Earning Persistence: The Influence of Operating Cash Flow, Debt Level, and Book Tax Gap

The profitability of a company is frequently utilized as a metric for evaluating its financial performance and the capacity to sustain its operational continuity. The purpose of this study is to analyze the effect of operating cash flow, debt level, and book-tax gap on earnings persistence. This research uses a quantitative approach with an associative research form. The data collection technique employs the use of documentary studies in the form of secondary data. The population in this study consisted of 125 non-cycle consumer sector companies listed on the Indonesia Stock Exchange from 2020 to 2022. The research sample was obtained through purposive sampling method as many as 39 companies. The data analysis used was multiple linear regression analysis, facilitated by the use of the Statistical Product and Service Solution (SPSS) version 26 as a data processing tool. The findings of this study demonstrate that there is no discernible impact of operating cash flow and debt levels on earnings persistence. Meanwhile, book tax gap has a positive effect on earnings persistence. This study suggests adding other independent
variables such as sales volatility, operating cycle, and accruals.