Essam Al Arbed   

This study investigates the relationship between logical premises, the classification of accounting as a science, its role within STEM (Science, Technology, Engineering, and Mathematics), and the globalization of American accounting standards. Three hypotheses were tested, focusing on the impact of logical premises on considering accounting as a science, the relationship between accounting as a science and its place in STEM, and the effect of accounting as a basic science on the globalization of American accounting standards. The study adopted a rigorous methodology, combining a theoretical literature review with data collected through expert-reviewed questionnaires. The findings reveal that accounting is widely perceived as a science and that it is considered an essential component of STEM, with strong support for the globalization of American accounting standards. Significant medium-intensity positive correlations were found between the three themes of the study, and non-linear regression models were developed to explain the relationships between accounting as a science, its place in STEM, and the globalization of American accounting standards. The study's findings suggest that logical premises and the recognition of accounting as a science play a crucial role in shaping the acceptance of accounting within STEM, as well as its potential for global standardization.

Henry Osimabale Auru   Abdullahi Audu Malgwi   and Kamaluddeen Funsho Adisa Ibrahim   

The study investigated the effect of E-banking on deposit money banks' performance in Nigeria from 2011 to 2022. To facilitate the investigation, the study adopts the ex-post facto research design, while Feasible Generalized Least Square regression model was employed for data analysis. The dependent variable was measured by return on asset while the independent variables were measured by fees/commission income ratio, capital adequacy ratio and liquidity ratio. Firm size was the control variable used in the study. The study used a sample size of nine (9) Deposit Money Banks and engaged secondary data sourced from the annual reports of the Deposit Money Banks and NGX website. The results from the Feasible GLS regression analysis proved that E-banking fees and commission has a negative and significant effect on Deposit Money Banks' (DMBs) Return on Asset (ROA), DBMs' capital adequacy has a positive and significant effect on ROA, and bank's liquidity has a positive and insignificant effect on ROA. Also, E-banking/commission generated by national banks is negative and significantly different from banks with international operating status. The study concluded that E-banking adversely influences DMBs Performance in Nigeria. The study recommends that Deposit money banks in Nigeria should implement effective cost management strategies to mitigate the negative impact of operating costs associated with E-banking services on ROA. This includes investments in technology, cybersecurity, and customer support.

Adewale Joel Adebisi   and Olabowale Taiwo Obasan   

Investors' perception is a significant factor in the survival of every listed company, and the earning quality of entities majorly impacts it. Hence, this study investigated the impact of earning quality on investors' perception of the selected listed companies in Nigeria. The study's specific objectives were to (i) evaluate the relationship between accrual quality and investor perceptions in the selected Nigerian listed companies and (ii) assess the impact of value relevance on investor perceptions regarding the earnings of Nigerian listed companies. The study adopted an ex-post-facto research design, and the secondary data was collected from the company's annual report submitted to the Nigerian Stock Exchange. Fixed and random effect regression analysis was used for the analysis of data selected from 6 listed companies. The study concluded that value relevance had a significant effect on investors' perception, with a coefficient (β=1.672, p<0.01), and inflation also had a significant effect on investors' perception, with the coefficient (β=6.895, p<0.072). While other variables like size, accrual quality, audit quality, and Gross Domestic Product do not have any effect on investors' perception of the selected listed companies in Nigeria.

Almina Doko (Manoku)   and Rezarta Shkurti (Perri)   

The quality of financial reporting is a crucial determinant of economic transparency, particularly for small and medium-sized enterprises (SMEs) operating in emerging markets, which are the main economic contributors in the respective markets and whose level of financial reporting quality usually is lower than that of bigger firms. This study investigates the state of financial reporting knowledge among medium-sized enterprises in Albania, focusing on their compliance with financial standards, challenges encountered, and the broader implications for the Albanian economy. Findings reveal that while many small and medium-sized enterprises demonstrate a basic understanding of financial reporting requirements and rules, significant deficiencies persist, particularly in smaller and less formalized enterprises. Limited access to professional expertise and inconsistencies in regulatory enforcement exacerbate these challenges, hindering small and medium-sized enterprises' ability to produce accurate and compliant financial statements. As financial reporting evolves in a rapidly changing technological landscape, knowledge of frameworks like eXtensible Business Reporting Language (XBRL), the General Data Protection Regulation (GDPR), the Digital Operational Resilience Act (DORA), the IFRS Taxonomy, and emerging standards like the AI Act and the Corporate Sustainability Reporting Directive (CSRD) is becoming increasingly essential for businesses to ensure transparency, accuracy, and compliance. The study highlights the need for targeted educational initiatives and regulatory reforms to improve financial literacy and enhance reporting practices. This research contributes to the field by offering insights into the unique challenges faced by small and medium-sized enterprises in Albania, providing a foundation for policymakers to design interventions aimed at strengthening financial transparency and corporate governance. Practical implications include the potential for improved financial statement accuracy to attract investment and foster economic growth. Socially, the study underscores the role of transparent financial reporting in building trust within Albania's corporate ecosystem. Future research should consider longitudinal studies to track the impact of regulatory changes and educational programs on financial reporting practices.

Honesta Chidiebere Anorue   Blessing Iheagwam   and Ernest Ugwoke   

Efficient management of cost accounting information must put into consideration human factors that influence decision-making in any business. The study examines human factors associated with the management of cost accounting information and its influence on decision-making in hotels. A cross-sectional survey study of 396 respondents of the management team was drawn from hotels in three selected southeastern states in Nigeria. Three hundred and seventy-five out of three hundred and ninety-six management staff members who were randomly selected using a multi-stage sampling method were given self-administered questionnaire. The researchers analysed the data using the mean, standard deviation, and analysis of variance (ANOVA) statistics. The results show that the influence of employee turnover rates is low in human resource decisions, just as the influence of customer cost acquisitions was also low in customer relationship decisions. This implies that decision-making in hotels in southeastern Nigeria did not adequately consider cost accounting information on human resources and customer relationship management. Human resource and customer relationship management remain critical components of cost accounting information for efficient and effective decision-making in the hotel industry. This is because human resources are essential for employees, whereas efficient customer relationship management is necessary for customer retention in hotels.

Muyiwa Emmanuel Dagunduro   Faraj Gheni Abbood   Mustafa Salih Dakhil   and Gbenga Ayodele Falana   

The globalization and increasing fiscal scrutiny, tax compliance have become critical issues for governments, businesses, and individuals. This study focused on evaluating the effect of electronic tax systems on tax compliance within Nigeria's informal sector. The study employed a survey research design, using a well-structured questionnaire to collect primary data from artisans, street vendors, small-scale traders, service providers, and other self-employed individuals in Southwest Nigeria. These individuals often operate informally without registering their businesses or paying taxes. A total of 700 questionnaires were distributed, and 651 were completed and returned. The questionnaire utilized a 5-point Likert scale, and a purposive sampling technique was used to target respondents relevant to the study's objectives. The reliability of the questionnaire was confirmed through a Cronbach Alpha test. Data were analysed using both descriptive statistics (mean, variance, skewness, kurtosis) and inferential statistics (correlation and regression analysis) to summarize findings and draw conclusions about the population. Through regression analysis, the study revealed that electronic tax systems, including electronic tax filing, billing, and payments, had a positive and significant impact on tax compliance. The results showed that businesses within the informal sector were more likely to adhere to tax regulations, such as timely filing and payment, when using these systems. This study concluded that the adoption of electronic tax systems has a substantial and positive influence on tax compliance within Nigeria's informal sector. In line with the findings of this study, it was recommended that government should continue expanding access to electronic tax systems, particularly in the informal sector, by providing digital infrastructure and promoting awareness.

Shamsaaddeen Faraj   and Issedeeq Saadi   

This study investigates whether internal auditors in Libyan oil companies possess the necessary competence and capabilities in the security of electronic accounting information systems within an era of transition from manual auditing to electronic accounting information system auditing. The study also examines the issue of whether internal auditors implement sufficient safeguards to address the risks associated with electronic accounting information systems. A questionnaire survey adopted for data collection revealed that: internal auditors in the sampled companies possess a high level of competence and efficiency in electronic accounting information system security; and that they also follow all protective measures to counter the risks of electronic accounting information systems. However, descriptive statistics show that the mean scores of participants' responses regarding the competence and efficiency of internal auditors in electronic accounting information system security were lower than the overall mean of the axis. This could be seen as a deficiency on the part of internal auditors in reviewing risks related to electronic accounting information systems, monitoring management's implementation of regular maintenance of electronic systems, ensuring the existence of sufficient protection programs to scan electronic programs or magnetic disks, implementing procedures to limit risks arising from electronic equipment damage, and periodically evaluating information security applications within the company. Descriptive statistics also indicate that the average scores of participants' responses regarding internal auditors' adherence to all protective measures to counter the risks of electronic accounting information systems were lower than the overall mean of the axis. This could be seen as a deficiency on the part of internal auditors in monitoring IT staff in implementing required security measures, participating in updating security methods according to changes in the evolving IT environment, participating in developing specific security policies such as selecting the appropriate technology and its effectiveness, participating in developing and formulating a strategy for developing the security of electronic accounting information systems, and contributing to the detection of security breaches through reports and describing the type of breach.

Shehu Umar   and Muhammad Tahir Dahiru   

This study investigates the effect of sustainability reporting on the share price of listed oil and gas firms in Nigeria. The oil and gas companies, in an effort to carry out their operational activities, have a tremendous impact on the environment and society. Thus, the impacts could be beneficial when the effects are positive and detrimental when adverse. Considering the challenge information asymmetry poses to the survival of listed Nigeria's oil and gas firms and the potential relevance of the sector to the Nigeria's economy, the purpose of this study is to explore the impacts of economic, environmental and social performance disclosure on the market share value of Nigeria's listed oil and gas companies using an ex post facto research design. The sample population of twelve (12) oil and gas firms listed on the floor of the Nigeria's stock exchange was selected using the purposive sampling method. Data were collected from an audited annual financial statement of sampled firms. The period of the study was nine (9) years (2012–2020). The hypothesis was tested using a linear multiple regression analysis technique. The study found that disclosures on economic performance, environmental performance, and social performance have a significant and positive effect on the market share price of listed Nigeria's oil and gas firms. This study explores signalling theory, emphasising how significant it is for businesses to report their successes and failures in order to lessen the information asymmetry that exists between stakeholders and management. Based on the study result, companies that report their sustainability performance are more likely to have long-term-orientated firm values and hence be sustainable. Consequently, it is expected that all companies in Nigeria's oil and gas sector should adopt sustainability reporting strategies as the reports show their commitment to economic, environmental, and social performance.

Yasin DoÄźan   and GĂĽven Sayılgan   

This study aimed to investigate the relationship between local stock market participation and market return-liquidity from the perspective of an emerging market—Turkey. In this context, the main research question is how investor attendance at different wealth levels influences market returns and liquidity. It is an established assumption that as wealth increases, the probability of being a rational investor also increases. We, because of multicollinearity in our models, employed statistical shrinkage methods-Ridge Regression, Lasso Regression, and Elastic Net Regression. While groups with low-level wealth were found to be the most important determinants for market liquidity, they were not predictors of market return. However, wealthier investors had positive coefficients in stock return models. Robustness tests confirmed the previous findings. These findings imply that those who consider investing in capital markets should have a long-run investment horizon; otherwise, they cannot sustain their presence in the market, as demonstrated in this paper. This is the first study to analyze the impact of retail investors on both stock market return and liquidity using nationwide data.

Arwinder Singh   Sapna   Sonia   and Poonam Mahajan   

Tax literacy involves understanding personal taxation concepts and making use of that knowledge to determine tax liabilities and file tax returns independently. The present study aims to measure the level of tax literacy among government as well as non-government employees and to compare tax literacy among them. The data were gathered from primary sources using a well-structured and pretested questionnaire. The study's scope includes government and non-government employees from major cities in Punjab, including Amritsar, Jalandhar, Ludhiana, and the union territory of Chandigarh. Samples of 400 employees were split evenly between 200 government and 200 non-government employees. The findings of this study reveal that approximately 50% of government employees have a medium level of tax literacy, with approximately 45% demonstrating high tax literacy and being capable of managing their tax matters effectively. In contrast, roughly 66% of non-government employees exhibit an average level of tax literacy, while only around 26% of them show a high level of tax literacy. Overall, government employees are more knowledgeable in tax affairs than non-government employees, but employees of both groups mostly have a medium level of tax literacy. Enhanced tax literacy programs are recommended to improve these skills and support economic growth, making taxation literacy a key part of adult education. Moreover, the knowledge of taxation concepts will help the employees effectively manage their hard-earned money via financial planning.

Gbenga Ayodele Falana   Olusola Esther Igbekoyi   and Oluyinka Isaiah Oluwagbade   

In recent times, poor financial reporting quality has led to accounting scandals, resulting in a loss of financing and investor confidence. Therefore, this study investigated how company attributes affected the standard of financial reporting from multinational corporations in Nigeria. This study employed a causal-comparative research design. The study's population included 46 multinational corporations located in Nigeria. To determine the study's sample size, the whole population was chosen using the exhaustive survey technique. This study's timeframe covered thirteen years, from 2011 to 2023. The data were acquired from the sampled firms' annual reports and examined using descriptive statistics and feasible generalised least squares regression analysis. The study's findings observed that firm size and innovation capacity have a relevant and beneficial effect on financial reporting quality. Conversely, firm leverage has significant adverse effects on financial reporting quality. The study concludes that some firm-specific attributes are crucial for improving the quality of financial reports. The study recommends that firms with huge assets should prioritise strategies for quality financial reporting, invest in sophisticated systems, maintain manageable leverage, and balance firm size, leverage, and innovation investment with strong financial control. The study contributes by showing a negative relationship between innovation capability and accrual ratio. While accrual ratio and innovation capability have been underdeveloped areas in literature, the study implies innovative firms focus on long-term strategies over short-term goals. While the study covers 2011 to 2023, this may not cover the long-term evolution of firms' behaviour.

Ayoola Azeez Olaoye   

This study examines how to enhance the corporate performance through impact of accounting control practice specifically within oil and gas companies operating in Nigeria. With a background rooted in the challenges of inadequate accounting controls leading to financial irregularities, the research investigates how preventive, detective, and corrective accounting mechanisms can enhance corporate performance. The research employs a quantitative approach, analyzing secondary data over 21 years (2003–2023) from annual reports of ten prominent listed oil and gas companies listed on the Nigerian Exchange Group. Using multiple panel regression models, the study examines the effects of each control practice on net profit margins. Findings reveal that preventive controls, such as segregation of duties and transaction authorization, significantly enhance performance by reducing financial mismanagement. Detective controls, including regular audits and reconciliations, are shown to have the strongest positive influence on performance, underscoring their role in early fraud detection and compliance. Corrective controls, aimed at rectifying detected errors, contribute positively to financial outcomes, establishing a comprehensive accounting framework that reinforces corporate governance and financial integrity. This study contributes to literature by focusing on listed oil and gas companies in Nigeria, emphasizing the need for robust accounting controls in sectors with complex regulatory landscapes. The research suggests that effective accounting controls can foster transparency, thereby increasing investor confidence and aligning corporate activities with strategic goals. Limitations include reliance on secondary data, which may not capture nuanced operational insights. The study's implications recommend that policymakers encourage stringent accounting controls across multinational oil and gas companies to enhance performance, offering practical guidance for sustaining profitability in volatile markets.

Gopalan Puthukulam   and Anitha Ravikumar   

Accounting fraud is a manipulating act done by the compilers of the financial statements and their supervisors alike by which the fraudulent manipulated financial statements to manipulate the financial position of the company resulting in the maximization of profits and hiding the losses. This study is conducted to evaluate the effectiveness of AI-based tools in detecting financial fraud compared to traditional audit techniques and to investigate the potential benefits and challenges of integrating AI-based tools into the audit process for fraud detection. It also aims to assess the impact of AI-based tools on overall audit efficiency, identify areas where they can be most effective, and explore the attitudes and perceptions of auditors towards using AI-based tools for fraud detection and the factors that influence their adoption. The study's findings highlight the potential of AI-powered solutions in improving auditing methods. AI technology can help auditors discover financial fraud, enhance audit efficiency, and optimize resource allocation. It further shows that these technologies may considerably improve the efficacy of identifying financial fraud, improve overall audit efficiency, and minimize audit time and resources.

Magdalene Enruchi Williams   

This research study analyzes the influence of the adoption of International financial reporting standards (IFRS) on foreign direct investments (FDI) inflows and economic growth in Nigeria. Institutional quality indicators are incorporated into the study to assess their mediating impact on the relationship between the independent and dependent variables. FDI inflows and economic growth are used as dependent variables in the study, while the independent variable is IFRS adoption. Time series data spanning from 2004 to 2022 is used to obtain the research findings. Multivariate analysis of covariance (MANCOVA) is used to test for the difference in FDI inflows and economic growth during the pre-IFRS and post-IFRS adoption periods. Mediating analysis indicated a significant positive effect of IFRS adoption on economic growth, with institutional variables influencing the relationship. Based on the research findings of this study, IFRS adoption positively contributes to economic growth by fostering the private domestic businesses and investments within the country. While, a negative influence of IFRS adoption on FDI inflows was revealed in the study findings with institutional quality factors playing a significant mediating role. This study supports the view that though IFRS adoption is expected to foster FDI inflows, in countries with weak institutional qualities its influence proves to be minimal. Adequate disclosures under IFRS are essential for promoting transparency, a critical factor currently lacking in many Nigerian companies. Further, IFRS is aimed at enhancing the value relevance of accounting information thereby ensuring international comparability, providing quality financial information and allowing both foreign and domestic investors rely on financial statements in making investing and economic decisions. However, the findings of this study prove that IFRS adoption in Nigeria has not been successful in bringing value relevant financial information. Therefore, it is vital to establish solid institutional and corporate governance structures to enforce compliance with IFRS in financial statement preparation, reflecting actual company earnings and financial performance to encourage increase in FDI inflows and economic growth.

Muleye Tarekegn   and Gurudutta P. Japee   

This paper uses a meta-analytical approach to synthesize conflicting studies and identify the causes of these discrepancies in order to shed light on the connection between debt funding and financial sustainability. The analysis synthesized 136 effect sizes from 98 studies to examine the role of debt financing on the Microfinance institutions' (MFIs) financial sustainability. As a result, loan funding was discovered to have a negative influence on MFIs' financial sustainability, as demonstrated using random effects models, which supports the Pecking order theory that holds that a high dependency on debt financing could signal that the MFI is having difficulty generating sufficient internal funds, which could negatively impact sustainability. This negative relationship holds across all the proxies used to measure debt financing and financial sustainability. Moreover, this negative association between debt financing and microfinance institution sustainability appears to be somewhat independent of geographic (Africa, Asia, Global) and economic contextual factors (developing and underdeveloped) or the key methodological features of primary studies, including research design, data sources utilized, and the number of MFIs included in their study. The results of this study have significant implications that can contribute to both academic research and practical applications.

Ndubuisi Odoemelam   and Henry O. Wobo   

Purpose: This study investigates the importance of earnings in Nigeria and focuses on the impact of low-quality governance (LQG) on the relationship between earnings per share (EPS) and stock prices. Design/Methodology/Approach: The study uses a quantitative approach, applying the OLS regression model to financial data from manufacturing companies listed on the Nigerian Exchange Group (NGX). Key variables include EPS, BVPS, and dimensions of LQG, such as the average composite of the rule of law, regulatory quality, control of corruption (ACRRC), audit quality (AFS), government effectiveness (GovEc), and political stability (PolStab). Findings: The results show that EPS and BVPS positively correlate with share prices; however, this relationship is significantly weakened by poor rule of law, regulation, control of corruption (ACRRC), and political instability (PolStab). Conversely, audit quality (AFS) and government effectiveness (GovEc) positively and significantly enhance this relationship. Research Limitation/Implication: The study is limited to manufacturing firms listed on the NGX, which may affect the generalizability of the findings to other contexts. Practical Implications: The findings suggest that policymakers should enhance governance frameworks to improve the reliability of financial reporting. Corporate managers should focus on robust governance practices to increase financial transparency, and investors should consider governance quality in their investment decisions. Originality/Value: The study's originality lies in its detailed analysis of the governance dimensions index (ACRRC, AFS, PolStab, and GovEC) and their moderating effects on the relationship between EPS and stock prices in Nigeria's manufacturing sector from 2006 to 2022. This research offers valuable insights for stakeholders.

Chidiebele Innocent Onyali   Chinedu Uchenna Okerekeoti   and Uzoamaka Maureen Ukoh   

The study investigated the effect of corporate ownership structure on the social responsibility cost of listed manufacturing firms in Nigeria. The specific objectives were to examine the effect of ownership concentration, board ownership, foreign ownership and institutional ownership on philanthropic responsibility cost of listed manufacturing firms in Nigeria. The research design employed in this study is ex-post facto. The study's target population encompassed the entirety of twenty-one consumer goods manufacturing firms that hold listings in Nigeria. The selection of sixteen companies forming the study's sample size was accomplished through the application of purposive sampling technique. Secondary data sourced from the firms' annual reports were used for the study. The period of coverage is a ten-year accounting period spanning from 2013 to 2022. The hypotheses were tested with the aid of ordinary least square regression which revealed that: Ownership concentration has a positive and significant effect on the philanthropic responsibility cost of listed manufacturing firms in Nigeria (p-value of 0.0000); Board ownership has a non-significant and positive effect on the philanthropic responsibility cost of listed manufacturing firms in Nigeria (p-value of 0.3959); Foreign ownership has a significant and positive effect on the philanthropic responsibility cost of listed manufacturing firms in Nigeria (p-value of 0.0001); Institutional ownership has a significant and negative effect on the philanthropic responsibility cost of listed manufacturing firms in Nigeria (p-value of 0.0001). The study recommended amongst others that manufacturing firms should establish clear frameworks and channels for involving concentrated owners in decision-making related to philanthropy. This may include creating dedicated committees or platforms where key owners actively contribute to shaping CSR strategies, ensuring alignment with their values and the broader corporate objectives.

John Kingsley Woode   Emmanuel Assifuah-Nunoo   Audrey Foriwaa Adjei   John Bambir   and Adjei-Boakye Esuako   

This study assesses the moderating influence of financial risk tolerance on the nexus between investment knowledge and investment decisions amid the coronavirus pandemic. The study employed a closed-ended questionnaire through online survey as its data collection framework. Data collection took place from July 2022 to May 2023, and the analysis was conducted utilising the R version of partial least squares structural equation modelling (PLS-SEM). The findings of the study revealed a moderate nexus between investment knowledge and investment decisions. Additionally, it was discovered that financial risk tolerance exhibits a negative moderating effect on this association, particularly in times of crisis. Generally, a significant relationship was established among the dependent, moderating, and response variables. As part of the policy recommendations, this study posits that Ghanaian investors possess a moderate level of investment knowledge. Hence, to mitigate the potential turmoil caused by fraudulent schemes, it is imperative to implement policies that enhance the investment knowledge and inclination of investors in Ghana through educational initiatives such as public lectures, conferences, and workshops, which will further enhance their financial risk tolerance. These recommendations remain pertinent despite the efforts undertaken by numerous financial institutions to improve and adapt their products and policies to cultivate investor risk tolerance, especially after the recent financial sector clean-up. These assertions further remain relevant, especially in periods of upheaval characterised by the global health crisis.

Khadeeja Farhana C P M   and Abdul Azees P   

This study reassesses the application of Fama-French three-factor model in order to determine its performance in current scenario and to take a decision regarding the further development of the model. Fama-French three-factor model adds size and value to CAPM. Through performance evaluation, this study assesses the ability of the model to explain the cross-sectional variation in stock returns by considering the impact of size and value identified by Fama-French that are relevant in the Indian context. The Fama and French methods are used to build portfolios. The OLS is applied for running regression analysis. Generalized Method of Moments (GMM) regression, GRS model's performance tests are undertaken through Gretl, EViews and SPPS software of data ranging from April 2000 to March 2023. This study finds that Fama-French three-factor model is better capable of capturing stock returns in Indian stock market based on GRS statistics and the explanatory power of size factor is higher than value factor. BL portfolio (portfolio with big size and low BE/ME ratio) has low AIC indicating higher goodness of fit. The findings will assist investors, including institutional investors, asset managers, and individual investors, in making better investment decisions, asset allocation methods, and methods for managing risk. In conclusion, this three-factor model is still performing better in Indian stock market from 2000 to 2023 and the upgradation to this model gives even more explanatory power in risk factors other than this three-factor.

Jones Adjei Ntiamoah   Kofi Opoku-Asante   Peter Arhenful   and Mathew Owusu-Mensah   

Why people pay taxes has received adequate attention in the tax literature, but what about how future taxpayers form their tax-paying attitudes? Again, why does a large fraction of individuals in developing economies conceal their income from the state? Is it because of a lack of patriotism or neglect by the state? The study utilized a correlational and cross-sectional design, specifically focusing on students enrolled at Accra Technical University in Ghana. Data on the future intentions of 284 students to pay taxes, childhood state support, and patriotism were gathered using a structured questionnaire. Descriptive and inferential statistics were utilized in the data analysis, such as multiple linear regression, Cronbach's alpha reliability, and correlation analysis. The results indicate that receiving state assistance during one's childhood has a substantial influence on patriotism, but a negligible effect on individuals' future intentions to pay taxes. This research questions the traditional notion that taxpaying intentions are significantly influenced by state support during childhood. Instead, it underscores the importance of analyzing future taxpaying intentions through the lens of patriotism. The identification of patriotism as a significant incentive for future tax compliance indicates that cultivating a sense of national pride may increase tax compliance. Furthermore, it urges policymakers to confront elements that hinder the development of patriotism, promote a sense of national pride and civic responsibility, and enhance tax compliance among prospective taxpayers in developing countries. Promoting the engagement of young adults in democratic processes about taxation may enhance subsequent adherence while cultivating supportive citizens.

Shahid Husain   Hamad Alhumoudi   and Abdullah A. Alakkas   

Life Insurers are operating in the public and private sectors in India. A substantial number of policyholders have invested their income in these companies. A company with a proper investment policy and profitability along with the safety of the funds will grow and sustain in the long run. This study aims to help prospective policyholders in choosing a growing life insurer to ensure the safety of their premium money and increased bonus at the time of maturity/claim. Moreover, the present study may provide useful tips for the newly added private sector companies in the industry. The current study reflects on Private Sector Life Insurers to learn from the consistent and smooth growth in profitability of the Public Sector and search for solutions. This paper also compares the investment profitability and profit analysis of the private and public sector insurance companies located in India. Profitability was measured using investment yield and income as two variables. Data collected from life insurance companies operating in India from 2010-11 to 2020-21 was compared. The secondary data was obtained from the companies' annual reports for analysis and comparison. Data was analyzed by using T-Test and significance was determined at 5% confidence. Equal and unequal variances were determined by using the F-Test. The results showed growth in the amount, income, and yield of investment of the Public and Private sectors, but the two sectors did not significantly differ in their investment. By observing the pattern of growth and consistency of public sector, private sector life insurance companies can improve themselves. The study particularly belongs to India but the results and findings can be used by other life insurance companies operating in different countries as well.

Azwifaneli I. Nemushungwa   

Proper modeling and anticipation of business volatility play an important role in risk management, derivatives allocations, and the price of assets in a finance research field. Hence, it means the requirement for forecasting models that deliver accurate forecasts during those periods. An accurate forecasting model is critical for interpreting financial data, and confirming the time series is stationary is a vital step in model development. Moreover, one must select a model that does well in a particular asset class. There is no single best model across all asset classes and periods. As a result, identifying a model that performs well in specific asset classes is critical. Several forecasting models are available to decision-makers, and no single model emerges as the best all-around. This is due to instability in predicting performance, which varies by state and is based on time-varying economic factors. As a result, this study compares the forecasting abilities of some GARCH models for exchange rate data on the South African market by using traditional and fluctuation tests within normal students, and general error distribution assumptions. Forecast accuracy was assessed using four model accuracy measures: root mean square error, mean absolute error, mean absolute percentage error, and the Theil inequality coefficient. The Giacomini and Rossi (2010) fluctuations test and the Diebold and Mariano test were used to evaluate relative predicting skills in the face of instabilities. In contrast, the Rossi-Sekhposyan (2016) test was utilized to determine if absolute predicting performance is robust to instabilities. It is revealed that symmetric GARCH models do not overperform those models with asymmetry under several assessment indicators and error distributions. Giacomini and Rossi's (2010) test confirms the efficiency of all models undertaking the t-distribution approach. However, the Sekhpoysan (2016) test suggested that despite all models generating good forecasts, an individual model might be making weak predictions compared to the others. The practical implication is that all models can make accurate predictions. It may perform poorly solely when compared to other models.

Salah Mohamed Eladly   

The structural equation model is used to examine the relationship between regulatory constraints measured by investment to paid capital, cash to paid capital, government securities and certificate, and firm size (algorithm of total assets) on financial performance measured by liquidity, Return on equity and Return on assets of insurance industry in Egypt. The results showed that the relationship between regulatory constraints and return on equity is such that there is a significant negative effect of the construct the independent variables in terms of investment, cash, and government securities and secure certificates (X₃), on the dependent proxy, return on equity. However, the later independent proxy of the algorithm of total assets (lnx4) has a positive impact on the dependent proxy in terms of return on equity and a significant negative impact of the independent proxies' investment, and cash on the dependent variables return on assets. However, the later independent variable of the algorithm of total assets (lnx4) has a positive effect on the dependent variable of return on assets. This validates the second research hypothesis, as the independent variables investment, cash, and algorithm of total assets (lnx4) have a significant effect on the dependent variable return on assets. Beside that there is a significant negative effect of the independent variables investment X₁, and cash X₂ on the dependent variable liquidity. However, the later independent variable of (lnx4) has a positive effect on the dependent variable liquidity. This validates the third research hypothesis, as the independent variables investment, cash, and algorithm of total assets have a significant effect on the dependent variable liquidity, but an insignificant relationship with government securities.

Hani Na'el Al-Abdallat   

In order to better understand strategic performance assessment within Jordan's banking sector, this study aims to identify its crucial components. We examine the complex nuances of measuring and improving strategic performance using a balanced scorecard (BSC) framework and key performance indicators (KPIs). According to our research, it is crucial to use a qualitative research methodology to evaluate banks' strategic performance in the Jordanian setting. This study is notable for moving beyond established paradigms of research, which have mainly focused on financial performance measurements. By introducing an extensive set of integrated Strategic Performance measurements under the auspices of the Balanced Scorecard, it makes history. They cover areas like finances, customer satisfaction, internal operations, and learning and growth. We carried out a multiple-embedded case study, methodically transcribing extensive, in-depth, and contextually complicated material to clarify and validate these measurements. We concentrated on two Jordanian commercial banks that were founded in 1956 and 1977 and both of which have grown their business operations outside of Jordan. We were able to identify distinct patterns and trends in their strategic performance measures thanks to our comparative study. A variety of intriguing findings and conclusions are presented as the climax of our empirical inquiry. These conclusions, which were supported by a careful investigation, provide insight into the many facets of these banks' overall performance. Notably, our research highlights the growing importance of information capital from the perspective of learning and growth, calling for quick attention from Jordanian banks. This tactical choice is in line with how quickly technology is advancing and how that is causing change in the banking sector.

Carlotta D'Este   Ilaria Galavotti   Pier Luigi Marchini   and Anna Maria Fellegara   

This paper aims to explore the impact of corporate governance mechanisms on managerial opportunism in reporting unrealized gains and losses under fair value accounting. Building on the agency theory, we explore the relationship between the board of directors' composition and other comprehensive income (OCI) reporting choices. Based on previous findings, our conceptual model suggests that more effective boards could limit managers' accounting manipulation in OCI items reporting, through the exercise of stronger monitoring and advising functions. Using a sample of 54 Italian listed firms for the period 2009-2018, we provide evidence that while larger boards negatively affect OCI changes, gender board homophily exerts a positive effect on the magnitude of total OCI. Consistent with our predictions, our results therefore suggest that more diverse boards may hinder managerial ability to distort financial information to their advantage. Overall, our study contributes to the ongoing debate on fair value accounting on financial information usefulness, also adding to the literature on firms' transparency and corporate governance, confirming their mutually supporting role.

Elizabeth Nabwire Millan   Charles Guandaru Kamau   and Mary Peninah Ibua   

The present research is designed to explore the implications of mobile banking technologies on the loan performance of Deposit-Taking Savings and Credit Cooperative Organizations (DT SACCOs) in Mombasa County from a unique perspective. The digital financial sector has been revolutionized by technical advancements such as mobile banking, which have allowed financial services providers to increase efficiency and meet customer demands. The study examined mobile banking technology from three distinct viewpoints: transaction volume, loan disbursement, and transaction cost, applying both a descriptive research approach and a linear regression model. Data was collected from 63 respondents, including members of the board of management as well as staff members of the six SACCOs that accept deposits located in Mombasa County. The descriptive results reveal that a large proportion of respondents are of the opinion that mobile banking technology has a substantial influence on the performance of the loan by DT SACCOs in Mombasa County. The regression analysis and hypothesis testing additionally indicated that mobile banking technology has a significant influence on loan performance. The study concludes that the adoption of mobile technology has a positive effect on the loan processes and procedures of DT SACCOs in Mombasa County. Therefore, the study recommends that DT SACCOs upscale their digital financial innovation, especially mobile technology, considering that the financial services industry is moving towards a digital environment. This will enable them to improve the performance of their loan portfolio and remain competitive in the market.

Okey Oyama Ovat   Samuel O. Abang   Okoiarikpo Benjamin Okoi   and Bassey Enya Ndem   

The quest to achieve an efficient payment system that reduces the demand for money for cash transactions and other motives, and makes the economy more competitive in the global market, necessitated the introduction of financial innovation in the financial system. This paper examined the impact of financial innovation on the demand for money, searching into the nature of their relationship and evaluating the stability of the money demand function in Nigeria, to provide further empirical insights into the unresolved debate of demand for money in the Nigerian economy. The paper adopted the ARDL model to determine whether there is a long run relationship between financial innovation and demand for money; the Granger causality test, to investigate the nature of the relationship; and CUSUM and CUSUMSq to explore the stability of money demand function in Nigeria. Quarterly data from 2009q1-2020q4 were used in the analysis. A disaggregated measure of financial innovation using the value of e-payment transactions of ATM, POS, MOB, and WEB to ascertain the relative impact of each financial innovation channel on the demand for money was employed. The disaggregated approach to measuring financial innovation and examining the causality issue, constitutes the novelty and point of departure of this paper from previous studies in Nigeria. The findings showed a long-run relationship between financial innovation and demand for money existed. Also, there is the existence of a unidirectional causal relationship with causality running from broad monetary aggregate to financial innovation. The findings further revealed that financial innovation impacted demand for money positively, implying that the Nigerian economy is predominantly cash-based; and the money demand function was found to be stable in the face of financial innovation. The findings also showed that income (GDP), interest rate, and inflation are significant variables influencing the demand for money in Nigeria.

Muhani   Syamsu Alam   Muhammad Yunus Amar   Madris   and Kadek Wiweka   

The purpose of this study is to examine the conceptualization of financial distress research in the textile and apparel industries, particularly in terms of research scope and methodology. Furthermore, this article attempts to systematically analyze the network formed by these literatures. In this study, a qualitative approach was used through the literature review method, with 41 specific articles about financial distress in the textile and garment sector serving as the research corpus and drawn from the Litmaps database. To interpret and describe the frequency patterns and relationships visualized using RStudio and Gephi devices, text mining, network analysis, and content analysis were used. This study discovers that a frequently discussed issue is the influence of financial variables, both dependent and independent, on the prediction of financial distress or vice versa, using various quantitative approaches and models of financial distress. This claim is supported by the findings of a systematic analysis, which reveals a positive correlation between global cloud output and network analysis. The corpus aspect of this research is limited, and the research scope is limited to the Indonesian context. Future research with broader literature sources and different types of company sectors is highly anticipated. This literature review can provide a comprehensive framework for researchers and practitioners who are interested in cases of financial distress. Furthermore, this is a recent study that conducts a systematic review of the literature on financial distress in Indonesian textile and garment companies.

Collins C. Ngwakwe   

This paper aims to appraise the impact of energy reduction on revenue, return on equity (ROE) and adjusted headline earnings per share (aHEPS). It also aimed to assess the effect of energy reduction on revenue, ROE and aHEPS, and to examine the moderating role of black economic empowerment (BEE) on the effect of energy and water reduction on revenue, ROE and aHEPS. Secondary data from Woolworths Holdings Good Business Journey Report were analysed by using the OLS regression analysis. The results from the analysis show that energy reduction and water reduction have a significant effect on the three dependent variables namely revenue, ROA and aHEPS with a P<0.05. Furthermore, the results also show that after the BEE is introduced as a moderating independent variable, water and energy reductions show a stronger impact on revenue and aHEPS as the addition of BEE produced a stronger coefficient of correlation (R) and coefficient of determination (R²). This finding offers a practical significance to bolster corporate environmental management and financial sustainability strategy. This paper thus demonstrates that corporate attention and capacitation of previously disadvantage population through Black Economic Empowerment (BEE) has a visible short-term and long-term financial implication, which are drawn from improved corporate legitimacy, approval from the community with attendant enhanced patronage. This paper contributes to the literature by proposing a framework for understanding the moderating role of BEE on the effect of water and energy reduction on revenue, return on equity and adjusted headline earnings per share. The paper thus offers an agenda for future researchers on the accounting and financial implication of BEE performance.

Malik R. Elhaj   and Maged Soliman   

The objective of this study is to examine auditors' perceptions on the challenges and attitudes toward the implementation of the International Financial Reporting Standards (IFRS). In this study, questionnaires are collected from auditors. The questionnaire is composed of 13 items that are measured using Likert scale. The responses were used to measure participants' perceived challenges and attitudes towards IFRS adoption. The survey ends with two open-ended questions to supplement the quantitative component of the study in providing insights, via participants' voices, into the challenges of IFRS adoption. For the quantitative component, the Statistical Package for Social Sciences (SPSS) has been utilized and a qualitative data analysis software package (NVivo) is used to analyze qualitative data collected from the open-ended questions. Analysis of both quantitative and qualitative data indicates that auditors support the adoption of IFRS. The qualitative component highlighted the importance of training auditors on the implementation of IFRS to ensure effective integration of the accounting standards. Training, knowledge sharing and professional practice are identified as key factors in facilitating effective adoption of IFRS. The findings suggest that adopting IFRS necessitates the development of well-thought-out training programs that consider the implementation process with a local insight.

Khalid Al-Adeem   

While some accountants are against using push-down accounting to prepare separate financial statements, others argue that it provides a suitable measurement. Authorities in the United States have issued rules and statements specifying where this practice could be applied. The opponents argue that, first, financial statements using push-down accounting could mislead some users due to the changes in the bases for valuation of the assets and liabilities of the acquired company. Second, the comparability property of the financial statements is lost. Third, the entity assumption is violated. On the other hand, the proponents state that push-down accounting allows providing relevant information to the stakeholders. That is, financial statements are based on current prices reflecting the real financial standing of the subsidiary. To them, an acquisition is a complete transaction and therefore, its impact must be reflected in the financial statements. Finally, they state that push-down accounting is a welcomed practice in many countries except in the United States. This article presents arguments to address some of these concerns. The variation of bases that occurs when push-down accounting is applied, additional information based on the historical cost model can be disclosed with the published financial statements to assist the stakeholders in making their decisions. The argument regarding the violation of the entity assumption is valid when accounting for a business combination is pushed down in corporate reporting. Additionally, since the external party's valuation is deemed to be evidence of the new value of the proportion of the acquired assets and liabilities, the parent company when applying push-down accounting provides a new value to a significant portion of the subsidiary. Using push-down accounting breaches the conceptual framework, which operates as the constitution of financial accounting for business enterprises, which weighs reliability more than relevance of information characteristics. While combining 'reliability' and 'relevance' is impossible, a tradeoff between them must be found.

Shaiful Agung   Diana Zuhroh   and Gaguk Apriyanto   

Indonesia is the country with the lowest tax ratio when compared to countries of similar economic sizes. The level of taxpayers' compliance influences the low tax ratio in Indonesia. This study explores and analyzes the factors affecting taxpayers' compliance from the perspective of tax officers interacting directly and intensively with taxpayers. Qualitative research methods with grounded theory analysis tools were used to analyze the results of interviews with informants. The selected informants for this study were tax officers with more than 15 years of work experience. The study results showed that economic and non-economic factors influence taxpayers' compliance. Government transparency and accountability in tax money are essential in shaping taxpayers' compliance. Law enforcement and the imposition of strict sanctions will create fairness for taxpayers who have complied. Government, Tax Authorities, and Taxpayers are the three parties of concern in forming taxpayers' compliance. Collaboration between the three parties will create a tax-conscious society. Taxpayers' compliance is not only formed by the taxpayers themselves, but also by the fiscal policymaking by the government, the implementation of the tax administration system by tax authorities, and the taxpayers' environment. The limitations of this study were the number of involved respondents, the timeframe of the study, and the limit of cases to the experiences, observations, and feelings of the tax officers as the informants. The novelty of this research is the formation of the taxpayers' compliance concept from the tax officers' perspective.

Hazhar Sharif   and Jalila Johari   

The study aims to examine the role of analyst following (AF) in the relationship between IR quality (IRQ) disclosures and implied cost of equity capital (ICC) in the developed market in Australia and New Zealand. The study also examined whether companies with higher-quality integrated reporting (IR) benefit from the cost of equity capital reduction. The main objective is to identify the role of AF in explaining the relationship between IRQ disclosure and ICC. Besides, the study highlighted the average effects of IR benefits, which increase when there is more information asymmetry between firms and investors. Furthermore, IR could play a bigger role (with greater information asymmetry) than cross-sectional tests. The study used a common sample of 100 top companies based on Standard and Poor's market capitalisation in Australia and New Zealand (2014-2016), with 870 observations of post-implementation IR. This study showed a significant, negative relationship between IRQ and the ICC with top companies in Australia and New Zealand. Also, the results showed that AF is a partial mediator in explaining the relationship between IRQ and the cost of equity capital. The findings also indicated that AF has a vital role in IRQ disclosures, associated with a subsequent reduction in the cost of equity capital in the developed market.

Mohammed Shamsidin Ango Abdullahi   and Yogesh Kumar Gupta   

Financing agriculture in Nigeria from the perspective of both conventional and Islamic sources of finance has been faced with multi-dimensional challenges that impede the agricultural sector threatening sustainable agricultural production for food security. With a population size of 206 million and 70.8 million hectares of arable land, Nigeria is threatened with a high rate of unemployment, poverty, malnutrition, and social inequality. This can be related to the lack of access to finance by smallholder farmers in financial institutions. If access to financial institutions in critical sectors like agriculture and energy can be enhanced, then there will be an increased development in the overall value chain of the agricultural sector. This review paper is aimed at (1) Evaluating the current studies of the cause and effect by looking at the roles played by private, public, and international financial institutions and agencies and (2) Outlining the research gap in the literature with a focus on comparative study on financing agriculture in Nigeria. This study is based on a multi-dimensional theoretical approach (structural-functional, dependency theory, modernization theory, human needs theory, conflict and critical theories). The paper adopted the systematic literature review and reviewed 27 relevant source documents. Based on the review of the literature, the following major results emerged: Lack of macroeconomic policy, lack of access to finance, and bureaucratic bottleneck. The literature review revealed the challenges of financing agriculture and the effect on society based on results that emerged from the study. In addition, it also revealed the practical, evidence, theoretical, population, implementation, and methodological gaps that can lead to further research study. This comparative review study contributed to knowledge in expanding the existing literature on cause and effect by focusing on the roles played by private, public, and international financial institutions and agencies in financing agriculture using multi-dimensional theories and methods to find what the causes are, why they occur, what groups are affected, how they cope in the absence of funds, and what measures to apply to improve agricultural finance.

Chiung-Yu Huang   Shu-Fang Yuan   Chung Dong Quang   and Anh Thi Truc Nguyen   

Nowadays, in the context of a globalized economy, businesses have more and more opportunities to participate in investment projects, especially in developing countries. However, most enterprises, still have a lack of understanding and awareness of the potential and benefits that investment can bring to them, therefore they have been meeting underinvestment or overinvestment problem. How enterprises make investment efficiency decisions is a matter of great concern. The aim of this research is to investigate the factors that affect firm's investment efficiency. A total of 36 investment efficiency research articles from the leading Social Science Citation Index (SSCI) journals were cited. By using methods of citation analysis, statistical analyses including factor analysis, and multi-dimensional scaling, this study identifies four research trends on investment efficiency: financial reporting quality; board gender diversity; ownership structure; and corporate social responsibility (CSR). The findings of this study contribute to providing an overview of factors that influence investment efficiency. The results of this paper not only open more interesting future research topics but also may help policymakers establish effective strategies in investment projects as well as motivate the growth of economics, especially in emerging markets.

Ramesh Saxena   

Accountants have always been at the forefront of using new technologies to achieve high-speed data analysis, increased accuracy, and cost and time savings in accounting operations. Financial reporting, which is an essential component of financial accounting, has distinct characteristics and requirements, including regulatory compliance. Financial reporting involves large amounts of data and repetitive tasks that consume a significant portion of companies' financial and human resources. As a result, businesses have always striven to use technology to improve the efficiency and effectiveness of their business processes. In recent years, accounting professionals and the big four accounting firms have become increasingly interested in using the new and emerging technologies embedded in artificial intelligence (AI) for financial reporting. This paper seeks to examine the factors that influence the application of AI for financial reporting, as well as the opportunities and challenges that AI presents for its potential use in financial reporting in part or whole in the near future. This paper also proposes a conceptual framework to address these issues and facilitate future research in this field.

