| This study was conducted to examine the relationship between leverage (debt to asset ratio) to accrual earnings management (discretionary accruals) and real earning management (rem index) with diversified operation as moderating variable.This study had four research models. The first model analyzes the effect of leverage to accrual earnings management. The second model, analyzes the effect of leverage to real earnings management. The third model, examines the effect of leverage to accrual earnings management with diversified operation as moderating variable. The fourth model, examines the effect of leverage to real earnings management with diversified operation as moderating variable. The analytical method used in this research is multiple linear regression.The sample used in all the research model are 340 data of manufacturing companies listed on the Indonesian Stock Exchange (IDX) for the period of 2011-2015. The result of the first research model shows that leverage have a negative effect to accrual earnings management. The result of the second research model shows that leverage have a positive effect to real earnings management. The result of the third research model shows that diversified operation modified the effect of leverage on accrual earnings management. The result of the fourth research model shows that diversified operation did not modified the effect of leverage on real earnings management. |