State Owned Enterprises in Indonesia: Bankruptcy Analysis

Abstract

This study aimed to look at the financial performance of SOEs, which was reported that SOEs went bankrupt in early 2020. Using the TSG model, this study tried to analyze the potential for bankruptcy in SOEs with data sourced from financial reports from 2014-2022. A total of 16 SOEs were sampled in this study. The results showed that two SOEs (GIAA and KRAS) became the SOEs with an enormous bankruptcy potential. For six consecutive years, the analysis results showed that there had been financial irregularities in Garuda Indonesia and Krakatau Steel. Other results showed that the Taffler model was not suitable for companies in the banking sector because this model focuses more on the company's short-term debt. The second model, the Springate model, showed almost the same results as the first model. While the third model, the Grover model, was slower or looser than the first and second models. In addition, this study also found that the t-score and s-score were not suitable for use in banking. Suggestions from the results of this study were that the two SOEs (GIAA and KRAS) need to refinance their debts, considering that the level of liquidity and leverage of their debts was very concerned.