James Daniel Chindengwike   and Alex Reuben Kira   

Tax is an important financial payment made by a person or body of people in the bearing of the spending of public power. Taxes are significant for individuals and the nation at large. The purpose of this study was to find out the effect of the tax rate on taxpayers' voluntary compliance in Tanzania. In addressing this objective, both qualitative and quantitative research approaches were used. A cross-sectional survey research design technique was used. The study employed document review, and survey in collecting both primary data and secondary data. Besides, systematic, unsystematic random sampling and purposive sampling were used as sampling procedures in this study. The study involved a sample size of 99 respondents who are SMEs' taxpayers. The findings of the study showed that there is a negative effect of the tax rate on taxpayers' voluntary compliance. Again, the study indicates that the presence of good tax rates improves taxpayers' voluntary compliance and the tax rates influence taxpayers' voluntary compliance. Lastly, there is statistical significance between tax rates and voluntary taxpayers' compliance in Tanzania. The study recommends that the estimation calculation base should be reset in tax rate and the critical involvement or participation during formulating of tax laws and regulation is very important to improve corporate governance, especially between government and people. Consequently, tax rate and taxpayers' voluntary compliance have a negative relationship. The contribution of this study is to examine the effects of the tax rate on voluntary tax compliance as an economic variable, but most of the studies already done on the effect of the tax rate on tax compliance are based on an institutional variable, the practical implication of the result indicated that the tax rate associated with tax is very high that affect the non-tax compliance, while the social implication of the study is that high tax rate causes the government to lose revenue and hence diminishes the efforts of providing social services to the citizens.

Yunfei Long   Hui Yang   and Caihong Tang   

Despite tremendous development efforts in recent decades, rapid economic development and great achievements in poverty alleviation, there is still an issue of income inequality in China. This paper examines whether financial inclusion reduces income inequality in China. A time-series data are collected, and a Grey relational analysis method is used to perform the analysis. The research results show that financial inclusion and income fairness are positively correlated; financial inclusion to a certain extent expands the breadth of the financial system, increases the coverage of financial products and services, and enables small and medium-sized enterprises to obtain more financing to produce or invest in high-yield projects, plays a role in optimizing resource allocation, improving production efficiency, and promoting income equality. At the same time, financial inclusion is obvious in alleviating financial exclusion and can be used as an important market tool to promote income equality. From the perspective of poverty eradication and social equality, it is of great significance to vigorously develop inclusion financial to promote the sustainable and balanced development of the finance and enhance social equality and social harmony.

Hartini Jaafar   Hazianti Abdul Halim   and Rosmini Ismail   

Retirement refers to a phase, in which an individual withdraws permanently from active working life and is no longer earning a steady income from employment. Unfortunately, their expenses will continue and they will need to depend primarily on their accumulated savings. However, the hard reality is that retirement planning usually falls at the bottom of the financial priority list among Malaysians. Considering the poor retirement planning among Malaysians, their level of financial preparedness for retirement warrants further investigation. Therefore, this study aims to examine the determinants of retirement preparedness among Malaysian millennials that are entering their career. In particular, it investigates whether financial literacy, financial stress, financial management practices or saving behaviour influence the level of retirement preparedness among this group of respondents. A survey questionnaire was designed and administered to a sample of 171 final-year bachelor's degree students of Universiti Pendidikan Sultan Idris aged between 20 and 38 years. The results show that financial stress and saving behaviour are significant predictors of retirement preparedness. However, financial literacy and financial management practices are found to have no influence on retirement preparedness. This study contributes to the extant literature by examining the segment that forms the largest working population in the country. Hence, our findings should provide more insights to interested stakeholders in designing new or improving existing financial planning programs or mechanisms, particularly those related to retirement to better promote sound retirement planning among millennials.

Eva U. Cammayo   and Jeanette I. Gonzales   

The BS Accountancy program is the most subscribed in the University. During the school year (SY) 2013 to 2015, 2,500 high school graduates enrolled in the University. Unfortunately, only a few have survived the rigors of the program. The purpose of this research is to determine the reasons for not succeeding in the program among the students. This study traced the retention and attrition of the 491 BS Accountancy freshmen enrolled in the university from School Year 2013 to 2015. On average, only 49% stayed in the BSA program as sophomores, and 12% were qualified in the program when they reached the third-year level. Most of the students (61%) who did not qualify for the program opted to shift to BSBA Management Accounting. The primary reasons for not succeeding in the BSA program were their failure to pass the battery examination, not meeting the minimum grade requirement of accounting courses, and their failure to maintain a GWA of 2.0 and above in all the courses in the BSA program. The best predictors of succeeding in the program were grades in Fundamentals of Accounting Part 2; Business Organization and Management; Speech and Oral Communication; and Physical Science. This finding could be used by the program management as the basis for enhancing the BS Accountancy curriculum to possibly increase the number of students who will stay and finish the program. The respondents suggested intensifying the conduct of tutorial and review classes for qualifying examinations and lowering the cut-off GWA to 2.25 for the first year and 2.0 for the second year.

Yanal Amayrah   and Mohammad Ali Al-Afeef   

This study aimed to identify the impact of the application of capital adequacy in commercial banks in accordance with the Basel Agreement (II) on the financial performance during the period (2009-2019), where the study population and its sample were from the financial statements of all Jordanian commercial banks during the period (2009-2019), and their number (13) Jordanian commercial banks, and to achieve the objectives of the study, the (EViews) program was used, where the study showed many results, including: There is a statistically significant effect at the significance level (α≤0.05) of the capital adequacy ratio according to the Basel Convention (II) on the financial performance. For commercial banks using Return on Assets (ROA) during the financial period (2009-2019), it also showed that there is a statistically significant effect at the significance level (α≤0.05) of the capital adequacy ratio according to the Basel Agreement (II) on the financial performance of commercial banks using Return on equity (ROE) during the fiscal period (2009-2019). The study delivered several recommendations, and the most important one is that the necessity for commercial banks to be interested in benefiting from Basel (II) standards in making financial decisions is related to banks' risk management policies.

Michael Nana Owusu-Akomeah   Joseph Asare   Stephen Owusu Afriyie   and Emmanuel Atta Kumah   

Financial decentralization (FD) is key to bringing development closer to the citizenry. Therefore, there is a need to ensure the judicious use of funds mobilized by local authorities to bring about the desired level of development. To achieve this, governments of developing economies have to put measures in place to safeguard funds raised or provided to the public. One of such measures is the continuous reform of laws and regulations governing the mobilization and utilization of public funds. In Ghana, one of such Public Financial Management Reforms (PFMRs) is the Program Based Budgeting (PBB) which is aimed at ensuring the judicious utilization of public funds while meeting the demands of citizens. This study aimed at assessing the impact of PFMRs, with a special emphasis on fiscal decentralization in a selected Municipal Assembly in Ghana. The investigation used the mixed research method (quantitative and qualitative approaches) of data collection. Also, both primary and secondary data were used in this study. Primary data were collected through questionnaires and interviews, while secondary data were retrieved from the institution's financial records. The study results revealed that there exists a positive relationship between PFMRs and FD, and a strong linkage between PBB and Service delivery in Municipal Assemblies. However, the assessment of the impact of PBB on service delivery at the selected Municipal Assembly showed a moderate impact. The study also revealed an improvement in revenue mobilization and expenditure, while noticing that resource dependency remains a challenge at the selected Municipal Assembly. Further, the study identified non-adherence to budgetary allocations, poor budget monitoring, and control systems, and delays in the release of inter-governmental transfers as the challenges hampering the implementation of the PBB in Municipal Assemblies in developing economies (such as Ghana).

Niyi S. Awotomilusi   and Comfort Tinuola Dare   

Gender diversity on the board provides legitimacy to the firm in its environment and beyond its immediate environment. It also provides the board with a resource of personalities to aid deliberations and effective decision making. This current study investigates the influence of gender diversity on the firm value of Nigeria's listed deposit money banks. Using the census sample technique, the Ex post-facto research design was employed with a sample of 13 listed Deposit Money Banks (DMB). The article draws secondary data from the annual audited financial statement of the DMB spanning from 2011 to 2020. Data were analyzed using descriptive statistics and panel data regression. The results revealed that gender diversity variables, female board composition, and female board audit committee had a statistically insignificant negative effect on firm value. However, the female Chief Executive Officer (CEO) showed a negative and significant impact on firm value. It implies that there exist weak selection criteria for the female CEO. The study, therefore, recommended that attention be focused on the requirements for the selection, recruitment and appointment of the Female CEO, female board member and female board audit committee members. The listed DMB regulatory bodies ensure the creation of a database of qualified, experienced and competent female personnel from which the banks can leverage for recruitment.

Besan Abdallah Saleh   

Corporate governance has gotten a lot of attention recently. In most of the world's countries, the companies are intending to increase the efficiency of their work and management, and hence their profits and success rates. This research aims at examining corporate governance's impact on financial performance. It also makes a comparison in the context of Jordan and Palestine. This study also focuses on the board of directors' characteristics in terms of board size, independence, meetings, qualifications, and gender diversity methods of internal governance. To assess the firm's performance, four indicators were employed: Return on Assets (ROA), Return on Equity (ROE), Earnings per Share (EPS), and Operating Cash Flow (OCF). The researchers' views varied to classify the role of the board on financial performance, which represents a key element in corporate governance. This study is applied to the Jordanian banks on the Amman Stock Exchange in addition to the Palestinian banks on the Palestine Stock Exchange in the period 2012 to 2019. The SPSS software is used to perform the statistical analysis and check the research hypotheses using descriptive statistics, multicollinearity tests, and OLS regression. The results of the study show variations in board characteristics impact firm performance in the context of Jordan and Palestine. However, there are consistent results. As the regression found, the size of the board and gender diversity have a significant and negative impact on firm performance in the context of both Jordan and Palestine. The regression also found that board independence has a significant and positive impact on firm performance in the context of both Jordan and Palestine. The results of the study also show that there are differences in the governance structures applied in Jordan and Palestine. The findings show how the organization of the board affects the company's performance, which is considered useful information for policymakers.

Rufus Ishola Akintoye   and Shamusideen Kehinde Kassim   

The universal declaration of a healthy and sustainable environment was adopted by the United Nations (UN) Human Rights Council in 2021 as a fundamental human right; The U.S. Security Exchange Commission in March, 2022 and the European Union's directives in 2014 strengthen the need for all reporting entities to include sustainability reports in their annual reports, for the purpose of improving the quality of financial reporting. Our study examined how sustainability reporting affects the quality of financial reporting from the perspective of legitimacy theory, within the manufacturing sectors in Nigeria as a result of their environmental impact amongst other sectors. The published annual reports of 16 listed manufacturing companies, on the Nigerian Stock Exchange Market, were observed between the financial reporting periods of 2011 and 2020. Sustainability indices were proxied using both the Environmental Disclosure index and Social Disclosure index, while the financial reporting quality was measured using the Accrued earnings management, following the Jones (1991) Model. Using a panel regression analysis, the study applied the Variance inflation factor to test for multicollinearity among the predictors and also employed the fixed effect estimator, as suggested by our Hausman test result, in analyzing the observed data. Our findings revealed that environmental disclosures do not impair the quality of their financial reports. Such impracticability could have resulted from the use of strict environmental regulations by the government and its agencies. However, opportunistic managers could use social disclosure information to dilute the quality of financial reporting. We also found that the profitability performance of manufacturing firm is highly susceptible to impairing the quality of financial reports. We suggest that auditors should be provided with a full-fledge understanding of sustainability reporting to unveil managements' practice of earnings management; the financial reporting council should mandatorily impose the disclosure of sustainability information either as a stand-alone report or as part of the annual reports to allow stakeholders to make relevant economic decisions about the firm; and adequate internal control systems should be in place and should be assessed on yearly basis, as firms continue to operate.

Demaki G.O.   Eromafuru E.G.   and Imasuen Osasere Festus   

This study looked at the observable characteristics of directors and the performance of publicly traded companies on the Nigerian stock exchange floor. Secondary data on observable features such as board size, board gender diversity, non-executive director, and board independence, as well as Tobin's Q performance measure, were used in a cross-sectional research design. The disproportionate random sampling technique using a sample of 100 firm-year observations covering 25 active listed firms in the periods of 2015 to 2018 was employed. The researchers used a disproportionate random sampling technique with a sample of 100 firm-year data from 25 active listed companies from 2015 to 2018. The panel least squares analysis was employed as the estimation method. The unit root and co-integration tests for panel data were used as pre-estimation tests to determine the long-term convergence status of the variables. The findings revealed that among the directors' qualities studied, board size and non-executive directors had a significant impact on firm performance; more importantly, only non-executive directors had a positive impact. On the basis of the findings, it was suggested that females be given more opportunities in the board composition because of their natural role of being meticulous, while the board size be reduced to decrease agency costs.

Ofili Ugwudioha   and Lucky Onmonya   

The management of accounts receivable is usually done not just to reduce inventory, improve sales and profitability, but also to improve liquidity and short-term solvency. These and other factors affect the level of accounts receivable in different ways depending on the industry's nature. This study examines the determinants of accounts receivable in consumer goods manufacturing companies listed on the stock exchange in Nigeria. The study population consists of 14 consumer goods companies listed on the Nigerian stock exchange as of November, 2020. It is a longitudinal study using expost facto research design. Census sampling method was used to consider all listed consumer goods manufacturing companies. Data were collected from 2014 to 2019 annual reports of the 14 companies. Accounts for these years were prepared to comply with the International Financial Reporting Standards (IFRS). The dependent variable is accounts receivable represented by the Receivables Collection Period. Firm size, profitability, inventory, liquidity, leverage and age of companies are independent variables. The study used panel data analysis with its various elements of Pool, Fixed and Random effects. Robustness tests conducted include Variance Inflation Factor (VIF) Test, Hausman test, Lagrange Multiplier test. The result shows profitability and age has significant impact on accounts receivable. Firm size, inventory, liquidity and leverage have no significant impact on Receivable Collection Period. This suggests that profitability and age of companies have significant impact on receivables of consumer goods manufacturing companies in Nigeria. This implies that key determinants of account receivable in these companies are the quest to make profit. It also suggests that older firms know their customers better and might have vast experience in handling accounts receivable.

Novi Swandari Budiarso   and Winston Pontoh   

Most investors need useful information for investment decisions to obtain optimum returns. Based on this assumption, information obtained by investors will influence investment decisions. Information related to the continuation of the COVID-19 pandemic has tended to be a psychological factor affecting investors since 2020. The objective of this study is to analyze whether market liquidity still has an impact on abnormal returns in Indonesia. Logistic regression is used to test the relationship between market liquidity and abnormal returns on 661 firms listed on the Indonesia Stock Exchange over the period of January 1, 2020, to December 31, 2021. By combining systematic and unsystematic risks, illiquidity in 2021 has a positive impact on abnormal returns, although some combinations show insignificant results. This study finds that during 2021, investors tend to have low sentiment, which may be due to the continued threat of the COVID-19 pandemic, especially for stocks of firms that have high abnormal returns but low systematic risk. On the other hand, illiquidity does not have a significant impact on the stock of firms that have high abnormal returns but also high systematic risk from 2020 to 2021. This result indicates that investors in that stock are still optimistic and not influenced by the continuation of the COVID-19 pandemic.

Naresh Sachdev   Kawal Nain Singh   Kamal Vohra   and Vishal Vinayak   

One of the recent developments taken place due to the evolution of technology is FinTech. The operations of FinTech instruments across various sectors have brought benefits all around. There are several FinTech instruments that have been launched in the market recently. Out of them, two of the most prominent ones involve the use of P2P lending and Crowdfunding as a source of funding among the businesses. Therefore, this study is an attempt to conduct a systematic review on these two FinTech instruments and wants to draw the feasibility of its application into the Medium Small and Micro Enterprises along with the start-ups evolving in a developing country like India. The study considers a detailed review of 40 articles, 20 of which correspond to each type of instrument. The study looks into a number of different aspects to integrate the outcomes. The results of the review show that the use of FinTech instruments successfully causes an increase in the compounded annual growth rates along with providing a hassle-free source of funds to smaller and innovative businesses. The study suggests the extension of use of FinTech instruments such as P2P lending and Crowdfunding in the medium and small size enterprises as well. As in a developing nation, the role of upcoming ventures plays an inevitable role. It can be successfully made to move towards development by including the two Fintech instruments considered in the study. This would help in generating a profitable environment for the MSMEs and make others around aware of these sources of funding especially in a developing country like India. Moreover, it would contribute towards the generation of employment through the optimal funding of the potential MSMEs and start-ups.

Abdulrahman Al Natour   Majed Qabajeh   and Ayman Al-Shanti   

This paper studies the tendency towards developing China's national accounting industry against the international Big 4 accounting firms. Studying a Chinese sample from 2003 to 2014, covering the recent structural reforms (i.e., the Split-share Structure Reform (SSSR) in 2005 and the announcement of Document 56 in 2009) the paper concludes that such reforms increased the tendency to hire higher quality national audit firms compared with the international Big 4 audit firms and other small audit firms. This study also highlights the role of market development in improving the likelihood of hiring high quality auditors, and how it counteracts the state influence over the firm's auditor choice. By splitting high quality accounting firms into: the international Big 4 and the Chinese national Big 6, this paper extends the literature on political economy and auditor choice and explains how China is developing its national accounting industry through issuing state policies and restructuring the accounting industry.

Angela Merici Minggu   Anis Chariri   and Tri Jatmiko Wahyu Prabowo   

This study aimed to analyze the financial accounting information's relative and incremental value relevance between 2012 and 2019. It also analyzed the relationship between noise trading and the value relevance of financial accounting information using 564 firm-year observations on banks and financial institutions in the Indonesia Stock Exchange (IDX) from 2012 to 2019. The price valuation model prepared by Ohlson [1] was used to test the value relevance of accounting information. The findings showed the relative and incremental value relevance of earnings and book value during the study. Furthermore, noise trading has a moderating effect on the earnings' value relevance. The samples used were from the financial sector to compare value relevance from previous literature on manufacturing companies. The results could be useful to current and potential investors while considering investing in the financial sector.

Mohammad Abdel Mohsen Al-Afeef   Haitham Ali Hijazi   and Asaad Alsakarneh   

The Jordanian economy faces a set of economic challenges, represented by the rise in unemployment rates, the decline in the rates of gross domestic product, and the rise in the general level of prices, which are the most important indicators of economic development. Jordan is considered one of the developing countries with limited resources, and it depends greatly on tax revenues, grants, and foreign subsidies to cover public expenditures. Because of the importance of fiscal policy to correct the economic path, and Jordan's need for an effective fiscal policy to achieve acceptable economic growth and find successful solutions to address poverty, unemployment, declining investment, adjusting public spending levels, and setting tax rates, this study aimed to examine the impact of fiscal policy tools (Tax Revenue, Domestic Revenue, External Debt, Foreign Grants and Total expenditure), on indicators of economic growth in Jordan (GDP, Inflation, and Unemployment), during the period 2005-2020. The study followed the analytical and descriptive approach using statistical programs through a multiple regression model based on historical quarterly data obtained from the statistical database of the Central Bank of Jordan and the Jordanian Department of Statistics during the study period. The most important findings of the analytical results of the study's hypotheses are a statistically significant effect of fiscal policy tools on GDP, inflation, and unemployment with explanatory power (94%, 97%, and 86.6%). Consecutively. This study contributed to finding a model capable of explaining the impact of public financial policy tools on the most important indicators of development in Jordan, by taking into account most of the financial policy tools, so it is expected that the results of this study will contribute to improving the quality of fiscal policy decisions in Jordan.

Muhammad Tho’in   

This research was conducted to determine the acceptance and usage behavior of Bank Syariah Indonesia (BSI) technology with TAM (Technology Acceptance Model) and spiritual motivation during the COVID-19 pandemic. The use of technology in this research is focused on mobile banking services. The method in this study uses quantitative methods. The research data uses primary data in the form of a questionnaire given to customers who use mobile banking services at Bank Syariah Indonesia online. The data analysis technique uses SEM-PLS or often called Structural Equation Modeling - Partial Least Square. The results of the study show that customers of Bank Syariah Indonesia (BSI) who use mobile banking services have high trust, so that customers can receive and use the provided mobile banking services. The research findings support the Technology Acceptance Model (TAM) theory, which states that individuals accepting and using the system are influenced by perceptions of ease of use, perceptions of usefulness, attitudes, and behavioral intentions. In addition, there is a customer's spiritual motivation that the use of mobile banking does not violate sharia rules and can achieve personal welfare in various financial transactions carried out.

Nehad Ibrahim Ineizeh   Murad Ali Al-Zaqeba   Obada Jebreen Hussein   and Ismail Younes Yamin   

This paper aimed to assess the level of CSR disclosure of Islamic banks in the GCC region against a backdrop of Islamic finance principles and Islamic moral economy, using content analysis to create the CSR disclosure index. As well, it employs the qualitative research approach, which is followed by measurement and the interpretation of the qualitative conclusions. This paper used the content analysis approach to examine data from annual reports a total of twenty-eight Islamic banks, analysing 334 annual reports from 2006 to 2019. Furthermore, Bahrain Islamic banks took first place, while Saudi Islamic banks earned the lowest rate in the region. However, when compared to previous studies, the level of CSR disclosure shows a slight improvement. Despite this, the data reveals that CSR disclosure remains low, at 55%. Commitment to debtors placed best in a cross-sectional analysis of CSR disclosure dimensions, with an overall value of 0.69. For Zakat, charity, and beneficent loans, the minimum score is (0.36). Several reports from the tested Islamic banks were found to be lacking CSR disclosure information, according to these findings. This research adds to the body of knowledge and will be valuable to policymakers, government entities, and regulators who may want to encourage Islamic banks to issue and determine a basic index for CSR disclosure policies in their annual reports and websites. In addition, future research may examine survey methodologies that include more in-depth interviews with administration and important stakeholder, which could improve the CSR disclosure degree of understanding in Islamic banking.

Nnamdi Martin Onyenmuru   and Steve Emeka Emengini   

The rise in financial scandals and corporate failures prompted a greater spotlight on CG, particularly as it pertains to financial institutions (FI). This research looks at how the corporate governance code, CS, and ownership structure affect financial institution performance in Nigeria. The data for the study was obtained from the annual financial reports of 37 financial service institutions as the sample between 2010 and 2019. Internal corporate governance code proxy by board size, board independence, board remuneration and audit committee size, capital structure proxy by long-term debt and equity and short-term debt and equity ratio, ownership structure proxy by board ownership, ownership concentration, and foreign ownership concentration are the independent variables used in this study. The dependent variable is performance proxy by earnings per share and Tobin's Q. The study used a dynamic panel GMM estimator to deal with the panel data models. The results show that the EPS of FI in Nigeria is positive and significantly influenced by board size and short-term debt to equity ratio. Board remuneration and the long-term debt to equity/assets ratio, on the other hand, have a negative and considerable effect on FI earnings per share. Similarly, for Tobin Q, Bindp and Bremu, except board size, negatively impacted FP of the Nigerian financial service industry. Capital structure proxies by long-term debt and equity and short-term debt and equity ratio exerted a considerable impact on Tobin's Q. Equally, the ownership structure has a considerable impact on Tobin's Q. As a result, we recommend that financial institutions in Nigeria prefer equity financing over long-term debt when funding capital projects. On the other hand, short-term debt obligations should be used to fund short-term initiatives to keep the firm's performance growing. The research is necessary to ensure that debt and equity ratios are used appropriately in financial sector funding firms to maximise return on capital.

Samuel Adeniran Fakile   Tony Ikechukwu Nwanji   Ben-Caleb Egbide   Stephen Ojeka   and Damilola Felix Eluyela   

The African Airline Association recently reported that high airport charges and taxes are responsible for suppressing the evolution, development and growth of the African aviation industry. Therefore, the purpose of the study is to determine whether taxation metrics – tax planning, tax burden and after-tax earnings impact the financial performance of the African aviation industry, using the regression of various financial performance measures – profitability, liquidity, and going concerned. The panel data methodological approach was applied in this study. Descriptive statistics, correlation techniques, Hausman test, regression analysis and Granger Causality test result were presented. The study shows a positive relationship between tax planning and profitability, a positive relationship between tax burden and liquidity, and a positive relationship between tax charge and tax profits. This study concludes that taxation affects firms' financial performance in the African aviation industry.

Anouar Faiteh   and Mohammed Rachid Aasri   

In the current economic context marked by the relentlessness of the competition, the internal auditor is often called upon to put his skills at the service of organizations in order to control risks and evaluate internal control systems. Consequently, he contributes to the creation of value. The purpose of this paper is to analyze the theoretical foundations of internal auditing and their relationship with the value creation for organizations. Through a literature review on the contribution of internal audit to value creation, we found that the results of the majority of these papers supported a positively significant relationship. However, by conducting a critical analysis of models used, we demonstrated the methodological limitations that may bias these results. As a result, we have listed the limitations of traditional indicators of value creation (Return on Assets, Return on Equity, discounted cash flows, among others); thus, we have argued the superiority of the Economic Value Added (EVA), as a measure indicator of value creation through the inclusion of the cost of capital in its structure. Following these well-founded results, a subsequent study will be conducted to empirically test the contribution of internal auditing to value creation by integrating EVA as a measure of value creation.

Lorenzo Magrassi   Francesco Paolone   and Matteo Pozzoli   

Financial and nonfinancial transparency represents crucial issues in the dialogue between nonprofit organizations (NPOs) and their stakeholders and an essential dimension of accountability towards the communities in which they operate. This paper aims to provide information on the level of transparency of Italian NPOs, drawing on an analysis of the top 100 third-sector entities that have received the highest contributions from the "Cinque per mille" (0.5% contribution) scheme. The 0.5% contribution scheme is an important fiscal measure within Italy's social and welfare policy, offering taxpayers the possibility of giving 0.5% of their personal income tax as a solidarity contribution to a select variety of entities that operate in specific welfare or charitable sectors established under Italian law. The study tests the relationship between the donations to these entities (2013 and 2017 0.5% contributions) and the level of financial and nonfinancial transparency (2014 and 2018 financial statements), based on a comparison of the organizations' financial and nonfinancial information. The paper shows a specific scenario, considering the existing Italian model the answer to the question of whether financial transparency truly represents a tool to create dialogue with donors and the community or is simply a necessary instrument to justify the permitted fiscal and legal advantages. This study presents limitations. First, the research has been based on financial statements' information. Currently, there is neither a mandatory format for the presentation of financial statements nor mandatory accounting standards. Another limitation is based on the difficulty of generalizing the information collected to the whole third sector system operating in Italy. Future contributions would investigate small and nonlarge NPOs, as the third-sector reform will have a larger impact on them in terms of transparency. This probably will support an even higher level of donations.

Rufus Akintoye   Olubunmi Ogunode   Modupe Ajayi   and Abimbola Abosede Joshua   

This paper examined the impact of cybersecurity in driving the financial innovation of Deposit Money Banks in Nigeria. The rapid growth in population coupled with the challenge of reducing the rate of the financially excluded has made the need for financial innovation by Deposit Money Banks in Nigeria a matter of serious importance. However, due to a mix of factors ranging from poor design, design vulnerabilities to lopsided adoption and implementation of new financial technology products, this need has remained largely unmet with attendant negative consequences on the financial system. The study adopted a survey research design with primary data obtained via a structured questionnaire administered to a sample size of fifty-six (56) Deposit Money Banks Staff purposively selected. The sampled staffs were senior member staff of key impacted departments while the Banks selected accounted for 93% of total market capitalization as on December 31, 2021. The primary data collected were analyzed using descriptive and inferential statistics. The study found that cybersecurity proxied by risk management and bank monitoring had a statistically and positively significant impact on financial innovation of deposit money banks in Nigeria (Adj.R²=0.447, F_(2,55)=23.274, p< 0.05). It recommended that deposit money banks should ensure regular review, revision and strengthening of their risk management framework to meet with emerging challenges from the deployment of financial innovative products and services. Additionally, deposit money banks should improve on the level of monitoring of the deployed e-banking channels (Card products, POS, ATMs and other channels) to facilitate greater reliance on them for the consummation of financial transactions.

Stutee Mohanty   B. C. M. Patnaik   Ipseeta Satpathy   and Suresh-Kumar Sahoo   

Decisions of an individual or investors' financial decisions are affected by behavioral or cognitive factors and not just knowledge. Decision-making is not in every case rational by nature. Investors make irrational decisions many times due to the influence of various cognitive factors. Moreover, the ongoing Covid-19 pandemic has added to the uncertainty around us. Every possible sector of business has been affected by it including financial markets. Aberration in investor behavior during this phase has also been observed and has led to deterrence in investors' financial decisions. The present study intends to focus on analyzing empirically and ascertain the impact of Covid-19 on the behavioral & cognitive aspects of financial investment. Primary data has been used for the purpose and was collected by distributing a structured questionnaire among the participating investors chosen by using the convenience sampling method. The sample size of the study is 200 practicing individual investors. Statistical tools like Descriptive Statistics, Correlation, Reliability, and Multiple Regression Analysis were employed for analyzing the data. In this paper, it is found that herd behavior lacks consistency and significance with anchoring having the highest impact on financial decisions taken by investors. The framing effect also has a very high influence on the financial decision-making process of investors. This research will be useful for the government and the policymakers in the country, brokerage houses, retail investors, financial analysts, and asset management companies. As Covid-19 is a time-bound phenomenon, financial decisions of investors may change when the situation normalizes.

Daniel Arficho Gaenore   M Montaz Ali    and Aduda Jane Akinyi   

Investors' attempt is to allocate scarce resources today and receive the best outcome in future. The best outcome in future is not known today. But one can forecast for the best outcome in future today. Markowitz developed mean-variance model to solve portfolio selection problem. This model has two main drawbacks. The first is that the model assumes future expected return is the same as current expected return. In practice, this assumption may not hold in general. The second drawback is that the model requires a lot of estimations when investors consider large number of assets to include in portfolio. Sharpe developed single index model to solve the second drawback of mean-variance model. In this research, we develop future portfolio model to deal with drawbacks of mean-variance model. The objective of future portfolio model is to maximize future Sharpe ratio forecast subject to no short and no leftover constraints. This model is a realistic model because investors would like to consider future outcome instead of current outcome. First, we construct future expected return forecast model to forecast future expected return of securities. Second, we apply capital asset pricing model to estimate variance of portfolio. Third, we build future portfolio model using future expected return forecast model and capital asset pricing model. Fourth, we solve for analytic solution of future portfolio model. Finally, we evaluate the performance of future portfolio model relative to single index portfolio based on Sharpe ratio process metric, diversification ratio process metric and accumulation factor error process metric. The result of this study shows that future portfolio outperforms single index portfolio based on Sharpe ratio process metric, diversification ratio process metric and accumulation factor error process metric except at few instant time points.

Daniel Arficho Gaenore   M Montaz Ali    and Aduda Jane Akinyi   

In this manuscript, we introduce asset allocation and portfolio selection techniques based on efficiency condition, Sharpe ratio error condition and order three zero opportunity condition. Investors expect the same level of risk and return from alternative investment options unless they want the advantage of diversification for risk. There are two fundamental investment portfolios. The first one is risk free fundamental portfolio, and the second one is risky fundamental portfolio. Investors use zero opportunity cost to select portfolio objective. In this research, mathematical derivation of portfolio construction approach is described in advance. Historical data of this research show that there is a positive linear relationship between natural logarithm of standard deviation of securities’ return and square of co-variance between securities and market return. Furthermore, it shows that there is a positive linear relationship between Treynor ratio of securities’ return and Sharpe ratio of securities’ return. We use global search optimization tool in MatLab and R software to solve empirical portfolio selection and asset allocation problem. Moreover, we apply direct and indirect mathematical proof methods to prove mathematical facts of this study.

Cicilia Melly Andita Hendary   and Firmansyah   

Inflation disaggregation across all provinces in Java is persistent. Mapping results show that all provinces fall into the category of low inflation and high persistence. This study aims to analyze inflation persistence and sources of inflationary pressure in Java Island. The sample includes six provinces, observed from 2015 to 2019. The variables are inflation, consumer price index, money supply, and government spending. The method used is Autoregressive dan Davidson-Mackinnon Panel Data Regression. This study finds that inflation in Java Island is persistent in terms of general inflation, disaggregation of inflation, inflation in expenditure groups by COICOP, and inflation in the 5 volatile food commodities that have the largest weight. In general, inflation in Java falls into the category of low inflation and high persistence. This study also finds that the source of inflationary pressure in Java Island was monetary behavior. The results of this study are in accordance with the quantity theory which states that the money supply has a role in the process of increasing prices. Theoretically, if the money supply increases, while the aggregate supply is considered constant, then inflation will occur. An increase in the money supply reflects an increase in aggregate demand, but because the stock of goods and services remains constant, producers will increase prices. In general, the contribution of government spending to GDP in Java is indeed far below consumption and investment, so government spending cannot explain inflationary behavior in Java.

Nawarathna Liyanage Erandi Abeywardana   S.M. Ferdous Azam   and Kevin Low Lock Teng   

Integrated Reporting is an emerging corporate reporting model amongst the other voluntary corporate reporting practices. However, the impediments may hinder the adoption of integrated reporting practices, and it may be affected by organizational sustainability. Hence, this study aims to examine impediments that affect the adoption of integrated reporting practice and the impact of the adoption or non-adoption of integrated reporting on organizational sustainability. The study adopted a qualitative research approach. Based on the judgmental sampling method, the data was collected through 15 semi-structured interviews from the responsible officers of integrated reporting in public listed companies in Sri Lanka. Data from interviews was analysed using the directed content analysis. The results showed that impediments to integrated reporting practice have occurred through the international integrated reporting framework, external factors, and organizational factors. Furthermore, IR practices’ adoption reinforces the identification of sustainability issues and strengthens the integration of sustainability issues into strategies. These findings contribute to the literature on impediments of integrated reporting and organizational sustainability in the context of developing countries. These findings could be helpful to professional accounting bodies, regulatory bodies, and firms that need to mitigate the impediments to integrated reporting and enhance organizational sustainability. This paper adds to the limited available literature on the impediments of integrated reporting for the emerging economy. Moreover, this study is the first to reveal the impact of adoption/non-adoption of integrated reporting practices on organizational sustainability.

Rovena Vangjel   and Jonada Mamo   

The objective of this paper is to assess whether financial development may impact economic growth in the Western Balkans over the period 2005–2019. Development of financial sector is measured by credit to private sector, broad money, non-performing loans, and interest-rate spread. Economic growth is measured by the annual growth in GDP as a dependent variable. Empirically, panel data were used for six countries in the Western Balkans, specifically testing for random effects method (REM) and fixed effects method (FEM). First, we employed the descriptive and correlation matrices to determine whether the model is valid. To guide the selection of the REM or FEM, we ran a Hausman test, which resulted in an FEM across countries. The main conclusions of the paper are: (1) The economic growth is affected positively by the efficiency of banking sector; (2) The increase in depth and size of banking sector shows less relevance in economic growth. The insignificance of broad money and the negative effect of private credit, we can conclude that, for this period, these countries may have low levels of financial intermediation, or the amount of finance used by businesses and the financial sector is not productive for the economy.

Zainal Abidin Sahabuddin   and Bram Hadianto   

In the weak-form market efficiency, investors cannot obtain profits by trading stocks through a positive price difference. Unfortunately, this perspective is doubtful because of the weekend effect theory. The highest and lowest return exists on Friday and Monday, respectively, based on this theory. For that reason, this study is presented to prove the weekend effect by statistically checking the return based on the trading days with the variance analysis model and the Tukey Honestly Significant Difference Testing. Unlike the other research, this study utilizes the shares' return to prove this effect in the bullish and bearish markets. Data are collected by archival method from the Yahoo Finance website based on the names of shares chosen as the LQ45 members. The workdays and holidays are obtained based on the information from the Indonesian stock exchange. This finding shows that the lowermost return exists on Tuesday for two markets. Separately, the reverse Monday and the middle-week effects exist in the bearish and the bullish. The return change in the bullish period is more significant than that in the bearish. Therefore, this study is helpful for public investors to transact their shares to gain a positive return by utilizing these daily patterns in these two markets.

Ifeoma M. Ihegboro   Chika Anastesia Anisiuba   Aernan Johnson Emberga   Ofogbe Nyore Sandra   Love Ogochukwu Ude   and Anthony Obiora Ude   

This study evaluated global financialisation, trade facilitation and international flows. The study specifically examined the effect of tariffs imposed on export and import, information and communications technology (ICT) development and usage in business, documents to import and documents to export (Numbers) and labour force in the economy on the net national income of Nigeria. Data collected were analysed using the ARDL model. The result of the analysis shows that the tariff imposed on export and import is negative and insignificantly impacted the net national income of Nigeria. It was also observed that ICT development and usage in business has a positive and insignificant effect on the cash flow rate in Nigeria. The study further shows a positive but insignificant impact of documents to import and documents to export (Numbers) on the net national income of Nigeria. It was also observed that the labour force in an economy has a positive but insignificant effect on the net national income of Nigeria. The study clarifies that trade flow is continuously increasing in Asian countries. It benefits all those countries that are actively performing well in international trade. It helps them with economic development and rising living standards. But some trade facilitation determinants need to be improved for a better advantage. Improvement in these determinants will result in an increase in trade volume with faster and cheaper trade flow.

Nur Khatik   Fatmasari Sukesti   and Ida Kristiana   

Islamic banking in Indonesia is facing a number of challenges in the midst of the Covid-19 pandemic, and impacting Sharia Micro Finance Institutions will face several potential risks to financial performance. For this reason, research is needed to analyze the impact of Covid-19 on sharia microfinance performance. In this case, BTM Kaliwungu analyzes financial statements using financial ratios, namely Return On Asset (ROA), Capital Adequacy Ratio (CAR), Non-Performing Finance (NPF) and Financing Deposit to Ratio (FDR). This is a quantitative study with trend analysis in Microsoft Excel. The data were collected three years (December 31, 2017- December 31, 2019) before and one year (December 31, 2020) after the announcement of the first case of Covid-19 on March 2, 2020. The financial statements demonstrate the overall impact of Covid-19 on sharia microfinance performance (BTM Kaliwungu). During the existence of covid-19, the CAR ratio has no effect. ROA displays the results of criterion calculation quite well before or during the Covid-19 pandemic. The NPF calculation results show that the poor standard is still within the acceptable standardized range. Furthermore, in the case of FDR, it necessitates a greater reliance on third-party funding.

Azleen Ilias   Nasrudin Baidi   Erlane K Ghani   and Rahida Abdul Rahman   

This study aimed to investigate the accounting students' awareness, interest, and intention to pursue the Certified Internal Auditor (CIA) qualification and career. This study examined the driving factors (attitude, social norms, and perceived behavioral control) on the intention to pursue the CIA. This study was based on the Theory of Planned Behavior (TPB) and utilized an online questionnaire to survey 243 accounting students from eleven (11) universities in Malaysia. It found that ACCA, CPA, and CIA are the main qualifications they intend to pursue. This finding showed that most accounting students are aware of the internal auditing (IA) certification. Based on the regression analysis, social norms and perceived behavioral control impact the students' intention to pursue the CIA and IA career. This study could help universities and the Institute of Internal Auditors Malaysia (IIAM) develop interest among accounting students to see the benefits of CIA and career in IA.

Theophilus A. Aguguom   Sikiru O. Ashamu   and Ebun Olanipekun   

Financial performance which results from the right combination of the sustainable conducive business environment, optimal utilisation of corporate human and capital resources and multinationality of operations by a competent management team, could be restricted due to challenges such as infrastructural deficits and inconsequential regulations. The business landscape in Nigeria is characterised by complexities related macroeconomic uncertainties and vulnerabilities predominant in the Nigerian economy. Multinational manufacturing companies are subjected to challenges which hinder financial performance such as unnecessary harsh conditions. Hence, the effect of multinationality on the financial performance of multinational manufacturing companies operating in Nigeria was examined in this study. An expo-facto research design was adopted as methodology for the study. A population of 22 Nigerian multinational manufacturing companies was selected. Eighteen companies, representing 80% of the population were purposively selected and observed for a period of 20 years. Secondary data were extracted from the audited financial statements of the selected manufacturing companies during the period under consideration. The data were analysed using descriptive statistics and inferential panel analysis. Findings revealed that multinationality exhibits a positive significant effect on the financial performance of multinational manufacturing companies in Nigeria. It is recommended that policymakers create enabling legal and regulatory framework that will ease business operations. Also, infrastructural investment should be provided to reduce the cost of running a business in Nigeria.

Subur Karyatun   Mahlia Muis   Abdul Razak Munir   Sumardi   and Kadek Wiweka   

The objective of this research is to compare movement of stock return literature on companies in the tourism sector and other businesses. This study also analyzed comprehensively the relationship between contexts built on the literature. The mix method approach is adopted by combining text mining methods, which are analyzed using network and content analysis methods. The scientific literature was collected using the web scraping method on Litmaps and selected 200 articles and only used 195 articles (between 2000-2021) related to the topic of stock returns and 23 (between 2013-2020) related to the tourism company sector. In the process of data analysis and visualization, this study uses AntConc, RStudio, and Gephi software. This review discovered that in terms of topic and context, stock return studies discuss issues related to the influence of fundamental factors on stock returns, and vice versa, while the approach used is mostly quantitative based on the financial performance reports. Regarding the frequency of appearance, this result revealed that the effects of fundamental factors on stock returns in tourism companies can be translated into a number of strategic issues, including Current Ratio, TATO, ROE, FATO, and Systematic Risk, which provide a significant and positive effect on Direct Share Prices. Furthermore, the Current Ratio, TATO, ROE, and FATO are thought to have a significant and positive effect on stock returns via Systematic Risk. The scope of this research is limited to the national journal (Indonesia) on the Litmaps search engine. In theory, the results of this research can be used as a comparison and considerations related to previous studies, as well as what investigation requires to be done immediately, in the context of tourism companies' stock returns. The literature study on the tourism companies' stock returns issue is perhaps the first systematic literature review in Indonesia.

Sitraselvi Chandren   Mohd. Amir Mat Samsudin   Sumaia Ayesh Qaderi   and Santhirasegaran Nadarajan   

Companies require a comprehensive plan and controls to support the business operations and revenue management best practises that may influence the operating performance (profitability and liquidity position) during the Goods and Services Tax (GST) and Sales and Services Tax (SST) periods. This paper applied two- sample t-test to analyse the operating performance the profitability and liquidity position for 249 listed companies from manufacturing and service sectors during the GST and SST periods. As a result, the GST has a positive impact on company profitability, whereas the SST has a slightly greater effect on the company liquidity position. In addition, the analysis on three main sectors operating performance results has similar findings with the main analysis where the profitability performance is better in the GST period while liquidity position increases in the SST period. Furthermore, the outcome of the operating performance analysis by company size reveals that small companies perform less successfully than expected for the profitability and liquidity position relative to large companies during the GST and SST periods. In spite of the fact that SST period outperforms the liquidity position for the companies; the companies still have high profitability and a manageable liquidity position during the GST era. This reveals that GST positively influences the operating performance of the companies from the perspective of effective revenue and short-term fund management. The outcome of this study provides a novel contribution to the business leaders, authorities and academics on the effect of two indirect taxes GST and SST on the companies operating performance.

Nguyen Thi Xuan Hong   and Dang Ngoc Hung   

This study examines the impact of debt structure and the interaction of state ownership on business performance of energy enterprises in Vietnam's stock exchange. Data in the study were collected in the period 2009-2020 with 665 observations, the estimated results by the GLS regression model show that short-term debt and long-term debt have a negative impact on business performance when measured by ROA and Tobin's Q. In energy enterprises in Vietnam, the state often holds the dominant stock, so in this study, we consider the impact of the interaction margin of state ownership, this study finds that the interaction of state ownership and short-term debt have a positive effect on business performance measured by ROA. In addition, the study also looks into control variables, namely firm size, liquidity ratio and asset structure that have a positive impact on business performance. We provide some recommendations to improve capital structure and business performance: Energy companies need to build an optimal capital structure to maximize business value; Investors can quantify the model to decide whether or not to invest or how much to invest in an energy business; The government needs to look into and consider holding a controlling stake in energy enterprises that are really necessary and bring good business results.

Cam-Duc Au   Philippe Krahnhof   and Lars Klingenberger   

German banks are experiencing harsh times due to rising costs and declining profits. On the one hand, acquisition costs for new customers are increasing because of the rise of innovative FinTechs, which entered the market with one specific goal: disrupting the whole financial services industry by occupying parts of the value-chain. On the other hand, the Covid-19 pandemic as well as an overall low level of interest rates cause the traditional source of bank income to still drain. Consequently, traditional banks must rethink their strategies or their identity, so to speak, because they go beyond their traditional offering of products and services. Having said that, banks may create new sources of income to stabilize their economic situation and replenish profits. The given paper aims to research the opportunities of establishing an ecosystem model. In doing so, the paper contributes to the current literature debate and provides reference points for traditional banks to start. Firstly, a systematic literature-review introduces a selection of research works the author regards as significant. In the following step, quantitative data from an online survey with bank clients is analysed by means of descriptive statistics to show the perspective of Germans with regards to an ecosystem offering. The final research findings indicate that the surveyed retail banking clients express interest in the new offer, whereas non-financial products and services are of lower interest than their financial pendants.

