Abstract :
Purpose of this study is to investigate whether the dividend policy can mediates the influence of free cash flow on the firm value in all industrial firms contained in IDX. Regression is the model used by this study to test the mediating variable in this case the dividend policy as measured by the dividend payout ratio (DPR) to the free cash flow as independent variable on the firm value as dependent variable. As well as firm size as control variable. Sample in this study are the entire firm in all industries during the period 2008-2013 with certain criteria. The result show that the dividend policy has positive and significant value in the influence of free cash flow on the firm value.