Financial performance is a subjective indicator of how effectively an organisation can use assets and produce profits from its primary operating mode. The term is often used over a given time as a general indicator of a company's overall financial health. Today, numerous Stated-Owned Enterprises (SOEs) in Indonesia faces losses and high dependence on government subsidies. Thus, this study is written to examine the intervening role of cost leadership in the effect of financing strategy, investment policy, managing before interest and taxes and earnings management on the financial performance of Indonesian SOEs. This quantitative study utilises time-series data of SOEs that face financial losses, difficulties, and high dependence on government subsidies. A total of 54 of 115 SOEs registered in 2020 were selected as research sample in this study. The result of this study shows that the leadership cost has been intervening the effect of financial strategy, investment policy, managing before interest and taxes, and earning management on Indonesia SOEs financial performance. In conclusion, this study has been successfully identified and examined the role of leadership cost as an intervening variable in the relationship of financial strategy, investment policy, managing before interest and taxes, and earning management on Indonesia SOEs financial performance. This study implies that using a leadership cost variable measured on the basis of matching principle in reconciling cost income in accounting. We suggest that the company management needs to prepare operational strategies and policies that can increase the SOEs financial performance. This study can also help the government and practitioners consider the variable of leadership cost in intervening the relationship of financial strategy, investment policy, managing before interest and taxes, and earning management on Indonesia SOEs financial performance.
Keywords: Financial strategy, investment policy, managing before interest and taxes, and earning management, Stated-Owned Enterprises, financial performance, Indonesia context