Shubham Goswami   Raj Bahadur Sharma   and Vineet Chouhan   

Transformation towards Financial technology makes possibilities throughout all areas of the economy for growth. Emerging developing economies have seen a fast expansion of financial technology and mobile money services. FinTech projects, which are regarded as some of the most significant advances in the financial sector, have also obviously been driven by the growth of digital transformation, as FinTech Mobile money and digital wallets address the economic infrastructure vacuum with an innovative technology solution and enable customers to conduct financial transactions affordably and dependably by eliminating spatial barriers, and can be used to bridge the gap of banked and unbanked. This paper investigates the critical success factors influencing the adoption of disruptive financial technology for financial inclusion in rural India. Present research empirically measures the impact of technology in promoting entrepreneurship in under-developed regions for future adoption of financial technology in rural areas. The quantitative approach uses inferential statistics for hypothesis testing. Exploratory Factor Analysis is being applied for critical factor identification and Structural Equation modeling for measuring the impact of FinTech in financial inclusion in Rural India. The result indicates that factors constructing the social influence also positively impact behavioural intention to use manager technology in the rural sector in India. An end-user habit of using financial technology systems and services has a positive relationship with behavioural intention. Factors affecting perceived ease of use towards using the financial technology are positively related to the system's usability. Present work provides emerging good practices for policy-makers, regulators, and investors in changing financial environment. It presents empirical findings to identify the critical success factor and another growth driver for FinTech services. The results would help mobile service industry to discover an economy of scope in providing services at low cost and with maximum social benefits. Study will also provide insights to financial institutions for offering banking services via mobile to handle cross-border transactions to low-income customers of remote areas.

Vaibhav Aggarwal   and Chintan Vadgama   

On the back of booming equity markets and falling interest rates, Indian high net worth investors have flocked to Portfolio Management Services (PMS) funds in India with substantial assets under management of INR 18,07,939 crores. However, there is scant academic literature on the performance of PMS funds in India which charge high fees compared to passive index funds. The purpose of this study is twofold. First, describe the performance of PMS funds in India as compared to their respective benchmark. Secondly, review the incentives fees structure of PMS funds and recommend regulatory changes needed to address the shortcomings. The principal results indicate that majority of PMS funds have failed to outperform the benchmark in the short-term and medium-term periods. In the long-term period, however, largely PMS funds have beaten the benchmark returns. The implications of this study are two-fold in the Indian market context. First, high net worth individuals in India must invest via PMS funds only if their investment time horizon is at least ten years. For the short to medium-term, it will be better to invest in index funds due to their meager expense ratio and returns, which are like the benchmark indices. Second, Indian policymakers must increase the minimum hurdle rate based on which the variable performance fee is charged to ensure portfolio managers are rewarded if they generate abnormal risk-adjusted returns. This study contributes to academic literature by focusing on the performance and incentives of PMS funds market in India, which is largely unexplored till now.

Van Hung Dao   The Dong Phung   Khac Lich Hoang   Thi Vinh Ha Nguyen   and The Kien Nguyen   

Central Bank Independence (CBI) is the ability of a central bank to control monetary instruments. It reflects the set of limits on the Government's influence on managing a central bank's monetary policy. CBI can be restricted or dilated on personnel, objective, policy, and lending aspects. There is quite ample empirical evidence that CBI helps reduce inflation and stimulate growth. However, some countries with high CBI still witness high inflation. This paper seeks to understand when central bank independence would promote inflation control effectiveness. By establishing a mathematical predictive model, the study shows that a certain level of dependence between the central bank and the Government will facilitate the dual goals of price stability and economic growth. The empirical evidence from Vietnam, where the Communist Party leads both entities, reveals the U-shaped relationship between CBI and inflation, but not growth.

Nor Balkish Zakaria   Norazida Mohamed   and Nuha Marzukai   

The purpose of this study is to investigate the perceptions of determinants of anti-money laundering compliance among banking officers in mitigating money laundering. There are three independent variables that are employed in this study to understand and analyze the level of perceived compliance among the banking compliance officers, which are the regulatory comprehensiveness, training, and awareness. The data were collected through the distribution of questionnaires to 56 banks in Malaysia. The findings of this study show that there is a positive relationship between regulatory comprehensiveness, training, and awareness on the perceived level of compliance. This study recommends that efforts should be made by the banking institution to strengthen the anti-money laundering regulation and policy to improve the efficiency of financial institutions in Malaysia. In addition, the compliance officer's competency should be enhanced to ensure better compliance quality.

Md. Kazimul Hoque   Mofijul Hoq Masum   and Md Abdullah Babu   

This paper examines the impact of green banking disclosures on the quality of financial performance over thirty listed banks of the Dhaka Stock Exchange. Time-series data through the year 2014 to 2017 have been scrutinized, out of which we have selected 70 effective samples because of the availability of the green banking disclosures. Multivariate analysis has been conducted where the spending on green banking is used as a dependent variable, the proxy variables of green banking disclosures. As the independent variable of financial performance, we have used three dimensions: profitability, liquidity, and solvency. The ROA, LR, and DAR have been used as proxy variables simultaneously. We found that green banking disclosures and ROA have a considerable positive relationship. In contrast, the other two financial performance variables, LR and DAR, have no statistically significant relationship with green banking spending. The study's findings will encourage the highly profitable listed banks to invest more in greening their activities, ultimately leading to sustainable development in this sector.

Deepak Sehgal   and Khushboo Sagar   

In order to explain the relationship between risk and expected return, different researchers use different asset pricing models. In this research paper, we identify whether Sharpe's single factor model termed Capital Asset Pricing Model or Fama-French three-factor model better explains the expected excess return on portfolio. We used NIFTY INDEX as the proxy market portfolio. For the purpose of FF Model, we used Market Capitalization (MC) as a variable of firm size and Book to Price (B/P) as a variable of firm value. Data are taken from 1^st July 2012 to 30^th June 2021 for 85 companies forming part of NSE 100. We have used the same portfolio selection framework used by Fama-French (1993 and 1996). 91 days treasury bills (T-bills) have been used as risk-free proxy and taken from RBI website for the given period. We found that Fama-French three-factor model captured better results than the single factor CAPM in explaining the expected returns for all the double-sorted portfolios constructed based on MC (size factor) and B/P (value factor).

Nkiri J. E.   and Ofoegbu G. N.   

This study examines the relevance of accounting based models in the prediction of financial distress and corporate failure. Using a sample of 30 commercial banks, consisting of 15 failed and 15 non failed banks during the period 2006-2020, the study utilizes the Logit and Multiple Discriminant Analysis (MDA) models using accounting information to predict the likelihood of failure within the Nigerian banking sector. The empirical results reveal that bank characteristics derived from financial statements can be used to predict corporate failure. Specifically, bank liquidity and profitability are key determinants of bank failure. The study adds to the scare body of literature on bank failure among developing economies, by analyzing, developing and testing a prediction model in a developing economy like Nigeria. This study also offers recommendations for both policy and practice, especially for bank regulators and the management team on the need to monitor the profitability and liquidity position of banks.

Nayef Mohammad Al-Rahamneh   and Zainol Bin Bidin   

Globally, Tax evasion has always been a continual defiance to policy makers. A developing nation is primarily reliant on tax revenue and foreign aids to keep the country afloat. To provide sufficient tax revenue, efficient tax collection and competent tax administration are required. Understanding the determinants that influence tax evasion, and the proper solutions to address these factors, can help to reduce the negative repercussions of tax revenue loss in both developing and developed countries globally. This is a conceptual paper of a future study based on the survey of previous literatures, particularly the socio-psychological theories. Subsequently, this study debates that integrating non-Economics factors, namely Peer Influence, Tax Fairness and Tax Complexity, together could probably better demonstrate tax evasion determinants. Consequently, the goal of this research is to give a proposed conceptual framework for the role of moral obligation in moderating the relationship between peer influence, tax justice, tax complexity, and tax evasion among small and medium enterprises (SMEs). The current study makes a theoretical contribution by emphasizing the role of moral obligation in moderating the relationship between non-economic factors and tax evasion among SMEs.

Isti Pujihastuti   Ujang Maman   Iwan Aminudin   Kuncoro Hadi   Hanny Nurlatifah   Rusdiono Mukri   and Sudirah   

Debt is one of the important sources of fund for Indonesian companies. The previous research of manufacturing companies listed on Indonesia Stock Exchange (IDX) in 2015-2017 indicated debt to equity ratio is 111%. The debt could probably cause disadvantages. There are requirements from external parties when companies request sources of funds, especially when conducting Initial Public Offerings (IPOs). There should also be debt covenants between company and debtor. However, the proper debt management will have a positive effect on capital structure. Therefore, this research aims to explore the effect of long-term debt (LTD), fixed assets (FA), earnings per share (EPS) and net income (NI) on capital structure (CS), assuming that LTD will moderate the effect of FA, EPS, and NI on equity. The research sample is 32 of manufacturing companies that conducted IPOs on IDX in period of 2018-2020, which were purposively taken based on the criteria of publishing annual financial report and having complete data needed in this research. Fortunately, the research found 11 companies for 2018; 9 companies for 2019; and 12 companies for 2020. The multiple linear regressions with cross data section show NI, FA, and EPS affect CS significantly; while LTD does not influence CS. However, the LTD significantly quasi-moderates the effect of FA on CS. While the LTD significantly moderates purely the effect of NI on CS. Therefore, the companies should manage the NI for investment in FA and increase the effectiveness of LTD's management in optimizing capital structure.

Nnam Imaobong Judith   Amara Felix Maduabuchi   Ekete Linus Igwe   Okeke Stella Ehis   and Chukwunwike Onyekachi David   

Small and Medium-sized Enterprises (SMEs) serve as vital economic stimulators in developing and developed economies. However, several factors including high energy costs and taxing practices hamper these businesses growth and expansion. Essentially, taxation or taxing practices are those multiple payments obligations placed on SMEs by the state. This study examined the effect of taxation/taxing practices on the growth of SMEs with a specific focus on whether �multiple payment obligations placed on SMEs have significant implications on their profitability, investment decisions, and cash flows. The study adopted survey research design. The chi-square and regression analysis were used in testing hypotheses. Results from the chi-square and regression analysis indicated that tax practices significantly affect SMEs profitability and investment decisions. However, on the effect of taxation on the cash flow of SMEs, the chi-square test showed a non-significant effect of taxation on cash flow while the regression analysis revealed a significant relationship between taxation and cash flow of SMEs. This contradiction may be ascribed to bias exhibited by some respondents in answering some questions asked during the survey. Therefore, the study recommended that the government improves on tax incentive already provided, improve infrastructure, and implement tax policies based on the ability to pay and eschew multiplicity of payment by SME owners; these will eventually encourage growth and expansion of SMEs and the economy at large.

Nayera Abdeldayem Eltamboly   and Maysa Ali M. Abdallah   

This research aims to investigate the main drivers of financial performance during the COVID-19 outbreak, particularly the role of national government and firm policy in relation to the negative economic effects of the COVID-19 outbreak on firms' performance. A generalized linear model (GLM) has been conducted to test the influence of government assistance and cash holding on the financial performance of 79 firms listed in FTSE Italia over 2020. Likewise, our research adopts the Second Stage Least Squares Method (2SLS) and Generalized Method of Moments (GMM) to examine the moderating effect of cash held on the association between COVID-19 outbreak and firms' performance. Our results suggest that the Italian government aids their firms during the COVID-19 outbreak to support their financial performance, and firms themselves increase the level of cash holding to continue their operations as a crisis management policy to face the COVID-19 outbreak. Moreover, cash holding as a moderator weakens the negative impact of the COVID-19 outbreak on the financial firms' performance. Therefore, during the COVID-19 outbreak, national governments and firms should consider a crisis management policy to reduce the negative effects on the firms' performance, mainly government financial assistance and cash holdings to sustain firms' operations during the outbreak.

Nkang Eyam   Peter Ubi   and Bassey Ebi   

This study investigates the impact of fiscal autonomy on educational attainment of the states in Nigeria. The focus is on the 36 states in Nigeria. The capability of a state to internally generate revenue is a basic requirement in the provision of social infrastructure. In the context of this research, fiscal autonomy was measured as a ratio of internally generated revenue to federal allocation. To investigate the relationship involving fiscal autonomy and educational attainment in Nigeria, instrumental variable three stage least squares (3SLS) panel estimation framework was adopted by this study. The Hausman's test was used to determine the most robust estimates and the Hansen-sargan test was also used to determine if the instrument used was identified between the two-stage and three-stage least squares. The result from the rigorous estimation technique of 3SLS does not seem to give support to the hypothesis that increase in fiscal autonomy can significantly drive increase in literacy rate vis –a-vis educational attainment across the states and hence economic development in Nigeria. The study therefore strongly advocates that states should tow the middle path of not being completely fiscal autonomous in striving for fiscal autonomy as fiscal autonomy itself does not necessarily guarantee high educational attainment of states in Nigeria.

Sugra Ingilab Humbatova   and Nazrin N. Ramazanova   

The main purpose of this study is to ascertain the determinants of demand for money and its stability in Azerbaijan using monthly time series data spanning from January 2006 to November 2020. Johansen cointegration, vector error correction model (VECM) and Impulse Response Function were employed to investigate the relationship between real money demand (M1), and macroeconomic variables, namely income, inflation, interest rate and exchange rate. CUSUM and CUSUMSQ stability tests were applied to check whether the money demand function was stable during the observed period. The results of Johansen cointegration reveal a long-run relationship between mentioned variables. Consistent with money demand theory, the VECM results show that the demand for real money balances is positively related to income but it responds inversely to inflation, interest rate and exchange rate. Impulse Response Function confirms the result of VECM. Moreover, after incorporating the stability tests, the empirical results show that real money demand function is stable over the observed period, suggesting possible use of the narrow money aggregate as a target of monetary policy in Azerbaijan.

Aldi Rivaldi   Khoirul Aswar   Taufeni Taufik   Andreas   and Eka Hariyani   

This study aims to examine the Machiavellian characteristic, independence, time budget pressure, and dysfunctional behavior as moderating variables on audit quality. Main Auditor of State Finance (AKN) of the Supreme Audit Institution of the Republic of Indonesia (BPK RI) was used as samples in this study. The purposive sampling method was used to select 52 examining auditors from AKN who completed a questionnaire. The hypothesis in this study was investigated using the SmartPLS 3.0 and the Structural Equation Modelling (SEM). This study will provide information to supreme audit institution in order to maintain and improve the quality of BPK RI. The result of this study shows that independence and time budget pressure had a significant effect on audit quality, while machiavellian characteristics had no significant effect on audit quality. The influence of machiavellian characteristics, independence, and time budget pressure on audit quality is not moderated by dysfunctional behavior. This research is expected to be useful for the leadership of the supreme audit agency in reviewing policies related to improving audit quality and paying attention to the condition of the auditor in carrying out audit assignments so that the reliability of the BPK LHP is maintained.

Azuraidah Taib   Yunita Awang   Shazalina Mohamed Shuhidan   Norfadzilah Rashid   and Mohd Sidki Hasan   

In the course of digitalization, the accounting industry will adapt to comparable developments. Finance and accounting professionals must embrace the digital shift as the digital world evolves to remain relevant. To flourish in their career, future accountants must be equipped with the most up-to-date technological knowledge. Thus, this study aims to investigate the link between future accountants' technological knowledge and technology readiness for the digitalization of the accounting profession. This study employed a non-probability purposive sampling approach as the research unit with future accountants. Online surveys were used to examine the relationship between technology knowledge and the digitalization of the accounting profession. It was delivered to 546 interns from the top six public universities in Malaysia for accounting and finance. A total of 187 respondents have participated in the survey.This study discovered a significant link between future accountants' technology readiness and the digitalization of the accounting profession. It suggests explicitly that the better-equipped accountants are to use technology, the better their capacity to adapt to technological progress in the industry. However, there is a weak relationship between technological knowledge and digitalization. As a result, an adequate focus must be given to establishing future accountants' qualifications alongside professional degrees. Their tertiary education should include more exposure and practice to digital literacy. Although this study was confined to six public institutions, the findings may not be extrapolated to represent the opinions of all future accountants. As a result, future studies might broaden the sample selection to include private and other universities.

Magnaz Lestira Oktaroza   Pupung Purnamasari   Rudy Hartanto   and Annisa Nadiyah Rahmani   

Auditors in carrying out fraud detection do not always get a bright spot, because the perpetrators have many ways to commit fraud and various underlying motivations. This reason strengthens government auditors, and it is important to understand or recognize indicators or red flags in determining fraud risk assessments. The aim of this article is to gather empirical evidence on how public sector auditors perceive fraud detection. Partial Least Square analysis is the method used. The number of samples in this study was 96 government auditors consisting of 48 BPKP auditors and 48 BPK auditors. The findings demonstrate that gender, duration of employment, and education and training of auditors at BPKB have an impact on the effectiveness of red flags, whereas auditors at BPK have a different impact, with job position, education, and training having an impact on red flag effectiveness. The results of this study give attention to BPKP and BPK to provide opportunities for auditors to participate in continuing education and participate in training that supports auditors in carrying out their work, especially related to training in the use of IT to detect fraud. The perception theory can explain the usefulness of red flags in detecting fraud, according to the findings of this study. This means that in determining the ability to use red flags, it is influenced by individual characteristics (gender, position, length of employment), and the capacity of auditors (education and training).

Dhananjay Banthia   and Sanjeeb Kumar Dey   

Financial literacy has gained importance in recent years and has become a major issue all around the world. The financial market offers a wide range of products in a complicated manner and product accessibility has also risen. As a result, it is critical for individuals to have the appropriate financial knowledge and awareness in order to make the utmost use of their financial resources. Due to the massive population, poor literacy levels, poverty, disparities in regional languages, diverse cultures, and wide socio-economic disparities, the path to a financially literate in India is also difficult. Further, the behaviour and attitudes of an individual are influenced by the enormous range of culture, beliefs, religion, and customs found in different states. Under such circumstances, this research is conducted to determine the way financial literacy is linked to financial knowledge, financial attitude and financial behaviour in Odisha, India. It is found that there is a negative effect of "Financial Behaviour" on "Financial literacy level". "Financial knowledge" is found to be positively related to "Financial behaviour" and "Financial attitude". But, "Financial attitude & Financial behaviour" are negatively related.

Oliver Oji   

Directors are a strategic factor of success in any enterprise, thus their motivation should form a fundamental aspect for efficient achievement of the overall objective and improve performance of an enterprise. This study examined the effect of directors' efficiency on the performance of enterprises listed on the Nigeria Stock Exchange (NSE). Therefore, the specific objectives of the study are to ascertain the effect of directors' efficiency factor (DEF) on return on capital employed (RoCE), Tobin's Q (TQ) and earnings per share (EPS). Hypotheses were formulated in alternate form as directors' efficiency factor has a significant effect on capital employed (RoCE), Tobin's Q (TQ) and earnings per share (EPS). In order to achieve the objectives stated above, the study adopted ex-post facto research design, and data were sourced from African Financials, Nigeria Stock Exchange (NSE) Fact Book and Annual Reports and Accounts of the enterprises under study. Eighty-eight enterprises were selected using purposive sampling technique from 2010 to 2019, and data collected were analyzed using panel data regression model. The study found that DEF has a positive and significant effect on RoCE, but has a negative and significant effect on EPS and has an insignificant negative effect on TQ. Hence, the study recommended that regulatory agencies of the government should ensure that remuneration/compensation/pay package of Directors is commensurate with the performance indicators of the enterprise; and fringe benefits for Directors should be structured as a means of motivation that could increase their efficiency. Stakeholders would continuously and critically review the activities of the Directors, analyze the growth rate as well as evaluate the performance indices of the enterprises in order to determine any form of augmentation.

Sudam Shingade   Shailesh Rastogi   Jagjeevan Kanoujiya   and Venkata Mrudula Bhimavarapu   

Shareholder activism refers to an active engagement of investors with the investee company and to influence its policies and strategies including the dividend policies. We have tried exploring the impact of shareholder activism on the dividend policies in India's banking sector. We have conducted panel data analysis using ordinary least square (OLS) methodology to understand how the dividend policies in India are impacted by activism. We also have used controlling variables such as return on asset, capital adequacy ratio, and provision coverage ratio in the model setup. The study was conducted on data of 34 Indian banks across four years (2016 – 2019). We have created a shareholder activism index that acts as a proxy for shareholder activism. As per panel data analysis, we found no significant impact of shareholder activism on corporate dividend policies. We also have tested the model for robustness and validated our findings. We have not found papers that study the connection between dividend policies and shareholder activism in the Indian context, but our findings are in line with similar literature available globally and in other emerging countries. We have a limited sample size of 34 banks to have data available for all the variables employed in the setup. Also, as shareholder activism is at a nascent stage in India, we found limited data around it. As per our review of literature, there is no similar study conducted in India. Instead of using different corporate governance (CG) variables, we have created a shareholder index that shows the involvement of shareholders in corporate governance activities. It covers an array of CG variables.

Afif Noor   Dwi Wulandari   Haniff Ahamat   Ismail Marzuki   Akhmad Arif Junaidi   and Mahsun   

Sharia debt-based crowdfunding is experiencing good growth in Indonesia. Its existence as a financial service institution based on information technology carries high risks such as default risk, misuse of funds, the potential for shadow banking, personal data misuse, risk of Sharia compliance, and risk of consumer protection and dispute resolution. The purpose of this study is to find issues related to Sharia debt-based crowdfunding as a financial service institution that is subject to Sharia principles in crowdfunding regulations in Indonesia. This research is normative juridical research that uses secondary data as research material, including primary, secondary, and tertiary legal materials. The results show that no regulation specifically regulates Sharia debt-based crowdfunding in Indonesia. Financial Services Authority Regulation number 77/2016 as the legal basis for debt-based crowdfunding in Indonesia does not regulate Sharia debt-based crowdfunding as a financial service institution that is subject to Sharia principles and does not regulate legal protection for its consumers. Sharia debt-based crowdfunding must be regulated to protect consumers, both preventive and repressive protection as a manifestation of the rule of law principle adopted by Indonesia.

Ala Hussein Albawwat   

A research was conducted to assess the influence of board member characteristics on corporate social responsibility disclosure (CSRD) within banking industries in Jordan where a total number of 155 banks per annum were sampled between the years 2010 and 2020. A hundred items have been developed as a checklist to evaluate the level of disclosure and the analysed results were comparatively low in terms of the level of disclosure for the selected banks in Jordan. To test the model, data from a time series and the ordinary least squares model have indicated the influence of three (3) factors that impacted positively on the disclosure of corporate social responsibility (concerning the board's size, board of foreign members and the audit committee). The present research thereby proposed that the directorate boards of commercial banks in Jordan need to create more awareness about corporate social responsibility, and implement proper monitoring activities in disclosing information on regular by the Central Bank of Jordan. However, any commercial bank that fails to comply with the rules and regulations should be sanctioned severely for indiscipline. This study became relevant by contributing meaningfully to literature where the quality of information of the banking industries could be improved to meet the novel trend by worldwide economic analysts. Furthermore, this research successfully carried out investigations on the impacts of CSRD level within the context of a new business environment, thereby projecting more guidelines for future works in a related discipline. However, the overall outcome from this study could be made to attract groups of stakeholders and shareholders like moderators, potential investors, and CSR and government officials.

Jerlin Jose   Gangu Naidu Mandala   Kavitha Desai   Nilofer Hussaini   and Shaik Shamshuddin   

The current study aimed to examine the causal relationship between the NSE currency future rates and currency spot rates in order to identify the price discovery mechanism at NSE market and its integration with foreign exchange market (spot market). To study the causal relationship between the said markets, we have considered daily closing rates for NSE currency futures and currency spot rates for selected pairs of currencies, i.e. USD/INR, GBP/INR, JPY/INR and EURO/INR. The data was obtained from www.nseindia.com and www.investing.com for the period from Jan-2010 to Sep-2017, which makes approximately 1750 observations for each currency pair in each market. It is found that the spot rate for JPY/INR leads the future rate. It is also identified that the spot rate for USD/INR does not cause the changes in futures. It indicates that the market integration between spot and futures at NSE for currency pair USD/INR is strong compared to other selected currency pairs. From the variance decomposition test we found that there is almost no impact of variance in USD/INR spot rate on future rate variance forecast errors. It implies that the causal relationship between for USD/INR spot and future rates is strong and mature compared to the measured causal relationships for the remaining currency pairs. This study concludes that the price discovery process for currency pair USD/INR is better at NSE currency futures among the selected currency pairs.

Chriscarol Antami Parluhutan   Ermawati   and Shinta Widyastuti   

Good audit quality is needed so that financial statements can be useful for the community as a basis for making decisions. Corruption Eradication Commission (KPK) named Supreme Audit Agency (BPK) members as suspects in the drinking water bribery case because an abnormal value was found in the financial statements and in 2017 the BPK auditor was caught in the practice of purchase and sale opinions on the financial statements of the Ministry of Villages. This can be indicated by the existence of fraud in the audit results which makes the quality of the audit doubtful. This study aims to examine the effect of auditor ethics, auditor motivation, locus of control on audit quality with auditor professional skepticism as an intervening variable. The sample used in this study amounted to 59 samples sourced from auditors Auditorat of State Finances (AKN) V and VI BPK RI with a questionnaire instrument. The analytical technique employed in this study was Structural Equation Modeling (SEM), which was performed with the SmartPLS version 3.0 tool. The findings of this study show that auditor ethics, motivation, and locus of control all have an impact on audit quality, while auditor professional skepticism does not. Furthermore, the relationship between auditor ethics and audit quality cannot be moderated by auditors' professional skepticism.

Bella Siti Nurbarani   and Gatot Soepriyanto   

This study aimed to determine the effect of behavior factors and social demography on the investment decision in cryptocurrency in the Greater Jakarta area. The method used in this study is partial least square (PLS) using the SmartPLS software application. The behavior factor variables used in this study are overconfidence, herd behavior, subjective norm, and awareness variables. This study also used social demography moderating variables in age, gender, occupation, education, and investment experience on 400 respondents in the Greater Jakarta area. The test results show that only overconfidence and awareness variables have a significant positive effect on decisions to invest in cryptocurrency and subjective norms variables that have no significant positive effect but can be moderated by social demographic factors such as age and investment experience. In addition, other variables have no significant positive effect. They cannot be moderated by social demographic factors such as age, gender, occupation, and investment experience on the decisions of cryptocurrency investors in Greater Jakarta area. Our study contributes to developing knowledge, insight, skills and analyzing researchers, especially regarding the influence of behavioral factors and social demography on investment decisions in cryptocurrency.

Razana Juhaida Johari   Tarmizi Mohd Hati   and Sayed Alwee Hussnie Sayed Hussin   

The practice of professional scepticism is an essential element to audit quality. An auditor is required to have a sceptical attitude to minimize the mistakes made during the examination or investigation of financial statements. However, the occurrences of corporate scandals among the audited companies had affected the public’s confidence and the blame was shifted on auditors for ineffective application of professional scepticism. Therefore, this study examines the potential factors that influence auditors’ professional scepticism including auditors’ trust, locus of control, and fraud risk assessment. The primary data were collected through the questionnaires given to the auditors from public accounting firms in Kuala Lumpur. The results of this study show that the attitude of professional scepticism has no significant bearing on auditors’ level of competence (knowledge and experience). Whereas, there are positive relationships between auditors’ trust, fraud risk assessment, work internal locus of control and professional scepticism.

Nadiah Abd. Hamid   Ida Suriya Ismail   Nuridayu Yunus   Muhammad Nizam Jali   and Anwary Syuhaily Rosly   

The government's continuous support in ensuring the resilience and development of the small and medium enterprises (SMEs) amidst the COVID-19 pandemic is not open to question, especially considering the huge allocation of funds to SMEs as incentives for sustaining their businesses. To date, the greatest allocation of RM38.7 billion has been made through the 2021 Budget to benefit the SMEs. As such, the obligation of SMEs to contribute to the government by paying taxes voluntarily and accurately is essential. This study examines the perceptions of taxpayers via quadrant analysis to identify organisational strengths and weaknesses based on the ranking between priority and satisfaction towards tax awareness, tax education and tax complexity. A structured questionnaire was developed, validated and distributed to SMEs' owners via an online survey form. A total of 140 respondents completed the questionnaire and they were included in the data analysis. Overall, taxpayers considered paying tax as a burden since it will reduce their income and they also opined that introducing a new digital tax is not compulsory at the moment. In addition, taxpayers were less informed about tax management and services provided by the tax authority. Issues relating to tax complexity and management procedure need to be addressed by the tax authority. These findings could assist tax authorities by focusing on the elements requiring urgent attention to increase tax awareness, especially among SMEs in Malaysia.

Svitlana Y. Korol   Olena I. Nykyforuk   Ulyana V. Pelekh   Nataliia S. Barabash   and Olha M. Romashko   

The study was conducted in order to assess and analyse the impact of globalization and regional optimization on the activities of economic entities that are required to prepare transfer pricing documentation. The methodological background of the study involved the following methods: generalization, explanation, grouping, induction and deduction, as well as analysis and synthesis, which were used to clarify the main scientific categories of research and substantiate the research results. Methods of schematic and graphical representation were used to visualize analytical data, formulate assumptions and substantiate the obtained results. The main focus of the study is on the analysis of the causes of global economic risks and the role of transfer pricing documentation, whose quality will help mitigate the negative consequences of undesirable events for the global economic system. The study found that not all countries apply the international instrument — Multilateral Convention to Implement Tax Treatment Related Measures to Prevent BEPS (MLI). Many countries that have started to use MLI reporting, have no uniform standardized rules for the preparation of transfer pricing documentation. The legislation only defines the list of information to be submitted by taxpayers, provided that the results of their business activities meet certain criteria. The development of a unified methodology for valuing financial assets for tax purposes and preventing their use in illegal financial transactions are the promising areas for further research.

Khoirul Aswar   Ermawati   Jumansyah   Mahendro Sumardjo   and Anita Nopiyanti   

This study is based on Indonesia's high levels of corruption, as evidenced by the Corruption Perception Index's low level (CPI). In Indonesia, the bulk of corruption cases involve local government entities. The objective of this study is to empirically examine the factors that contribute to high levels of corruption in local governments of district or city in Indonesia and the role of enforcement in that influence. This study applied a purposive sampling method to obtain a sample consisting of 66 district governments and 15 municipal governments in Indonesia in 2019. The data were analyzed by utilizing multiple linear regression techniques using Statistical Package for the Social Sciences (SPSS) version 25. The results of the analysis revealed that fiscal decentralization, government size, and audit findings have a significant positive with the level of corruption and law enforcement significantly moderates such relationship. This research contributes to auditing practices, government administration, law enforcement, and corruption control initiatives in the local government of Indonesia. Local government is also expected to be able to involve the role of the community to help oversee the running of a government which is free from corruption practices. Supervision also needs to be done by law enforcement officials, especially those dealing with corruption cases. Law enforcement officers are expected to be able to supervise and crack down on perpetrators of corrupt practices.

Shankar Kumar S   and Jeyaprabha B   

Financial inclusion is the process of confirming access to financial services and adequate credit at timely, wherever required by vulnerable groups such as low income groups and weaker sections at a reasonable cost. Financial inclusion programme primarily emphasizes on offering secured financial solutions to the underprivileged segments of India without any signs of inequality and unbiased treatment. The main objective of the study is to examine the effectiveness of financial inclusion and rural upliftment with empirical evidence from Tamil Nadu. This research study is descriptive in nature, and target audiences are residing in Tamil Nadu region. Secondly, the sample size of this study represents 480 citizens, and the sampling method adopted is non-probability sampling using judgmental sampling method which is used for the target population. The Likert five-point rating scale questions are used for collecting the data through structured questionnaire. The findings revealed that the intensity of financial inclusion has improved over the years across different districts of Tamil Nadu but majority of districts still fall under the medium inclusion in rural area category. In this research study, it is suggested that financial inclusion generates economic progress and prosperity that drive activities among standard of living increasing across all segments of the society. This result shows that financial inclusion programme is potential and capable to transform the face of the state Tamil Nadu and it travels continuously towards upliftment of each and every individual without a doubt. The future research may consider more dimensions of financial inclusion like perception, engagement, empowerment of citizens and comparative study on different financial inclusion schemes at different regions, as this study is restricted to only (rural upliftment) financial inclusion.

Marsyanda Eka Pratiwi   Muhammad Din   Rahma Masdar   Andi Mattulada Amir   Femilia Zahra   Abdul Kahar   and Lucyani Meldawati   

There are increasing demands from the public related to the accountability and transparency in public sector administration. The governments usually respond by providing financial information to the public. In order to fulfill public rights to the information, government is also establishing the efficient way to achieve transparency by utilizing information technology (IT) in both financial management and public administration. This study aims to analyze the effect of human resource capacity and government internal control systems on the value of local government financial reporting information using information technology as a moderating variable. The population in this study is the financial manager in 41 government units in Palu City, Indonesia. The sampling technique uses purposive sampling with analysis tools processing data using WarpPLS. The results showed that human resource capacity had a positive and significant effect on the value of local government financial reporting information. The results also revealed that government's internal control system had a positive and significant effect on the value of local government financial reporting information. In terms of moderating effects, the results found that the use of information technology moderates the relationship between human resource capacity and the value of local government financial reporting information and the relationship of the government's internal control system to the value of local government financial reporting information.

Jones Adjei Ntiamoah   and Joseph Asare   

Tax compliance study, which is linked with the study of human behavior, remains complex and evolving. The complex nature of taxpayers who are humans coupled with the inconsistencies in the methodologies and approaches used by tax compliance researchers have added to the complexity. Again, it remains unclear as to what motivates a typical taxpayer in a developing economy to honor their tax obligations voluntarily. To understand this complexity, a survey was conducted using questionnaires containing a list of economic and noneconomic tax compliance factors. A total of five hundred (500) respondents who are taxpayers located in four different developing economies were selected. The study found that understanding tax compliance decisions of taxpayers in developing economies requires at least some appreciation of the underlying factors which influence individual taxpayer's decision about whether to pay or evade taxes. The findings from this study prove that tax compliance decisions of individual taxpayers in developing economies are highly influenced by non-economic factors. However, to achieve improved tax compliance among individuals in a developing country, equal attention would be required for both factors. Further, the study provides some preliminary evidence that paying attention to the noneconomic factors could play a vital role in improving tax compliance level among individuals by up to 89% whereas compliance level could improve by only 11% if attention is paid to only the economic aspects of tax compliance decisions.

Mochammad Solichin   Zuraidah Mohd. Sanusi   Razana Juhaida Johari   Tri Gunarsih   and Nur Aima Shafie   

It is stated that fraud in the government sector includes deceptive acts such as asset misappropriation, loss of state income, falsification of financial records and reports, and mark-ups in government financing. The purpose of this study is to investigate the potential impact of audit competences (professional skepticism and audit experience) and internal control on an auditor's capacity to detect potential fraud occurrences. Primary data were gathered via a printed questionnaire distributed to the 149 government auditors who work at Indonesia's Inspectorate Office. The findings, based on the Partial Least Squares of structural equation modelling, show that both audit competences have a significant impact on the capacity to detect probable fraud. Internal control, on the other hand, has no direct impact on the capacity to detect potential fraud. The findings show that internal control significantly moderates the link between audit competencies (professional skepticism and audit experience) and the auditor's ability to detect potential fraud occurrences. This research offers practical government suggestions for improving government auditors' professional audit competencies and abilities. Audit authorities should be able to create a more effective internal control structure that prioritizes feedback and learning. The limitations of the study as well as future research are highlighted.

Ala Hussein Albawwat   

This study examines the influence of audit committee characteristics on voluntary disclosure of non-financial firms considering the context of Amman stock exchange (ASE). As a result, a total number of 140 firms were annually considered as study samples between 2015 and 2019 making up to 4 years reports. To measure the impacts of audit committee on information of voluntary disclosure, a number of hypotheses were tested from selected firms listed in Jordan. On the test for hypotheses, a descriptive analysis was carried out followed by the model of multiple regressions. The outcome from the findings in this study however indicated a positive relationship between the factors of independent audit committee, the sizes, the multiple directorships of members of audit committee and the corporate voluntary disclosure. The rate at which meetings were held by financial expertise and members of audit committee was observed to be associated significantly with the corporate voluntary disclosure. The results further revealed a strong significance difference between investors in accounting sector and policy makers and the accuracy of monitoring the process of corporate reporting. The current research however projected foresight ideas to improve corporate governance of Jordan and other developing countries with the tendency of imposing reliable regulation bodies.

Halyna Velykoivanenko   and Vladyslav Korchynskyi   

The issue of determining the financial condition of commercial banks and separating investment-attractive banks from problem banks on this ground is extremely important for developing countries. The aim of this study is to make sure on the example of Ukraine that commercial banks really form separate clusters, where more reliable, stable and efficient banks are well separable from less successful ones in this regard. The study used the t-SNE and UMAP dimensionality reduction algorithms, and the Ward's Agglomerative Hierarchical Clustering algorithm. The results of visual analysis of two-dimensional t-SNE projections show that banks of different degrees of risk are well separable and have their own specifics. Clustering in the UMAP algorithm allowed distinguishing clusters with banks of Class A, "mid-tier" and problematic banks by different parameters. The t-SNE and UMAP algorithms for solving the problem are compared. The results show that a purely visual analysis of the two-dimensional map for the banks over the last period is best made using the t-SNE algorithm. UMAP, on the other hand, is proved to be excellent when used in tandem with the clustering algorithm.

Swarmilah Hariani   and A. Fakhrorazi   

The research investigated the relationship among FRQ, ICS, RPM, and COR as moderating variables. The research recommends that local governments should improve in the field of financial management and implement an effective internal control system. Aligning the research problem and objectives, this research adopted the agency theory for local government. This theory includes information asymmetry, where the agent has more information and understands more about the actual financial position than the principal. Modern democracies are based on a series of principal-agent relationships, which may lead to problems in the public sector. In this research, 257 qualified questionnaires were collected from local governments in Indonesia, using self-administered surveys. Furthermore, Partial Least Square-Structural Equation Modelling (PLS-SEM) technique was used for data analysis. The results showed that ICS, COR, and RPM have a positive relationship with FRQ, while the hypothesis that COR strengthens the effect of ICS on FRQ was rejected. High COR does not significantly improve the FRQ without being supported by a good ICS. With a high or low COR, the ICS will continue to be carried out properly by leaders and superiors. Therefore, a good COR does not significantly moderate the effect of the ICS on the FRQ. The quality of financial reports is the result of accounting activities that can provide financial information which can be understood by users and be used for decision-making in the future.

Ijaz Ali   Asma Khatoon   Ashraf Imam   Asif Baig   Odunayo Magret Olarewaju   and Imran Ahmad Khan   

The purpose of this paper is to identify the types of firms for which government financial support for SMEs is provided in Malaysia. The financial data of privately held and publicly traded companies are used and a probit model is estimated with qualitative variables as explained variables. The estimation results of the probit model reveal that the more Bumiputras are included as the ethnic composition of the board of directors. The more support they have received, the more fixed assets a company has, and the more support it receives. Firms with poor corporate performance tend to be more likely to receive financial assistance. Since the length of operation and ROE are not statistically significant, length of operation and ROE do not seem to have a significant effect on government financial support. The study finds that government financial support through development finance institutions is related to the ethnic composition of the board members. And the more difficult it is for SMEs to borrow from banks on a commercial basis, the more government financial support they receive.

Pham Ngoc Van   and Khoa Dang Duong   

Prior literature documents that the Sharpe ratio (SR) generates biases in performance evaluation if returns distribution deviates from normal distribution because SR is derived under the mean-variance model with the strict assumption of either quadratic preferences or customarily distributed returns. When the return distributions deviate from normality, it may lead to unreasonable results. Therefore, this study examines which performance measurement approaches are efficient for non-normality on the distribution of asset returns. We collect monthly returns of 14 Credit Suisse (CS) hedges fund indexes from April 1994 to June 2021. The hedge fund index returns exhibit high negative skewness or high positive kurtosis, implying non-normal distribution. Then, we employ the Sharpe ratio (SR) and two performance measures, which extend the Sharpe ratio, the generalized Sharpe ratio (GSR), and the economic performance measure (EPM), to evaluate the performances of hedge funds. In addition, both the nonparametric and parametric estimation methods of the GSR and the EPM are utilized. Our findings indicate that the nonparametric GSR and the nonparametric EPM produce more similar rankings than the SR. Among the three parametric estimation methods of the GSR and EPM, only the method proposed by [1] produces similar rankings with the nonparametric GSR and the nonparametric EPM. Finally, our study contributes the practical approach for fund managers to evaluate their fund performance efficiently.

Lesya Yastrubetska   Ihor Krupka   Viktor Kovalenko   Nataliia Zhmurko   and Olesia Mykuliak   

This scientific article is devoted to the development of the mechanism of companies' financial security management and measures to improve it under the hybrid conflict. The study is conducted on the prerequisites of Ukrainian companies operating in the zone of hybrid conflict. The study aims to develop a mechanism for managing the financial security of Ukrainian companies operating under hybrid conflicts. Insufficient scientific research on improving companies' financial security under hybrid warfare and the government's imperfect regulation of financial security makes the topic relevant for scientific research. The academic paper highlights the theory that whilst the hybrid conflict weakens the level of financial security of the company improves. Statistical and mathematical methods of calculations are used to carry out empirical research. The correlation between the peace index and the index of financial security of Ukraine is determined. The article's novelty involves the development of risks classification associated with non-military actions affecting the companies' financial security management. The financial security management mechanism's functional components have been developed in the research; the steps to improve financial security have been outlined. Two directions of development of financial security management, based on changes in the geographical location of the enterprise and the continuation of work in a hybrid conflict, are proposed. Contentious views have confirmed the fact that changing the enterprise's geolocation is less widespread; consequently, the proposed directions for the development of financial security are of practical importance for business in the temporarily occupied territories.

Slatvinska Valeria   Demchenko Vitaliia   Tretiak Kateryna   Hnatyuk Rostyslav   and Yarema Oleg   

This article examines the impact of blockchain technology in the financial sector and international trade. The aim of the article is to measure the effect of blockchain technology on international trade and financial business. The paper uses methods of analysis and synthesis of information from researched academic articles, government programs, reports, and statistical data. The averages and regression analysis (in particular, the calculation of the Pearson coefficient) are used for getting analytical results. Graphic methods are used to summarize the information and to present the understudy materials. According to the results of the study, it can be concluded that blockchain technology has great potential for the development of international trade and financial business. It is possible by improving the settlement of international trade, applying smart contracts in the formation of the transaction, improving logistics chains, and reducing the speed of information and delivery processing, increasing the economic turnover. Blockchain has a positive impact on reducing costs for merchants and the banking sector, predicted by 2030 to decrease costs by 11% using this technology. The technology will have a very significant impact on the development of intellectual property, which could be particularly activated by the possibility of reducing the impact of pirated copying. It is possible to reduce corruption and fraud by applying blockchain technology in public procurement, which currently accounts for the bulk of international trade. Blockchain technology will add $3 trillion in additional business value by 2030 and $866 bln in international trade, including financial business.

B. Vijayalakshmi   G. Subashini   M. Jayalakshmi   and C. Umayal   

The promotion of Small and Medium enterprises (SMEs) has continued to remain an important and integral part of Indian development strategy and is known to play a vital role in the global economic landscape. Despite the fact that Government of India has formulated many policies to promote export expansion of SMEs, they have traditionally focused more on domestic markets and the export performance of this sector in the global market has been unimpressive. Although SMEs want to exploit the international opportunities and want to become more export oriented, many barriers impede the growth performance of Indian SMEs to meet the challenges of emerging trends in globalization. This paper specifically aims at finding the perception of the SMEs in determining their hedging strategies to mitigate the foreign exchange risk. The study is performed by considering primary and secondary data. The primary data were collected from 71 selected export traders through structured questionnaire and analyzed using suitable statistical tools. From the study, it is concluded that the SMEs with high turnover prefer to adopt currency derivatives, especially forward contracts whereas the SMEs with lower turnover prefer natural or non-hedging strategy. It is also recommended that the banking sector can also step forward to give information on currency price movements to their clients as an additional service.

Engkos Achmad Kuncoro   Gatot Soepriyanto   and Arfian Erma Zudana   

Narcissism is related to the need for recognition. Prior studies show that narcissist behavior may influence the CEO's actions engaged in accounting numbers manipulations. This study examines the effect of CEO narcissism on accounting irregularities in Indonesia. Indonesia provides a unique setting to test this issue because narcissistic behavior is an uncommon trait in the country. Consequently, it may influence the motivation of narcissistic CEO to manipulate accounting numbers. We test the issue by measuring CEO narcissism with the characteristics of CEO's photo on the annual report. We then conduct a simple logistic regression on that proxy to the Beneish M-Score as our accounting irregularities measure. In accordance with our expectations, we find no evidence of an association between CEO narcissism and accounting irregularities. This may attribute to the fact that Indonesia's social and cultural aspects lower the incentives for individuals, including CEOs, to engage in narcissistic behavior, thereby decreasing their motivation to use accounting numbers as a venue to get attention and recognition. Interestingly, this study discovered a significant negative relationship between CEO narcissism and accounting irregularities for firms audited by BIG4 auditors. This may indicate that BIG4 auditors can significantly mitigate the intentions and activities of narcissistic CEOs in manipulating accounting numbers to get better publicity.

