceptance criteria and the hypothesis rejection in the average DER of the sample of manufacturing companies
test F are as follows: observed was 0.77, where the standard deviation of 0.52
means that the DER to equity (equity) ) has a share of 0.77%,
Ho rejected if F counts < F of α table = 0.05: meaning all the DER value is above one, companies tend to use debt as a
free variables simultaneously have no significant effect on the source of corporate funding. The minimum value of 0.02 at PT
bound variables. Ho received if F count > F table Padaα = Pyridam Farma Tbk in 2017 and the maximum value of 2.41
0.05: Meaning all variables are free Simultaneously significant at PT Sri Rejeki Isman Tbk in 2014. Shows that the average
effect on bonded variables. KI of the sample of manufacturing companies observed is
0.38, where the standard deviation is 0.39 meaning that
 T-Statistical Test ownership of shares by institutions has a portion of 0.38 %.
The T-Statistic test basically shows how much the The minimum value of 0.01 at PT Siwani Makmur Tbk in
influence of one individual variable-variables in describing the 2014 and the maximum value of 0.98 at PT Mandom
variation of the dependent variable (Ghozali, 2016). The zero Indonesia Tbk 2015. Indicates that the average EV / EBITDA
hypothesis (Ho) that you want to test is whether a parameter of the sample of manufacturing companies observed is 1.59,
(βi) equals zero or the alternative hypothesis (ha) parameter of where the standard deviation of 1.12 means that EV / EBITDA
a variable is not equal to zero. has a portion of 1.59% . Minimum value of 0.01 at PT Indo

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Volume 5, Issue 1, January – 2020 International Journal of Innovative Science and Research Technology
ISSN No:-2456-2165
Kordsa Tbk in 2017 and a maximum value of 3.99 at PT Delta Variabel VIF Information
Djakarta Tbk in 2014. CATA 1.271244 Non Multikolinieritas
FATA 1.048163 Non Multikolinieritas
 Normality Test Analysis DER 3.495952 Non Multikolinieritas
This normality test aims to test whether in a variable CATA*KI 3.550862 Non Multikolinieritas
regression model bonded and free variables have a normal FATA*KI 1.831542 Non Multikolinieritas
distribution or not. In research Anini test normality done using DER*KI 5.435282 Non Multikolinearitas
the method Jarque-Bera where the data is said to be KI 1.386276 Non Multikolinearitas
distribution normal if the value of significance is greater than
Table 5:- VIF values
0.05.
Source: Secondary data processed in years 2019
Variabel Jarque-
Multicollinearity test results on the independent variables
Bera Significance Information obtained tolerance values on research variables above 0.1 and
CATA 3,139 0,208 Normal VIF values below 10 so that it can be said there is no high
FATA 4,333 0,114 Normal relationship between the independent variables.
DER 1,639 0,440 Normal
EV/EBITDA 5,509 0,064 Normal  Heteroskedasticity Test Analysis
KI 5,687 0,058 Normal The autocorrelation test aims to test whether in a linear
Table 4:- Normality Test Results regression model there is a correlation between disruptor
Source: Secondary data processed in years 2019 errors in certain periods with disruptor errors in the previous
period. If there is a correlation between disruptor errors, it can
The results of the normality test of each variable indicate be said that in a linear model there is an autocorrelation. The
the Jarque-fallow significance Jarque-Bera significance is autocorrelation test in this study uses the LM-Test test where
above 0.05 so that it shows that all variables are normally there is no autocorrelation if the significance value of Obs *
distributed. Square is greater than 0.05.

It can therefore be said that the data in this research is Obs*Rsquared Significance Information
already a normal distribution. The normality test can also be Non
done using the histogram chart present in the attachment with 32,778 0,3798 Heteroskedastisitas
the result on the histogram chart, indicating the normal Table 6:- Heteroscedasticity Value
distribution pattern is to follow or approach the shape of the Source: Secondary data processed in years 2019
bell, so that the regression model meets the normality
assumption. The test results of normality based on significance The above results obtained significance value of Obs *
testing and the histogram chart indicate that the data in this Rsquared is 0.3798 so the value is greater than 0.05 so there is
study is already under normal distribution. no heteroscedasticity, so it can be said that the regression
model does not contain heteroscedasticity symptoms.