Fatmasari Sukesti   Abdul Kharis Almasyhari   Nurul Nazlia Jamil   and Ainulashikin Marzuki   

IFRS convergence was initiated through the agreement of the G20 leadership meeting in Washington at 2008. The meeting agreed to use IFRS as an international accounting standard. Adopting IFRS as a single global accounting standard can make Indonesian companies ready and able to transact across countries, or mergers and acquisitions. IFRS supports the readiness of industry in Indonesia to be competitive at the global level. Financial statements based on IFRS produce information more relevant, accurate and more comparable. IFRS can produce valid information on company assets, liabilities, equity, income and expenses. Management will have a high level of accountability to run the company. This study examined the role of audit quality as moderating variable in the relationship between the IFRS convergence and disclosure quality, and studies on multinational companies listed the Indonesian Stock Exchange 2012-2018 period. The research used 63 multinational companies and it tested using the SPSS 25 statistical test tool. The research has proven the effect of IFRS convergence on disclosure quality, and the role of audit quality in strengthening the relationship between the two variables. IFRS convergence applied requires the role of external audit to provide assurance or assurance that the financial statements presented have complied with the standards for preparing financial statements and are fairly presented without material errors.

Reepu   and Rakhi Arora   

Online banking is a major service for the contemporary banking sector's expansion plan. Numerous researchers have contributed to the research paradigm the positive aspects of online banking. Consumers sense the interconnectivity due to its presence online. Nonetheless, this service was not extensively utilized due to consumers' remaining afraid of the danger of online transactions. Users fear to use such services online due to the prevalence of different kinds of risks. Thus, the detailed and distinctive risk job in risk awareness for the banking industry is an important and useful task. The influence of perceived risk in online banking use is investigated in this research. As it has been regarded for the majority of times, perceived risk serves as one of the major barriers towards usage of such kind of services. The paper has set out the varied categorical risks like privacy, social risk etc. which influences the usage or intention towards usage of such online banking services. The research model is envisaged on the basis of different theories of information technology acceptance. Questionnaire method was employed to obtain responses specifically from female users of online banking. Data collected were analyzed through Structural Equation Modelling (SEM). Results have been analyzed well. The findings of SEM show risk elements "privacy risk, security risk, social risk, time risk, and financial-performance risk" in perceived risk, which has a negative impact on desire to utilize online banking. Research findings may assist in suggesting ways to improve safety and mitigate online banking risks prevalent among users.

Salah Mohamed Eladly   

The subject matter of this study is the analysis of the relationship between risk assessment and firm size on financial performance. The population encompasses thirty-nine listed insurance firms in Egypt during the period 1999 – 2019, whereas a sample of nineteen insurance companies was selected. The financial assessment is a dependent variable, while the independent variable is risk assessment. This study used general linear multivariate analysis and descriptive statistics. The article is an attempt to investigate the relationship between risk assessment and firm size on financial assessment of insurance sector in Egypt. The results indicate that there is significant positive linear relationship between standard deviation of return on equity, standard deviation of return on asset, and natural logarithm of total assets with return on equity. Moreover, there is significant positive linear relationship between standard deviation of return on equity, standard deviation of return on asset and natural logarithm of total assets where on return on asset. Therefore, there is significant positive linear relationship between standard deviation of return on equity and standard deviation of return on asset on liquidity. Nevertheless, there is a negative relationship between natural logarithm of total assets.

Misbah Noreen   M. S. Mia   Zahiruddin Ghazali   and Ferdoushi Ahmed   

Purpose- Pakistan is a lower-middle-income country and financial inclusion rate is comparatively lower than other South Asian countries. In this circumstance, Government of Pakistan has implemented various financial inclusion policies and strategies to enhance the rate of financial inclusion in the country. However, a cursory attention has been paid to Government policies by the previous studies. Therefore, the aim of this study is to provide an insight into the current government policies and strategies for fintech adoption and financial inclusion in Pakistan. Design/ methodology/ approach- This study collected and reviewed previous literature that focused on various fintech adoption and financial inclusion policies and strategies by the Government of Pakistan. Literature has been selected from various secondary sources such as journal articles, conference proceedings, annual reports of SBP (State Bank of Pakistan), Global findex report by World Bank and so on. Findings- The study found that Government of Pakistan has successfully implemented a number of financial inclusion policies and strategies during the last decade. A noteworthy innovation approach (i.e. fintech) was applied as a catalyst in order to extend the scope of financial services in Pakistan. The Government also implemented Financial Literacy Programs specifically for youth to create awareness about financial resource management in the country. Very recently, Government of Pakistan launched banking on equality program to enhance gender equality in financial inclusion. Originality/value- The findings of this study might be useful for the decision makers and practitioners to implement the policies and strategies more effectively and efficiently to enhance the rate of financial inclusion in country.

Namig Garib Orujov   

The aim of the study is to clarify and arrange the types of investment in tangible assets based on the practice of forming such assets in the world and Azerbaijan in particular. The article involves methods of analysis and synthesis in the development of criteria for attributing costs to investment in tangible assets. The dynamics of the investment in tangible assets of economic entities were analysed through the statistical analysis. The monographic method is applied to a comprehensive in-depth study of the types of investment in tangible assets, and the cause-and-effect relationships of their implementation. An abstract logical method was used to generalise and draw conclusions. The nature of investment in tangible assets was studied, taking into account the provisions of international accounting standards and other regulatory documents. An algorithm for identifying investment in tangible assets was developed, which provides for their consistent recognition from the moment the operation gets the attributes of investment activity and the subsequent distribution of investment by individual groups of assets to their final completion. The usefulness of the identification algorithm in making informed management decisions on the material investment in individual objects was determined. The classification of investment in the tangible assets of the company was determined, and the key types of investment were identified. The dynamics of the volume of investment in the tangible assets of Azerbaijani companies were investigated; an econometric model was developed to predict it, and the amount of investment in the tangible assets of Azerbaijani companies for the next five years was predicted. The prospects for further research include the search for directions for modernising the company's investment policy.

Galina Ivanovna Osadchaya   Marina Lvovna Vartanova   Igor Aleksandrovich Seleznev   and Evgeniia Evgenyevna Kiseleva   

The main factors of macroeconomic uncertainty for the Eurasian Economic Union member states are the threat of a global financial crisis, long-term restrictive measures associated with the spread of the pandemic, trade wars between major states, new sanctions, volatility in commodity prices, growing inflationary pressures, internal risks of tightening monetary policy, volatility of national currencies, as well as an increase in the budget deficit and total debt. There is a need to protect against undesirable external influences and radical internal changes in the conditions of global instability, to assess the socio-economic potential of the Eurasian Economic Union member states on the way to a single integration space, in other words, the need for security is a basic, fundamental need, both for the life of an individual and including society and the state, which makes this study more relevant. The COVID-19 pandemic had a major impact on many economic and social processes. In these difficult conditions of external factors' influence, the system of ensuring financial and economic security acquires significance. The conducted research allows concluding that, firstly, the economic security of the countries of the Eurasian Economic Union is a complex concept that reflects the state of the financial system of countries, their ability to timely and reliably meet needs of the economy in the amounts necessary to provide growth of the economy in the conditions of integration. Moreover, the indicators of budget and stability of investments of each of the countries determine the level of the EAEU member financial security.

Rezarta Shkurti Perri   and Shpresa Cela   

In this study, we investigate the relationship between the capital structure and the profitability of the firms. We focus our study unto 53 construction companies of Albania for years 2016 – 2019, and by calculating variables to measure both capital structure and profitability, we run multiple regression analysis. We use Return on Assets and Return on Entity to measure profitability and up to five different variables to measure the capital structure. We notice that the construction companies use mainly the short-term leverage to fund their activities. The regression results show that there is no significant impact of the capital structure on the profitability of the firm, whereas we notice a significant relationship between the capital structure and the Return on Entity of these firms. More specifically, our results show that the current liabilities to total assets ratio and the current liabilities to total liabilities ratio have a negative correlation with the Return on Assets of the entities. The non-current liabilities to total assets, current liabilities to total assets and total liabilities to total equity ratios have a positive relationship with the Return on Equity of these firms, with the last ratio having the biggest impact. These findings contribute to the existing literature on the relationship between capital structure and performance and give hints to more profitable ways of financing for these companies such as relying on long-term financing or finding alternative ways in regional capital stock markets.

Adegbola Otekunrin   Kudzanai Matowanyika   Clever Fungai Munyoro   Ngoni Doma   and Stella Ibitoye   

This study examined the feasibility of implementing the Public Entity Corporate Governance Act's (PECGA) best practices to enhance good performance at a State Owned Entity (SOE). Boards of State enterprises and parastatals (SEPs) had encountered impediments in promoting corporate governance best practices in Africa. Identified factors hindering the implementation of PECGA of 2018 were examined to proffer recommendation for its adoption. Zimbabwe came up with the PECGA of 2018. The feasibility of implementing PECGA's best practices to enhance good performance at the SOE is not well known when this study was conducted. Mixture research methods were adopted where questionnaires were used to collect data. Purposive sampling methods were used to examine the populations of 38 head office managerial staff. Chi-square and regression analysis were used for analysis. It is found that job title and education level are related and the execution of sound PECGA best practices and the SOE's operational performance are related. The results confirmed that there were hindrances on the execution of sound PECGA best practices on the SOE's operational performance. The study concluded that it is not feasible to fully implement the PECGA best practices in SEPs to enhance performance in Zimbabwe. The Zimbabwean's PECGA must be moved from the "apply or explain" model (that is relying on the disclosures requirement doctrine as a method of promoting the execution of definite corporate governance practices devoid of mandating real practices) to "comply or else" model of corporate governance to achieve sustainable corporate governance success in the near future.

Cordelia Onyinyechi Omodero   and Michah Chukwuemeka Okafor   

The research investigates the consequences of digital financing on taxation in the fourth industrial revolution, with a focus on Nigeria. The primary goal of industry 4.0 characteristics is to increase income in both the municipal and private sectors. As a result, the government's embrace of digital finance is expected to increase tax revenue collection in Nigeria. In this study, we examine the effectiveness of digital financing instruments such as ATMs, point-of-sale terminals, and web-based or internet-based payments in increasing tax collection in Nigeria. Because the first statistics on digital finance recorded by CBN annual reports were published in 2006, the analysis spans the years from 2006 to 2019. We use multiple regression approaches to assess the effect of each digital financing tool and discover that only ATM has a substantial influence on tax income over the research period. Other digital finance gadgets have statistically negligible results. As a result, the study suggests that Nigeria's network be improved, as well as tax payers' knowledge and usage of digital finance instruments in order to comply with their tax responsibilities.

Halil Paino   and Tjut Intan Teuku Iskandar   

Earnings management is a technique used by the management of an organization to intentionally manipulate a company's profits in such a way that the figures suit the agreed target and to generate financial results that provide an excessively optimistic view of the company's operation and finances. Due to poor performance, companies are using different strategies to exploit and provide a positive picture of financial and management profitability to look better in the eyes of shareholders and stakeholders, and this is generally referred to as earnings management. This study aims to examine the potential factors of pressure (financial stability and financial target), opportunity (board independence and audit committee), and arrogance (CEO duality and the CEO's picture) that cause earnings management in manufacturing companies in Malaysia. This study used organizations as the unit of analysis while manufacturing companies from the Public Listed Companies (PLCs) were chosen as the research sample. This study found that the proxies of board independence, audit committee, and CEO's picture have a positive relationship with earnings management. Adversely, the indicators of financial stability, financial target, and CEO duality have negative effects on the incidence of earnings management.

Intan Waheedah Othman   Richard Slack   and Rebecca Stratling   

This study explored the varied characteristics of misstatement firms, which serve as the foundation to develop a model that predicts income-decreasing forced restatement (IDFR). Multivariate logit regression was performed on 4,698 firm-years of Malaysian listed firms from 2002 to 2012. The results were tested for robustness using a stepwise logit model and a penalised likelihood logit model. Several factors, such as share price volatility, independent board of directors, company's internal fund, and political connection, emerged as the main predictors for IDFR. This study proposes a prediction model that synthesises financial and non-financial aspects in terms of scaled probability (F-score), which may function as a red flag of income-increasing misstatement firms that warrant further investigation.

Liubov Lysiak   Svitlana Kachula   Anna Kushnir   ViktĐľriia Datsenko   and Tetiana Tereshchenko   

Systematic assessment of the financial stability of local budgets is important for timely detection of budget imbalances and identification of their causes, thus helping to make informed management decisions of current and strategic nature on the development of territories, quality local public services and improving welfare. The article proposes the use of Kohonen maps to determine the financial stability of local budgets. The main advantages of the practical use of Kohonen maps for this purpose compared to such common assessment methods as integrated and matrix are the simplification of the process of assessing the financial stability of local budgets and at the same time visualization of the results for public presentation. On Ukraine's example local budgets were grouped according to the parameters of their financial stability with the construction of Kohonen maps based on the SOM-Ward algorithm. It allowed determining the financial condition of local budgets of Ukraine during 2017-2020 and accordingly the type of their financial stability. Taking into account changes in the financial stability of local budgets over time is important when adjusting fiscal policy. The idea is that simplifying the process of assessing the financial stability of local budgets is an important condition for its active practical application and at the same time will allow visualizing information for the public about local budgets which will promote transparency in budget management and increase trust in the formation of priorities of fiscal policy at the local level.

Jamaluddin   Masruddin   Indra Basir   Rahma Masdar   and Lucyani Meldawati   

The purpose of this study was to determine and analyze the effect of role ambiguity, role conflict and auditor competence on auditor independence and internal audit quality as well as the effect of auditor independence and audit planning on internal audit quality. It is also to empirically analyze the mediating effects of auditor independence and audit planning in the relationship between independent variables to dependent variable of internal audit quality. The population of this research is auditor inspectorate in Central Sulawesi Province. Sampling used purposive sampling technique with a total of 202 samples. The data were analyzed using the Structural Equation Model (SEM) technique. The results showed that role ambiguity and role conflict had a significant negative effect on auditor independence, but did not significantly affect the quality of internal audit. Auditor competence has a positive effect on auditor independence and internal audit quality. The findings also pointed out that auditor independence and audit planning have a significant positive effect on internal audit quality. Statistical testing of mediating variables showed that auditor independence mediates the relationship between role ambiguity and role conflict and the quality of internal audit. Likewise, mediating variables of auditor independence and audit planning have empirically proven to strengthen the effect of auditor competence on the quality of internal audit.

Mykola Dziamulych   Tetiana Shmatkovska   Mykhailo Krupka   Lesya Yastrubetska   Bohdana Vyshyvana   and Svitlana Derevianko   

The main purpose of the research is to study changes in the methodology of formation and regulation of liquidity of commercial banks in Ukraine, as well as to study changes in the structure of bank assets that will result from the use of new approaches. For data collection, the following analysis methods were adopted: a semantic analysis of the traditional and new approach to determining the regulatory liquidity ratio, structural and dynamic analysis of assets and income of commercial banks, as well as a method of logical generalization in drawing conclusions about the analysis. The results of the research show that the introduction of new approaches to determining the liquidity of commercial banks on the basis of the Basel III agreement requires banking institutions to increase the general requirement for the principles of formation of their assets. There is also an objective need to develop new approaches to ensure the proper effectiveness of current liquidity control and ensure the stability of cash flows as well as an overall reduction in banking risks. Based on the analysis of the banking system of Ukraine, it is established that the introduction of the NSFR ratio instead of the regulatory ratio N6 provides for commercial banks a general reduction of the risk of banking operations and helps to expand sources of financing active operations. The study found that one of the key consequences of the introduction of the NSFR ratio in the activities of banking institutions in Ukraine will be a decrease in their net interest margin in lending operations. As a result, commercial banks will be forced to limit lending activities mainly by limiting the issuance of riskier loans. However, another consequence of the use of the NSFR standard will be the differentiation of active operations of banks, which will reduce the dependence of their operating activities purely on lending, which will also result in an overall increase in the financial stability of banking institutions.

Vikram Jeet   and Parvesh Kumar Aspal   

The present analysis proposed a model to explain the impact of corporate intangible resources, such as research & development (R&D), human capital, and corporate reputation on corporate financial performance. The corporate financial performance was measured with two determinants, return on assets (ROA) & return on equity (ROE). The data had been collected from 81 different manufacturing and consumer goods companies for three years from 2014 to 2016. To investigate the association considering the intangible resources and control variables, the panel data regression is applied. For the descriptive analysis, the mean, dispersion, and correlation among all the variables are examined and the redundant fixed effect test is applied to choose an appropriate model between panel data regression and pooled OLS regression. The study results highlighted that the intangible resources human capital and research & development have significantly and positively impacted the financial performance indicators ROE and ROA. However, the intangible resource corporate reputation significantly, but negatively affects the corporate financial performance ROE and ROA. Likewise, the control variable leverage has a significant impact, but the size has an insignificant effect on corporate financial performance. The study highlights the importance of a firm's intangible recourse in the organizational performance and gives a wider scope to investigate the influence of other intangible resources on organizational financial performance.

John Guay Pagaddut   

Micro, small and medium enterprises (MSMEs) are considerably contributory to social and economic progress and prosperity through their entrepreneurial capacities and capabilities. However, they experience constraining challenges that importunately impair their abilities, failing to optimally engage themselves in the privileging opportunities around, particularly in the financial aspect. This paper aims to establish the financial factors affecting the financial performance of Philippine MSMEs whose audited financial statements are utilized to extract financial ratios needed for the study. It also aims to determine the factor structure that can explain the variation among these financial factors and to determine the cohesive cluster that can separate these financial factors. It employed multiple linear regression, factor analysis and cluster analysis in order to respectively achieve its objectives. It establishes that debt ratio, asset turnover and gross profit margin have a significant effect on return on assets. It further establishes that there are two significant factor structures, namely "Sustainability" ratios and "Efficiency" ratios, explaining the variation among these financial ratios. It furthermore establishes that there are two cohesive clusters, namely "good" ratios and "poor" ratios, separating these financial ratios. It suggests that MSMEs should remain self-sufficient and self-reliant, without unreasonably depending on debts, hence should adequately afford capital to finance their businesses. Further, they should optimally operate to generate sales by efficiently employing their resources. Furthermore, they should judiciously control costs, without compromising quality of their products and services, in order to increase their margin. They should reinforce their performance by regularly advancing their efficiency and sustainability. They should work well to sustain good ratios and improve poor ratios. Notably, this paper suggests that stakeholders sustainably support MSMEs in light of creativity and collaboration.

Peter Ubi   Bassey Ebi   and Enang Udah   

Fiscal deficit, economic uncertainty and macroeconomic performance have gained currency in recent public discussion among policy analysts and economists. The scale of the debates raises a question of whether or not economic uncertainty dampens the ability of deficit financing to achieve its desired objectives. This paper investigated the impact of budget deficit in an uncertain economic environment on gross domestic product (GDP) and inflation. Measures of macroeconomic performance are real GDP and inflation. Other explanatory variables include credit to financial sector (proxy for financial sector development), fiscal deficit, capital and recurrent expenditure. The paper measures economic uncertainty using exchange rate volatility through GARCH model and adopted the Auto-Regressive Distributed Lag (ARDL) bounds methodology. This approach allows the splitting of the variables into expected and unexpected variations which could be estimated using VAR. The results showed that economic uncertainty has an adverse effect on economic performance by creating passive expectation about the future. Uncertainty erodes the confidence of both foreign and domestic investors about future cash-flows and the stability of the economic environment as well as the safety of investors' assets. This impact would be visible in the existence of substantial sunk cost. The results approximate the submission that conducive economic environment along with appropriate mix of fiscal policy promotes real economic activity and stabilizes the price level. Improved economic conditions builds confidence in economic agents to invest in real productive activity, enables fiscal deficit to achieve its desired objective of stimulating economic activity and signals great optimism in the financial transaction system leading to improved funding of the private sector.

Yondrichs   Muliati   Supriadi Laupe   Arung Gihna Mayapada   Jurana   and Ridwan   

Purpose: This study aims to analyze the effect of fundamental factors and sustainability reporting on firm value. This study also investigates the moderation effect of corporate governance on the relationship of fundamental factors, sustainability reporting, and firm value. Design/methodology/approach: The population is all companies listed in Indonesia Stock Exchange and indexed in IDX30 throughout 2014-2020. The data are obtained from financial statements, annual reports, and sustainability reports. The analysis method used in this study is panel data regression analysis. Findings: This study shows that profitability and leverage as fundamental factors affect the firm value. This study also found that good corporate governance moderates the effect of the fundamental factors on firm value. However, the sustainability reporting cannot increase the firm value. Research implications: These results verify agency and signaling theories but do not support legitimacy and stakeholder theories. Practical implications: These results confirm that fundamental factors are still the investors' primary concerns about making investment decisions. Originality/value: The novelty of this study lies in highlighting corporate governance as a moderation variable in the relationship of fundamental factors, sustainability reporting, and firm value, which has still not been concluded yet.

Petr MakovskĂ˝   

The Efficient Market Hypothesis (EMH) is the generalization of the so called perfect competition for the financial markets. Sometimes the financial markets are assumed to be the markets most similar to the perfect competition. So, every test of the EMH theory is the test about the perfect competition approach and then its conclusions are about the market mechanisms and potential regulation and policy. Even though, discussions about the financial capital regulations, free movements of financial capital and taxing are widespread, not only in economic theory scientific conferences, but anywhere. The FOREX market is the financial market, in which there is the highest amount of trading, so that we assume the feature analyzed be the most visible. More in the Czech Republic there is permanent question about the pros and cons of the national currency. The EHM theory concluded remarks also influence the discussion. The problem is not so simple. The conclusion is not about the purity of the efficient or inefficient financial markets. The conclusion must be about the level of the market efficiency, which is moreover variable in the different time periods. More we analyzed the effects of the great financial crisis in 2008.

Nurcahyono Nurcahyono   Ayu Noviani Hanum   Ida Kristiana   and Imang Dapit Pamungkas   

This study aims to empirically examine the factors that can be used to detect the risk of Fraudulent financial statements. Fraudulent financial statement is an interesting topic to study, because it has a huge impact on business sustainability and the country's economy may become a crisis. The research population is the financial sector companies listed on the Indonesia Stock Exchange in 2018-2021. The sampling technique uses purposive sampling. The number of companies that meet the sample criteria is 76 companies, so there are 228 observations. Data analysis used Moderated Regression Analysis for hypothesis testing. The results show that companies which provide shares for managers and streamline the role of the whistleblowing system and audit committee will prevent companies from committing fraud, because they act as internal controls. Auditor switching and management arrogance are early indicators that can be used for fraud detection, because the strategy of management is to hide crimes. Financial ratios are certainly the easiest indicator to detect fraudulent financial statements risk, profitability, liquidity, and solvency of a company that is small or minus will encourage management to commit fraud so that the company looks good. Also, organizational culture can reduce the risk of fraudulent financial statements if it is properly internalized.

I Putu Abed Adi Pranata   Komang Adhitanaya   Muhammad Fairuz Rizaldi   Gede Bramasta Eka Winanda   Ni Made Intan Dewi Lestari   and Partiwi Dwi Astuti   

Tax aggressiveness is an interesting research topic in the accounting and management literature. Tax aggressiveness is one of the driving factors in many corporate decisions. Research testing the link between CSR and firm size, leverage to tax aggressiveness is limited and shows inconsistent results. The study aims to test the influence of corporate social responsibility (CSR), firm size, and leverage on tax aggressiveness. The research was conducted in food and beverage sub-sector manufacturing companies listed on the Indonesia Stock Exchange for the period 2017-2019. A sample of 16 companies was determined using the purposive sampling technique. Data in the form of 48 financial statements obtained from the Indonesia Stock Exchange website. The data is analyzed using multiple linear regression analysis techniques, with SPSS 20 software. The results showed that CSR has no significant negative effect on tax aggressiveness; firm size has a significant positive effect on tax aggressiveness; and leverage has a significant negative effect on tax aggressiveness. The results of this study contribute to the financial accounting and taxation literature, especially the discussion of tax aggressiveness and the factors that influence it. Theoretically, the results of this study strengthen stakeholder theory and legitimacy theory. While practically, the results of this study can provide understanding for companies about the factors that can affect tax aggressiveness.

Firas N. Mardan   Noriah Che-Adam   and Zaimah Abdullah   

This research hypothesized that intellectual capital had a moderating impact on the connection between corporate governance and company performance. Researchers and investors have been investigating, monitoring, and analyzing firm performance in light of the serious consequences of many corporate accounting scandals, such as Toshiba 2015, as well as the occurrence of numerous nations. After the economic crisis, the deterioration in corporate governance has shown that this lack of governance could have long-term macroeconomic consequences. As a result, good corporate governance practice is important to improve organizational efficiency, secure investor rights, strengthen investment climate, and promote economic development. The investment in expertise and intellectual capital has become one of the most significant assets required to increase its value, create a competitive advantage, and improve its performance. Along with corporate governance, intellectual capital is a key to business growth and can better explain disparities in the firm's financial performance. The findings of this study indicate that the role of intellectual capital as a moderator variable is designed to improve firm performance in combination with the structure of corporate governance, thereby promoting economic growth. Therefore, this study recommends that future research be conducted as a moderator of firm performance with the integration of corporate governance and intellectual capital. It may improve corporate governance practice, thus enhancing firm performance.

Ivan Kirsanov   and Lyudmila Parfyonova   

Over the past 10 years, significant reforms have taken place in the Russian tax area. Households are under the influence caused by the following changes: the rules for property and land tax recalculating according to the cadastre data including summer cottages and garages in the list of taxable objects, the transport tax on luxury cars, and the introduction of a progressive personal income tax scale. Accordingly, the purpose of this article is to examine the response of households to changes in tax policy and to interpret this response using behavioral approach. The key hypothesis of the study is that households demonstrate varying degrees of reaction to any changes in tax legislation. Likewise, in the context of the deteriorating fiscal environment, households seek to optimize the tax burden. The authors analyzed the theoretical and methodological basis of this topic, which allowed the authors to propose improvements in methods of studying households. The study was conducted on the basis of data on payments of taxes by the Russian households. The authors revealed the features of the relationship of tax payments and different economic indicators. It is established by the Pearson correlation coefficient that there are varying degrees of households' reaction to changes in tax legislation, and households' responses are not uneven for all types of taxes. Authors also calculated the coefficient of elasticity of tax payments depending on various factors. The approach given in the article is needed for a more complete understanding of how effects of tax changes to households may be used to create effective techniques and measures in tax policy. This study makes unique contributions to further researches in the area, which will lead to the introduction of new mechanisms for state programs in tax area and forecast their implementation for the medium- and long-terms.

Md. Qamruzzaman   and Rajnish Kler   

The motivation of the study is to gauge the asymmetric effects of remittances (R), gross capital formation (GCF), and FDI on financial development (FD) in Bangladesh, India, Pakistan, and Srilanka spanning the period 1978-2018. The study applied unit root tests, including DF-GLS and Zivot–Andrew, ARDL bound test, tBDM test, Bayer and Hanck combined cointegration test, nonlinear ARDL (NARDL) for asymmetry, and, finally, directional causal effects evaluated with the Toda-Yamamoto causality test. ARDL bound testing documents the long-run association between R, GCF, FDI, and FD, valid for sample countries. Additionally, remittance elasticity exposes a positive, statistically significant linkage with financial development in the long run and short run. The standard Wald test reveals that the test statistics are statistically significant at 1% level, suggesting the asymmetric association between financial development and explanatory variables. The asymmetric association is valid both in the long-run and short-run. With the asymmetric effects of remittances, positive and negative shocks expose positive, statistically significant at a 1% level both in the long-run and short-run. However, in coefficient elasticities, harmful innovations are more critical to financial development than positive innovations in remittances. It suggests that policymakers have to make efforts to formulate policies that induce the migrants to send remittances to the economy. Finally, the directional causality test results disclosed unidirectional causality running from remittances to financial development.

Ida Kristiana   Nurkatik   and Nurcahyono Nurcahyono   

This study aimed to analyze the effect of SAK EMKM-based accounting implementation, accounting knowledge, education level, and revenue on MSME Taxpayer Compliance in reporting its tax obligations during the COVID-19 pandemic. The population of this study was the MSMEs registered in the Department of Cooperatives and SMEs of Semarang City. The sample was taken by using simple random sampling with survey technique. A set of questionnaires were distributed to 100 respondents which mainly focused on SMEs around Tembalang. The data was then analyzed by using multiple linear regression with the assistant of SPSS software. This study showed that SAK EMKM-based accounting implementation, education level, and revenue variable positively affect MSME Taxpayer's Compliance in reporting its tax obligations during the COVID-19 pandemic. Meanwhile, the education level variable did not significantly affect MSME Taxpayer's Compliance in reporting its tax obligations.

Amine El Badlaoui   Mariam Cherqaoui   and Omar Taouab   

The purpose of this paper is to review the research literature dealing with output indicators that indicate the level of audit quality: Auditor's report, bankruptcy, client satisfaction, auditor litigation and expectation-gap. This paper reviews a total of 89 papers authored post-2012, which relates to output indicators of audit quality, using a Systematic Literature Review. For each study, we demonstrated the methodology used (Archival/ Experimental), the sample chosen and the main results. Based on our findings, studies on the audit report state that it should contain more information and detail. For bankruptcy, researchers find that going concern opinion is an essential element in predicting bankruptcy, and that the auditor becomes more conservative after a bankruptcy. Through experimental studies on client-satisfaction studies, researchers have ruled on the elements that can satisfy clients on the audit work. The research on auditor litigation state that auditors being sued provide higher audit quality because they have more wealth at risk in case of litigation. The common cause of audit expectation-gap is the misperception of the auditors' responsibility to detect and prevent fraud. We contribute to the literature in the following aspects. First, we propose an audit quality framework that includes all the factors indicating the level of the external audit's quality (Auditor-related indicators; Audit-process indicators; Output indicators). Second, we present a review on the output indicators of audit quality (auditor's report, bankruptcy, client satisfaction, auditor litigation and expectation-gap). Thirdly, we draw on the results of previous literature and provide suggestions for future research.

Hety Devita   Djoko Setyadi   Ardi Paminto   F. Defung   and Doddy Adhimursandi   

Achievement of Corporate Value can have a positive impact, both internally and externally. This study aims to examine the effect of several variables on firm value mediated by earnings management and moderated by intellectual capital in property, real estate, and building construction companies on the Indonesia Stock Exchange (IDX) investigated. The number of samples is 58 companies, and this study uses secondary data in the form of financial statements for the 2014-2019 period. The data was processed using Path analysis with the Warp PLS program, which was used to analyze the effect of exogenous variables on endogenous variables to obtain a comprehensive picture of the relationship between variables. The results of this study indicate that increasing share ownership by managers in the company is not able to create optimal company performance; on the other hand, the greater the growth of the company, the smaller the practice of earnings management will be. The positive path coefficient indicates that the higher the capital structure score, the better the earnings management will be. Company ownership has a negative and significant effect on Company Value. The negative path coefficient indicates that the greater the share ownership by both managerial and institutional, the lower the firm value. Capital structure has no significant effect on firm value, indicating that the larger the capital structure, it is unable to have a real impact on changes in firm value. Furthermore, this study shows that earnings management significantly mediates the effect of firm ownership, firm growth, and capital structure on firm value. The Moderation test shows a negative and significant coefficient. Intellectual capital weakens the influence of earnings management. Better intellectual capital will reduce the impact of earnings management practices; then, the decline in the value of the company can be controlled.

Endang Tri Widyarti   Idris Idris   Irene Rini Demi Pangestuti   and Hersugondo Hersugondo   

Financial inclusion as the goal of the countries in the world has been considered important by international policymakers even though every country has its specific development models. The MSME sector can encourage economic growth and create jobs so that the MSME sector can stabilize the economy. The development of MSMEs in Indonesia also shows growth every year. Based on these data, the government must continue to increase the growth of MSMEs, because, with the increase of MSMEs, the number of workers will also increase. This research is quantitative, meaningful research that describes conditions of financial inclusion in Central Java and Indonesia. The data in this study used secondary data. Secondary data obtained were from supporting data through literature studies, journals, mass media articles, and books related to this research topic. The purposes of this study are to map the growth of MSME's Supporting Model in Financial Inclusion and determine the level of financial inclusion in the regional scale of Central Java by developing a model at the level of financial inclusion in Indonesia for a national scale.

Md. Abu Issa Gazi   Md. Shahbub Alam   G. M. Anwar Hossain   SM Nahidul Islam   Muhammad Khalilur Rahman   Md. Nahiduzzaman   and Abu Ishaque Hossain   

Bangladesh is a developing country. The vital role of banking sector in permanent, sustainable and continuous economic growth is undeniable. Bangladeshi banking sectors consist of private commercial banks, specialized banks, Islamic banks and public sector banks. Covering the period of 50 years banking sector Bangladesh has apparent serious changes in terms of growth of profitability and development which is the main concern of this study. The main objective of this research is to determine the factors affecting profitability in the banking sector of Bangladesh. The study attempts to investigate firms' specific factors and macroeconomics factors' impact on the profitability in the Bangladeshi banking sector. In this regard, 32 banks have been considered as sample and the scenario of these banks over the last 10 years has been observed (2011-2020). In this case, panel data research methodology has been used. OLS regression model is used to analyze data. Moreover, a general to specific modeling approach is used in this case. The result of this study reveals that both firms' specific variables (i.e. Equity to Asset Ratio, Deposit to Asset ratio, Debt to Equity Ratio, Loan to Deposit Ratio) and macroeconomic variable (GDP growth rate) have statistically significant impact on the profitability, represented by Return on Asset (ROA) and Return on Equity (ROE). All the research findings are very useful to the investors, shareholders, bank's authority, policy makers, and government for the improvement of the performance in the banking sector of Bangladesh.

Segun Wale Olayinka   Momodou Mustapha Fanneh   and Rafiu Oyesola Salawu   

Payment of dividends among firms in Nigeria has become irregular and setting an optimal dividend policy has become an herculean issue. Studies in developed countries indicated that stock liquidity influences dividend payout and this has not been well established in Nigeria. Hence, this study examined the effect of liquid stock on dividend payment of fifty (50) non-financial quoted companies in Nigeria between 2012 and 2019. The study employed secondary source of data collection and analysis was done using descriptive statistics and inferential statistics. The study model expressed the effect of Turnover Ratio, Firm Size, Financial Leverage, Cash Holding and Investment Opportunity on Dividend Payment Ratio using OLS Panel Regression. The results based on the random effect model showed that turnover ratio (TOR) which is a proxy for liquid stock accounts for a significant positive influence on dividend payment while other variables showed negative influence except cash and cash equivalent. Based on the above findings, the study concluded that for most of the companies operating in the non-financial sector of the Nigerian economy, the influence of liquid stock on the amount paid as dividend is positive and significant and those firms with more liquid stocks pay higher amount of dividend than those with less liquid stocks.

Orits Frank Ebiaghan   Edirin Jeroh   and Abel Oghenevwoke Ideh   

Overtly, the colossal infrastructural deficit occasioned by the ever increasing population of Nigeria requires sizeable revenue strings if they must be copiously addressed. Largely, the country has over time relied on oil revenue to carry-out her sacred duty of welfare and security provision along with efforts targeted at guaranteeing freedom of her citizenry amongst others. With the recent global drop in oil prices, there has been a general call for government to reinforce other channels of revenue generation so that the country can weather the tides of economic turmoil. This however calls for an understanding of the interrelatedness of various components of accruable revenue to the government through a causality study of such revenue components. This study thus focuses on a causality analysis of non-oil tax component of government revenue, company income and transaction taxes by obtaining empirical evidence from a third world developing economy – Nigeria. Time series data for 15 years were analysed based on the study's intent and with the use of relevant statistics like the unit root tests, chow test, granger causality test, least square and auto regressive regression analysis. Our study's outcome proved that while federally generated revenue proved to have been significantly improved by revenue from income taxes and stamp duties, the tax policies and their subsequent amendments could not exert significant influence on non-oil tax revenue of government during the period. On this note, we recommend the need for effective policy pertaining to Stamp Duties and Companies' Income Tax (CIT) along with a marginal reduction in tax holidays of companies to the extent that the Stamp Duties' Act (SDA) is fully enforced/implemented vis-à-vis strict penalties for non-compliance. Outcome from this research has policy implications which stand to benefit regulatory bodies/policy makers, tax consultants, academics and key stakeholders as it presents key issues relating to CIT, SDA, and non-oil revenue of Nigeria's government.

Olubukola Adegbola Otekunrin   and Kudzanai Matowanyika   

There is a consistent debate in the literature on how mandatory rotation of audit firms (MAFR) contributes to audit quality (AQ). For a reason, some have adopted MAFR while others did not. This study examined MAFR to AQ based on stakeholder perceptions. Theoretical insights were established to explore on existing evidence. A descriptive survey design was carried out with a triangulation approach. Interviews were conducted while at the same time questionnaires were administered to accountants, auditors, investors, and management. A population of 71 listed and audit firms were chosen, of which 29 firms were selected using simple random, systematic and purposive sampling. Correlation and regression analysis were used to examine and interpret the quantitative data. The study's findings indicated that MAFR has a positive relationship with AQ from the linear logistic regression computed; therefore, the null hypothesis is rejected. Meanwhile, having firm audit rotation is compulsory for all listed firms, which increases competition and improves independence and new idea development which ultimately results in improved audit quality. The study, therefore, concludes that MAFR is essential. The study recommends that a further study must be done to address other factors that can enhance AQ constituting 67% shown by the ANOVA test results.

Valentyna Panasyuk   Nina Ovsiuk   Ruslan Volchek   Grygorii Azarenkov   NataliŃ–a Volenshchuk   and Olena Tyvonchuk   

In most countries of the world, business entities independently determine their accounting policies, choose the form of accounting, synthetic and analytical accounts, forms of primary documents, and organize an internal control system. In this case, it is necessary to be guided by the legislation requirements, which is not always perfect and consistent. According to the accounting policy, the consequence of the deficiencies in legislative regulation was its ineffective implementation and use by enterprises in practice. This, in turn, negatively affects the efficiency of business entities as a whole. One way to solve this problem is to consider the organizational and technological features of the activities of enterprises as the basis for their development of accounting policies. The authors investigated when the standards should guide a company and when the creation of an accounting policy is reasonable. The study contains a theoretical and methodological substantiation of the directions, as well as the proposals themselves for the formation of the accounting policy of the enterprise, namely: a possible algorithm for the construction of the accounting policy of the plant by IFRS is presented, which represents the process of forming the accounting policy of the enterprise; the analysis of IFRS norms is clearly shown since this is fundamental in the formation of the accounting; analyzed IFRS, according to which options and/or variability of which are due to the inconsistency of IFRS and justified the choice of one or another option. The proposed recommendations will attract more foreign investment and can facilitate the transition to IFRS for the company.

Shairil Izwan Taasim   Sharon Yong Yee Ong   Neilson Anak Teruki   Anita Rosli   Adrian Daud   and Edwin Anak Francis   

Fiscal policy is one of the popular instruments used by government to provide balance to growth in the national economy and market. In Malaysia’s context, fiscal policy is implemented using such as the annual budgets, Malaysia Plans, and multiple stimulus packages aimed at boosting Malaysia’s economy especially during the recent lock down which has threatened to cause an economic crisis due to the Covid-19 pandemic. Additionally, one of the Malaysian Government’s biggest spending using fiscal policy is its development expenditure, and tax is one of the largest contributions used to support this development expenditure. In order to attract investors to Malaysia, critical features such as benefits, facilities, and social welfare have been designed by decision-makers in each formulated policy. Initiatives such as inter-governmental forums, trade agreements and discussions are platforms that can be used to share and respond to economic problems. However, the existence of competition and foreign policy have become major challenges to the country’s efforts to attract investors. Therefore, the aim of this study is to investigate the relationship between Malaysia’s federal government development expenditure with foreign direct investment (FDI) inflow, as well as the country’s openness towards investment. The two dimensions of asymmetric FDI inflow were analysed to see how they react to government expenditure from 1970 until 2019 using the Linear and Nonlinear Autoregressive Distributed Lag method. Findings from the Nonlinear Autoregressive Distributed Lag Model (NARDL) model indicated that FDI has a positively significant effect on fiscal accumulation for development expenditure. In conclusion, increases in government expenditure increase FDI inflow into Malaysia in both the short- and long-run. Hence, government development expenditure behaviour represents accelerating economic growth in the Malaysian context, and it is proven to have a significant impact towards economic growth in the long-run. This study contributes to empirical literature on the relationship between federal government development expenditure and FDI inflow, particularly the effect of openness to investment into a developing country towards economic growth in the long- run.

Gopalan Puthukulam   Anitha Ravikumar   Ravi Vinod Kumar Sharma   and Krishna Murthy Meesaala   

Technology is an inevitable part of businesses and human lives. It has brought about substantial changes in the way businesses and operations are conducted. A business organization has to perform auditing which involves analyzing and testing a large volume of financial transactions. In manual auditing, testing and analyzing the entire transactions in a business are not possible. The usage of artificial intelligence (AI) and Machine Learning (ML) not only allows testing the entire financial transactions in a business but also helps improve audit efficiency. Audit efficiency relates to the professional skepticism and professional judgment demonstrated by the auditors. The core purpose of the research is to understand the perception of auditors on the impact of such technologies on professional skepticism and the judgment of internal auditors in improving audit efficiency. To understand the impact of AI and ML, various factors influencing the use of AI and ML and the challenges were considered. Data were collected from 169 respondents spanning across all sectors in Oman using a structured questionnaire. The collected data were analyzed using correlation to determine the relationship between AI and ML-assisted auditing practices and professional skepticism and professional judgment. Results indicate that AI and ML-assisted auditing practices have a strong positive relationship with professional skepticism and professional judgment. This proves that AI and ML have an impact on professional skepticism and professional judgment. Moreover, it helps in improving the detection of errors and material misstatements. Even though the advantages of AI and ML outweigh manual auditing, the complete replacement of human beings with AI and ML should be considered with caution. Hence, auditing must be carried out with the help of AI and ML along with human intervention in improving auditing efficiency.

Llesh Lleshaj   and Dorina Kripa   

Euribor (Euro Interbank Offered Rate) is considered to be the most important base rate for all types of financial products like interest rate swaps, interest rate futures, saving accounts and mortgages. Euribor rates turned negative for the first time in January 2015 and have been negative ever since. In recent years, several European central banks have imposed negative interest rates on commercial banks, which is the only way to stimulate their nations' economies. Under these circumstances, the purpose of this study is to estimate the optimal equilibrium of the negative rates which are still increasing constantly. This fact raises doubts about the financial stability in many countries and the effect of monetary policy in stimulating economic growth in European countries. This study has analyzed the volatility of the Euribor rates related to the daily time series 2015-2021. Advanced volatility econometric methods are applied to GARCH models and volatility forecasting in the long-run equilibrium. The optimal model for the weekly and monthly maturity rates is identified; however, the larger the ARCH(p) and lag-variance(q) value we test, the poorer the performance of the obtained model is. Practical implications ought to be taken into consideration by the banking sector and other financial institutions.

Maria Yosaphat Dedi Haryanto   Anis Chariri   and Etna Nur Afri Yuyetta   

The concept of corporate social responsibility (CSR) has gained much attention and has been currently practiced by many companies. This study examined the role of CSR disclosure as a signal on the corporate liquidity in creating value for the firms. We examined the effects of moderation using subgroup analysis on a sample of 77 manufacturing sector firm that listed on IDX with three years data observations. By using the Chow test, the results show that CSR disclosure is related with firm value in non-financial constraints (NFC) firms compared to financial constraints (FC) firms. However, the two groups of companies have opposite effects. Companies with non-financial constraints have a positive direction while the other group has no specific pattern for the FC sample. The empirical evidence showed that firms with financial constraints report less information about their CSR activities than firms with non-financial constraints. Our findings suggest that company with non-financial constraints can confidently and strategically increase CSR investment to enhance firm value. However, the company with financial constraints needs to carefully examine the effects of CSR on firm value when making CSR-related decisions.

Sylvia Christina Daat   Mariolin A. Sanggenafa   and Rudiawie Larasati   

The purpose of this study was to obtain empirical evidence of the influence of components of intellectual capital, namely human capital, structural capital, and relational capital on the financial performance of small medium enterprises or SMEs in Jayapura City and Jayapura Regency, West Papua, Indonesia. Respondents in this study consisted of 54 respondents who had business fields, consisting of culinary businesses, fashion, daycare services, lodging services, and futsal fields. In addition, respondents are selected based on ethnicity, namely, Papuan as many as 26 people or 51.8% and non-Papuan as many as 28 people or 48.2%. The analytical tool is used in SmartPLS 3 by looking at the measurements of the outer model and inner model. The results show that the components of human capital and relational capital significantly affect the financial performance of SMEs with a significance value of 0.042 and 0.044, respectively. Meanwhile, the hypothesis of the influence of the structural capital component on SME financial performance is not statistically supported with a significance value of 0.569. The results theoretically provide empirical evidence for studies on the importance of intellectual capital on the financial performance of SMEs in particular with the context of SMEs in Papua that has not been studied. The main findings of this study highlight the development of intellectual capital in SMEs. The limitations of this study lie in the effect of structural capital components on financial performance which is not empirically supported. Thus, further research needs to examine the effect of structural capital interaction with other components of intellectual capital to improve MSME financial performance.

Dhoriva Urwatul Wutsqa   Martina Ayun Pamungkas   and Retno Subekti   

The Black-Litterman model is a portfolio model that considers investor views. The purpose of this study is to develop the Black-Litterman (BL) portfolio model with views prediction using Elman Recurrent Neural Network (ERNN) on LQ-45 stocks. The ERNN model is one of the neural network models that adjusts the input using the output feedback from the hidden layer. The BL portfolio is generated based on the capital assets pricing model (CAPM) excess return equilibrium. The data used in CAPM model must fulfill the normality assumption which is checked by using Jarque Bera test. The selected stocks for the portfolio are the member of LQ-45 stocks which meet the normality assumption and have the highest expected excess return CAPM value, those are AKRA, BBNI, INCO, and JSMR stocks. The ERNN model is employed to those stocks to obtain the views prediction. Then, the Black-Litterman portfolio is constructed by combining the ERNN views of the stock returns and the expected equilibrium return yielded by the capital assets pricing model. Three designs of relative views are considered, each design is distinguished from the percentage of each stock return prediction. The simulation shows that the best portfolio is constructed based on the design of the first views due to the most accurate views prediction.

Gentiana Sharku   Perseta Grabova   and Donald Vullnetari   

This paper intends to explore the economic factors which stimulate the demand for insurance products in Albania due to the fact that insurance industry has a significant effect on the economic development of a country. Albania is a developing country and insurance market has progressed moderately. Considering density insurance as a proxy of life and non-life insurance market development, the authors have examined the economic determinants of the Albanian insurance market during the period of 2009-2020 based on quarterly data. The analysis is performed using Vector Error Correction Model designing separate models for each of the insurance segments: life and non-life ones. Among several economic variables, this paper examines the effect of GDP, inflation, real interest rate and unemployment. According to the empirical results, GDP per capita has the most significant impact while unemployment is found to be insignificant in respect to life and non-life insurance density. The results are mostly in accordance with the empirical research work, and they are valuable to both academics and experts in insurance industry. The paper contributes to the existing international literature, especially to the literature related to developing countries, being the first one investigating the influence of a set of economic factors on life and non-life insurance industry in Albania. On the other hand, the results of the paper suggest that insurance companies monitor should evaluate these factors in order to increase and improve insurance service available to the public.

Nhung Thi Tuyet Dao   

Since the end of 2019, the world has been witnessing a severe Covid 19 pandemic. Right from the beginning, it reveals serious effects on many aspects of the economy. During this period, it is believed that firms tend to reduce their investments and therefore hold more cash to minimize potential risks. By studying 2,868 firm-year observations from non-financial listed firms in Vietnam from 2017 to 2020, this paper examines the impact of Covid 19 pandemic on cash holdings and overinvestment. Furthermore, the paper also makes the comparison between the cash holding level of overinvestment firms and non-overinvestment firms during Covid 19 pandemic. With the panel data, the research uses GLS, fixed effect, GMM and logit models to test appropriate regressions. The findings indicate that firms seem to have a tendency to hoard more cash and also reduce overinvestments during Covid 19 pandemic that are consistent with the theory of precautionary motive. This research further shows that overinvestment firms still reserve less cash than other firms during the pandemic. This paper contributes to the current literature with the investigation of both corporate cash holdings and overinvestment during the Covid 19 pandemic. However, the research time period is only from 2017 to 2020, which might be a limitation of this paper.

Theresia Prima Risanti   Khoirul Aswar   Jumansyah   and Wirman   

In producing a reliable audit quality, it requires the quality of the auditors themselves. The Financial and Development Planning Agency (BPKP) is a state institution that is part of the Government Internal Supervisory Apparatus (APIP). This study aims to determine the effect of auditor skepticism, understanding of information systems, auditor education, and audit motivation on audit quality and the effect of time budget pressure in moderating the effect of audit motivation on audit quality. This research was conducted at BPKP DKI Jakarta with a questionnaire instrument and processed using SEM-PLS. The results of this study indicate that auditor skepticism has a significant effect on audit quality. Meanwhile, understanding of information systems, auditor education, and audit motivation doesn't have an effect on audit quality. Time budget pressure also does not moderate the effect of audit motivation on audit quality. This research is expected to be an additional understanding and knowledge about the effect of auditor skepticism, understanding of information systems, auditor education, and audit motivation on audit quality.

Iuliia S. Pinkovetskaia   Anton V. Lebedev   Mikhail A. Rozhkov    Diego Felipe Arbelaez Campillo   and Magda Julissa Rojas Bahamon   

The purpose of the research is to assess the indicators describing the activities of microfinance lending systems for entrepreneurs in Russian regions. Our study uses official statistics on the quantity and total amount of microloans provided for entrepreneurs in all regions of Russia in 2018. The paper deals with the following relative indicators: the number of microfinance loans per 1000 entrepreneurs, the number of microloans per one region resident, the number of microloans per entrepreneur, and the average value of one microloan. Our study provides an assessment of these indicators for all regions of the country, determines their average values and intervals of change, typical for most regions and identifies regions with large and low values of these indicators. Methodology used in the paper and the developed tools can be used in further scientific works devoted to microfinance. The research results can be applied by state and regional bodies in the process of formation and implementation of measures that improve financing of the business sector. The developed models can be referred to when determining the needs for entrepreneurs' microfinance in regions where the entrepreneurial sector is not discussed. The data obtained can be used in the process of teaching bachelor and master students at universities.

Divyesh Khushalani   and Manish Sinha   

This work intends to inspect the financial performance of our country's banks before and post the merger. Acquisitions or mergers have been implemented as a tool these days as a respite for distressed banks. By Mergers and Acquisitions, banks are restructured to increase shareholders' value and competitiveness by increasing efficiency. For this work, a specimen of four bank mergers that happened after liberalization was taken and they were analyzed based on financial parameters, for example, Net Profit Margin (NPM), Dividends per Share (DPS), Capital Adequacy Ratio (CAR), Return on Assets (ROA), and Credit Deposit Ratio. This set of parameters chosen is unique when compared to past works. Paired t-test was implemented to identify a substantial change between the financial particulars before and after the merger. The paper also looks at the study's future scope, such as analyzing the stock price movements before and after the merger. This study then can conclude whether the merger of the banks involved was beneficial for the banks and the Indian banking industry or not.

Idaka Sunday Egbe    Ugwoke Robinson Onuora   Ajuh Ali Iteh   and Edith O. Onyeanu   

The study analyzes the effect of economic variables on the financial performance of listed firms manufacturing consumer goods in Nigeria. The researchers adopted the Ex-post facto research design and Ordinary Least Square multiple regression analysis for estimation of the equations. The population comprises 20 listed consumer goods manufacturing companies, and total sample of 13 firms, the data covered 17 years' financial reports. The sample was determined using the elimination method and purposive sampling techniques. We found strong correlation between CPI, interest, exchange rates and net asset per share. CPI has significant effect on NAPS and there is short run relationship based on the coefficients ARDL, exchange and interest rates showed no significant effect on NAPS. The economic implication of the result based on the CPI is that consumers are paying more due to the rise in the level of inflation, firms adjust their profit margin to cushion the effect, and 1% rise in interest and exchange rates result to decline in NAPS. The researchers recommended that government should provide enabling environment for business to thrive by providing moderate interest rate to manufacturing firms, and encourage the demand for made-in-Nigeria to strengthen the value of the Naira to compete well with foreign currencies in the international market.

Vivek Divekar   and Sreerupa Sukhari   

The COVID 19 has brought down aviation industry to its knees. Till March 2020, before getting sense of distraction by this pandemic, Indian economy was eager to take off to reach further heights including the Aviation Sector. The growing middle class was the base reason for the prosperity in the Aviation Sector, but the pandemic has changed the whole scenario at least temporarily for next couple of years. However, even before the pandemic the history is showing that almost all Indian airlines companies are in losses. Jet Airways is almost grounded permanently whereas Kingfisher Airlines is now a history. Being one of the important sectors for the economy and even for the investors, an attempt is made to find out the reasons behind financial failure of selected Indian Aviation Companies by using Altaman's Z Score Model and Pilarski's P -Score Model and various problems faced by them. The secondary data is collected mainly by using Annual Reports of 4 leading Airlines Companies in India. Analysis is showing that various internal and external factors which are responsible for such pathetic financial position of these companies and a serious overhauling is required not only by those companies but also from the government side.

Bohdan Danylyshyn   Maksym Dubyna   Maksym Zabashtanskyi    Natalia Ostrovska   Kateryna Blishchuk   and Ivanna Kozak   

Any economic system can be identified as cyclical fluctuations: ups and downs in the economy, which are caused by shocks of aggregate demand and aggregate supply and called business cycles, economic or business cycles. The phases of business cycles are the rise, "peak", recession (or decline) and "bottom", i.e. the crisis. Often such fluctuations in business activity are unpredictable and irregular. At the present stage of development, the state of Ukraine is unstable and characterized by significant crisis processes and phenomena, including critical growth of debt, devaluation of the national currency and limited reserves of the National Bank, reduced lending by banks to the real sector, low financial stability and more. These challenges are exacerbated by the impact of modern global external factors destabilizing financial systems at various levels and financial and economic relations, including the COVID-19 pandemic, which raises the issue of justifying the development and implementation of effective innovative monetary and fiscal policy instruments. The authors explored the nature, components and objectives of monetary and fiscal policy. The authors analyzed the challenges of stabilizing the monetary sector and fiscal policy and developed improving tools. The authors proposed an algorithm for assessing the effectiveness of the monetary policy, where the main criteria for the effectiveness of monetary policy are the criteria that contribute to macroeconomic stability. Regarding innovative fiscal policy instruments, the authors proposed to provide targeted support for industries or projects, namely, the algorithm for determining targeted support for sectors, which implies the creation of clusters of industries and considers the possible negative consequences of the COVID-19 pandemic. The proposed instruments will allow stabilizing the economy to a greater extent, as well as to ensuring more excellent price stability, maintaining a stable exchange rate and promoting balanced economic growth.

Oksana Savchina   Aleksandr Bratanov   Natalia Konovalova   and Svetlana Saksonova   

The global petrochemical industry is one of the most dynamically developing - it is twice as fast as the world GDP in terms of growth rates. Over the past 20 years, significant changes have taken place in this industry. New major players have appeared and the structure has changed. As for Russia, its share in the global petrochemical production is about 2.5%. At the same time, Russia is one of the world leaders in the production and export of hydrocarbon raw materials, where the country's share is about 12 - 19%. Currently, a steady trend in the development of polymer materials science has been observed and it will continue to develop. In the next 15 years, the demand for petrochemical products will grow by an average of 4% per year. The purpose of this study is to analyze the financial standing, assess the prospects for development and optimize the activity of one of the largest systemically important organizations of the petrochemical industry in Russia - PJSC "SIBUR Holding" in the conditions of the macroeconomic instability. To implement the research the authors have collected financial data from the reports of financial results and the balance sheets of the company. They have selected the key performance and solvency indicators in particular, liquidity, business activity, profitability, solvency and investment attractiveness. Particular attention is paid to the factors of financial risk affecting the opportunities for business expansion. Econometric modeling methods were used to determine the company's development prospects that are dependent on the internal policy of cash flow management, accounts receivable, debt, external influence of inflationary risk. Research results suggest that the continuous cash flow, namely, the formation of a policy for managing accounts payable in the crisis, has a significant impact on the further development of the company.

Dmitry A. Endovitsky   Larisa S. Korobeinikova   and Viacheslav V. Korotkikh   

Testing an adaptive modification of the portfolio analysis model with a two-level mechanism of return generation is used to identify the temporal structure of efficient frontiers. The stock market is volatile and, although it is consolidated, it follows different trends at different times. Therefore, stock market processes are viewed as multitrend in nature. It particularly applies to the process of generating returns. For the convenience of the analysis, a multitrend process can be presented as a finite decomposition using adaptation principles. As we have already said, adaptive mechanisms are an important factor for the effectiveness of the stock market. Considering these requirements, the most suitable method is adaptive trend decomposition. In our study, we used data analysis and machine learning methods. The article presents a method of portfolio analysis based on the decomposition of efficient sets into temporal components. This allows for a comparative analysis of portfolio sets regarding their efficiency over different time intervals and enables a dynamic analysis of the temporal structure of efficient sets in order to determine the optimal time for holding the portfolio or changing its structure. A family of efficient sets provides a better understanding of investment opportunities. Our calculations also demonstrated that the temporal structure of a family of efficient sets is more likely to remain robust during the prediction period.

Md. Qamruzzaman   Rajnish Kler   M. Theivanayaki   and Salma Karim   

No isolated financial markets are available due to global financial integration through trade liberation and FDI presence. Therefore, financial markets are subject to response to home economy events and pair economy movements. The study's motivation is to investigate the volatility transmission and interlinkage between financial markets in BRICS nations from January 01, 2001 to December 31, 2019. The study applies unit root tests, the test of cointegration, ARCH-GARCH effects, and the Non-granger causality test to expose interlinkages. Results of unit root tests expose variables are integrated in mixed order, i.e., few variables are stationary at a level I (0), and few variables are after first difference I (0). The cointegration test reveals the long-run association available in the empirical model, implying that the long-run BRICS stock markets act in the same direction. Results of ARCH-GARCH (1.1) disclose the presence of volatility persistence in the financial markets. Furthermore, the directional causality under the error correction term discloses that the feedback hypothesis explains the causality among financial markets in BRICS nations in the long run. On the other hand, a similar conclusion also derives from the Non-granger causality test.

Sergey V. Rastoropov   Elvira N. Iamalova   Natalia A. Sadovnikova   and Igbal A. Guliev   

Africa, despite continued and substantial financial assistance from more developed countries, has not yet achieved significant economic growth. It can be concluded that the assistance format requires adjustment. As a new information society is being formed, it can be supposed that the transfer of many technologies to African countries can significantly improve their situation. Thus, the authors put forward the hypothesis that in order to boost the development of African countries, the transfer of basic industrial technologies is needed. The major challenge of the article was to create a model, incorporating both economic indicators of growth and the volume of aid to the African countries, as the second parameter is hard to estimate. Within the developed hypothesis, proposals are put forward for the formation of technological convergence specific mechanisms through supranational institutions. The main aim of the article is to confirm the hypothesis, and put forward four schemes for the formation of the technological exchange infrastructure on the continent. In addition to that, the article provides basic directions for the institutional cooperation between the international development institutions. The key contribution of the article is the proof that the international development institutions' activity and their aid don't correlate with the economic development of the African countries, thus they don't have a significant economic influence.

Nazri Hashim   Mohd Faizal Basri   and Mohd Yahya Mohd Hussin   

This study aims to identify the technical efficiency of Development Financial Institutions (DFIs) in Malaysia with the selected inputs of fixed asset and labour. Meanwhile, the output used in the study is financing. DFI is an institution that plays an important role in socio-economic development under the supervision of Bank Negara Malaysia (BNM). Using annual data from 2009 to 2018, technical efficiency is analysed using Data Envelopment Analysis (DEA) on the ten institutions selected in the DFIs. DEA results show that Sabah Development Bank Berhad (SDB) is the only institution considered as the most efficient. The rest of DFIs in the sample were deemed technical inefficient. The results also indicate that inefficient institutions including those with the lowest performance which are Credit Guarantee Corporation (CGC), Bank Pertanian Malaysia Berhad (Agrobank) and Bank Simpanan Nasional (BSN) have inefficient management in resource utilisation. Thus, activities in the operation of DFIs need to follow the law of return to scale for input and output orientation so that resources can be managed efficiently.

Azer Dilanchiev   and Tengiz Taktakishvili   

The recent shocks in demand and supply caused by Covid-19 influence and the current depreciation of the Georgian Lari (GEL) reduced the trust of economic agents in currency. There is no objective macroeconomic reason that would change their attitude to the future of currency for the better. Depreciation of a currency impacts all the components of GDP, leading to myriad problems in economic growth. The depreciation of the national currency is generally perceived as positively affecting the country's export. The study analyzes the impact of Georgian Lari's exchange rate depreciation on Georgia's export using monthly GEL exchange rate data from May 2006 to April 2020. The paper employs Autoregressive Distributed Lag Model (ARDL) for its advantages of measuring cointegration, usefulness in the small samples, and being unbiased in measuring a long-run relationship between variables. Outcomes indicate that the exchange rate depreciation has an inverse long-run impact on export in the long-run period. The exchange rate impact on Georgia's export shows inelastic demand for Georgia's export goods. The study contributes to the literature while providing the implication of currency depreciation on exports of the Georgian economy. The estimated value of the exchange rate has been found to exert no direct pressure on the amount of export. In the paper, possible reasons for such implications are also examined. Paper found that the control variable interest rate also has an inverse impact on Georgia's export performance in the long-run as well as in the short-run. International reserves positively influence the export in the long-run with a high significance level. The paper also discusses possible ways of stabilization of national currency.

Muhammad Enamul Haque   and Nusrat Farzana   

This paper investigates modeling the conditional volatility of the Bangladesh equity market, namely the Dhaka Stock Exchange benchmark index (DSEX) and the Shariah Index (DSES), to explore the presence of leverage effects and long memory behavior covering the period from July 01, 2004 to December 31, 2020. We employ a family of Fractionally Integrated GARCH models FIFARCH BBM, FIGARCH CHUNG, FIEGARCH, FIAPARCH BBM, FIAPARCH CHUNG, and HYGARCH to capture both asymmetric effects and long memory behavior in conditional variance, a unique study in volatility literature. We detect strong evidence in favor of asymmetric effects and long memory behavior in the conditional volatility of DSEX and DSES returns, which repudiates the weak-form efficient market hypothesis. The study reveals FIEGARCH and FIAPRACH CHUNG outperform the other fractionally integrated GARCH specifications in modeling conditional volatility of equity returns. The paper further examines the diagnostic test of misspecification of the conditional variance equation based on the news impact curve, and results ensure that all models are fairly specified. This study also looks into the risk-return tradeoff in time-varying volatility and finds no evidence of the positive relationship between equity returns and volatility dynamics. The findings have pragmatic implications for retail and wholesale investors and other market players to initiate the investments and hedging strategies before investing in an emerging equity market like Bangladesh.

Endang Tri Widyarti   Sugeng Wahyudi   and Hersugondo Hersugondo   

Investor assessment of information on the effect of Ramadhan on stock return and trading volume company activities in the capital market is an important phenomenon that always occurs. The purpose of this study was to analyze average abnormal returns and average trading volume activities of stocks before and after the announcement the effect Ramadhan as National Non-Natural Disaster. The method used was an event study with a sample of companies listed in the LQ45, JII, SRI KEHATI, and PEFINDO Indexes. Observations of the 30-day Ramadan event were carried out from April 23 to March 24, 2021, in the month of Sha'ban - syawwal, using 15 samples obtained from IDX (Indonesian Stock Exchange) data. The analytical tool used was regression supported by the SPSS application. The results of the study showed that the Abnormal Returns (AR) was significantly different before (Sya'ban) and after the month of Ramadan (Syawal) for companies on the Indonesia Stock Exchange in 2021, indicating a consistent AR reaction to the Ramadhan Effect. Meanwhile, Trading Volume Activities (TVA) didn't differ significantly before (Sya'ban) and after the month Ramadan (Syawal) at companies on Indonesia Stock Exchanges in 2021. This study updates previous research by including the effect of Ramadan as a research test variable.

Aruna Polisetty   Nammi Lalitha   and Hari Babu Singu   

An entrepreneur is often driven by a quest for innovation and creativity in a market, thus creating competition. The competition will create wealth, leading to improved living standards for individuals and the economy at large. Moreover, innovation and creation result in new and superior products that enable modern markets to be developed. However, the enthusiasm to become an entrepreneur is not the sole driving factor. One must know the importance of financial literacy. Besides, the negative stigma due to the COVID-19 pandemic ruined many lives and impacted businesses with less money due to the reduction of clientele; also, it had impacted budding entrepreneurs (at early start-up stages, and hardly have had experience between 1-3 years) with fewer opportunities to make money. That reduced the willingness of entrepreneurs to invest capital in the business due to raging losses. The current article presents the importance of financial literacy for budding entrepreneurs. To find and measure the financial literacy among budding entrepreneurs, the data were distributed to 223 entrepreneurs; however, 179 were finally used for analysis due to several reasons mentioned in the research methodology. The data was collected from five districts of the South region of India (Kerala, Andhra Pradesh, Karnataka, Telangana, and Tamil Nadu) and the snowball technique is used in the analysis. The study revealed that most budding entrepreneurs lack proper financial literacy. The study found that Financial Skills, Financial Knowledge, Financial Attitude, Social Interactions & Past Experiences, Financial Support & Guidance directly influenced Financial Literacy levels among entrepreneurs. The study also suggests that aspiring entrepreneurs should be given practical financial training sessions; it should be made mandatory.

Larysa Ivanchenkova   Halyna Tkachuk   Larysa Skliar   Olesia Holynska   Kateryna Stasiukova   and Yuliia Tomchuk   

The purpose of this article is to analyze the control of local budget expenditures in Ukraine under the influence of the crisis caused by COVID-19 and to find ways to improve the internal financial control of expenditures of budgetary organizations. The relevance of the study is due to the need to create a system of separation of powers and responsibilities in the public sector on the basis of ensuring economical, efficient, effective and legal use of budget resources to achieve the goals set by the organization. The study was conducted on the basis of data from Ukraine. Expenditures of budgetary institutions as an object of internal financial control are considered. The analysis of control of expenses of local budgets is carried out. It is established that Ukraine needs further reform of the state financial control of expenditures of budgetary institutions - in the direction of decentralized control. It is proved that the creation of a modern information and analytical resource optimizes the accounting and control system, which will lead to the introduction of more effective mechanisms for administration, de-shadowing of the economy and increasing control over budget expenditures. Thanks to digital technologies, the economic activity of budgetary institutions will become more transparent, risk assessment will be optimized and the capabilities and effectiveness of the system of internal financial control of expenditures will increase.

Romeo Mano   Armela Anamali   and Bitila Shosha   

Purpose. The purpose of this paper is to make an analysis of challenges to private sectors repaying bank loans during and after lockdown restrictions imposed by Albanian government due to Covid-2019 pandemic, and their prospects for bank lending. Design/ Methodology/ Approach. This paper uses a mixed methodology. To collect primary data, we distributed online questionnaires to a number of Albanian firms. The sample collected is a probability sample of business population operating in Albania. The data collected are subsequently processed with the inferential statistical methods using SPSS version 21. Findings. This study identifies and examines the impact of Covid-19 on businesses that have taken credits during the pre-pandemic period. The results indicate that the risk of deferring loan repayments depends on businesses age, i.e., years of operating in the market, and the use of cash reserve funds of business. The need for liquidity and the perspective shows that firms are reluctant and not sure whether to opt for a bank loan. The factors influencing their decision in this regard are government policies, interest rates and uncertainty in the future. Originality/value. By analyzing the relationship between two important pillars of the domestic economy, this paper represents a novelty. Albania is a developing country and this study would help in future research both for Albania and other similar countries. The findings of this paper can also be used as a baseline for a future forecast model. They could help in analyzing private sector credits in a new socio-economic and geopolitical era caused by Covid-19 pandemic.

Sunarti Halid   Radziah Mahmud   Nor Balkish Zakaria   and Rahayu Abdul Rahman   

The growing of stakeholders' demand for better corporate transparency has derived firms to adopt integrated reporting. Thus, this study aims to examine the impact of firm's board of directors on integrated reporting practice. In particular, this study investigates how board characteristics; board size, board independence, board activity and board gender diversity influence the degree of integrated reporting disclosure of Malaysian commercial banks. Consistent with prior research, this study uses a disclosure index based on International Integrated Reporting Council Framework to measure integrated reporting disclosure. Using a sample of Malaysian commercial banks from 2013 to 2017, the results show that board size is significantly negative associated with integrated reporting disclosure. Other board characteristics, however, are not associated with integrated reporting disclosure. Our findings provide insights for regulators in designing more effective corporate governance mechanisms that promote better integrated reporting practice.

Veronica Tibiletti   Pier Luigi Marchini   and Federico Bertacchini   

The uncertainty generated by the Covid-19 pandemic has influenced countless aspects of business management. In order to deal with the pandemic, managers had to make particularly complex choices regarding, for example, the cash management activities, investment decisions and workplace safety procedures. At the same time, the instability related to the performance and solvency of companies has made it necessary for companies to have adequate information disclosure, even more than that in the past. The Covid-19 pandemic has in fact increased the need for an effective communication about the main corporate events with all corporate stakeholders. Based on this premise, this study aims to highlight the main scientific contributions regarding the impact that the Covid-19 pandemic has had on accounting and on corporate financial reports. The analysis carried out led to the identification of five thematic areas: Policy, Corporate Social Responsibility, Disclosure, Financial Statements Data and Audit. Moreover, considering the importance of providing adequate disclosure in a period of great uncertainty, this paper proposes an analysis on the disclosure about the Covid-19 pandemic provided by the companies belonging to the FTSE MIB index of the Italian Stock Exchange. Following a preliminary quantitative analysis of the performance of these companies, a content analysis was carried out on the financial statements and the main documents attached to it, in order to verify the presence of references to the Covid-19 pandemic. It will be shown that the companies analyzed have made adequate disclosure of information regarding the emergency situation arising from the pandemic.

Valery Okulich-Kazarin   

The background of the research is that scientists and practitioners are interested in the efficiency of the use of public finances. There are articles about financial management processes in the form of planning, implementation and reporting as elements of good governance of public finances. The aim of this empirical research was to check: do Polish officials effectively make use of public finances? The author has used justified research methods such as general scientific research methods (methods of analysis and synthesis, induction and deduction, etc.); study of scientific sources and official documents; observation with recording the results using photography; statistical methods, including verification of statistical hypotheses. In the first example, the use of public finance in a state-owned enterprise was carefully studied. In the second example, the author described the use of public finance at the local level. The empirical research had only one limitation: the inefficient use of public finances is usually hidden from citizens. The key hypothesis: the Polish officials effectively use of public finances. These examples did not allow us to accept the Key Hypothesis. The principal result of the empirical research is that the facts of inefficiency of the use of public finance in Poland have become a new scientific knowledge. Modern statistics allow us to attribute the results of the sample to the entire population. The major conclusions and its contributions to the field of public finances are in the facts: A) Polish officials use public finance inefficiently both at state-owned enterprises and at the local level. B) The inefficient use of public finance was five years ago and continues now. The result is highly statistically significant (99.0%). The inefficient use of public finances has serious negative social consequences: economic, budgetary, legal and psychological. The most important aspects of the empirical research are in practical and theoretical significance. In the practical significance, it is necessary to create working bodies for checking the efficiency of the use of public finances. In the theoretical significance, it is very important to create financial mechanisms that stimulate the effective use of public finances.

Naresh Kedia   and Anil Vashisht   

The institutional investors, whether the DII (Domestic Institutional Investor) or FII (Foreign Institutional Investor) contribute to the growth and management of stock market. The stock market is very dynamic in nature and the volatility is prevalent across. It is important to understand the relation of different institutional investors on the stock market. Foreign institutional investors and Domestic institutional investors are two major sources from which the stock market receives its investment. Thereby, it is necessary to understand the cause and effect of these investments on the stock market. The flow of fund from the foreign investors is one of the reasons for the growth of Indian Stock Market. The cause-and-effect study gives us a better picture of the stock market movement and this study focuses on finding the same. The study will help investors and stockbrokers to understand the movement of the stock market in a better way. In this study, cause and effect between the FIIs, DIIs and Stock Market returns is analysed. The statistical tools used for analysis are Granger Causality test and Johansen Co-integration test. Both the statistical tool used are reliable and the expected results will be highly beneficial for the investors at large. The results shows that there is cause and effect relation between the FII and DII, but the co-integration between the FIIs, DIIs and stock market is absent. The study will contribute in understanding the behavior of stock market.

KateĹ™ina Berková   Andrea Kubišová   and Dana Kolářová   

The aim of the study is to examine the differences of opinion among students (n = 74) of Czech higher economic education institutions on the requirements of employers for accountants. Data collection was conducted in 2020 using a questionnaire. The data were analysed by Pearson correlation coefficient to look for relations between variables (i.e., gender, type of higher education institution, popularity of accounting, professional interest, quality of school training, importance of competencies). Gender differences and differences between students in terms of type of institution were tested by Mann-Whitney U-test. It was found that there is a need to strengthen students' awareness of the requirements of employers in the Czech and international labour market in the field of accounting practice. Gender, type of institution and popularity of the accounting subject have an influence on the perception of the importance of competences for accounting practice. Differences were found at the level of soft skills, namely in the case of effective communication and responsibility. The findings suggest the need to strengthen practical training in terms of time allocation, involvement of experts from the field, internships, as well as the modernization of the curriculum.

Christina   and Mandra Lazuardi Kitri   

Credit rating is a measure of a firm's creditworthiness in financial markets. The cost and benefit given from credit rating is supposed to affect the capital structure decision in the following year. This research examines the effect of each rating level on the capital structure level and examines how credit ratings are substantial for the firms to reach the optimal capital structure. It will also compare the impact of credit ratings from different agencies. Quarterly data of 110 firms that fulfil the requirements are gathered from 2010 until 2021. Panel data analysis using the fixed effects method shows a nonlinear U-shape between Standard & Poor's and Fitch's credit rating on capital structure level and on the distance to optimal capital structure level. Low and high rated firms tend to have higher debt levels in the following year and have a larger distance to the optimal capital structure level. Meanwhile, mid rated firms have lower debt levels and smaller distances. However, the result is opposite using Moody's rating and insignificant using PEFINDO's rating. This research suggests that credit rating is important to the capital structure decisions and other Indonesia firms could acquire credit rating especially from international rating agency.

Askar Garad   Alni Rahmawati   and Suryo Pratolo   

The purpose of this study is to gather and analyze recent research publications on the relationship between governance (board, audit, and ownership) and financial and corporate value. A rigorous literature review of current international articles is used in this paper. The meta-analysis method was utilized to examine papers published in high-evaluation scientific publications indexed in Scopus. The tool (WordStat 8) was utilized to study articles and summarize descriptive statistics, correlation, and keyword cloud during the analysis process. According to the study, the board of directors works to protect investments from misappropriation by actively participating in the development of the company's strategy, giving appropriate incentives to management, and monitoring and evaluating its performance, thus maximizing the company's value. The audit committee can be used as a governance mechanism to improve financial information confidence and openness. Through their participation in the financial statement preparation process as well as improving the independence of both internal and external auditors, the audit committee can help prevent future financial disasters. The study discovered that the emphasis on a company's ownership is critical, and that focusing on the largest shareholder can considerably boost the company's long-term profitability. As a result, it is obvious that the current shifts in ownership focus will diminish performance, but that the negative effects will fade with time and may even have a beneficial impact on the organization's performance. The study will benefit a variety of stakeholders, including investors, stakeholders, company CEOs, board of directors, and other connected groups. Furthermore, guiding shareholders, investors, and stakeholders to make decisions based on reasonable and objective foundations follows a true assessment of the company's market value. This study offers both academics and professionals a written review of the study as well as an updated reference index to measure the relationship between governance and financial success from 2017 to 2020.

Yueyun (Bill) Chen   and Tzu-Ting (Patty) Hsu   

This paper focuses on why the US stock markets have recovered so fast from the pandemic crash in March, 2020. It selects three types of the independent variables, the pandemic related variables of the US and global infections and deaths, the economic variables of the jobless claims and economic index, and variables of the vaccines and therapies of the pandemic to study which factors have led to the significant changes of the three US major stock indices (DoW, S & P 500 and NASDAQ). The regression analyses of the data from March 1 to October 31, 2020 indicate that it is not the infections or deaths in the US directly and significantly affecting the stock indices, but the vaccines and treatment medicine developments deciding the stock markets movements. In addition, the Weekly Jobless Claims and Weekly Economic Index significantly affected some stock indices. The paper further discusses the prospects of the US stock markets and its long-term threats. This paper is different from other similar studies, using a longer time period of the weekly data (instead of the daily). It also included economic and COVID-19 related medical development variables. It offers a comprehensive and new perspective on the dynamic of the US stock market that is valuable to both investors and policy-makers.

Uttam Golder   Fatema Sultana   Mohammad Kamal Hossain   Mohammad Awal Hossen   and Md. Monzur Hossain   

This study aims to examine empirically whether financial development can promote economic growth in Bangladesh. It employs the Autoregressive Distributed Lag (ARDL) model and takes annual data from 1987 to 2019. This study confirms a cointegrating relationship between financial development and economic growth. The nature of this relationship is unidirectional, running from financial development to economic growth. The outcome of the study confirms that financial development, as proxied by private sector loans and broad money supply, augments economic growth in the long-run. As for the control variables, gross domestic savings show an insignificant impact on economic growth when private sector loans are proxied for financial development. However, it confirms a substantial impact on economic growth when broad money supply is proxied for financial development. More interestingly, trade openness, another control variable, suggests an adverse impact on economic growth in the long-run. However, it has a substantial positive influence on economic growth in the short-run. In the short-run, broad money supply at lag 2 and gross domestic savings significantly affect economic growth when broad money supply is proxied for financial development. The findings of this study advocate that a robust and dynamic financial structure in Bangladesh is a critical success factor for developing the country's economic growth.

Ofogbe Nyore Sandra   Ojiakor Ijeama P.   Nnamani Chidiebere   Ifeoma Maria Ihegboro   Anisiuba Chika Anastesia   and Ruth Lass   

There has been moderately scarce literature on the relationship between company social responsibility (CSR) and the cost of capital (COC) in Nigeria. Numerous studies have analysed the association between the CSR of the companies quoted within the Nigeria Stock Exchange (NSE) relating to their overall performance neglecting the COC component. This study examined the long-run relationship between CSR dimensions (Corporate social performance (CSP), environmental performance (ENP) and corporate governance (CGP) dimensions and cost of debt (COC). It seeks to investigate if CSR has, in the long run, reduce the cost of capital. Annual panel data of 96 companies for the duration; 2005-2020 quoted in the NSE were selected judgmentally. Thomson Reuther Index (TRI) was used as a measure of CSR, whilst the cost of equity (COE) and cost of debt (COD) were used as a measure of COC. Panel ARDL model was adopted to analyse the long-run relationship between CSR and COC. Findings revealed that companies that spend on CSR have a better chance of accessing capital at a reduced cost. The results support the findings of scholars works, especially in the developed countries. In conclusion, companies that spend on CSR have a better chance of accessing capital at a better and low cost. Based totally on the findings, the researcher advocates an on-stop investment on issues that concerns CSR as this may, if consistent, ease the getting of funds at a reduced cost in the long run.

Mariana I. Muzychuk   and Olena V. Fomina   

The topicality of scientific and applied research, which was aimed at developing and improving methods of tax administration of transfer pricing, is the relative novelty of the active use of this tool. It is worth noting that almost all elements of the mechanism for determining the value of the transaction, the operations of which are recognized as controlled, including the procedures for conducting functional analysis for the preparation of transfer pricing documentation. This allowed stating the aim of the publication, which is to identify the features of functional analysis to justify the choice of the comparative side of the controlled operation in Ukraine, as well as the method of ensuring compliance with the arm's length principle and organisation of the reporting process. The organisational and legal support of the functional analysis for the purposes of transfer pricing and the use of its results in the preparation of transfer pricing reports were studied. The study revealed incomplete organisational and legal conditions for preparing a transfer pricing report in Ukraine, in particular, difficulties in obtaining information for comparisons, as well as the lack of a unified methodology for functional analysis to reveal the economic nature of the transaction, which is considered controlled for transfer pricing purposes. Based on a positive and regulatory analysis of the processes of forming the market value of the transaction for tax purposes, the author's vision of the methodological approaches to functional analysis in Ukraine, presented in the Practical Manual on Transfer Pricing for Developing Countries 2021, was proposed.

Quang Phung Duy   Thinh Nguyen Huu   and Chien Doan Quyet   

The aim of this paper is to calculate ruin probabilities using Monte Carlo method for two models: i) classical risk model with claim amounts are homogeneous Markov chains; ii) generalized risk models with premiums amounts, claim amounts are homogeneous Markov chains. The sequence of random variables in the article is considered as a series of Markov dependent random variables. The main results of this paper are Lemma 3.1, Lemma 3.2 and Lemma 3.3, which have built mathematical formulas for the simulation of the probability of insurance models considered in this paper. From those lemmas, we build algorithms to simulate ruin probability for insurance models considered in this paper. From these algorithms, we build numerical results illustrating the problems posed in the paper. These results all show that when the initial capital increases, the ruin probability will decrease, and when the time increases, the ruin probability will increase. This result is consistent with the theory of the risk problem in insurance.

Olubunmi Adewole Ogunode   and Rafiu Oyesola Salawu   

This study examined the post -implementation impact of IFRS 15 from the Nigerian perspective and challenges associated with the adoption. Four listed companies operating in IFRS 15 key impacted firms in Nigeria which accounts for 82% of total market capitalization as of April 2021 were selected. The data extracted were analyzed with the aid of tables, charts, ratios, percentages and content analysis. The study revealed that listed firms in Nigeria aligned with the need to adopt and fully implement IFRS 15 in their financial reporting in response to regulatory pressure and increased internationalization of their operations. The study, therefore, concluded that adoption and implementation of IFRS 15 had a positive effect on accounting numbers of listed firms in Nigeria. The study identified the proper identification and treatment of royalties, income taxes, proper delineation of revenues from contractual fees, the need for persistent contract modifications, capitalization of contract costs, and collectability issues, as key challenges of IFRS 15 implementation. The study recommended that the Board and Management of companies operating in the IFRS 15 impacted industries should always provide greater clarity on the basis used for arriving at the significant judgment calls they make. Also, the Financial Reporting Council and external auditors need to develop workable methodologies to monitor and tighten compliance with both quantitative and qualitative IFRS 15 disclosure requirements.

Alexander Arkadyevich Safronov   and Alexey Ivanovich Sazonov   

Since early 2015, the key rate of the Central Bank of the Russian Federation has been steadily decreasing. At the beginning of 2021, it amounted to 4.25% per annum, which was an unprecedented low value for the Russian economy. This conditioned a steep deposit rate fall and a significant growth in real estate prices. In the current economic situation, many private investors come to the stock market, which transforms savings into investments in the real sector of the economy. The article considers the fundamental and technical analysis of stocks. The authors have conducted a comparative analysis of shares from one industry as exemplified by PAO "Severstal", PAO "MMK" and PAO "NLMK", i.e. the leaders of the Russian ferrous metallurgy. The technical analysis of stocks is carried out on daily timeframes in the period from August 28, 2020 to March 5, 2021 using the following indicators: moving average convergence divergence (MACD), the MACD histogram and the RSI oscillator. The fundamental analysis of stocks is performed using the bottom-up method through multiples: P/E, P/S, P/BV, EV/EBITDA and EPS. The authors have concluded that it is inexpedient to invest in the shares of these companies at the current level of their capitalization.

Chuvakhina L.   Nasirbeik A.   and Ivanovskaya   

In its essence and content, dollarization is one of the keys and most significant phenomena of modern dynamically developing international monetary and financial relations. There are different theoretical approaches to determining the economic essence and content of the complex and contradictory phenomenon of dollarization. Different scientists have investigated the monetary nature of this phenomenon and have given a comparison of the concepts of official and partial dollarization, based on the degree of economic coverage of dollarization. In this research the process of official dollarization is considered on the example of Eurasian Economic Union (EAEU) member states. The paper examines the scale of financial dollarization in the EAEU member states, where, due to the loss of residents' confidence in the monetary policy and the national monetary unit, the functions of the national currency are partially replaced by the US dollar. Furthermore, the role of the US Federal Reserve in the implementation of dollarization of the foreign economies is analyzed. The article substantiates the intention of the US Federal Reserve to take steps to dollarize the foreign countries' economy in the context of the started process of de-dollarization of the world economy. The most active supporters of de-dollarization are Russia, China, and Iran. Their efforts are aimed at weakening the dominant position of the dollar as a key reserve currency, the currency of international settlements. In the current condition of the world economic development, it is unlikely to expect a weakening of the position of the US dollar, given the role of the US dollar in the trade of oil and petroleum products. The petrodollar system is the basis of the US dominance in the global financial system and the key to the stability of the US dollar. As a result, countries are forced to buy dollars in order to be able to purchase oil on the open market. While the demand for the US dollar will remain at a high level, it is not necessary to talk about the success of de-dollarization and the transition from an American-centered monetary and financial system to a polycentric one in the near future.

Molchanova L. A.   Khokhlova S. V.   Basova N. V.   Makarova E. B.   and Gyunther I. N.   

The Russian economy's long-term growth is inextricably linked to an appealing and efficient investment process, without which it is impossible to upgrade output structurally and qualitatively, build market infrastructure, and boost local competitiveness. The pressing issue of adequate investment tools necessitates an active search for viable sources for domestic economy demands, which concretizes the problem of mobilizing the state's internal resources - the population's savings. According to the experience of countries with a high degree of economic development, population savings are the primary source of establishing the resource basis for ensuring long-term economic growth and development. The function of the domestic financial market in the process of converting savings into investments is examined in this article. It has been established that there is a link between the financial market and the investment process. Theoretical components of the essence of savings and how they are transformed into investments are exposed. The impact of household financial investment volumes on the country's economic development indicators is studied and the dynamics and structure of population savings in Russia. The issues surrounding the conversion of savings into investments are recognized and the directions for intensifying it to maximize the financial potential of savings for the implementation of investment programs.

Volodymyr A. Viedienieiev   

The purpose of this study is to improve the methodology for assessing the fair value of enterprises based on the DCF model with the use of ensemble methods for predicting the selling price of their products. The study compares the fair values of three Ukrainian agricultural enterprises. The value of each company was calculated in several ways: using forecast data from statistical agencies, calculated forecast values, and real indicators. The methodology is based on the use of methods and models for forecasting time series. The study uses neural networks, as well as prediction methods such as linear regression, FB Prophet model, Holt-Winters exponential smoothing method, SARIMA, XGBoost, which are combined into a single ensemble with the use of the stacking method. The study employed such general scientific methods as analysis, synthesis, abstraction, and comparison. Also, methods of graphical and tabular presentation of materials were applied. Statistical modelling was used to determine the parameters of the model. The study found that the DCF model can potentially be improved by using ensemble methods when predicting metrics such as inflation, exchange rates, and the selling price of goods and services. These metrics have a significant impact on the final result of the model and therefore the slightest changes in these input data can lead to significant deviations in the result. It was demonstrated that the use of ensemble methods only at the selling price can increase the accuracy of the model by 5-15%. It is advisable to use the results of the study in the investment activities of companies, in mergers and acquisitions of companies, as well as in measuring the fair or investment value of companies.

Natalia V. Trusova   Oleksandr M. Petruk   Andrii Yu. Polchanov   Iryna M. Tsaruk   and Tatiana O. BilŃ–ak   

The article considers the forming resource elements of financial support of passenger transportation in the regional road transport system of the state, taking into account the impact on their structure of interdependent basic parameters of financial flows of public-private partnership. A methodological approach to assessing the formative resource elements of financial support for passenger transport in the region, which is based on the concept of developing the financial potential of the road transport industry, which determines the interaction of various factors under the general financial mechanism and aims at ensuring target parameters of profitable activities is developed. The mechanism of redistribution of own and credit resources between separate objects of the regional road transport system is substantiated, as it is a vector of integration direction of movement of the financial streams arising between the road transport enterprises in the sphere of passenger transportations. Changes in the basic parameters of financial flows of road transport enterprises in the cycle of financial support of passenger traffic in the region have been formalized. The analysis of the species structure of the road transport system and the volume of passenger turnover of Ukraine is carried out. The conditions of redistribution of financial resources by the State Road Fund of Ukraine between the regions and the share of implemented public-private partnership projects in the field of road transport of the country are determined. The scenario of the optimal market value of road transport enterprises in the cycle of financial support of passenger transport of the region is offered.

Inna V. Hnydiuk   Ganna V. Datsenko   Irina H. Krupelnytska   Olena M. Kudyrko   and Olena O. Prutska   

Audit of budget programs in EU countries requires a detailed study of the audit procedure in order to minimize possible deviations and errors in the implementation of programs. The principal result of the audit of budget programs' indicators financed from EU funds is to verify the cost-effectiveness, efficiency and effectiveness of the use of budget resources. The purpose of the academic paper is to study the results of the audit of budget programs in EU countries in order to identify the causes and factors that influenced the violations and errors in the use of budget funds. The research methods are as follows: system and logical analysis; information synthesis method; systematization and generalization; comparison method; statistical analysis. Study contributes relevant information and processed data regarding to internal and external audit standards and mechanisms to improving their efficiency. Limitations of the study are possible unknown violations of the budget programs that result in inaccurate data analysis. Results. Conducting audit of the budget programs in the EU in accordance with international auditing standards complies with the generally accepted procedure for audit of using budget funds by beneficiaries. In 2019, as a result of the audit of budget programs by European Commission, it was found that 51 out of 130 transactions (39%) contained violations and errors. A significant number of errors have been found in programs that direct budget funds to research and innovation. It has been revealed that most of the errors were found in the budget program Horizon 2020, in connection with which the European Court of Auditors calls in question the eligibility of all costs declared by the beneficiary for the audit period. The main errors in reporting in other budget programs were reimbursements of travel expenses not related to the implemented EU budget program; the erroneous exchange rate used in the programs was not that provided by the rules of the program. The level of error in conducting audit of budget programs in 2019 has been 4.0%, which is a significant reserve for improving the efficiency and effectiveness of the audit.