 Multicollinearity Test Analysis
Multicolinearity tests are performed to see the presence  Autocorrelation Test Analysis
or absence of the correlation between independent variables in Heteroskedastitas test is done to test regression model in
testing the model of multiple linear regression. A regression case of variance inequality from the residual of one
Model is good if there is no high correlation between its free observation to another observation. If variance occurs
variables, because if there is a correlation then the variables differences then it is called Heteroskedastitas and if the
are not orthogonal or there are similarities. This test was variance is fixed then it is called Homoskedastitas. The
conducted to avoid partial influences of each free variable Heteroskedastitas test in this study used the White test where
against the bound in the decision making process. This test in there is no heterogeneity if the significance value of Obs *
regression models can be seen by means of the tolerance value Square is greater than 0.05.
and the value of VIF (Variance Inflation Factor). To view the
multicholinerity by using Eviews is to see a value of VIF no Obs*Rsquared Significance Information
more than 10. Non
3,040 0,2186 Autokorelasi
Table 7:- Autocorrelation Values
Source: Secondary data processed in years 2019

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Volume 5, Issue 1, January – 2020 International Journal of Innovative Science and Research Technology
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The above results obtained significance value Obs *  Individual Parameter Significant Test (Test Statistic t)
Rsquared that is 0.2186 so that the value is greater than 0.05 T-statistic tests essentially show how far the influence of
so there is no autocorrelation. Therefore, this regression model one independent variable individually in affecting its
does not have a correlation between the error of the intruder in dependencies variable. T statistical test results can be seen as
a certain period with the error of the intruder in the previous follows:
period.
Koefisien Significa
Variabel t count Information
 Multiple Regression Analysis nce
In this research hypothesis test used includes; partial test CATA 0.324590 5.750867 0.0000 Significant
(t-test), and test of coefficient of determination (R2). Multiple Not
linear regression models in this research are shown as follows: FATA
0.021494 0.387302 0.6988 significant
DER 0.695801 3.588817 0.0004 Significant
 Coefficient of Determination (R2) CATA*KI Significant
0.207670 2.529766 0.0119
The result of the determination coefficient above is 0.281
- Not
which can be said CATA, FATA, DER, CATA * KI, FATA * FATA*KI
-0.147564 1.472866 0.1417 significant
KI, DER * KI and KI moderation together can influence
EBITDA of 28.1%. -
DER*KI Significant
-1.290122 3.975616 0.0001
Coefficient of determination testing is used to explain Constanta -3.665492
how large variations of dependent variables can be described Fcount; Significant = 23,658 ; 0,000
by variations of independent variables. A R2 value that detects R Square= 0,2815
1 (one) means that its independent variables provide almost all Table 8:- T Test Results (Partial Test)
the information needed to predict the variation of an Source: Secondary data processed in years 2019
independent variable. The coefficient of determination aims to
know the magnitude of the influence of variables independent From the table above, we can get the multiple linear
of dependent variables. The resulting coefficient of regression equation as follows:
determination above is 0.281 which can be said that CATA,
FATA, DER, CATA * KI, FATA * KI, DER * KI and KI EV / EBITDA =
moderation are jointly able to affect EBITDA by 28.1%. -3,665 + 0,324 CATA + 0,021 FATA + 0,696DER + 0,208
CATA * KI - 0,148FATA * KI - 1,290DER * KI
 Simultan Regression Analysis
The calculated F value is 23,638 and the significance is The CATA variable has a value of T count 5.751 and a
0,000 so the calculated F value is greater than the F table and significance of 0.0000 so that the value significance is smaller
the significance is less than 0.05, it can be concluded that there than 0.05, so there is a significant partial influence of the
is a simultaneous influence of the variables CATA, FATA, CATA variable against EV/EBITDA. This means that CATA
DER, CATA * KI, FATA * KI, DER * KP against EV / has a significant effect on EV/EBITDA. A constantan of-3.665
EBITDA. states that if the independent variable is considered constant,
then the company's value (EV/EBITDA) of-3.665.
A statistical test of F essentially indicates whether all the
independent variables included in the model have an influence The FATA variable has a value of T count 0.387 and a
together with the dependencies. When analysis using the F test significance of 0.6988 so that the value of significance is
indicates that all independent variables are a significant greater than 0.05, so there is no significant partial influence
explanatory of the dependent variables. from the FATA variable against EV/EBITDA. This means that
FATA has no significant effect on EV/EBITDA.