Hishamuddin Abdul Wahab   Wan Nur Rahini Aznie Zainudin   Sharifah Fairuz Syed Mohamad   and Asmah Mohd. Jaapar   

The rise of the Islamic capital market in the emerging economy of Malaysia over the past few decades motivates us to investigate the impact of the Syariah compliant status on the level of exchange rate exposure. The Syariah compliant status implies that a company should use a minimal level of debt as capital to finance its operations. Given this, it is hypothesized that Syariah compliant firms should exhibit lower levels of exchange rate exposure than their counterparts, supported by the strong theoretical connection between interest rate and exchange rate. In terms of specification, previous efforts in pricing exchange risk failed to capture the true size of exposure due to the use of single time domain in traditional model. To cater the bias in estimation, this study intends to calculate multi-horizon exchange rate exposure based on maximal overlap discrete wavelet transformation to decompose single series into multiple time domains. The financial risk analysis involves 30 listed non-financial individual stocks in Malaysia having different Syariah compliant status from November 2013 until May 2018. As a result, the study finds no significant difference in currency exposure between Syariah compliant and non-Syariah compliant stocks. Secondly, it is found that the extent of currency exposure and the percentage of exposed firms exhibit non-homogenous trend across different time scales where large amount of exposure is concentrated at higher scale. From policy implications, the study suggests that Syariah compliant firms and non-Syariah compliant firms share the same exchange risk profile where exchange risk management routine is expected to be identical for both groups. Besides, the enhanced level of exposure at higher scale requires vigorous financial risk hedging strategies especially within widened investment interval.

Jasper Kim   

Derivatives can be embedded in financial engineered structures involving one or more conduit entities and jurisdictions. Increased innovation led to an emergent market view that assets can be both de- and re-composable, with each iteration version being tradable "aspect[s] of assets" in the marketplace. Conceptual methodology of this article provides a conceptual tax policy analysis arguing that derivatives instrument innovation poses several significant challenges to the traditional tax system. Such factors must be carefully weighed by policymakers, given their respective specific market dynamics and tax objectives, leading to the conclusion that not one approach represents a policy panacea to derivatives financial instruments. This article provides a conceptual tax policy analysis arguing that derivatives instrument innovation poses several significant challenges to the traditional global tax system, which has been traditionally predicated on a clear-cut demarcation regarding: (1) asymmetric tax treatment between debt and equity; (2) the timing rule in terms of income recognition for tax purposes (e.g. accrual versus realization); and (3) income characterization (e.g. ordinary income versus capital gains). The conceptual tax policy responses, including anti-avoidance measures, mark-to-market, bifurcation, integration, and various information-sharing regimes, have their benefits and weaknesses.

Dharmesh K. Mishra   Sushant Malik   Asmita Chitnis   Dipen Paul   and Subham Sushobhan Dash   

The purpose of the study is to analyse the factors contributing to financial literacy and financial inclusion among women of self-help groups (SHGs) of Sisilo village in Balianta block of Bhubaneswar, India. A survey questionnaire was designed and administered to a sample of 100 women respondents in the age group of 18 to 59 years. The survey data were analysed using factorial analysis. Factor extraction was done by the method of principle component analysis. The three factors extracted which influenced financial literacy were identified as education level, awareness of bank and insurance products and household income. The four factors extracted which influenced financial inclusion were identified as product knowledge, risk level of products, insurance schemes for security, and availability of bank branch. A few of the factors are hindrances to financial literacy and financial inclusion which are gender difference, access to education, ethnicity, personal finance, lack of trust in financial institutions, distance and lack of proper guidance. The study will help bankers and policymakers to be aware of the factors that influence financial inclusion and financial literacy amongst women, and incorporate the same for implementing successful interventions for women SHGs in India.

Muhammad Enamul Haque   and Andreia DionĂ­sio   

This study investigates the evidence of market efficiency dynamics and chaotic behavior of the Dhaka Stock Exchange benchmark index (DSEX) over the 2000-2020 period. We employed the newly developed model of mutual informational and global correlation coefficient in addition to the traditional linear and nonlinear techniques. Results suggest there is evidence of serial dependence in the DSEX returns. We attempted the Lyapunov exponent model to evaluate the possibility of chaos and nonlinear dynamics in the market. The results conspicuously represent the existence of chaotic behavior- a nonlinearity-based profitability pattern revealed in the DSEX return series in its short run behavior. By applying two technical trading indicators, we justify the predicting trend of the Bangladesh stock market and conclude that investors active in the Dhaka Stock Exchange can earn abnormal returns. Findings have practical implications for general investors and professional fund managers to exploit the profitable opportunities and reshuffle the investment decisions. Results also convey the message to the regulatory body to initiate the strategies for intervening in the operating mechanisms to reduce the market inefficiency.

Nuril Asyikin Mohamad   Nor Hasliza Mat Desa   and Maznah Mat Kasim   

Poverty is a major problem either in this country or globally as it is like a vicious cycle that is endless. In Peninsular Malaysia, there are four states: Kelantan, Terengganu, Perlis and Kedah that still recorded higher incidences of poverty than the national average. The differences in development among regions, states and rural-urban areas maintain a wide gap even though the economic growth was reported by all the states. This might be attributed to some key factors that could have effects on poverty in a smaller region. It is argued that the factors prescribing the index have different levels of importance or weights towards the poverty incidence. Hence, this paper aims to determine the weightage of poverty indicators that affect the poverty rate in smaller area in Kedah and to develop the corresponding poverty index in Kedah. This paper used the CRiteria Importance Through Intercriteria Correlation (CRITIC) weighting method to determine the importance of five indicators. It is revealed that the most important indicator is the size of household followed by income, expenditure, head of household, and residence. Moreover, the poverty index was also developed for 12 districts in Kedah by using Simple Additive Weighting (SAW) method. Results showed that the district with highest poverty index value is Kuala Muda while the lowest is Bandar Baharu district. This paper contributes to changes of poverty information so that the government and Non-Governmental Organizations (NGO) can design appropriate policies to reduce higher poverty rate in Kedah and plan on providing more aids for the targeted group especially in districts with higher poverty index values. Consequently, it is hoped that these governmental and non-governmental initiatives could help poor people to motivate themselves to have a better education so that they can enhance their economic productivity for the betterment of their lives.

Cordelia Onyinyechi Omodero   Michah Chukwuemeka Okafor   and Josephine Adanma Nmesirionye   

The contribution of personal income tax to gross national income is assessed in this study. Over the years, tax revenue has been an important government source of income to finance public goods and services. In Nigeria, the tax structure includes personal income tax (PIT) as well as other direct and indirect taxes. There is PIT collection by both the state and federal governments. This study examines the influence of PIT on aggregate income of the country from 2011 to 2020 using ordinary least squares method. The dependent variable is the gross national earnings while the independent variable is the personal income tax collected at the federal government level in Nigeria. The study finds corruption and inflation as two useful control variables that have direct influence and link with individuals' tax compliance in Nigeria. The data sources include the Organization for Economic Co-operation and Development (OECD) for PIT figures, Transparency International (TI) for Corruption Perceptions Index (CPI) data and World Bank Economic Indicators for Gross National Income (GNI) and inflation statistics. The empirical findings reveal that PIT has a significant positive influence on the gross national income. The moderating variables applied are not significant and could not explain the vicissitudes in the gross national earnings. The study recommends improvement in the PIT administration to boost tax revenue collections and remittances to the government treasury. Further suggestion by this study is that corruption and inflation should be minimized to enhance PIT collection at both federal and state government levels.

Viktoriya Valeryevna Manuylenko   and Marianna Aslanbekovna Shebzukhova   

Lack of theoretical and methodological grounds to formulate essential characteristics of "financial controlling" in corporations makes it difficult to efficiently conduct it in practice. It is believed that the conceptual terminology and definitions should be reflected in the methodological toolkit that determines corresponding values. Accordingly, determination of the economic content, classification of the types, forms and methods of financial controlling in corporations are the necessary elements for building methodological basis for its conduct. In this regard, it is important to correctly formulate theoretical and methodological provisions of the financial controlling in corporations and take into account development of economy. All this underlines relevance of this study. The purpose of this study is to substantiate potential development areas for the existing methodological tools related to "financial controlling" in corporations revealing economic, essential and substantial characteristics of the concept. Based on the general scientific and special methods, such as inductive, deductive, analysis, synthesis, system thinking, detailing, generalization, grouping, formalization, abstract-logical, the essence of the concept of "financial controlling" in corporations was identified considering theoretical and methodological approach. The theoretical provisions are expanded and improved for classification and interconnection of different types and forms of financial controlling. The theoretical and methodological synergetic links of the concepts related to the financial controlling, as well as its types, forms, and methods are characterized, which will provide the ground for development of methodological toolkit for its successful implementation in the future.

Farah Liyana Abdul Aziz   and Intan Waheedah Othman   

Fraud has become a worldwide issue, impacting a massive number of organizations throughout the globe. The PwC's Global Economic Crime and Fraud Survey 2020 highlighted not only has fraud surged in the private sector, but it has also impacted the public sector causing entities to incur significant financial losses. Motivated by this phenomenon, this study aims to investigate whether fraud awareness, fraud prevention and detection strategies and anti-fraud technology are significantly related to the public auditors' perceptions of the efficacy of fraud prevention and detection in the public sector. Data was collected through questionnaires, distributed to 180 respondents of public auditors in the Malaysian ministries. 133 usable responses were obtained, generating an effective response rate of 74%. Based on the underpinning fraud triangle theory, the research discovers that fraud awareness, and fraud prevention and detection strategies are positively related to the perceived efficacy of fraud prevention and detection. This study differs from prior studies that primarily examined the prevention and detection of fraud in the private sector, by expanding the scope to include the public sector. Determining whether fraud prevention and detection strategies exist and are properly implemented in the public sector is critical since government bodies continue to be vulnerable to irresponsible people misusing public funds. The research findings offer important insights on the level of fraud awareness among practitioners and the determination of fraud prevention and detection mechanisms and technologies that are perceived to be most effective in public organizations.

Muthoifin   

The spread of the coronavirus in various countries has brought many changes in various sectors, including the financing sector, many people are doing re-credit, asking for leniency in installments due to limited access, income, employment, and others due to the implementation of the lockdown. Likewise, what happened in Indonesia was that many people panicked about financing at banks and BMTs. The purpose of this research is to analyze the performance of sharia financing in sharia financing institutions and cooperatives amid the Covid-19 pandemic. The method used is field research using the qualitative paradigm with the phenomenological approach. Primary data were collected from observations and direct interviews, while secondary data were obtained through books, journals, articles related to Islamic financing. Following the data processing, analysis was carried out using data validity techniques and data reduction, thus conclusion could be drawn. The research was conducted in three sites; BMT (Baitul Mal wa Tamwil) Amanah Ummah, BMT Kube Colomadu Sejahtera, and BMT Wanita Mandiri. The results of the study showed that sharia financing activities at those BMTs decreased due to the impact of the Covid-19 pandemic. Likewise, the level of customer ability fell due to the physical distancing in some of the customer's residences, reduced income, and increased consumptive costs, which led to default in customers at three different BMT locations. The implications of this research are expected for the customer to be more cooperative in fulfilling obligations in paying installments and being more committed to fulfilling mutual agreements. For BMT managers to be more careful in choosing customers and make better efforts to resolve customer's defaults in a family way. For the Government to be able to make policies related to customers and BMTs, so that they do not feel disadvantaged by the current pandemic conditions and can feel more secure and comfortable in any conditions.

Muhammad Ahmar Ali   Mohd Sollehudin Shuib   and Alias Mat Nor   

Islamic banks are recognised as entities which support social objectives as well as economic development of the country. Financial performance of the global Islamic banking and finance has shown promising growth as equal to well-established conventional banks. The study aims to investigate the effect of asset quality and operational efficiency on the financial performance of Islamic banks in Malaysia. The study uses panel data analysis, whereby the annual reports of 16 Islamic banks in Malaysia are analysed over a ten-year period from 2010 to 2019. The independent variables of the study are asset quality and operational efficiency. The dependent variable of the study is financial performance proxied by Return on Asset (ROA) and Return on Equity (ROE). Multiple regression models consisting of random-effect model and fixed-effect model are employed to analyse the data of the study. The findings of the study show that both asset quality and operational efficiency of Islamic banks have a significant influence on the financial performance proxied by ROA and ROE. Hence, the findings of the study evince the importance of proper management practices in protecting the wealth, as well as the financial performance of the Islamic banks.

Armela Anamali   Alma Zisi   and Bitila Shosha   

Purpose-This article examines the relationship between service quality and customer satisfaction from the banking service in Albania. Design/methodology/approach-For the realization of this study, the authors relied on primary data. The population, taken in the study, are the clients of a commercial bank operating in the city of Durrës. The questionnaire is structured with questions on a five-point psychometric scale, grouped for each dimension of quality and the dependent variable of customers' satisfaction. To prove the consistency of the indicators within each factor, the Cronbachs' alpha test was performed, while for the analysis of the functional relationships between the dimensions of service quality and customers' satisfaction, the correlations were tested and the Enter/Stepwise methods were used. The software used for data processing is SPSS V.21. Findings-Customers' satisfaction for the sample taken in the study is dependent on two factors, assurance and responsiveness. Other factors do not directly affect customers' satisfaction with banking services, but are statistically significant related to the independent variables included in the study. Originality/value-This paper tests previously found relationships, but the socio-economic developments, the level of financial culture, and the extent of banking sector in Albania, seem to affect consumers' perceptions of quality and what makes them satisfied. Passing two major financial crises (pyramid schemes in 1997 and the 2008 financial crisis) with a poor financial culture, the Albanian customers expect a quality service in a service that makes them feel safe and is being offered specifically to their expectations.

Otekunrin Adegbola Olubukola   Samu Tafadzwa   Sifile Obert   and Matowanyika Kudzanai   

The research sought to find out how environmental accounting can work in Zimbabwean Mining Companies. Descriptive research design was used and mixture of qualitative and quantitative data was collected using questionnaires and interviews. Stratified purposeful sampling of 52 respondents was made up of 16 Mining Companies' executives which are dominant companies in mining gold, nickel, asbestos, coal, copper and chromite, 20 government organisations representatives and 16 mining communities’ heads (8 Chiefs and 8 Headmen) were done. Community heads were interviewed and questionnaires were sent to Mining Companies' executives and government organisations representatives who were also interviewed two months after. The research reveals that government is not doing enough in fostering the implementation of environmental accounting in Zimbabwe. There is no commitment of enough resources by the government towards adoption of environmental accounting. The mining sector has been politicized, making it difficult to enforce environmental laws in this sector whilst on the other hand there are no effective laws and policies that regulate environmental accounting issues. The core existences of economic instability and political upheavals in the nation have forced firms to concentrate on their continued economic existence, doing almost nothing on environmental accounting. It was also noted that there is no proper monitoring and controlling of mining activities by law enforcers, leaving the natural environment subjected to unsustainable mining activities. There are no environmental accounting guidelines. The research recommended that government organisations monitor and control mining activities independent of politics and commit both human and financial resources towards researching on how best environmental accounting can be implemented.

Saheed Ademola Lateef   Norfadzilah Rashid   Abubakar Umar Farouk   and Wahid Damilola Olanipekun   

The Supreme Audit Institutions (SAI) are required to act as a corner stone in the public financial management system to prevent and discourage corruption by enhancing transparency, accountability and good governance. However, the executives and legislative arms of government in most of the African countries have reportedly overpowered the independence of SAI due to certain factors. Therefore, this study examines the factors hindering the independence of SAIs towards good governance in the Nigerian public sector. The primary data were collected from senior and management officers in the office of the Auditor General for the Federation and Public Account Committees of the National Assembly through self-administered questionnaire. One hundred and fifty (150) questionnaires were distributed to the respondents. The statistical analysis tool employed in this study is Structural Equation Modeling. The two hypotheses developed for this study were tested through regression analysis which indicated that both negatively affect good governance in the Nigerian public sector. The study revealed that the independence of SAIs in Nigeria was impaired in two critical areas; deliberate under-funding of SAIs and the quality of external auditor hired to perform the task. The study recommends that the constitutional provision that impairs the independence of SAIs should be repealed to ensure their financial autonomy. Finally, the study suggested that the Nigerian government should allow the SAI to independently determine the appointment of experienced external auditors and their fees.

Idamoyibo Hwerien Rosemary   Abner Ishaku Prince   Akpan Ededem Jack   Orugun Ibidunni Fausat   Emmanuel Nwabueze Enoch   and Udo Emmanuel Samuel   

The focal point of this research was to establish the liquidity-viability link in quoted non-financial firms in Nigeria. Liquidity improves the profitability of firms but not its solvency. The solvency and performance of a firm exclusively anchor on the firm's capacity to realize the "twin conflicting" targets of liquidity sufficiency and stable growth through a diversified and stable asset-liability mix. The firm's inability to strike an equilibrium balance among meeting financial obligations, sufficient liquidity and profitability has led to insolvency of most firms in Nigeria. Most empirical studies in Nigeria ignore effect of cash flow management on the non-financial sector to focus on the financial sector. Use the regression model predominantly and also ignore the widely accepted econometric process of a pre and post diagnostic test. This study focuses on 13 quoted non-financial sectors in Nigeria firms from 1999-2020. The preliminary test was conducted to determine the best fit model. Liquidity proxy by the current ratio significantly influences ROE and non-significantly on ROE when proxy by the cash flow ratio. Findings also divulged a bidirectional nexus between current ratio, cash flow ratio, and ROE and a non-causal nexus with other variables. Policy recommendations are further discussed.

Evgeniy Vladimirovich Orlov   Tatyana Mikhailovna Rogulenko   Oleg Alexandrovich Smolyakov   Nataliya Vladimirovna Oshovskaya   Tatiana Ivanovna Zvorykina   Victor Grigorevich Rostanets   and Elena Petrovna Dyundik   

Modern businesses throughout the world operate in a market characterized by constant changes. These changes are becoming more dynamic from year to year. It is the project-based approach that will allow one to solve problems and ensure high efficiency of project-oriented operations. The purpose of the study is a comparative analysis of the impact of the use of IT project management methodologies of Kanban and Scrum on a company's financial performance. The authors identify the essence of the agile methodology, its conceptual foundations, and explore the key aspects of its efficient implementation. The popularity of the practical application of the agile approach in various business areas is analyzed. The authors also choose the best methodology for a particular IT project for the optimization of such economic and financial indicators as project cost, profit from project implementation, and implementation time. The key differences between the most popular agile technologies are identified. The requirements for forming an agile team are examined considering the main issues during the implementation of agile management technologies. The primary stages in the implementation of an IT project using the Scrum methodologies are defined.

Lama Alyousef   and Sulaiman Alsughayer   

The objective of the present research is to examine the relationship between corporate governance and voluntary disclosure, and to determine how certain factors enhance governance practices and consequently increase voluntary disclosure. The study considers the content analysis of 22 Saudi listed companies from 2015 to 2019. A comprehensive index is developed, with a check-list covering 30 items to extract and measure corporate governance practices and levels of voluntary disclosure. The researchers use ordinary least squares (OLS) regression to examine whether corporate governance-specific mechanisms can explain any differences in voluntary disclosure levels among the listed companies. The results indicate a statistically significant relationship between the number of non-executive directors and board size and the level of voluntary disclosure. This study concluded that non-executive directors and board size are ranked the highest in terms of their positive effects on voluntary disclosure. The relationship between the independent directors and audit committees and voluntary disclosure is insignificant. The results suggest that the high number of non-executive directors and the increase in the number of directors on the boards lead to greater voluntary disclosure of information. This study helps regulators of corporate governance and company directors understand the factors affecting voluntary disclosure. Corporate governance regulators should require an increase in the minimum number of boards and non-executive directors for listed companies in order to gain the desired levels of voluntary disclosure and transparency. Saudi listed companies are advised to willingly increase their board members to the maximum number specified by regulation. This study has some limitations as participants represented a small sample; hence, the results cannot be generalised. Furthermore, the voluntary disclosure data were collected only from annual reports; sources such as websites, public announcements and press releases, were not taken into account, but would have provided many relevant details.

Ben Etim Udoh   Akpan Ededem Jack   Abner Ishaku Prince   Kelvin-Iloafu Lovlyn Ekeowa   Victor Ndubuaku   and Udo Emmanuel Samuel   

Financial firms' services are considered germane to an economy's expansion universally. 2015-2016 economic and financial in Nigeria can be accredited to the hollowness of the financial firm contracting the economy by 2.06%, 63.7% market capitalization, and 67.2% in all share indexes losses. Prior empirical techniques focus primarily on finance-growth linear nexus. Which begs the question is the reported linear nexus a function of the linear assumption test power or earth evidence? The baseline ARDL and NARDL techniques are used in this research. To observe if there is a possibility of a non-linear association, for structural breaks, the Zivot and Andrews tests were used, as well as Granger causality to test for causality. From 1999Q1-2019Q4, quarterly data from the three arms of financial firms "insurance, banking, and stock market" were used. Findings revealed that economic growth adjusts non-linearly at a faster pace. A variety of macro-non-macroeconomic and financial factors can be implicated in the non-linear adjustment. A bi-directional link between the variables was revealed by causal nexus.

Oleksandr M. Petruk   Oksana S. Novak   Anastasiia O. Petruk   and Nataliia H. Radchenko   

The article discusses empirical calculations of sustainable development and volatility of derivative financial instruments in the banking system. The methodical approach to forecasting the index of the first stock trading system (FSTS) for sustainable market development is presented, considering the lack of normal distribution of financial resources in the banking system. It is substantiated that when choosing the volatility model and setting the option price, it is important to consider the theoretical generality and composition of the volatility structure, which is able to effectively and accurately estimate the parameters. It is proved that the rate of average volatility variable for modeling, analysis and stable assessment of important market parameters (i.e., local volatility) is determined using the moments of past periods. The real and forecast value of FSTS volatility at different values of the model parameter is developed. A model of implied volatility for the FSTS index is built. It is substantiated that the formulation of stable market development of derivative financial instruments takes into account all its semantic and financial features of resisting the influence of external and internal factors (shocks, imbalances) and maintaining dynamic equilibrium to ensure parameters of the entire financial system needed to form positive feedback between financial and real sector of the economy. The ratio of world GDP and the nominal value of derivative financial instruments were estimated. Maps of the market value of over-the-counter DFI, gross risk exposure in the over-the-counter DFI market and the nominal value of exchange-traded PFI are presented. The factor models of influence on the development of the exchange-traded and over-the-counter PFI market of world and national levels are constructed.

Natalia V. Trusova   Oksana V. Hryvkivska   Leonid V. Melnyk   Olena V. Gerasymova   and Maksym A. Tereshchenko   

Risks of payment system of banking institutions of Ukraine are considered in this study. Risk events clearly correlate to the effectiveness of network interaction of banking institutions to adapt information technology of payment systems in the payment portfolio of banks when changing operating environment, so mechanism for minimizing their probability has been developed. Economic elements of the mechanism of minimizing the risks of payment systems are identified, which allow forming the planned level of profitability, risk and liquidity of institutions (organizations) within the relevant principles, methods, levers, cash flows in order to respond and adapt to changes in the environment. A methodical approach to assessing the effectiveness of risk management of payment systems of banking institutions, which is from the standpoint of multivariate structuring and a list of their indicators of the microeconomic level, forms an optimal set of tools to minimize the set of risks. Indicators of payment systems of Ukraine are determined, according to the net level of credit risk, liquidity risk, business risk, investment risk, legal risk, operational risk, systemic risk, technological and information security risk. The impulse index of functioning of payment systems of Ukraine is calculated. A neuro-fuzzy model for assessing the individual credit risk of participants – legal entities (users-borrowers) of card payment scoring of a banking institution is developed. The basic criteria for assessing the individual credit risk of a participant-legal entity (user-borrower) by card payment scoring are determined.

Nataliia H. Vyhovska   Oleksii V. Lysenok   Viktoriia H. Hranovska   and Viktoriia M. Krykunova   

The functioning of the banking system, in the face of financial and economic shocks, is gaining global scale, and requires banking institutions to guarantee financial stability. The aim of the article is to consider the regulators of credit activity of banking institutions in the interbank market and the debt obligations of Ukrainian borrowers. A comprehensive methodological approach to assessing the stimulators of credit activity of banking institutions, which allows to model macroeconomic and local factors of credit risks of borrowers, scenarios for servicing their debt, given the safe level of profitability, liquidity in the interbank market in the current period is implemented. A comprehensive methodological approach to assessing the stimulators of credit activity of banking institutions on the basis of cognitive analysis and modeling of factors of the banking system, which are determined by stress testing when the exchange rate is changing. Interest rate fluctuations in the interbank market and liquidity in the country is proposed. The model of a complex assessment by a banking institution of the credit risk of a debtor-financial company when servicing its debt on the interbank market is presented. The cognitive analysis is carried out and the cognitive map of stimulators of crediting of the economy of Ukraine by banking institutions is constructed. Optimistic and pessimistic scenarios for changes in the lending activity of the banking system were identified, the growth of loans to residents was chosen as a desirable situation, taking into account the impact of inflation and devaluation of the hryvnia, as well as the growth index of the banking system. The integrated indicator of creditworthiness of borrowers and the relationship between quantitative and qualitative indicators of credit risk with a factor load on debt service by financial companies of Ukraine are calculated.

Nataliia M. Ridei   Nataliia M. Tytova   Valentyna I. Tymoshenko   Volodymyr V. Moroz   and Natalya V. Bibik   

The article is devoted to the problems of improving methodological approaches to determining the directions of financial security of Ukraine in the modern conditions of globalization and the hidden of the financial sector of the economy. It has been found that people's interests and public institutions, which are not reflected in official regulatory documents and acts, often have a decisive impact on the economy. There were generalized studies of economists regarding the interpretation of the category "financial security". Under these interpretations, main components of the financial security of the state are identified. Relevance of this study in the analysis of the tense and unstable political and socio-economic situation in the country and development of theoretical, methodological, and practical proposals for improving methodological approaches in various areas of ensuring the financial security of Ukraine in the modern conditions of globalization of the economic sector. The author's definition of the category "financial security" in the context of research problems was provided. The theoretical and methodological content of the concept of financial security of Ukraine has been developed and it has been proved that the content of such a document should not be dogma, but should be constantly and systematically updated. A universal and effective institutional and legal mechanism has been established for the monetary policy of ensuring the financial security of the state, aimed at developing an effective system of public administration bodies with the involvement of central entities for the formation of financial security - territorial communities. An organizational and economic mechanism has been developed for a monetary policy to ensure the financial security of Ukraine, the key element of which is the implementation of strategic goals and directions for the development of this policy. Methodological approaches have been improved in the sectoral areas of financial security of Ukraine, namely, the banking system, financial and credit infrastructure; non-bank financial and credit organizational and legal institutions. It was concluded that the implementation of the presented theoretical and methodological measures will strengthen the financial security of Ukraine in various sectoral areas, reduce the level of hidden of the monetary sector, eliminate the threat of a decrease in the potential of the country's general financial system and introduce modern mechanisms for managing financial security at the macroeconomic and microeconomic levels.

Siti Fatihah C. O.   Hila N. Z.   Shaharudin S. M.   Tarmizi R. A.   Mohamed N. A.   Romli N.   Muhamad Safiih L.   Sri Andayani   and Hafizulddin W. M. W. H.   

Accurate prediction of the stock price is necessary for efficient financial decision making and reconstruction planning, especially during the COVID-19 crisis. Meanwhile, the ARIMA model with neural network approach is a hybrid statistical model that has been used widely in finance and statistics. It could solve the non-linearity problem in ARIMA. However, based on the unreliable sampling variation, the unbalance between the linearity and nonlinearity parts in the hybrid model could lead to inaccurate prediction. This matter motivates the purpose of this study, where the authors aim to balance the linearity and nonlinearity of the hybrid model towards predicting the Islamic investment during the Malaysia Movement Control Order (MCO). In this study, Islamic investment is analyzed using statistical based model of ARIMA. In order to balance linearity and nonlinearity parts of ARIMA which is outperforming the unreliable sampling variation, the aggregating bootstrap approach is used on ARIMA. The resampled linearity and nonlinearity parts will be declared as inputs of neural network system in order to predict the Islamic investment. Resampled nonlinearity part will be generated in this system and its sampling variation is examined. In addition, the performance of model procedure is estimated. It shows that the aggregating bootstrap gives smaller bias values and generates small weights in neural network system. In terms of prediction, applying the resampled procedure in neural network system eventually increases the precision of prediction estimation where it reduces the error estimation of MAE and MSE. Also, the prediction values continually align with actual values of investment at MCO phase. Balancing the linearity and nonlinearity part using the aggregating bootstrap in major procedure of prediction field contributes to high precise prediction of Islamic investment return estimation. The uncertainty of investment returns during MCO phase is a challenging phase and affects Malaysia financial trading. By considering using alternative procedure proposed in this study, i.e. helps in providing accuracy of investment prediction returns, a well-construct financial decisions and plans could be structured during MCO. However, this study limits to examine the effect of aggregating bootstrap. For further research, it is suggested to apply prediction on 10 years returns of Islamic investment using the proposed method.

Anisa Kusumawardani   Rizky Yudaruddin   and Yanzil Azizi Yudaruddin   

The Asian Financial Crisis in 1997 and various other scandals in large companies in Indonesia led to the emergence of good corporate governance (GCG). Regulators on the capital markets understand that good corporate governance promotes transparency and improves the quality of financial reporting, including cash management, responsibly. Furthermore, high cash levels lead managers to misuse the fund for personal gain, because the assets under their supervision increase thereby. This research analyzes the effect of corporate governance, such as board size, and independence on cash holding in Indonesia. Data were obtained from 373 firms in seven industries publicly tabulated on Indonesia Stock Exchanges (IDX) from 2008-2017 and 2,742 firm-year observations. The obtained data were analyzed using Common, Fixed, and Random Effects Models. The result showed that the total number of the board of directors, is positively and significantly proportional to Board Size thereby increasing the company holds cash. Meanwhile, the other corporate governance variable, known as Board Independence, is insigni�cant in any three models. The result also showed positive coef�cients of board size on cash holding (CASH) in companies with and without CEO duality. The result further showed that the independent board had a significant and negative impact on cash holding (CASH), which is more pronounced in companies with CEO duality and used to strengthen corporate governance. The results have specific policy implications like the importance of corporate governance, in particular the role of the Board of Directors in the effective supervision of managers and transparency of enterprises.

Suparman   A. M. Diponegoro   Mahyudin Ritonga   Yahya Hairun   Tedy Machmud   Idrus Alhaddad   Mustafa A. H. Ruhama   and Safiuddin   

Stocks are one of the aspects that affect the economy in the world. In the stock market, the price of a stock changes every time. Investors who are able to predict the increase in stock prices will tend to get profit, but investors who are unable to predict the increase in stock prices will tend to experience losses. This study aims to find statistical models and use them to predict the probability of an increase in the price of a stock in the stock market. The method used in this study is a literature study regarding stochastic models and selected suitable stochastic models. This study finds stochastic models and uses them to predict the probability of an increase in stock prices. The novelty in this research lies in the stochastic model triangulation. The increase in stock prices is predicted using two stochastic models, namely: Bernoulli and autoregressive. The decision on stock prediction is determined by the results of the triangulation of the two methods. The proposed method in this study has the advantage that decision making is based on more than one stochastic model. The results of this study can be applied to the financial sector, especially in the stock market.

Uche Peter Nsoke   Ndu Marvis Okolo   and Grace N. Ofoegbu   

This paper examined the effect of accounting practices on the growth of micro and small enterprises (MSEs) in Nigeria. The study specifically examined the influence of book-keeping and accounting knowledge on the growth of micro and small enterprises as well as the effect of financial management practices on the growth of MSEs in Nigeria. The study adopted survey research design. Micro and small scale enterprises in South-East and South-South geopolitical zones in Nigeria formed the population of the study. The study made use of primary data. Questionnaire was the instrument for data collection. A sample size of 384 was adopted using Bill Godden sample size formula. Proportional stratified random sampling technique was employed to distribute this 384 to MSEs. The data were tested using percentages, mean, and standard deviation, while the hypotheses were tested using regression analysis and analysis of variance. Multicollinearity test was conducted to determine the collinearity of the two independent variables. According to the findings, book-keeping and accounting knowledge as well as financial management practices have significant effect on MSE growth in Nigeria. This finding implies that MSEs will experience continuous growth if they acquire accounting knowledge and apply such knowledge in financial management practices in their business operations. This study will be beneficial to researchers, readers of this work, investors, and intending investors in MSEs in Nigeria. The limitations experienced in the course of this research were the reluctant attitude of some respondents who felt that they might be revealing business secrets to free-riders but later showed full cooperation when convinced it was purely for critical examination of problems of accounting practices affecting MSEs growth in Nigeria and the ability to find out solutions. It recommends government and MSE owners/managers to focus greater attention on the acquisition of book-keeping and accounting knowledge and financial management practices that can constantly lead to MSEs' growth.

Inim Victor Edet   

The growth-finance nexus in Nigeria is investigated in this research. Prior studies used time-series data and classical linear regression mainly, as well as various financial deepening indexes and methodologies. These studies produced a mixed bag of results. This study is unique as it adopts quarterly data from the three arms of the financial industry (banks, stock markets, and insurance companies) which most previous studies neglected to focus solely on the banking sector. The Autoregressive Distributed Lag (ARDL), Error Correction Model, and the Granger causality test were used to examine the convergence and divergence technique. Prior researches overlook a variety of pre-and diagnostic tests. The findings revealed a long-short run co-integrating nexus. Financial indices respond to economic growth in a linear fashion. The insurance industry has a 28% impact on economic growth. The short-run finding demonstrates a 74% speed of convergence from explanatory variable-induced disequilibrium to long-run equilibrium. Economic growth reacts more quickly to the financial climate's shocks and dynamics. A bi-directional association was discovered using causality testing. Recapitalization of the banking and insurance sectors, as well as a review of the Monetary Policy Rate to enhance lending to the private sector and boost savings and investment, is among the recommendations.

Alina Zh. Sakun   Iryna V. Perevozova   Olha H. Kartashova   Oleksandr S. Prystеmskyi   and Andrii S. Mokhnenko   

The article considers a comprehensive methodology of innovative paradigm of management accounting, which takes into account the functional design of information and analytical support of the innovation process that is the foundation for expanding tools and determinants of controlling in the socio-ecological and economic space of entrepreneurship. The maximum possible amount of organized information data is substantiated. It considers the individual features of the management accounting model for decision-making to form the determinants of controlling development with the probability of turning it into a strategic resource aimed at ensuring a stable business, taking into account socio-environmental and economic factors. The model of development of the innovative theory of the administrative account from a position of meaningful enrichment is presented. It is proved that the subject of management accounting with an innovative aspect is the process of managing transaction and innovation costs, which strengthen the development strategy of business entities. Indicators of management accounting, which is formed into a three-component part of business development – social, environmental, economic – as a basis for an integrated assessment of the level of activity of entities in a particular area or industry. A detailed veil of monetary and natural innovative components of management accounting with a focus on the past and future is presented. The intellectual resource and its derivative benefit - intellectual rent is proposed to study in the plane of the philosophy of human-centeredness and with an emphasis on professional knowledge in time, which is obtained by a person. The method of controlling effectiveness is substantiated, which forms a synergistic effect of interaction of functional components of controlling and coherence of their goals.

Randi Anto   Irene Rini Demi Pangestusti   and Eriesta Novia Purwandari   

Purpose – The purpose of this study was to analyze the effect of Bank Age, Loan to Assets Ratio (LAR), Net Interest Margin (NIM), and non-interest margin (Non NIM) on bank efficiency, especially in ASEAN-5 countries (Indonesia, Singapore, Thailand, Malaysia and Philippines). In this research, bank size was used as a control variable. Design/methodology/approach – The sample of the research was taken form general banking entities listed in each country over the period of 2014-2018. Purposive sampling method was used to select 58 banks as the sample population. We use two-stage methodology in this research by using Data Envelopment Analysis (DEA) to calculate bank efficiency and Multiple Regression Analysis (MRA). Findings- The result showed that capitalization and bank age had a negative significant effect on bank efficiency, while the variable of Loan to Asset Ratio (LAR), Net Interest Margin (NIM) and No-NIM had a positive significant effect on bank efficiency. Originality/value – The measurement of bank efficiency was conducted by utilizing DEA in this study to examine the bank efficiency in ASEAN 5.

Andi Herman Jaya   Tasrina Sari Tolla   Ahmad Syatir   Anwar Nasruddin   Novita Sari   and Haerul Anam   

This study aims to analyze the effect of the Central Bank, which is in Indonesia presented by Bank Indonesia (BI) Rate and inflation rate on the savings rate at commercial banks in Central Sulawesi by using the analysis tools of autoregressive conditional heteroscedasticity (ARCH) and generalized autoregressive conditional heteroscedasticity (GARCH). The results of the analysis show that the BI Rate and inflation have significant effects on saving rate at commercial banks in Central Sulawesi. The importance of being a source of investment funds to support development activities can be a consideration for the government to formulate a policy for allocating investment from these savings funds for productive sectors. Practically, it is hoped that the distribution of savings through investment activities can encourage economic growth and increase economic development in Central Sulawesi.

Shailesh Rastogi   Chetan Panse   Arpita Sharma   and Venkata Mrudula Bhimavarapu   

UPI (Unified Payment Interface) platform has been used especially in India since 2016. This paper is aimed at exploring how UPI is impacting, financial literacy, financial inclusion and the economic development of the poor in India. Structured equation modelling is applied in the paper to explore the path analysis of the relevant construct to establish the relationship. A structured questionnaire of interval scale was administered to gather the data for the study. It is found that UPI is impacting the financial literacy. In addition to that, it is found that financial literacy is significantly impacting financial inclusion which in turn is significantly causing economic development. Moreover, the significant association of financial literacy to financial inclusion is partially mediated by financial stability and the significant association of financial inclusion to economic development is also partially mediated by trust. The main implication of the study is that UPI is helping people in more than one way. It is not only supporting the financial literacy but also contributing to financial inclusion and economic development of the poor, indirectly. Therefore, policy makers can use the findings of this study to frame policies for UPI more effectively in the future. This study is unique as no other study is observed on the linkage of UPI with financial literacy, financial inclusion and economic development of the poor.

Isil Erem Ceylan   

The purpose of this study is to examine the impact of both firm-specific and macroeconomic factors on the financial distress risk of the firms listed in the Borsa Istanbul Small and Medium Enterprises (SMEs) Industrial Index over the period from 2010 to 2019. Generalized Method of Moments (GMM) estimator is used to determine the potential impact of firm-specific and macroeconomic factors on financial distress risk. The dependent variable used in the study is financial distress risk measured by Springate S score. This study considers the independent variables by incorporating both firm-specific (current ratio, quick ratio, asset turnover, debt ratio, financial leverage, and return on assets) and macroeconomic factors (economic growth, exchange rate, and inflation rate) in the analysis of financial distress risk. The empirical results show that the current ratio, quick ratio, asset turnover, debt ratio, financial leverage, and return on assets have a statistically significant positive impact on financial distress risk. On the contrary, the findings document a negative association between percentage change in the consumer price index and financial distress risk. To the best of the author's knowledge, this is one of the several studies seeking to identify the determinants of financial distress risk for Turkish SMEs by considering both firm-specific ratios and macroeconomic indicators with panel data analysis (generalized method of moments). This study may be extendable to be used by SMEs and may provide a remarkable resource for them. Also, the obtained results equate numerous practical implications nominately for the executives of SMEs as mentioned in the conclusion part of the study.

Marina Evgenievna Ordynskaya   Tatyana Alexandrovna Silina   Lala Eldarovna Divina   Irina Fedorovna Tausova   and Saida Aslanbievna Bagova   

The purpose of the study is to analyze the functions of a cost management system in modern organizational management. Based on general scientific research methods and an expert survey, the key functions of cost management are defined. The authors justify the feasibility of developing a cost management system with the determination of cost management functions. The key approaches to cost analysis are formulated. It is important to ensure stable connections between the elements of the management system at the management level of the business hierarchy during the implementation of cost management functions. Moreover, one must build a mutual cost regulation mechanism at the stages of planning, organization, technological process development, and production, i.e. during the creation of the entire business process. There is a need for coordinated work by all the structural departments at the enterprise with strong horizontal and vertical logistical connections and established responsibility centers during the development of the general management system that the cost management system should be integrated into it. The tried and tested communication plan for information transmission and coordination between structural units at an enterprise determines the efficiency of the management and control systems aimed at maximum impact from management at the executive level when management decisions are made. The practical significance of analyzing the functions of cost management systems in a modern organization management system consists in increasing the efficiency of management decisions made based on the data from the analytical assessment of the costs of the enterprise. The theoretical significance lies in the chance to use the study results during the development of a general organization management system.

Anzhela P. Lelechenko   Vladyslava V. Iyzefovych   Iryna I. Doronina   Tykhon S. Yarovoi   and Viktoriia V. Tomakh   

The article is devoted to the current problem of forming a strategy-oriented mechanism for managing the financial security of Ukrainian enterprises based on the introduction of new information technologies. It was established that transformational processes in the economy of Ukraine create the need to search for modern and effective ways to ensure the sustainable development of economic entities. The approaches to the definition of the financial security category of the enterprise are generalized and provided the author's definition of this category taking into account the strategically oriented approach. The main strategic guidelines are systematized, which are a prerequisite for the formation of an effective and efficient mechanism for managing the financial security of a modern enterprise of Ukraine in the context of the information and digital economy. A financial security management mechanism has been established to solve the problem of ensuring financial security, assess the level of financial security. A set of measures aimed at using the available resources and capabilities of the enterprise are taken. Proposals are presented for solving typical tasks on information and analytical support of the management process of financial security of the enterprise by means of introduction of new information technologies.

Volodymyr I. Kravchenko   Lina V. Bondareva   Roman Yu. Bykov   Larisa V. Danilova   and Olha V. Myrna   

The article is devoted to the current problem of introduction and effective functioning of the process of financial decentralization as a key factor in the socio-economic development of territorial entities. It has been found that the problem of creating and implementing effective mechanisms for solving the problem of financial differentiation is one of the most important areas of building effective social and economic policies in the context of the spread of innovative forms of public administration at the local level. There are generalized scientific works on the socio-economic development of territorial entities of Ukraine, given an author's interpretation of this concept in the article. Approaches to the definition of financial decentralization have been systematized and a clarified definition has been provided. The general directions of the introduction and functioning of the institute of financial decentralization are justified. The advantages and disadvantages of the financial decentralization process are identified both for the state as a whole and for a separate territorial entity. A universal system for the functioning of the financial decentralization process has been established, which consists of interconnected subsystems that function on the basis of sustainability and feedback. Quantitative analyses have been performed by the means of constructing an integral indicator. Proposals on directions of improvement of financial decentralization process in modern conditions of Ukraine are presented. It was concluded that the improvement subsystem is a key factor in the success of the entire financial decentralization system by providing continuous feedback for other subsystems for the continuous introduction of new ideas, technologies, and models for managing this process.

Oleg A. Diegtiar   Oleksandr V. Bezuhlyi   Yuriy O. Tararuyev   Tetiana O. Suslova   and Tetiana V. Romanchenko   

The importance of sustaining small and medium-sized enterprises (SMEs) around the world is increasing rapidly each year. In modern days many countries try to develop methods to preserve this type of companies given recent global crisis. SMEs in the Ukrainian economy account for 99.98% of the total business population. Relevance of this study consists in the significant role of the SMEs in the structure of national economy and their importance in development of the modern domestic economic systems. Objectives of the study are to determine prospects, shortcomings and features of establishing management accounting practices (MAPs) in SMEs. The problem of the study consists in fragmentation of the knowledge in the literature relating to management accounting practices in small and medium sized enterprises and problems of establishing them, due to restriction of resources and particularly wide gap between management accounting theory and practice compared to larger companies. Trends in the small and medium-sized enterprises in the structure of the national economy and their role in the development of the domestic economic system can be predicted on the basis of several reviewed cases. This confirms the relevance of the analysis of the management accounting system of economic entities in order to determine financial reserves to ensure economic activity in a crisis. Automated parametric control systems have been developed and proposed for implementation as elements of management accounting in order to provide processes for planning, monitoring and controlling of operational processes, as well as provide information and analytical support for management decision-making as a result of this study.

Natalia V. Trusova   Leonid V. Melnyk   Zhanna S. ShŃ–lo   and Oleksandr S. Prystеmskyi   

Today the problem of managing credit and investment risk in the bank in the context of financial globalization remains one of the most relevant problems. At the same time, science may not yet explain the answers to some questions and the banker needs to solve them in practice. Therefore, the construction of a comprehensive system of credit and investment risk management in banks is one of the main components of security effective lending activities of banks. The article considers the features of credit and investment activities of banks in the interbank market in the context of financial globalization. The article reveals that the main economic function of Ukrainian banks in the period of accession to the EU is the credit and investment activity of their clients. State of the loan and investment portfolio and dynamics of loans were analyzed. The model and methods of the integrated stabilizer of credit and investment activity of the bank on the interbank market are developed. The authors proposed a list of methods and actions that unify threats, identify risks and improve the credit and innovation activities of the bank in the period of globalization for countries that are in the process of forming the banking infrastructure.

Iuliia S. Pinkovetskaia   Anton V. Lebedev   Olga V. Slugina   Diego Felipe Arbelaez Campillo   and Magda Julissa Rojas Bahamon   

The Aim of the article is in the assess indicators characterizing informal personal financing of entrepreneurs in different countries. Initial information used in our research is the data obtained in the course of the survey habitats of various countries (Global Entrepreneurship Monitor). In the course of the study we consider the indicators characterizing investment activity of men and women on three options including financing of the entrepreneurs who are their relatives, colleagues, friends and acquaintances. The assessment of the levels of nine indicators used economic-mathematical modeling based on density functions of normal distribution. The use of these functions allows defining medium values and ranges changes in considered indexes typical for most countries. In addition, the survey identifies the national economies which are characterized by the maximum and minimum data nine indicators. The study demonstrates that there is a gender gap in the data for various states. The scientific novelty and originality of this research are as follows: the indicators of external investment in firms created by entrepreneurs in different countries have been estimated; the assessment of nine indicators characterizing external investments for start-up entrepreneurs has been modeled; presents a high difference in the values of considered indexes in different countries has been shown; countries with maximum and minimum values of each indicator. It has been proven: proportion in a number of involved men in informal financing of created SMEs established by their relatives in most countries is lower than the same indicator of women, and men proportion involved in informal financing of the new SMEs created by their colleagues, as well as friends and neighbors in most countries is higher than the same indicator of women. Further research can be aimed at detailing the structure of informal financing recipients among entrepreneurs.

Sanjeeb Kumar Dey   

Goods and Services Tax is considered to be one of the revolutionary tax reforms in India since independence. The foundation of this new taxation system is to remove the cascading effect and increase the tax revenue with more transparent mechanism. The present paper is an attempt to assess the impact of this new taxation system on indirect tax revenue of India in general and of Odisha in specific. The study is analytical in nature and is based on published data. Collection of revenue under goods and services taxes has been considered from July 2017 to March 2021. The results show an increasing trend of indirect tax in India due to implementation of new tax except a few months because of some administration complexity and prevailing Corona pandemic. Future tax revenues have been forecasted using Exponential Triple Smoothing function and are compared with actual collection up to March 2021. So far Odisha state is concerned, expected tax revenue is not yet realised and the situation may be unfavourable when Central Government will stop giving Compensation cess after July 2022.

Marina Evgenievna Ordynskaya   Ruslan Aslancherievich Tkhagapso   Irina Grigorevna Tkharkakhova   and Dana Izmailovna Ponokova   

The study aims to determine the essence, classification, reduction methods, and the impact on accounting organization of the risks faced by the customer and the contractor when outsourcing accounting. The article examines the types of risks that arise when outsourcing accounting. Based on the use of such scientific methods as logical generalization and comparison, as well as an expert survey, the following classification criteria and types of risks for the customer have been identified: concerning the customer's activities (operational, financial, control); by the level of loss and distortion of information (risk of disclosure of confidential information, risk of loss of customer documentation, accounting risk); by the aspect of emergence (psychological, moral, loss of reputation); by the source of occurrence (subjective, objective), by the possibility of prediction (predicted, unpredictable); by the possible consequences (risk resulting in loss to the customer; risk resulting in the customer receiving a specified level of income). The reasons and consequences of the proposed types of risks have been determined. The authors also have determined the influence of each of them on accounting organization and the main stages of risk management and methods of risk reduction. The practical importance of improving the classification of risks in outsourcing accounting is to assist parties in contractual relations in developing a strategy and forecasting business activities. The theoretical value lies in the possibility of using the research results to develop new classifications.

Roslin Lazarus   Stanley Lazarus   and Shobhna Gupta   

Working capital (WC) determinants play a crucial role in operating activities and corporate performance in a routine firm. This paper examines the influence of WC determinants on corporate performance employing a sample of thirty-one metal and mining firms listed on the National Stock Exchange (NSE), India for 10 years from 2010-2019. Pearson's correlation and fixed effect regression models were used to estimate the explanatory variables regression coefficients on the outcome variables. ROTA, ROEQ and ROCE variables were used to ascertain performance of sample firms and results revealed a significant negative influence of WC – inventory period (INVP) and accounts receivable collection period) on corporate performance (ROTA,ROEQ & ROCE). No significant influence was observed between Corporate performance (ROTA, ROEQ & ROCE) and account Payable (AP). Moreover, Control variables corporate size (CZ) results revealed significant negative influence on corporate performance (ROTA,ROEQ & ROCE), & Debt ratio(DR) result revealed a negative significant influence on ROTA, ROEQ .The result of sales Growth (SG) indicated a positive significant influence of corporate performance (ROTA,ROEQ & ROCE). From the result of this study, it has been inferred that by reducing the INVP & ARCP the management can enhance corporate performance & eventually creating value for firm's shareholders. Through a meticulous reduction of the inventory period (INVP) & account receivable collection period (ARCP), firms can demonstrate the effective and efficient utilization of financial resources, mitigating default & liquidity risk thereby enhancing its profit. Thus, systematic utilization of working capital elements positively influences firm's performance.

P. V. Chandrika   and K. Sakthi Srinivasan   

Knowing about the future returns attract every investor. Investors can take appropriate decisions once they know what would be the future returns based on their investments. To know the returns, the earlier studies have proposed basic models like Efficient Marker Hypothesis and Random Walk Model, whereas these theories have their own limitations in predicting the direction of the stock and the next day value of the stock. Later with the evolution of Machine learning and Deep Learning Techniques, there were many experiments which were made to study the stock markets. The present research paper aims at applying the Deep Learning technique of Artificial Neural Network to predict the direction of the stock index. The data consist of daily open price, close price, high price, low price and volume of NIFTY 50, S&P 500, New York Stock Index, Korean Stock Index, Dow Jones Index and Shanghai Stock Index from Jan 2015 to May 2020. The open price of the index is fed as input to the Artificial Neural Network. The model is evaluated on different performance metrics of Accuracy, Precision, Recall and F1-Score.

Siti Zulaiha Ibrahim   Teh Raihana Nazirah Roslan   and Ali F Jameel   

Prior studies revealed that most researchers tend to employ the Black Scholes model to price equity warrants. However, the Black Scholes model was found deficient by contributing to large estimation errors and mispricing of equity warrants. Therefore, issues involving equity warrants are discussed in this paper, by focusing on specific topics and respective stochastic models to provide a basis for improvements in future research. In recent years, stochastic approaches have been used to a great extent among researchers due to the expansive applications in both theoretical and practical sense. Subsequently, this paper provides the results of a comprehensive literature review on various stochastic modelling methods and its applications for pricing financial derivatives in terms of applications, modifications of methods, comparisons with other methods, and general related researches. Focus is given on two types of stochastic models namely stochastic volatility and stochastic interest rate models, along with the discussions associating these two types of models. This paper acts as a valuable source of information for academic researchers and practitioners not only for pricing financial instruments, but also in various other fields involving stochastic techniques.

Abdessetar Bensaid   Suhaimi bin Ishak   and Ifa Rizad binti Mustapa   

The aim of this paper is to review existing literature related to the risk management committee attributes (RMC) that can facilitate transactions between board committees and add value to corporations. The emphasis of this study is on RMC as it has become a crucial element, especially after the collapse of large corporations. RMCs have attracted the attention of academics and become one of the important factors that enhance the companies' performance as well as the quality of financial reporting (FRQ), and its demographic attributes are expected to play an important role in corporations. However, prior studies on the area have found inconclusive results and provide several gaps in the literature due to the mixed findings. In addition, prior studies highlight the RMCs attributes that affect corporate's performance and also the reporting quality and provide an urge to conduct more researches in related fields. Taking the period from 2003 to 2021, this paper reviews previous studies and gives a better understanding of RMC's role and future research directions. In addition, this study provides recommendations to the policymakers, regarding the demographic attributes of RMCs that can influence corporate performance and its FRQ. Finally, this review demonstrates that businesses should concentrate on these mechanisms to strengthen their performance and their reporting quality.

R. Aditya Kristamtomo Putra   Nana Diana   Wirman   and M. Nasim Harahap   

The effect of sales (X1) and operational cost (X2) variables on net profit (Y) on the 2019 LPPOM MUI Halal Award Winner Companies is Listed on the Indonesia Stock Exchange. The method used is descriptive statistics with a quantitative approach. A classic assumption test is also utilized to analyze the data and multiple linear regression analysis to determine the level of relationship or influence given by the sales and operating costs to net income. The data used are the secondary data with quantitative types of data for the period 2014-2018 with the population of this study being the company that won the 2019 Halal Award listed on the Indonesia Stock Exchange. The sampling method is purposive sampling method with the number of observations of 6 companies. The results of the study showed that sales and operating costs variables simultaneously affect net income. However, partial testing showed that sales have no effect on net income and operational costs partially affect net income. The results of the coefficient of determination indicate that net income (Y) is influenced by sales (X1) and operating costs (X2) as much as 90.1% and the rest is left influenced by other variables by 9.9%.

Okolo Ndu Marvis   Ideh O. Abel   and Emengini Steve Emeka   

There is the dearth of empirical evidence on the relationship between corporate tax, aggregate federally collected tax revenues and economic growth, predominantly in the post-electronic tax era. This study seeks to assess whether corporate taxes affects aggregate federally collected tax revenues and economic growth using quarterly time-series data as extracted from the official websites of the Federal Inland Revenue Service, National Bureau of Statistics (NBS) and Central Bank of Nigeria (CBN) Statistical Bulletin covering during the period 2015q1-2020q1. The Multivariate Vector Auto Regression result revealed that corporate taxes positively and significantly affect aggregate federally collected tax revenue; company income tax (CIT) and economic growth (RGDP) were statistically significant while petroleum profit tax (PPT) is statistically insignificant to economic growth (RGDP). In view of this result, it is recommended that the Nigerian government should diversify measures aimed at jettisoning leakages in the administration of corporate tax, particularly petroleum profit and company income taxes since they contribute significantly to the revenue base of the country. Moreover, more measures that are stringent should be put in place to revitalize and fully automate the tax systems for improved revenue generation. The study is limited to the post-electronic tax system payment in Nigeria which was occasioned by tremendous improvements in the tax administration system in the Country.

Syaiful Hifni   Akhmad Sayudi   Atma Hayat   A. Kadir   and Rano Wijaya   

Purpose: The purpose of this research article is to assess what information should be connected and how its information can be connected based on integrated thinking fit within integrated reporting into information system of regional investment potential (ISRIP) of regional government. To develop insight into how it can be implemented over changes of investment climate due to the top down pressures to fulfill sustainable development goals (SDGs). Design/methodology/approach: we conducted research for regional governments (province/district/city) in Indonesia with investment characteristics of the potential, priorities and opportunities of regional investment units by taking samples for 100 regional investment units. Measurement used nominal scale with chi-square test for goodness of fit to get the measurement of observation frequency (OF) and compared with the expected frequency (EF). Findings: the measurement results showed observed frequency (OF) with a value of 137.97. Afterwards, for expected frequency (EF), with degrees of freedom (6-1) (7-1) and a significance level of 0.05, within the chi- square showed the value of 43.77. Due to OF > EF, this result indicated for being of corresponding between integrated thinking of regional investment within implementation of information system of regional investment potensial (ISRIP). The level of integrated thinking relationships with integrated reporting in the role of 'ISRIP' has a Pearson contingency coefficient of 0.4057, as a moderate relationship. Originality: This research article contributes to the growing debate about the benefits of integrated reporting as a voluntary reporting initiative, and in which another organization have adopted as a mandatory initiative for the mode of reporting up to date; more specifically, in the efforts of regional governments to adopt an integrated thinking that is in line with the role of an integrated reporting system, in communicating of regional investment units. Practical implications: To be as an early adopter of reporting practices towards the implementation of the information system of regional investment potential (ISRIP). We imply that the six capital with strategic communication will enhance performance of ISRIP, through fundamental way and as regional strategic wisdom. To meet the values of accountable organization within regional investment units' management. In line with national alignment in global megatrends with the sustainable development goals (SDGs) accomplishment.

T. T. Onileowo   F. M. Muharam   M. K. Ramily   and Saleh F. A. Khatib   

Despite the fierce competition in the business environment, firms accept relatively low innovative solutions in their daily activities and consequently lose competitive advantage, experience creeping growth at a snail's pace directly associated with the firm's inadequate finance and eventual collapse. This study examined the interrelationship between access to finance, innovation, and competitive advantage. Premised on the study findings, results revealed that innovation is an all-important strategy that differentiates the products and services of business firms and consequently sustaining competitive advantage. The results suggest that adequate financing can be a mechanism by which innovation and competitive advantage positively relate to increased performance. The strength between these variables would be heightened as access to finance increased. It was further established that firms with encouraging innovative culture would gain rare core competencies and maintain the position of the market leader while sustaining competitive advantage. Based on these findings, the study recommends that business firms conduct market surveys to determine the need of current and prospective customers. Management should prioritize, invest heavily in research and development, and the government should strive to provide adequate financial support, infrastructural facilities, and incentives for business operations.

Fuad   Zulaikha   and Agung Juliarto   

Debates on whether the new globally adopted accounting standard outperforms national generally accepted accounting principles have not yet reached the final conclusion. Prior researches were mixed and often yield to contradictory findings. Our study believes that there are numerous institutional backgrounds that contribute to these inconclusive findings. The main objective of this study is to propose a testable framework on the impact of implementation of International Financial Reporting Standards on accounting qualities. The proposed framework based on the assumption that accounting should be linked to its social, political influences and culture. In this regard, we proposed whether the positive effects of IFRS implementation to the increase of accounting qualities may also be enhanced (impaired) by the firms' national culture and corruption at the country level. This study should provide further research some preliminary arguments on how the accounting information quality is not affected by the high-quality accounting standards, per se. Rather, our study conveys worth-looking message that IFRS-accounting quality may also be influenced by those institutional environments. Hopefully, this may provide a way out of the intractable debate of prior research.

Christian Philip A. Fortuna   

A budget is an economic tool for realizing and facilitating the vision of an organization. If a budget is to serve as a useful tool, then it is essential that all phases of budgeting are appropriately linked and managed [1]. This study made use of the three types of research by methods: descriptive research to gather the profile of respondents (size and type of business), budgeting practices (manager's participation, linking budget development to strategy, rational allocation of resources, flexibility continuous budget, and reduction of complexity and use of information technology) and level of profitability; causal-comparative research to determine differences between variables; and correlational research to determine the degree of relationship between variables and for hypothesis testing. Primarily, the 331 respondents of the study were from the four-commercial centers in Isabela, broken down as follows, Cauayan City (116), Ilagan City (58), Santiago City (121) and Municipality of Roxas (36). Results of the study showed that test of difference in respondents' budgeting practices regarding managers participation, reduction of complexity and use of information technology significantly differed between small and medium enterprises. Additionally, when the respondents were grouped according to the type of business, merchandising and servicing business varies with manufacturing business budgeting practices regarding managers participation and linking budget development to strategy. Conversely, small-sized and medium-sized businesses significantly differ as regards their level of profitability. Furthermore, the test of the relationship on respondents' perception of budgeting practices is used and their level of profitability reveals a direct and significant relationship.

Yana L. Gobareva   Olga Yu. Gorodetskaya   Marina V. Karp   and Igbal A. Guliev   

The problems of technological exchange and technological development are becoming the most important for all groups of countries. Developed countries want to maintain their dominant position, developing countries try to catch them up, and the least developed countries try not to be a raw materials appendage of both the first ones and second ones. Technological convergence can become the answer to the challenges for all countries. The article's aim is to form theoretical approaches to technological convergence with the development banks participation. The main challenge of the article is the lack of statistical data on the subject, just as the novelty of the scientific field covering technologic convergence itself. The main article's results are the development of a more equitable technological convergence model, the technology exchange model in Asia, the financial mechanism's development for technological convergence through development banks and proposals for development banks entering the suggested technological convergence track. Thus, the answer to the question posed in the title is negative, as modern development banks cannot effectively cope with the technological exchange. The key contribution of the article is the creation of the theoretic model for the Asian international development institutions on the technology exchange mechanisms, just as the model of attracting financial resources to the project in the field of technology, interconnected with each other.

Nurkhodzha Akbulaev   and Matanat Mammadova   

Financial literacy is knowledge that every person needs in everyday life. Studying theory, mastering practical skills, developing financial thinking - all this will allow each of us to become financially successful. Research Objective: The aim of this study is to ascertain the financial literacy level of individuals living in Baku, The Republic of Azerbaijan. 280 people between the ages of 17-60 were involved in the survey, comprised of public and private sector employees, self-employed, retirees and students to attain this objective. Method: SPSS 25.0 for Windows package program was used to evaluate the research data. First of all, frequency was determined in the research. While testing the hypotheses of the research, t-test was applied for independent samples, and Mann Whitney U test was used for comparison of two nonparametric independent groups in the examination of the differences between more than two groups. In addition, the Chi-Square test was utilized to ascertain the degree and direction of the relationship between the relevant variables. Factor analysis has been practised to reduce the number of basic dimensions or group, the variables to facilitate understanding and interpretation of the relationships between multiple variables. In order to decide on the correctness of the answers given to the questions, reliability analysis was performed. Results: In consequence of research, the average level of financial literacy success is determined to be 75% in Baku. Nevertheless, financial literacy level of the participants differs according to demographic variables such as gender, age, marital status, income, profession, education level. Conclusıon: These results can be used to guide policy makers where to place more emphasis in terms of financial education for Azerbaijans.

Wiyadi   Sayekti Endah Retno Meilani   Imanda Firmantyas Putri Pertiwi   Rina Trisnawati   and Nor Hazana Abdullah   

Disclosure of human resource accounting is an important facet of sound corporate governance to ensure organizational sustainability. However, practices of human resource accounting disclosure (HRAD) have not been made mandatory among Asian countries and therefore to what extend the companies have reported their human resource accounting is not evident. This study aimed to describe HRAD practices among top ranked companies based on ASEAN Corporate Governance Scorecard which include Indonesia, Malaysia, Vietnam, Philippines, Thailand and Singapore. Assessment of HRAD practices was done based on sixteen criteria based on previous studies. A total of 195 companies were assessed based on their annual reports in year 2014 and 2015. The study found that Indonesia has the highest HRAD practices (71%), followed by Thailand (66%), Vietnam (65%), Malaysia (59%), Singapore (43%) and Philippines (40%). It is also found that separate HRAD is almost non-existent except a few companies in Philippines and Malaysia. This indicates that HRAD practices need to be institutionalized for better governance in Asean countries.

Ahmet Niyazi Ă–zker   

In this study, we aim to determine the extent to which the average investment limits affect the average tax burden under the OECD. It appears that international investment limits in OECD countries are affected by three components. Undoubtedly, one of these is the average tax burden under the OECD. Other components are the average debt ratios of governments and countries' real growth movements on economic growth, which affect the global average measure of investment services. It is observed that the changes in investment options in OECD countries show significant differences according to the average tax burdens of the countries and affect the investment limits significantly. This phenomenon put forth a significant change effect on investments as an average of criteria effect, and this approach makes it meaningful to conduct a tax burden-based study. Since the tax burden phenomenon in countries varies in terms of domestic and foreign debt of countries and is directly related to growth rates. The fact that changes in the average tax burden of OECD member countries affect investments reveals that it is dependent on the tax burden, the GDP of the relevant countries and the average debt burden of the OECD countries. Domestic and public foreign debt options of these countries directly affect the OECD's average investments. It shows that this influence analytically increases the negative criteria based on investments in these countries concerned.

Albertina Paula Moreira Monteiro   Joana Andreia Machado Vale   Catarina LibĂłrio Morais CepĂŞda   and Eduardo Manuel de Almeida Leite   

This study aims to develop and evaluate a Decision-Making Success contingency model to assess its dependency on Internal Control System Quality and Financial Information Quality. The authors developed a study based on a sample of 381 Portuguese managers. The structural equations model was used in the analysis of causal relationships between different constructs. Results show that Internal Control System Quality contributes directly to Decision-Making Success. Moreover, Internal Control System Quality and Financial Information Quality are determining factors for Decision-Making Success since Internal Control System Quality has a significant direct impact on Financial Information Quality (with a 64% coefficient of determination) and indirect on Decision-Making Success. The model justifies 67% of the variance of the dependent variable. This research covers a literature gap, since it identifies innovatively, two independent variables that are determinant for Decision-Making Success from the Portuguese companies' manager perspective. This study is relevant to literature development, as it develops and evaluates an original model, and to managers, in the sense that it identifies factors that contribute to Portuguese companies' success.

Bitila Shosha   Armela Anamali   and Alma Zisi   

The real estate sector is one of the most important sectors of the economy for developing countries. The housing market is directly related to the performance of economy. The impact of this market is measured through the volume of various transactions, such as real estate sales, lease contracts, construction contracts, import transactions, foreign exchange, transactions of financial intermediaries and real estate agencies, employment contracts, etc. The real estate market is directly influenced by housing policies, the level of financial system development, visible additional costs (tax rates and credit costs) and its invisible costs (which is informality and information asymmetry). Hypotheses: The housing market operates according the rules of the supply-demand and the factors that affect the fluctuation of housing prices. The purpose of the article is to evaluate the demand factors in the performance of house prices in Albania. Methodology: The study employs an exploratory analysis based on the literature review, the secondary data and empirical analysis. The authors make a comparison between the factors identified by the literature review, the analysis of the secondary data for the Albanian real estate market, and statistical relationships of individual factors as well: GDP/capita, Exchange rate, Interest rates in ALL, Interest rates EURO, Remittances and the level of mortgage loans in EURO. In the conclusions of the paper, some of the factors that have directly influenced the fluctuations in real estate prices in Albania are: the demand and the supply of real estate; the change in the value of the functional currency; state intervention through fiscal policies and urban planning; credit financing to businesses and individuals, etc.

Ekaterina Yu. Voronova   and Husan Sunatullaevich Umarov   

Accounting information systems are evolving along with modern information technology, which opens up countless opportunities to expand the intellectual, scientific and professional potential, contributing to the culture and "language" of accounting, professional principles extend beyond one country. However, differences in national and regional accounting systems still persist and reflect not only a diversity of accounting policy views but also deeper structural differences rooted in legal, financial and social systems. The Islamic (partner) accounting model appears to be the least studied and, at the same time, the most different from other accounting models. The economy of Islamic states is an important part of the world economy, so Islamic and other companies operating or investing in an Islamic institutional environment have a direct interest in proper disclosure of accounting information. The major goal of the research is to find similarities and differences between the IFRS and Islamic banking and to prove that it's beneficial in the modern Islamic countries. In order to assess and compare the IFRS and the Islamic banking practices the authors used comparative analysis and empirical study of the major parts of the both accounting systems. The major findings include the proof of the positive role of Auditing Organization for Islamic Financial Institutions (AAOIFI) which develops norms of convergence of International financial accounting standards (IFRS) and AAOIFI, and the proof that Islamic banking is based on the Sharia and Islamic ethics, but can be based on other principles that are not contrary to Sharia. The authors have come to a conclusion that zakat (religious tax for the poor and needy) is a positive social external effect, and that Islamic accounting is characterized by greater disclosure than traditional accounting.

Yadulla Hasanli   Turac Musayev   Gunay Rahimli   and Simrah Ismayilova   

The article analyses balance between the capital and labor market in the CIS countries rich in hydrocarbon resources – Azerbaijan, Kazakhstan and Russia. For this purpose, the impact of capital (fixed assets) and labor (employed population) on the production volume (on GDP) was estimated based on the relevant statistical data from these countries using production function analysis. The parameters of CES production function were determined in the Mathcad system by the nonlinear least-squares method. The subject of the research has enhanced relevance due to the lack of extensive research of the problem posed in the oil and gas-rich countries of the CIS, and the research evaluates the balance between capital and labor markets for the first time in resource-abundant countries. From the results, it can be seen that for each of these three countries the distribution coefficient for capital is significantly higher than that for the labor factor. This means that there is an excess of capital that cannot be started. This is typical for the countries rich in natural resources. The main reason for this process is the complex structure of increasing capital with oil revenues and low level of specialization of the existing labor force to launch this capital. Moreover, according to the results obtained from the CES production function, the substitute elasticity coefficient in oil-rich countries of the CIS is less than one. The study summarizes the current problem as an imbalance between the capital (fixed assets created using modern technology) and the labor market (labor to leverage key assets using potential opportunities). Based on the analysis, the results obtained from modeling is formulated and scientifically grounded recommendations have been provided for the improvement of education and its quality in these three countries, especially in Russia and Azerbaijan.

Mehmet Nar   

The aim of this study was to analyze the relationship between credit default swaps and net portfolio investments. Since the series remained stationary at varied levels in the study, the ARDL limit test approach was employed. In the analysis, 10 years of periodical data from 2010 to 2020 were compared. During the implementation of the ARDL limit test, it agreed to add a dummy variable to the model for months 2018M4 and 2020M3 upon the analysis of the CUSUM and CUSUM2 graphics; hence, in the final model, a dummy variable was also included. By means of diagnostic tests administered to the ARDL model that was repeated after the inclusion of the dummy variable, it became evident that the final model met the required hypotheses for the ARDL limit test, and it was thus feasible to interpret the long- and short-term coefficients. As the coefficients of final model attained, it was detected that an increase by 1% in short term risk premiums reduced current period net portfolio investments by 2.87%. However, it was evident that in the long term credit risk premiums have a small but positive and significant (p<0,05) effect on net portfolio investments.

Iuliia Pinkovetskaia   Irina Gruznova   Anton Lebedev   and Larisa Tsybina   

The purpose of the paper is to evaluate indicators describing the participation of men and women in external financing of new small and medium businesses in different countries. As the initial information in our study, we used the data obtained from the implementation of the Global Entrepreneurship Monitoring Project. The study evaluated the indicators that characterize the participation of men and women in investments in emerging businesses, and the average values of the corresponding contributions. The scientific novelty and originality of our study are as follows: indicators on external investment in SMEs by men and women in different countries have been assessed; six indicators describing external investments for start-up entrepreneurs were modelled; males' participation in external financing of SMEs has shown to be higher in most countries than in women, and there is a gender gap in external funding; average values of deposits in investments for start-up entrepreneurs have been established; significant differences in the values of the six indicators under consideration by country are shown; countries with high and low values of each of the six indicators are represented. The results are of theoretical and practical importance for government bodies and entrepreneurs. The methodological approach to assessing external financing of new SMEs proposed in the article can be applied in further studies. The new knowledge gained is of interest and can be used in the educational process in universities. Further research may aim at detailing the structure of external financing recipients among entrepreneurs.

Fawzi A. Al Sawalqa   and Atala Qtish   

This study examines the current status of accounting standards among Jordanian firms. In particular, it examines the adoption level of IAS/IFRS. In addition, it examines the implementation process in terms of difficulties and challenges. Further, the study tests empirically the effect of international institutional pressures, local legal enforcement bodies and accounting education level on accounting standards adoption level. The results of the study are based on the descriptive and multiple regression analysis technique. Based on 62 usable responses, the study reveals that the adoption level of IAS/IFRS among Jordanian firms is moderate. For example, IFRS 7 (Financial Instruments: Disclosure) is the most adopted standard. This is followed by IAS 32 (Financial Instruments: Presentation) and IFRS 15 (Revenue from Contracts with Customers) respectively, while IFRS 2 (Share-based Payment) is the least adopted standard. In general, the study reveals that the implementation process of some standards is easy such as IFRS 7 (Financial Instruments: Disclosure), while others such as IAS 36 (Impairment of Assets) and IFRS 13 (Fair Value Measurement) need additional efforts to properly implement. In addition, several challenges were detected, which could prevent the proper implementation of some accounting standards such as the shortage in the governmental and IT supports. Further, the study shows that international institutional pressure and local legal enforcement bodies have a positive and significant relationship with the adoption level of accounting standards, while the effect of accounting education level is insignificant. JACPA should coordinate and collaborate with IASB and the government to offer all the necessary financial, technical and legal support for Jordanian firms to fully adopt and apply accounting standards. Several recommendations were offered for future research to enrich this vital topic in Jordan and other developing countries.

A. Mulyo Haryanto   and Wisnu Mawardi   

This research tries to show that information about COVID-19 affects market arousal indicated by the frequency of transactions, and the market performance shown by Jakarta Composite Index (JCI). The theory used for analysis is the prospect theory and efficient market hypothesis (EMH). The results of statistical analysis indicate that information about COVID has a negative effect on JCI, as well as trading volume the previous day. The evidence can briefly prove that there is an effect of COVID-19 and weakening daily transactions on JCI. The research findings show that the JCI market uncertainty is in line with the VUCA and Prospect theory. In this case, it occurs that uncertainty affects the behavior of investors' decision making. Investors' decision-making behavior is accumulated in market behavior, and is subsequently manifested in index changes in accordance with the efficient market hypothesis. The contribution of this research to the study of financial market behavior is that uncertainty and uncertainty faced by investors affect market behavior and changes as measured by the index.

Anindya Ardiansari   Siti Ridloah   Irene Rini Demi Pangestuti   and Pipit Indriyani   

The development of property and real estate companies in Indonesia is expanding. Property and real estate companies have great opportunities to further develop their companies. However, an increase in intellectual capital investment does not affect financial performance and market value. Therefore, this study aims to examine the effect of intellectual capital on financial performance and the market value of the property and real estate companies in Indonesia from 2014 to 2018. The population of this research is 56 property and real estate companies listed on the Indonesia Stock Exchange (IDX) from 2014 to 2018, then the sampling technique used is purposive sampling which results in 42 companies being studied with 210 observations. This study uses independent variables, namely Value Added Capital Employed, Value Added Human Capital, and Structural Capital Value Added as a representation of intellectual capital. The dependent variables in this study are financial performance and market value. The data analysis technique used is multiple linear regression. The results show that simultaneously intellectual capital has an effect on financial performance, but it has no significant effect on market value. Partially, only structural capital has a positive and significant effect on the company's financial performance. This study has limitations, namely, the results show that the level of influence of intellectual capital on financial performance and market value is low. Therefore, it is suggested that further research should include other variables such as corporate social responsibility and good corporate governance.

Ratchata Utama   and Ekkachai Kunnawuttipreechachan   

In this paper, we study a class of business cycle models related to the relationship between the gross product and the capital stock. The model is extended by adding general terms of the investment and the saving functions. In addition, a time delay which is represented an expectation and time lag for investment is also added into the model. The aim for this work is to find the sufficient conditions in which the model's solution is periodic. We study the existence of unique positive equilibrium. Next, the linearization method is used to analyze local behavior of the model. In addition, by considering time delay as a bifurcation parameter, we investigate sufficient conditions for the existence of a Hopf bifurcation of the model. Our results are applied to represent conditions for an occurrence of business cycles, which can happen in many business situations. Finally, some numerical simulations are illustrated to support our theoretical results.

Niu Weining   

Residual income model in equity valuation has emerged as a useful reference for investment decisions on account of its theoretical foundations for analytical accounting research and also the basis of modelling for empirical study on value relevance. However, since investors have disagreement on firm's future earnings, it may have an effect on firm's evaluation and hence affect stock price. The paper extends the residual income model by incorporating investors' heterogeneous beliefs on the persistence of residual income, and then tests the theoretical findings through numerical simulation. The model implies that the relation between stock price and heterogeneous beliefs depends on the sign of residual income, and the impact of informed traders on stock price relies on the interaction effect of heterogeneous beliefs and residual income. The numerical simulation results prove that under the circumstance of positive heterogeneous beliefs, if residual income is also positive, stock price has a positive relation with heterogeneous beliefs and amount of informed investor; while if residual income is negative, stock price has a negative relation with heterogeneous beliefs and informed trading. The findings of the paper provide some useful theoretical implications on the effect of heterogeneous beliefs on equity valuation via residual income framework. Research limitations mainly exist in the strict theoretical assumptions, which can be loosen in further researches to make the model closer to real market.

Bill Pangayow   and Kurniawan Patma   

Good village financial management is very important in improving good governance in the village. The large amount of funds given to villages requires managers to improve the quality of the financial management process so that they can be trusted by the community. This study aims to examine the effect of financial management processes in the form of planning, implementation and reporting on Accountability, which is an element of good governance. The research sample was 78 officers in four villages in Sentani District, Jayapura Regency, Indonesia. The indicators used to measure the planning, implementation, reporting and accountability variables refer to Regulation of the Minister of 51ĘÓƵ Affairs (Permendagri) number 113 of 2014 and updated with Permendagri number 20 of 2018 concerning Village Financial Management regulates financial management carried out by village officials. The analytical tool used in data processing is Partial Least Square using Warp PLS software. This study proved that there was a significant influence between the variables of the financial management process (planning, implementing, and reporting) on Accountability. This research has implications for the need for quality financial management processes ranging from planning, implementation and reporting to increasing public confidence in the level of accountability held by village officials.

Gangu Naidu Mandala   Meenakshi Verma   Anuj Verma   and Pushpanatham Arumugam   

Purpose: The banking business is significant for each country yet with the extreme rivalry between the public and private area banks, it is the service given that surprisingly recognizes the banks. The bank's execution relies upon how they fulfill and draw in their modern clients. Deals are straightforwardly identified with consumer loyalty. As the deals are expanding there is a necessity of improving the quality of services they conveyed. The item is utilized by the client and the abundance expansion is relying upon their fulfillment level. Design/methodology/approach: The examination broke down the public and private area bank clients' conclusions on CRM concerning service quality and furthermore analyzed their assessment on it. The examination likewise attempts to establish the general correlation of the clients' insight. For the investigation, 240 clients were chosen as a respondent from public and private area banks. Findings: The examination found the view of clients and attempts to advise the path to the banks that how they can hold the old ones and pull in the new ones (clients). Originality/value: The examination demonstrated that in the assessment of public bank clients they scarcely have service quality in their bank and the private bank clients indicated that their bank has better service quality. It very well may be deciphered that in the event that there is an absence of service quality, at that point long-haul relationship with the client may influence. It is inferred that banks need to reinforce their services to satisfy their prerequisites to profit the advantage over the long haul.

Musdalifah Azis   Burhanuddin   and Heni Rahayu   

This study provides an overview of the situation and condition of the share price of publicly listed companies on the Indonesia Stock Exchange (IDX) and the impact of the Covid-19 pandemic experienced by the investor community on the performance of the Indonesia capital market. The data collection of this research was carried out by survey techniques by giving online questionnaires to the respondents. This study uses semantic scale analysis to measure respondents' views about the share price of their portfolio, the impact of the pandemic, and the performance of the Indonesian capital market. We performed validity, reliability, and hypothesis tests in forming a well-fitted model. The results of this study indicate that all the variables studied are valid and reliable, the hypothesis of the proposed statement is accepted that meets the significance level of the F-test and t-test, meaning that the strength of the issuer's stock price and the impact of the Covid-19 pandemic. This is able to explain and influence the performance variables of the Indonesian capital market by 74.7% out of 100 respondents in 2020.

Azhar Alam   Renaldi Sahrul Nizam   and Muhamad Taufik Hidayat   

There are still many fishing communities in Indonesia that live in poverty. That situation happens because they have been depending on moneylenders who provide high-interest rates. This study's focuses were: First, to reveal the role of Baitul Maal wa Tamwil (BMT) or Islamic Microfinance Institution (IMFI), which embrace fishermen by implementing the free late interest system. Second, to reveal the products of IMFI for the fishing community as a form of empowerment. This study was a descriptive qualitative with a case study method. Informants of this study consist of employees and clients of BMT Mandiri Sejahtera Jawa Timur in Blimbing (BMSB), Lamongan, Indonesia. Data collection techniques used were interview, observation, and documentation. The data analysis technique was interactive analysis consisting of data reduction, data presentation, and concluding. This study showed that: First, BMSB had a pretty good role, but not effective yet in empowering fishing communities. Second, BMSB only offered savings and mortgage financing products with Islamic principles. Third, BMSB did not foster a productive attitude toward fishermen in providing additional income.

Svetlana G. Babich   Mikhail V. Karmanov   Natalya N. Toropova   Elizaveta S. Sokolova   and Elnur T. Mekhdiev   

Mortgage lending is one of the most important and most socially significant sectors of the national economy. Today, mortgage in Russia is rather underdeveloped and has a significant impact only on the economy of large cities. The development of mortgage in the Russian regions is hampered by the non-diversified approach to this issue. The article presents the results of analysis of housing mortgage loans dynamics in Russia. The number and volume of mortgage loans issued to individuals were assessed by regional structure. The Russian federal entities were grouped by the main indicators that affect the housing mortgage market. This allowed forming a basis for creating a strategy for the development of mortgage in Russia in the long term. Given the lack of a close relationship between mortgage lending and the situation in the housing market (in Moscow and St. Petersburg the demand for mortgage is higher than in other regions), the author has formed a more complex diversified model of regional distribution of mortgage lending. The author has also measured the dependence of the volume of housing mortgage loans on the main socioeconomic factors. The key finding of the article is that the most serious factors affecting mortgage lending in Russia are the factors that need to be influenced, specifically the volume of wages, housing prices at current prices, as well as the level of employment in the economy.

Sutanuka Shaw   and Debdas Rakshit   

This paper analyses the adjustment speed of the firm to achieve target leverage. The study further extends the empirical work to diagnose the factors that significantly impact its capital structure. The study consists of 132 Indian non-financial firms listed in the National Stock Exchange for the period 1998-2018. A static panel model and dynamic two-step GMM model has been used to make a comparative analysis and select the best model. The results of the study claim that the adjustment speed is 44 percent per annum, yielding a half-life of 1.18 years. Further, the study reveals that profitability, tangibility, and GDP growth are significantly related to leverage in the dynamic model. In the static model, besides profitability, tangibility, and GDP Growth, its uniqueness, growth, and age also significantly impact leverage. In the study, the R square appears to be 0.34, and the determinants, namely, profitability, growth uniqueness, and age, follow pecking order theory, and size, tangibility, liquidity, GDP Growth, and inflation follow trade-off theory. The comparative statement results reveal that the dynamic model is more realistic, considering the adjustment cost. This paper can be further improved by incorporating human resource factors and their impact on its leverage.

Juan Antonio Torrents ArĂ©valo   

Risk is an important factor in the business environment. Decisions have a risk associated with them, and the importance of this risk depends on the environment. Investing in the construction sector is not the same as investing in the banking sector. The possibility of loss requires one to know the maximum risk of sector each type and the implications for this on making the investment. In accordance with this, the objective of this report is to apply the economic and financial risks, which are more important from the business point of view in the construction sector from 2003 to 2013, which allows us to assess whether the risks in the years of growth in this sector are excessive. The data used to carry out this study come from the Bank for the Accounts of Companies Harmonized (BACH) and the methodology will be the formulas for economic and financial risk. The main results of this report are that the risk could advance the future problems of the construction sector while the report also enables an improvement in the risk management in different sectors. Furthermore, this concept ensures that the companies or the sectors could advance measures to optimize the management risk of these areas, especially the economic and financial areas. However, this methodology should be applied in other sectors during the same crisis period in Spain, since this would increase the performance of future studies.

Gangu Naidu Mandala   Pallawi Baldeo Sangode   S. Anjani Devi   and Venkata Ramakrishna Rao Gandreti   

Purpose: In this study, the main aim is to know farmers' problems in the agricultural sector. Food products are the primary good to ensure the quality of life and health. In the world, many countries are depending on the agricultural sector and farmers are the backbone of the economy. Design/methodology/approach: In this study, the main aim is to find what are the challenges faced by the farmers in Andhra Pradesh State. The present paper attempts to spell out some of the constraints like production, and marketing, and finance-related problems faced by the farmers. Primary data were collected from the farmers to investigate the aim and applied a convenient sample technique to collect opinions from the respondent. Findings: To find out production, marketing, and finance-related problems have been faced by the farmers. This study helps to encourage farmers to produce more goods and to increase productivity. Originality/value: It was concluded that a spellbinding report utilizing essential information would be fitting to explore the destinations. The essential information was gathered from the farmers by utilizing a meeting plan explicitly intended for the reason. Most extreme consideration was taken to give essential explanations in vernacular to empower the respondents to reply as precisely as conceivable with no uncertainty.

Nurkhodzha Akbulaev   Ilkin Mammadov   and Samir Shahbazli   

One of the important factors shaping accounting education is the business world. Structuring of accounting education according to the expectations of the business world which will employ the graduates is an important issue and it is especially necessary in our country. Every year, significant numbers of expenditures are provided for education in Azerbaijan. In order to get even more efficiency from these expenditures, education system should be developed, updated and renewed. Developed countries meet the need for labor force by the business world with vocational training methods which are formed according to businesses’ internal dynamics, by taking advantage of international experiences. Countries that implement their education based on university-business cooperation are only those who apply school-based education, and countries that adopt both approaches but are constantly in pursuit of achieving this goal through three different methods. (It needs to indicate the methods) The current education system in Azerbaijan is based on theoretical approach. Due to the expectations of the business world and the importance of modern accounting education, the specialization level of the graduates is expected to be brought to the standards of the business world who will employ them, by restructuring accounting education itself. In this study, we analyzed expectations of the business world from the accounting education in the Universities and Vocational Schools in Azerbaijan and determined main problems they face in this field. For this purpose, a research has been conducted on the expectations of the companies operating in Baku from teaching of accounting. In this research, general information about accounting and educational institutions, the structure of the current accounting training in universities, the perspective of the business world in accounting teaching and their expectations were analyzed. In the technical part, 110 questionnaires collected from various respondents were analyzed with SPSS-25 program package with descriptive statistics and factor analysis methods and the results were interpreted. The vocational courses taken by new graduates during their accounting education are ranked according to their importance by the members of the profession.

Rina Rachmawati   and Widowati   

Background: The number of Indonesian SME units in 2018 was 99.9% of the total business units (62.9 million units), absorbing 97% of the total employment and contributing 60% to GDP. However, two fifth of Indonesia SMEs has internal and external capital and financial acquisition constraints. Purpose: Based on the entrepreneurship and finance theories, this study aims to analyze the influence of the entrepreneurship capability on improving the business performance of a Central Java fashion industry of batik SMEs with the mediating effect of financial dimension. Methodology: Types of data used in this study are primary data and secondary data. The study population was the owner of the SME batik business in Pekalongan, Central Java. The sampling technique was non-probability sampling with a purposive sampling approach of saturated sampling. Principal results: The results showed that the entrepreneurship capability and the internal financial dimension had a positive effect on the business performance of the batik SMEs, while the external financial dimension had a negative effect on the business performance. Moreover, the internal financial dimension was able to mediate the entrepreneurship capability on the business performance of the batik SMEs. Major conclusions: The improvement in the performance of batik SMEs is influenced by the entrepreneurship capability and it will increase if it is mediated by the internal financial dimension. Contributions to the field: There are research contributions of this study, by exploring the indicators from the funding dimension variable and indicators from the entrepreneurship capability variable from a psychological side. Important aspects of the study: What makes this research different from previous researches is that the independent variables used and the research object are different and broader.

Sevda Mammad Huseynova   

The article is dedicated to investigating existing competitive environment in the Azerbaijani leasing market, analyzing criteria and indicators characterizing it, identifying the ways in which the leasing company's marketing policy will be enhanced, and disclosing directions for the formation of a competitive environment in the country's market. For this purpose, the author has examined the major aspects of theoretical competition in the article, highlighting the competitive advantages of the leasing services market as well as the elements of the marketing mechanism that effectively operates in the market (price policy, frequency of services provided by leasing companies, intensity of consideration of initial leasing documents and claims) , terms and conditions of leasing deals, advanced information technologies, corporate information systems, including the use of the Internet), the features of price formation for leasing services were disclosed, and SWOT analysis of Azerbaijani leasing market was conducted. In addition, the article highlights the importance of choosing the main strategic directions and competitive methods in the leasing services market, and has made relevant proposals to improve the leasing company's marketing policy as well as the formation of a favorable competitive environment in the leasing market of Azerbaijan as a whole.

Setia Iriyanto   Suharnomo   Muhamad Taufik Hidayat   and Muhammad Anas   

Competition in small and medium-sized businesses (SMEs) is growing in the era of transition. As a result, these advances are putting pressure on the retail sector to find new and efficient solutions to boost retail and customer experience. Meanwhile, in Central Java, Indonesia, there is one specific SME type that is part of the nation's cultural heritage, namely Batik SME. This study aims to determine the effect of Intangible Assets and Innovation Orientation on the Competitive Advantages of Batik SMEs in Central Java, Indonesia. This study's method was an explanatory survey method with a type of decompression-verification study from primary data obtained from Batik SMEs and using PLS SEM in analyzing the data of the book. The results of this study indicate that Intangible Assets with Path coefficient (β) = 0.320, P value <0.001 (<α = 0.05), and Innovation Orientation with Path coefficient (β) = 0.28 P value <0.038 (<α = 0.05), have a positive effect on Competitive Advantage with coefficient (β) = 0.46, P value <0.001 (<α = 0.05). This result means that the better Intangible Assets would improve the Batik SME Competitive Advantage. Besides, the Orientation owned by Batik SME would increase the Competitive Advantage. Batik SME in Central Java should improve the quality of their Intangible Asset and Innovation Orientation to increase their Competitive Advantage.

Sandeep Kumar   Mukesh Kumar   and Manoj Sahni   

The present article elaborates a multi-product economic inventory model in which multiple items are considered with demand, which depends on time, abides power law, shortages, and complete backordering. The rate of production is greater than the rate of demand for each item. This type of demand pattern is accessible to various kinds of practical problems in the present modern era. In this paper, the production rate is assumed to be directly proportional to the rate of demand. In real situations, demand is always dependent on the price of any product, so it is also assumed that demand is depleted linearly with the price. This paper aims to fulfill the requirement of products and maximize the overall profit in any organization. Optimal values of involved costs, price, re-order point, and scheduling period are also calculated. In this work, the objective is to maximize the total profit and optimize production quantity. Optimization methods are used to obtain the maximum profit. Shortages are permitted and completely backordered. Total cost and production quantity models for deteriorating items have been developed. The study is validated with a numerical example, and sensitive analysis of the optimal solutions concerning main parameters is carried out using the software Mathematica. The tables are also shown for optimal values of the present model.