Simultaneous testing aims to determine whether there is
a co-influence of the variable independent of the dependent The DER variable has a value of T count 3.589 and a
variable. There is an influence jointly between independent significance of 0.0004 so that the value of significance is less
variables if the value of F counts is greater than F table and than 0.05, so there is a significant partial effect of the DER
significance is smaller than 0.05. The value of F count is variable against EV/EBITDA. This means that DER has
23.638 and the significance of 0.000 so that the value of F significant effect on EV/EBITDA.
count is greater than F table and the significance is smaller
than 0.05, it can be concluded that there are simultaneous The CATA * KI variable has a calculate count value of
influences of the variables CATA, FATA, DER, CATA * KI, 2.530 and a significance of 0.0119 so that the value of
FATA * KI, DER * KI against EV/EBITDA. significance is greater than 0.05, so there is a significant
partial effect of the CATA * KI variable against EBITDA.

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Volume 5, Issue 1, January – 2020 International Journal of Innovative Science and Research Technology
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The FATA * KI variable has a value of T-1.473 and a The results of this research are aimed at the company in
significance of 0.1417 so that the value of significance is managing financial policies and decisions that are investment
greater than 0.05, so there is no significant partial influence of decisions and financial decisions as well as the institutional
the FATA * KI variable against EV/EBITDA. ownership structure of the company in enhancing the
company's value. The company may consider the financial
The DER * KI variables have a count-3.976 value and a decisions taken and consider the magnitude of the company's
significance of 0.00001 so that the value of significance is institutional ownership to increase the value of the company.
greater than 0.05, so there is a significant partial effect of the
DER * KI variable against EV/EBITDA. The results of this research is intended for investors to be
used as consideration in terms of decision making investing
VI. CONCLUSION especially in manufacturing companies in Indonesia. Investors
can choose companies that carry out mechanisms of
This research analyzes the influence of investment management of companies and companies that have good
decisions, funding decisions on the company's value with the financial decisions according to government and corporate
ownership structure as a moderation variable in manufacturing rules.
companies on the Indonesia Stock Exchange. Based on the
research and results of the analysis that has been done, it can SUGGESTION
be concluded as follows:
1. Current Asset to Total Asset Ratio (CATA) positively Based on the discussion and conclusion that has been
affects the value of Company (EV/EBITDA) gained on the influence of investment decisions, the decision
2. Fixed Asset to Total Assets (FATA) has no influence on the to fund the value of the company with the ownership structure
value of the company (EV/EBITDA) as a moderation variable in the manufacturing company on the
3. Debt Equity Ratio (DER) has a positive effect on the Indonesia Stock Exchange The author gave the following
company's value (EV/EBITDA). advice
4. Institutional ownership reinforces the relationship between
Current Asset to Total Asset Ratio (CATA) and company For investors, it is better to invest capital in companies
value (EV/EBITDA) that have good financial decisions and the appropriate share of
5. Institutional ownership does not affect the relationship institutional ownership. For companies, pay more attention to
between Fixed Asset to Total Assets (FATA) and company financial decision making and the share of institutional shares
values (EV/EBITDA) in accordance with applicable regulations and benefit the
6. Institutional ownership weakens the relationship between company. For further researchers develop this research by
Debt Equity Ratio (DER) and company value analyzing other factors and adding to the research period.
(EV/EBITDA)
7. CATA, FATA, DER, CATA * KI, FATA * KI, DER * KI For the company, pay more attention to the financial
and KI moderation are jointly able to affect EV/EBITDA decision making and the portion of the institutional share
by 28.1%. ownership in accordance with the prevailing rules and
profitable companies.
This study analyzes the effect of investment decisions,
funding decisions on firm value with ownership structure as a For further researchers develop this research by
moderating variable in manufacturing companies on the analyzing other factors that Influence the company's value and
Indonesia Stock Exchange. This research period for four years can provide a appropriate regarding variables that can
from 2014 to 2017 with a slight sample of 87 companies from moderate and influence the other variables.
150 manufacturing companies. This research uses a four-year
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