Ahmad Haruna Abubakar   Noorhayati Mansor   and Wan Izyani Adilah Wan-Mohamad   

Financial statements are supposed to convey comprehensive information about firms' financial position, performance and changes in financial positions to assist a wide range of users in making economic decisions. Audited financial statements provide independent assurance that the information presented by management about the company's financial performance and positions are true and fair. However, even with audited financial statements, there is no guarantee of zero risk of financial statements manipulation. The art of manipulating the reported earnings to achieve pre-set objectives is termed as earnings management and it can be categorized into real or accrual earnings manipulations. This study extends existing research on the real earnings management by examining the effects of corporate tax avoidance and free cash flow on real earnings management in Nigeria. The analyses involve a sample of 72 non-financial firms with 360 firm-year observations for a five-year period (2014-2018). Data was obtained from the annual reports of these companies as well as from Thompson Reuters and Bloomberg databases. Multiple regression technique was used to test the model studied. The results show that both corporate tax avoidance and free cash flow increase management's real earnings manipulation activities. The study can benefit policymakers, shareholders, and regulators on the importance of effective internal control mechanisms to help curtail real earnings manipulations and improve the quality of reported financial statements.

Udo Emmanuel Samuel   Idamoyibo Hwerien Rosemary   Victor Inim   Akpan Jack Ededem   and Victor Ndubuaku   

This study investigates the co-integrating and causal link between energy consumption and economic growth in three economic sectors of agriculture, manufacturing, and service sectors in Nigeria. Through the multivariate framework and quarterly data from 2000Q₁-2018Q₄. The ARDL bounds test approach, and Error Correction Model are the key techniques of analysis, and the Clemente-Montanes-Reyes unit root approach for structural breaks in the series. Findings revealed estimated billing system, and energy demand-supply gap as factors negatively influencing energy distribution and consumption in various sectors of the economy. The results also revealed a co-integrating relationship between economic growth and sectorial value creation. The results also revealed a bidirectional causality between liquefied natural gas and energy consumption and a unidirectional causality between economic growth and petroleum oil consumption. On the contrary, there is a non-causal relationship between the service and agricultural sectors. Sufficient energy distribution and consumption stir economic growth through value additions in the agricultural, manufacturing, and service sectors. The study recommends a review of the billing system, pricing framework, and policies to support, value creation, and addiction in Nigeria.

Vitalii Rysin   Oksana Galenko   Nina Duchynska   Nataliia Kara   Oleksii Voitenko   and Alla Shalapak   

The relevance of the topic of financial convergence considered in the article is primarily dictated by the intensifying processes of globalization, which generate an increase in competition between participants in the financial market. An essential global trend in the development of the financial services industry has also become the process of increasing interpenetration by different participants of various sectors of the financial market into its other segments due to competition - financial convergence. The processes of financial convergence and the formation of new institutional forms of financial associations (financial conglomerates) in the world economy already have a significant impact on the real and financial sectors, public finance and other spheres of the economy. The article examines the prerequisites for the emergence and use of financial convergence by participants in the global financial services market to provide additional competitive advantages and stable development by modifying the established order in the sectors of the financial market. On the example of financial convergence between companies in the insurance and pension sectors, through the creation and participation in financial conglomerates, the main problems of the current state of the global financial market are considered. The article discusses practical ways to determine the presence of financial convergence, based on a modern approach using the methodology for calculating sigma convergence.

Veronica Tibiletti   Pier Luigi Marchini   Valter Gamba   and Dina Lucia Todaro   

In March 2020, given the extended and dangerous nature of the Covid-19 virus, the Italian government issued measures geared towards containing the effect of the pandemic, thereby identifying the national territory as a protected area and limiting the movement of people. This had great repercussions on the productive activities of businesses, which were forced to suspend production. Strong uncertainties, tied both to the time frame, as well as to the impact of Covid-19 on micro and macroeconomic levels, have made it extremely difficult to forecast what future outcomes might be in the short term, that is to say, it is related to the year 2020, and, specifically, on assumptions regarding the future operations of companies. This manuscript proposes a study of financial reporting, as required by accounting standards, which listed companies must provide in regard to disclosure due to Covid-19 as well as in regard to being a going concern. After having examined the main measures adopted by the Italian government, and after having outlined the existing literature on the relevance of the accounting information, an investigation is undertaken to analyze if the companies demonstrated, or failed to demonstrate, consistency in the reporting on future performance, by means of a comparison of what was represented in the financial statements for the year ended on December, 31, 2019, and the results actually achieved as of June, 30, 2020. It will be shown that negative judgments frequently emerge relating to future performance and that no critical issues attributable to going concern were found.

Halyna Kuzmenko   Kateryna Yahelska   Oksana Artyukh   Iryna Babich   NataliŃ–a Volenshchuk   and Larisa Sulimenko   

The issue of organization of payments to employees at the enterprise is the basis of social and labour relations of employees, employers and the state, affecting the effectiveness of labour management in general, they are one of the most critical and complex areas of work, occupying a central place in the accounting system. The authors analyzed the theoretical and methodological basis of payments to employees, compared to international and domestic standards for employee benefits. Authors also analyzed the dynamics of average and minimum wages over the past 10 years, and revealed the features of the organization of wages and the general scheme of accounting for wages. The authors demonstrated the essence of the concept of "payments to employees" and its components, analyzed in detail the features of the existing practice of accounting and audit of settlements with employees. A thorough theoretical and methodological analysis of the study allowed the authors to propose improvements in accounting for settlements with employees on practical examples, namely the detailed structure of account 66 "Payments to employees". The authors also proposed an improved audit methodology that will allow the auditor to cover all aspects of payroll accounting, investigate the correctness, timeliness, legality of reflection in payroll, cover all aspects of payroll accounting, identify violations promptly, conduct a quality audit.

Ibnu Nur Hamzah   Firmansyah   and Andi M. Alfian Parewangi   

Background of the research: Previous study on minimum wages policy in Indonesia mostly focused on employment and welfare effect, while its relationship with productivity is lack. Purpose: This study tends to study the wages and productivity relationship using minimum wages increase information in Indonesia. This paper aims to calculate the time varying productivity using one step production function then implements difference-in-difference technique to measure the productivity changes due to the implementation of minimum wages policy. Methodologies: We choose the case of food and beverage industry in Indonesia and find a strong support for efficiency wages theory. This research takes information from medium to large firms within food and beverages industry in several region in Indonesia as a sample. The reason why this research used this sample is the importance of food and beverages industry in Indonesian economy. Principal results: Using standard panel regression, this paper also find evidence on positive relationship between relative wages and productivity. Major conclusions: The findings showed that firms adopting minimum wages policy show higher changes in productivity compared to firm that is already above the minimum wages. Contributions to the field: the study made a good attempt to examine a critical issue of relationship between minimum wage policy and total factor productivity changes for food industry in the context of Indonesia. Important aspects of the study: The important aspects of the study lie in the analysis of food demand as the indicator of agricultural markets.

Boubker Mouline   and Hicham Sadok   

The topic of corporate cash holdings has received relatively little attention from academic researchers. However, this decision has always been at the center of interest of any company seeking to improve its performance. This article aims to examine the relationship between agency costs related to managerial discretion and cash holdings by Moroccan companies. In order to do this, we will mobilize both agency theory and free cash flow theory. To date, and to our knowledge, no research has been conducted on the cash flow of Moroccan companies in the light of agency theory. This study contributes to cash holdings research in Morocco by exploring the reasons for holding cash through a sample of Moroccan non-financial companies that are listed on the Casablanca Stock Exchange for a period of 12 years (from 2007 to 2018). This research uses econometric models based on a positivist approach with a hypothetical-deductive method. Our results show that there is a strong positive relationship between cash holdings and cash flow. It also turns out that the liquidity of these companies is significantly negatively affected by the debt leverage and the growth opportunities of the company.

Asen Ayange   Nwude Chuke Emmanuel   Idamoyibo Hwerien Rosemary   Ufodiama Clifford Ndudi   and Udo Emmanuel Samuel   

The lack of precise methodology to determine the capital structure mix on firm performance has generated a lot of mixed results. Empirical studies from emerging nations revealed a scarcity of empirical findings on the measures with a significant impact on firm performance. This paper examines capital structure measures on manufacturing firm’s performance in Nigeria. Using annualized panel data for a sample of 15 quoted firms from diverse sectoral classifications from 1999-2018. Excluding the financial firms due to the uniqueness of their capital structure and the strict legal requirements for their financing choices. This study focus on non-financial firms. Capital structure measures book value and market value of the firm. Results indicate that performance proxy by ROE, and Tobin’s Q, significantly influence SDTA, SIZE, LDTA, and TDTA while ROA negatively influences LDTA, D_E, and TDTA. Findings revealed a robust relationship between Tobin’s Q and financial performance compared to other book value. Tobin’s Q is a better measure of performance within the period under review. The study reveals that Nigerian firms are keenly financed by short�term debt supporting the Pecking Order Theory. It’s vital to note that no single theory can sufficiently explain the capital structure effect on firm performance.

V. Selvakumar   Dipak Kumar Satpathi   P. T. V. Praveen Kumar   and V. V. Haragopal   

The main objective of this research paper is to build an appropriate mathematical model that helps in forecasting third party claim amount for different categories of vehicles based on the chosen characteristics of the data. In actuarial research, predicting the insurance claim amount for different vehicle categories is a challenging task, and minimal empirical research studies were done to forecast the claims. In the present study, the annual time series historical data were collected for a period of 34 years. We had built the machine learning predictive models to modeling the claim amount with different categories of vehicles effectively. In this context, we exhibited the feasibility of using a statistical machine learning approach such as Linear regression Model, the Exponential Smoothing Model, autoregressive integrated moving average (ARIMA), artificial neural network (ANN), and hybrid ARIMA-ANN models to predict the various categories of vehicles claim amount. The data were analyzed, compared, and the empirical analysis showed that Artificial Neural Network is a better predictive model among the other time series models based on performance evaluation metrics RMSE and MAPE with lesser variance. Therefore, the machine learning approach for forecasting third party claim amounts will help the Insurance Companies in India to provide a better predictive model, which ensures better claims settlement and management for different categories of vehicles.

Mohd Naim Mohd Yussof   Mazurina Mohd Ali   and Erlane K Ghani   

The role of government-linked companies (GLCs) in Malaysia is vital for the growth of the economy in Malaysia. Nonetheless, the perception from the public at large towards GLCs in Malaysia was unpleasant because of the performance not as it should be as GLCs. Using 17 GLCs listed on the Bursa Malaysia, this study aims to investigate the factors that determine the share prices for the GLCs in Malaysia over the period from 2013 until 2017. The influence of the independent variables, namely return on asset, return on equity, dividend per share, price-earnings ratio, current ratio and acid test ratio on the share prices were tested using multiple regression analysis. The result of this study shows that those variables account for 69.6% of GLCs share price movements. Additionally, dividend per share, price-earnings ratio and acid test ratio are significantly positively related to share prices. These findings imply that for managers to create value for their shareholders, they should increase the dividend paid to shareholders, improve the company's earnings and have more liquid assets.

Nooriha Abdullah   Azreen Roslan   Rosmi Yuhasni Mohamed Yusuf   and Mohd Faizol Rizal Mohd Rasid   

Globally the role of insurance industry is crucial for every country as it plays a core function in the mordern economy and the financial systems. Insurance, like other financial services, has become important due to the increase of risks and uncertainties in most societies. Simultaneously, the rapid changes in technology have a huge impact on human lives, in particular the internet. Since iGeneration or commonly known as Generation Z, includes people born between 1990s and early 2000s, was born �in the internet' era, therefore most of their decision to buy things depends on the info that is obtained from the internet. With less than 40 percent of Malaysian citizens that own a life insurance or family takaful policy, there is a significant, untapped potential for the insurance industry to penetrate Malaysian market in particular the iGeneration population. Hence, this paper is to determine the drivers of consumer purchase behavior that can influence the willingness of iGeneration to buy life insurance policy. Due to the characteristic of iGeneration, a survey via �google form' was utilized in order to obtain the relevant data. Using quantitative research method, about 200 questionnaires were distributed. The findings show that service quality variables of insurance company as well as perceived value of life insurance policy have significant effect on iGeneration behavior in purchasing life insurance policy. Whereas, the role of agent has no significant effect on the dependent variable of iGeneration behavior. Subsequently, perceived value of life insurance policy was found to be the most influential factor that affects iGeneration behavior in purchasing life insurance policy. Thus, this paper suggests that iGeneration are aware about the benefits of purchasing life insurance products because iGeneration already have knowledge about life insurance policy and they can compare which insurance products are more valuable and worth to purchase. The implication towards the insurance companies as a catalyst of financial system in Malaysia, should grab this opportunity to enhance their marketing efforts to capture the potential buyers among the iGeneration.

Samrudha Nayak   B. C. M. Patnaik   and Ipseeta Satpathy   

The purpose of this article is to study the preparedness of the Indian financial system to adopt the "International Financial Reporting Standard" (IFRS). IFRS, which is enunciated by the International Accounting Standards Board (IASB), describes how corporations have to manage their accounts and report on them. Created to establish a common accounting language, the goal of IFRS is to make financial statements consistent and uniform throughout the globe and across different industries in varying business environments. Although the study covers the implications of IFRS on various segments of commercial activities carried on in India, its focus was concentrated on the country's banking system. India has a multi-layered banking system which is predominantly owned by the government. With a history of more than 100 years, the Indian banks are the oldest of all the entities engaged in the business of financial intermediation in the country. No other sector of the Indian economy can match the contributions made by the Indian banks to the economic development of the nation. In the process of conducting the study, efforts have been made to examine and analyze the possible effects of those prescribed financial standards of IFRS which will substantially alter the hitherto followed accounting and reporting practices of the banks in India and its implications on the various stakeholders of the Indian banking system. The convergence of the Indian Financial Reporting Standards – the IND AS – with the International Financial Reporting Standards – IFRS – has not been a smooth sailing transition, despite the best efforts of the Reserve Bank of India, which is the regulator in the Indian banking industry as the country's central bank.

Sanjeeb Kumar Dey   and Debabrata Sharma   

Corporate governance (CG) is now a world phenomenon and the nucleus of economic regulations. History evidenced that failure in corporate governance might lead to economic turmoil. Governance of banks is particularly important for a country like India which is still in the path of economic development. In this paper, we have tried to establish the nexus between corporate governance practices and financial performance of selected Indian public sector banks. The study is empirical in nature and is based on secondary data collected from CMIE Prowess database. We have considered ten public sector banks based on their balance sheet size covering seven years ending on 2019. We have used Correlation and Regression Model to achieve our objectives. Two performance variables, eight corporate governance variables and two control variables have been used for this purpose. Based on the diagnostic tests, we applied fixed effects generalised least square (GLS) regression. Our results showed that financial performance (ROA and ROE) is negatively associated with board size, board meetings, board committees and board independence. On the contrary, we found a positive relationship between the number of woman directors, executive directors, non-executive directors and banks' performance measures. Finally, we suggest that public sector banks should not have a board size beyond a certain limit. Our study will provide a new dimension to the existing literatures regarding the impact of governance and banking sector in particular.

Widi Hariyanti   Finisha Mahaestri Noor   and Adenanthera L. Dewa   

Background: Systematic planning and participation will determine the quality of organizational performance. As one of the most important aspects of business planning is budgeting. However, in many cases, budgeting does not only require systematic planning, but also requires high motivation from organizational members. If so far, motivation is mostly understood singly, this study analyzed the pluriform motivation in budget planning and managerial performance. Purpose: This research was conducted to examine the effect of budget participation on managerial performance with pluriform motivation as moderating variable. Methodology: This research was conducted by using the unit analysis with the sample of manufacturing company managers in Indonesia. The sampling technique used is the purposive method. Principal results: The result showed that there is a positive influence and significant effect of budget participation on managerial performance. The findings also showed a significant effect of pluriform motivation as moderating on the relationship between budget participation in managerial performance. Major conclusions: In general, the main findings of this study underline the importance of a more in-depth analysis of pluriform motivation in budget planning and management performance. Contributions to the field: This study combines human resource studies and behavioral accounting by investigating employees' participation and motivation and managerial performance in budget planning. Important aspects of the study: This study originally offers the idea that motivation in behavioral accounting and human resources needs to be seen in its plural form. The positive and significant influence of pluriform motivation justifies the importance of this idea in future studies.

Robert Keng’ara   and Ibrahim Makina   

Government budgeting processes are always lengthy and elaborative; a system that provides detailed framework of how it has performed in the past and what it plans to execute in the current fiscal year. A budget is a tool which is utilized by the government of Kenya with the aim of achieving both operational and development activities in the short and long term especially with the aim of realizing vision 2030. The aim of this study was to assess the effect of budgetary processes and the performance of an organization in relation to non-commercial marine agencies, Kenya. Specific objectives were to determine the effect of budgetary planning on organizational performance, to establish the effect of budgetary control on organization performance and to determine the effect of implementation and evaluation on organization performance. The study utilized four theories: Budget cycle theory, Agency theory, institutional theory and stewardship theory. The study utilized descriptive research design. The study was conducted in Mombasa County in Kenya. Target population was Heads of Department in Financial, Procurement Audit and Monitoring and Evaluation in Marine sector and Chief executive officers. The sample size of the study was 70 respondents. Data collection tool was questionnaires that were distributed among 70 respondents. Both primary and secondary data were collected. Primary data were collected through questionnaires while secondary data were collected from the organization's archives because few respondents census was utilized. Content validity was utilized. Collected data was analyzed through multiple regression analysis to determine the relationship between the variables. Collected data was presented through tables. From the analyzed results it was revealed that there was a positive significant relationship between budgetary processes for intense budgetary planning, budgetary control and budgetary implementation, monitoring and evaluation on organization performance. The regression was 0.834a and R. square of 0.65. For the correlation there was a positive coefficient between budgetary processes and organization performance. The study recommended that organizations should embrace budgetary process in order to realize superior performance.

Amira Izzatie Ishak   and Mazurina Mohd Ali   

The study aims to examine the determinants that influence participation in tax evasion by individuals. This study uses religiosity and perception towards the government elected in the previous general election (GE14) as factors that may influence the individual's behaviour to participate in tax evasion. This study collected data from primary sources using 500 questionnaires distributed manually as well as questionnaires distributed through a google form. The respondents of this study are individuals in Shah Alam, Malaysia. By using regression analysis, this study finds that religiosity and perception towards government have a significant influence on tax evasion. The implication of these results is that the government may design policies to prevent tax evasion from any religions or belief and provide a better solution to encourage the taxpayers to obey and support the government's decisions.

Llesh Lleshaj   and Alban Korbi   

The risk-return relationship is an analysis especially for the investors who are risk aversion. In this context, their decision to invest in an investment strategy is a complex process. This complexity is larger for financial capital markets which are not very liquid. Hence, the aim of this study is the analysis of stock exchange capitalization in the Western Balkans Region, and the possibility of building an efficient frontier curve of investments, and finding the optimal potential portfolio. In this study, we analyzed the daily stock quotations of the five Western Balkan countries which are not members of the European Union, and these data are proceeded by five indexes with the official daily publications of quotations. The time-series data are divided into three semi-annual (2019 and 2020). The analysis also has calculations in terms of return on the capital distribution as well as the risk level. Realizing this major purpose used Lagrange multipliers and interpolating polynomial methods, which have generated the efficient frontier curves. Whereas, determining the profit or loss intervals based on the risk point used VaR and CVaR estimation techniques according to the Monte Carlo simulation for geometric Brownian motion for the historical data of daily logarithmic returns. The major hypothesis in this study finds out that the stock exchange indexes of the Western Balkans Region are not efficient (in the equilibrium) because an optimal portfolio cannot be found according to the active investing, nevertheless exists a possibility diversification only for the passive investing.

Cem Berk   and Bekir Tutarli   

Currently, there are a lot of criticisms on Modern Portfolio Theory (MPT). Black Swan argument claims that in the event of a financial turmoil, the stock prices move beyond what is expected by normal distribution. This study empirically investigates whether it is possible to apply MPT by using additional criteria. The criteria used in this research are related to financial analysis, a well-known field in corporate finance. The ratios used are debt-to-equity and return on equity. According to the analysis, Modern portfolio theory can be applied by the use of these additional criteria. The analysis with debt-to-equity criterion reveals that Portfolios 3 and 5 which have lower debt-to-equity ratios performed better in the period. The analysis with return on equity reveals that only Portfolio 8 which has 9 companies with ratios larger than 0.2 has positive return whereas the other portfolios have negative returns. The results further show that, while applying MPT with these criteria is perfectly possible and sound, the investor could diversify further by selecting portfolios with higher number of securities and still have better financial ratios. This research to the authors' knowledge brings a novelty by proposing these selection criteria in MPT. The suggested method could be applied by practitioners in this field. This study also targets to bring a new direction to the ongoing debate whether the theory of Markowitz (commonly known as father of Modern Portfolio Theory) is dead or alive.

Ennio Lugli   and Federico Bertacchini   

This article sets out to explain how practical wisdom, supported by rationality, can play a fundamental role in management and combat the main problems of rule-following and hyper-codification. The systematic use of Big Data, collected via the ever-increasing adoption of technology, has generated a large increase in the degree of standardisation of company procedures concerning not only physical and technical issues but above all decision-making. Applied to the solution of repetitive, easily codified problems, standardisation increases the level of efficiency, but when used for the resolution of complex problems it may partially, or even completely, preclude the pursuance of the common good. This may occur through the setting of rules which are not capable of fully describing reality, and their inappropriate use, which may lead, through their unthinking application, to a lack of morality, and even to the side-lining of earnings opportunities. We believe that practical wisdom is able to interact with necessary, unavoidable codification systems and rules to provide the right interface with circumstances, becoming a part of the decision-making process in its own right and not just a viewing lens for use retrospectively to verify whether the outcomes of decisions taken have been effective in pursuing the common good.

Mukesh Kumar   Anand Chauhan   S. J. Singh   and Manoj Sahni   

In this paper, we propose a manufacturing reliability inventory model in which demand depends on the factors advertisement, time, and selling price. Here we consider lead time is zero, and shortages are not allowed. The manufacturing rate depends on the order level. In a real-life situation, the supplier offers a credit limit to the customer during there is no interest charged. Still, upon the expiry of the prescribed time limit, the supplier will charge some interest. However, the customer has the reserve capital to initially make the payments but decides to benefit from the credit limit. The most critical factor, i.e. deterioration plays a significant role in the field of inventory. Here we consider it a constant rate of decline, and the resources of degradation are essential in several inventories. It is assumed that non-instantaneous deteriorating substances are reserved at a holding charge. The whole study is based on preservation techniques, trade credits, demand, inflation, and deterioration. This study has two primary purposes; first, the mathematical model of an inventory system is established under the above conditions. Second, this study demonstrates that the optimal solution not only exists but also remains feasible. A numerical example validates the proposed model, and the graphs are plotted, and its analysis is done. This study is beneficial in industries for the production of food products and fashionable items, etc.

Jerimieus S Sinaga   Iskandar Muda   and Amlys Syahputra Silalahi   

Along with the level of development of the times, the development of the business world in Indonesia has entered the era of globalization which has resulted in the opening of markets in Indonesia to compete with foreign competitors through trade. Based on the financial ratios and policies of banks that want to review the health of their banks, the measures that must be considered are Macroeconomics, namely the exchange rate, inflation, Central Bank of Indonesia (BI) rate, lending, namely the size of the value of the credit channeled, Collectability is the size of Non-Performing Loans (NPL) and Fund Raising. The Purpose of This Research is to Influence BI Rate, Exchange Rates, Inflation and Third Party Funds (DPK) On Credit Distribution and the Impact on Non-Performing Loans (NPL) At Bank XYZ Commercial Segment. The research method used is a method with a quantitative research approach, while the type of research is descriptive and verification research. To test the research hypothesis, the Path Analysis method is used. Partially the BI rate and Third Party Funds (DPK) have a significant effect on lending, while the exchange rate and inflation have insignificant effects on lending at the commercial segment Bank of XYZ. In addition, the exchange rate and DPK have a significant influence on NPL, while the BI rate, inflation and lending have not significant influence on NPL in the commercial segment Bank of XYZ.

Ahmet Niyazi Ă–zker   

In this study, we aim to put forth the tax wedge case that affects both the labor costs and the proposed investment level that also means economic growth through the public decision-making process in an analytical framework. Given that the tax wedge is the proportional difference between the tax paid by a taxpayer worker and the cost to the employer, it is understood that the effect levels also create different differential effects. In this context, it is necessary to question the analytical relationship between the tax wedge and the tax burden. The relationship between this systematic-analytical structural relationship and economic growth also means examining possible externalities in their impact levels. It seems that this effect on OECD countries reveals significant differences according to the development levels of the states. Besides, the breaking point where these differences are substantial in terms of our determinations is the tax burden of nations, and it is understood that the proportional changes in the tax wedge are directly affected by this financial fact. In addition, the fact that OECD countries also have different tax burdens, the differences between tax systems in practice also differentiate the analytical relationship between the tax wedge and tax burdens. However, the measures related to the deviations of global financial and economic relations between OECD countries reveal that possible analytical differences between tax wedge and tax burdens have tried to be overcome via the fundamental systemic financial restructures in recent years.

Muhammad Ikbal   Irwansyah Irwansyah   Ardi Paminto   Yana Ulfah   and Dio Caisar Darma   

We explored the specific context of financial statements of fraud in Indonesia based on empirical evidence. We also explored the lineament of fraudulent financial reporting in Indonesia. This research is important because it will greatly assist the auditor in understanding the pattern and form of fraud, to be able to detect and report these illegal actions. We used a mixed-method of surveying and observation to collect data. Our finding is that the financial statement of fraud is a case throughout the world. The most dominant fraud in Indonesia is the problem of recognition of inappropriate income and secondly related to the improper valuation of assets. We also found something else, that the higher the auditor's experience, the easier it was to find and detect fraud on financial statements and that auditors who hold CFE certificates found more cases of financial reporting fraud during the audit process compared to auditors without CFE certificates. This research contributes to the development of literature by broadening the understanding of academics and practitioners of various fraud profiles that are generally carried out in Indonesia.

Olaoye Clement Olatunji   and Adebayo Omolola Christiana   

This study examined the effect of Base Erosion and Profit Shifting BEPS) on revenue generation in Nigeria. This study employed ex-post facto research design and data were sourced from the CBN Statistical Bulletin of 2017, Security and Exchange Commission (SEC) annual bulletin and the Federal Inland Revenue Services (FIRS) annual reports. Quarterly data were gathered on tax revenue and Gross Domestic Product of Nigeria from 2013-2017. Specifically, data collected on tax revenue were divided into PRE-BEPS (from the third quarter of 2013 to the third quarter of 2015) and POST-BEPS (from the fourth quarter of 2015 to the fourth quarter of 2017). The study covers nine quarters before the introduction of BEPS and nine quarters after the introduction of the BEPS. Data gathered were analyzed via mean, standard deviation, paired t-test and simple linear regression. The findings revealed that there was a positive significant difference between tax revenue generated before and after the introduction of Basic Erosion Profit Sharing (BEPS) in Nigeria to the tune of 0.033 and that ax revenue exerts a significant positive effect on Nigeria's economy to the tune of 10.9030 (p=0.0001<0.05). It was established that BEPS can improve tax revenue in Nigeria. Thus, it was recommended that multinationals and other firms should willingly comply with regulations on tax revenue and transfer pricing. This might increase the revenue pool of the Nigerian government needed for the desired level of growth and development.

Hidetoshi Yamaji   Masatoshi Gotoh   and Yoshinori Yamakawa   

It can be said that short-termism and excessive executive compensation are drawing critical and negative attention in recent years, judging from famous politician's lecture and the passage of law forcing to publicly disclose the ratio of the compensation of the chief executive officer (CEO) to the median compensation of that company's employees. We assume that these management problems are sharpened by human instinctive discounting behavior. By brain experiment of discounting behavior (neuro-science method), we scientifically reveal that stimuli like globalization mobilize new brain parts (precuneus, IPL, TPJ), sharpen human discounting behavior and in turn sharpen the management problems. The research results show that human beings predict other people's discounting behavior more sharply than their own by additionally activating new parts of brain. This in turn will sharpen their discount behavior. This chain of discounting behavior and activation of new brain parts becomes prominent in the globalization of economies involving more strangers. In order to stop the sharpening of management problems, improvement policies counter to human instincts become necessary. Our research results are closely related to resolve some of the problems by using accounting institutions. For example, since the institutionalization of the quarterly report promotes the short-termism, its rectification is necessary. Also, in order to correct the distortion of corporate compensation structure, the SEC oversees the disclosure of remuneration for middle-ranking worker and is seeking full-fledged institutionalization. Implementation of these accounting policies are strongly supported by our research results.

Arash Sioofy Khoojine   and Han Dong   

In this paper, researchers utilize mutual information and distance covariance to establish the minimum spanning tree of the financial network of log-returns and trading volumes of the top 96 companies of the United States stock market listed on S&P 100 index. Researchers analyze the United States stock market's turbulence during 2015-2016, employing the data from January 2012 to July 2018. For investigating the turbulence, researchers construct three minimum spanning trees of the pre-turbulence, turbulence and post-turbulence. The findings represent that the degree distribution follows the power law and the minimum spanning tree of pre-turbulence contains a notable difference in topological characteristics and network's measures such degree ratio, betweenness, closeness, eigenvector centrality, node eccentricity, node strength, node domination compared with turbulence and post-turbulence minimum spanning trees. Moreover, the minimum spanning trees constructed by two methods of mutual information and distance covariance are different in topological characteristics and the network's behavior. Besides, the pre-turbulence and post-turbulence networks are robust against nodes attack, and turbulence network is tenuous against it.

Malik R. Elhaj   

The purpose of this study is to explore the convergence mechanism and process of SME's financial statements into the International Financial Reporting Standards(IFRS) including the benefits and the impact of financial reporting on users of financial statements. The paper also explains the early IFRS adoption in Saudi Arabia according to the guideline provided by Saudi Organizations for Certified Public Accountants (SOCPA). The mechanism of the convergence incudes: nature of information to gather during the convergence, the significant IFRS to include in the financial reports, and financial accounts affected by the convergence. The article results find that the fair value adoption and Zakat rules are the most challenges for SME's in the financial stamens convergence process in addition to lack of adequate guidance by SOCPA and the complexity of IFRS. The Zakat rules need more interpretation and transparency. Therefore, companies spend more effort in financial statements convergence for Zakat purpose. In addition, more collaboration and training are required to improve the quality of financial reporting which would reduce the time consumption and convergence costs including cost of outsourcing (offshoring) financial statements convergence into IFRS.

Mei-Se Chien   Chih-Yang Cheng   and Yi-Chung Hsu   

The aim of the paper is to study how trade freedom and financial freedom affect the excess return of real estate security, and we apply annual data for 1,108 publicly traded real estate companies of 24 countries from 2006 to 2013 to examine it. The main findings are as follows : First, for whole sample, the coefficients of the index of trade freedom, the index of financial freedom, are significantly negative, which means that higher freedom of trade and financial will increase efficiency of real estate market but the excess return of real estate will decrease. Second, comparing the effect of the indexes to affect excess return of real estate securities in three different regions, the indexes of financial freedom and Trade freedom are vital factors, but all of four indexes of freedom are important in Europe and other area. Third, the coefficients of indexes of monetary freedom and indexes of trade freedom are negative in both of high and non-high income groups. Finally, for the group of non-high income level, the coefficient of index of investment freedom is negative and the coefficient of index of financial freedom is positive, which are different with the results of the whole sample.

Gianluca Gabrielli   and Alice Medioli   

The great corporate frauds reported over the past twenty years have damaged and undermined the confidence of stakeholders, shareholders, investors, savers, and regulators. These facts have increased the focus on prevention and detection activities and tools. Fraud is costly, therefore it is very important to prevent and detect the fraudulent event to avoid high losses and damages to corporate financial health. Fraud detection is a dynamic discipline where traditional auditing activity is strengthened with new tools like Benford's Law and Beneish Model. This paper aims to focus on the analysis of the usage and application of these instruments in detecting accounting fraud.

Hui-Cheng Yu   Bor-Yuan Tsai   and Beiling Ma   

This study adopted the signalling theory perspective to explore the effect of information transparency on the cost of equity capital among enterprises in China. Variables of information transparency and debt ratio were used to examine their influence on the cost of equity capital of enterprises in China between 2014 and 2015. The empirical results revealed that information transparency negatively affected the cost of equity capital, regardless of examining all observations simultaneously or examining the samples from 2014 and 2015 separately. However, the effect observed in 2014 was non-significant. In addition, debt positively moderated the effect of information transparency on the cost of equity capital. The results revealed that investors of the capital market paid attention to both financial and nonfinancial information disclosed by enterprises. This finding should be of great value to enterprise managers, supervisors, and decision-makers in financial or socioeconomic systems similar to that of China. Previous relevant studies have rarely explored emergent economies in socialist systems. The empirical results of this study facilitated reinforcing the research gap regarding how enterprises in socialist countries reduce their cost of equity capital amidst the economic development therein.

Ateyah Mohammad Alawneh   

This study aims to estimate the impact of net cash flows on investors' decisions on industrial and service companies listed in the Amman Stock Exchange during the period of 2001–2017. The study is based on data from the accumulated annual reports of the previously mentioned industrial and service companies. The study tests autocorrelation by using the Breusch–Godfrey serial correlation Lagrange multiplier test, and the analysis shows no autocorrelation between the variables of the study. Moreover, the study tests the stability of the variance by using the autoregressive conditional heteroskedasticity test, and the results show the absence of a variation problem among the study variables and models. Thus, they do not suffer from measurement problems. Hypotheses testing through the measurement analysis of the industrial sector show a negative impact of net investment cash flow on investors' decisions. However, net financing cash flow has a positive effect on investors' decisions, while net operation cash flow has no statistically significant effect on investors' decisions. The analysis of the service sector reveals a statistically significant negative effect of net operation cash flow on investors' decisions, whereas net financing cash flow has no effect on investors' decisions. The study concludes with a set of recommendations, the most important of which is the need for companies to pay attention to net investment cash flows to buy companies with fixed assets and to use traditional financing alternatives such as murabaha, musharaka, and Islamic sukuk hedging instruments.

Yiannis K. Yiannoulis   

The purpose of this paper is to examine the literature regarding the accounting and auditing environment in Hellas; Hellas is a natural experiment in the sense that has characteristics that substantially differ from the major European countries. "For example, the mandatory adoption of International Financial Reporting Standards (IFRS) on January 1, 2005 aimed to improve the quality of financial reporting in Greece, which had been regularly criticized for earnings management and the ineffectiveness of external auditing" (Tsipouridou and Spathis, 2012, Abstract). In addition, Hellas faced a 10-year economic crisis (2008-2018) which affected/changed the Hellenic corporate and capital market environment. For the years before the crisis and the implementation of IFRS, empirical studies showed that Hellas had the one of the highest levels of earnings management (Bhattacharya et al., 2003 and Leuz et al., 2003). All these features are examined in this article in order to gain insight regarding the quality of Hellenic financial reporting and to investigate the changes that crisis had on financial statements quality. The conclusion is that crisis exaggerated problems that already existed in Hellenic corporate environment.

Alan T. Wang   Wen-Chung Hsu   and Wen-Cheng Ho   

As bank managers have informational advantage in screening and monitoring borrowers, loan loss provisions determined by bank managers may contain important information for outside investors and regulators. This paper adapts a time-series framework and finds that loan loss provision contains information for future non-performing loans during the post-crisis period. This indicates that U.S. commercial banks have been associated with enhanced risk-taking discipline [Bushman and Williams, 2012]. Secondly, high yield corporate bond spreads have contained information for future bad loans, and loan loss provisioning by bank managers has incorporated such information. Finally, when exercising the discretion of loan loss provisioning by bank managers, smoothing the long-run level of loan loss reserves has been considered. Traditional hypotheses such as earnings management, capital management or income signaling are not supported by the data.

Ateyah Mohammad Alawneh   

The study aims at estimating the indicators of financial development and their impact on financial indicators of the main sectors in Amman Stock Exchange. The study found that there is no statistically significant impact among the following indicators of financial development [total private credit on Gross domestic product [GDP] and total deposits to GDP], the main sector indices [insurance sector index, services sector index, banking sector index, industry sector index, and general index of Amman Stock Exchange], While the analysis revealed a positive statistically significant effect between the index of financial development [the ratio of the value of shares traded in the financial market to GDP] and the main sectors indicators [insurance sector index, service sector index, banking sector index, industry sector index, and general index of Amman Stock Exchange]. However, the analysis revealed a negative statistically significant impact between the index of financial development liquidity index (LMI) and the main sectors indicators. There was also a significant negative impact between the index of financial development total Monetary index (TMI) and the indicators of the main sectors accept the insurance sector index.

Kanbiro Orkaido Deyganto   and Ayneshet Agegnew Alemu   

The objective of this study was to investigate the factors affecting financial performance of insurance companies operating in Hawassa city Administration, Ethiopia. In this study, the researchers have employed causal research design with mixed research approach due to quantitative nature of data required to prepare the report of this study. The target population of the study was 17 general insurance companies operating in, Ethiopia. Out of all seventeen insurance companies in the city, the researchers selected six general insurance companies that have 10 year audited financial statements from 2008 to 2018. The secondary data were collected by reviewing of financial statements and related published and unpublished materials to achieve the objective of this study. Ordinary least square model has employed by the researchers to analysis the data through SPSS version 20.0. Then, the result of this study showed that out of eight (8) explanatory variables incorporated in the model, five (5) variables such as underwriting, premium growth, solvency ratio, growth rate of GDP, and inflation rate have significant effect on financial performance of the insurance companies operating in Hawassa city Administration. Whereas, the reinsurance dependence, company size and interest rate have no significant effect on financial performance of the insurance company of Hawassa city Administration. Finally, the findings of the study may inform policymakers about factors affecting performance of insurance companies operating in the city in particular and in Ethiopia in general, supports to formulate constructive policy to enhance financial performance goal of the insurance firms in one hand and to promote the economic development of the country in other hand.

Ching-Chih Wu   Bing-Huei Lin   and Tung-Hsiao Yang   

We investigate three issues about the impact of insider trades and institutional holdings on mergers and acquisitions (M&As). First, we test how insider trades affect the trading behavior of institutional investors in M&As. Second, we test whose trading behavior, either insiders or institutional investors, has greater explanatory power for the performance of M&A firms after takeover announcements. Third, we analyze the industry-wide spillover effects of insider trades and institutional holdings. Empirically, we find that insiders and institutional investors of M&A firms may utilize similar information in their transactions because insider trades induce similar trading behavior for institutional investors. In addition, insider trades, relative to institutional holdings, have greater explanatory power for M&A firm's long-term performance. Finally, compared with insider trades, institutional holdings have a more significant spillover effect in the industry of M&A firms.

David Onguka   Eramus S. Kaijage   Cyrus M. Iraya   and Sifunjo E. Kisaka   

This study aimed at determining the impact of corporate control on corporate value of Nairobi Securities Exchange (NSE) listed firms. The paper tested the hypothesis that there is no significant relationship between corporate control and corporate value improvement as indicated by ROA and Tobin Q. Agency theory is the anchoring theory. The study applied census survey for sixty-four firms listed at the NSE. The time frame of analysis is five years between 2013 and 2017. Out of the 64 listed companies targeted, 58 were analyzed forming 90% of the population. Corporate control index was developed as proxy measures of variables. The study applied census survey given that the population of firms listed at the NSE is not large. Regression analysis and correlation analysis were applied to test the hypotheses. The results of descriptive statistics revealed a significant positive relationship between the variables. The study findings were in line with previous research findings and also provided further insight on the impact of self-determining variable, corporate control on the corporate value. Analyst and investors may apply findings to identify crucial control mechanism in financial markets. The findings can also be useful for policies evaluation and development. The study has also applied important mechanism in CCI to examine the effect of corporate control on corporate value which has provided new insight on the relationship thereby enriching the result.

William V. Rapp   

This case study reflects the work done for a large Fortune 500 technology based MNE facing various tax and royalty issues related to the use of its technology by its subsidiaries and affiliates as well as its licensing agreements with other companies in different countries. It also poses a series of R&D related issues facing the firm including where it should locate a new R&D facility outside the US. The issues posed in this case arise because each country where the firm does business has a different tax regime but in all cases each government wishes to maximize tax revenues. One way this is accomplished in countries where the subsidiaries are located is by limiting the royalties on technology transfers that subsidiaries pay to their parent firms and thus take as a deductible expense. Conversely the parent firm's government, in this case the US, wishes to maximize its taxes through having the firm's subsidiaries pay "full value" for the technology in the form of higher royalties. This creates a zero-sum game with the firm caught in the middle. The case offers some strategic approaches and ideas the firm can use to manage this situation.

Girma Gudde Jote   

The objective of this study was to identify and examine the determinants of loan repayment in MFIs in Gedeo zone, SNNPRS, Ethiopia. In fact, identifying and examining such determinant factors of loan repayment is vital in the achievement of profitability and sustainability of MFIs. Out of total population of 6662 (1610 defaulter and 5052 non-defaulter borrowers), 364 representative sample from borrowers are selected by using stratified random sampling from borrowers by dividing the borrowers in to two strata, in terms of loan payment status as defaulters and non-defaulters. In this connection, the researcher collected data from primary and secondary sources and analyzed by using binary logistic model. A total of ten explanatory variables were included in this model and out of these, six variables were found to be statistically significant to influence the probability of loan repayment. These significant variables are: educational level, method of lending, nearness of borrower's residence to the institutions, family size, and income from activities financed by loan and training. The researcher suggests that the identified significant variables to be a spring board for further interventions by Microfinance institutions, stakeholders and policy makers so as to come with a breakthrough to significantly decrease or even avoid defaulting problems. On the basis of the study findings, the researcher also provided some recommendations that are vital to reduce loan repayment problems and improve loan repayment performance of borrowers in the study area. These includes: proper training, continuous supervision, enough loan officers or committee and technical support for borrowers on profitable business activities.

Kanbiro Orkaido Deyganto   

Taxpayers' voluntary compliance attitude with tax system is influenced by demographic, individual, social, institutional and economic factors. Thus, the objective of this study was to examine the factors influencing tax voluntary compliance attitude with tax system the case of Gedeo Zone. To this end, the author used mixed research approach. The target populations of the study were tax authority and taxpayers in Zone. A sample of 323 taxpayers was randomly taken from the 1,678 taxpayers in the Zone but tax officers were judgmentally selected by the researcher in order to collect sufficient and relevant information required to prepare the report of this study. Both primary and secondary data were collected. Primary data were collected through structured questionnaire and interview with officers and taxpayers representatives. The secondary data were also collected by reviewing of related published and unpublished materials. Binary logistic regression model was employed to analysis the data through Stata software application version 12.0 and SPSS version 23.0 were used to present the results of this study. Then, the result of this study showed that out of fourteen explanatory variables incorporated in the model, seven variables such as gender, age, lack of tax knowledge, simplicity of tax system, awareness on penalty, probability of being audit, and perception on tax rate were found to be key factors influencing taxpayers' voluntary compliance attitude with tax system in the study area. Whereas variables such as education level, tax authority efficiency, peer influence, occupation, income level of taxpayers, perception on government speeding, and perception on fairness and equity have no significant influence on tax voluntary compliance attitude. Finally, the findings of the study may inform policy makers about the factors influencing voluntary compliance attitude towards tax system in the Zone and supports to formulate constructive policy in order to achieve the goal of raising required tax revenue to promote the economic development of the country.

Karen Lightstone   Tyra McFadden   and Lucie Kocum   

Defined-benefit pension plans were in a worse state than previously reported due to managements' ability to manage the assumptions, according to our study. This empirical paper examined whether managers would have used unreasonable discount rates and assumed rates of return for their pension obligation and assets in order to improve their financial position. We found companies were 4 times more likely to have used an unreasonable discount rate thereby reporting a better funding status than was warranted. We also found, companies were 34 times more likely to have used an unreasonable rate of return for calculating pension expense thereby increasing net income. This paper has implications for employees who have a defined-benefit pension plan; employers who want to be attractive to future employees; and governments that provide retirement supplements for their citizens.

David Fritz   and Eugen TČŤws   

A bank's annual risk report intends to reduce the information asymmetry between the bank and its stakeholders. Using automated text mining measures, we assess the quality of the reports in terms of their fulfillment of regulatory requirement and identify its main drivers in a panel regression. On a set of 343 risk reports from 30 German banks between 2002 and 2013, we further perform a cooccurrence and sentiment analysis and determine several additional characteristics of the reports' text. Our methods detect discrepancies for the reports of distressed and non-distressed banks and also for different types of banks. Some of these discrepancies might indicate an intended concealment of certain risks of a bank. We find that our text mining measures explain the variance of the reporting quality to a large extent. The number of words is an important factor for the determination of risk reporting quality. The share of positive words in a report reduces its reporting quality on average.

Miraj Javed   and Wang Zhuquan   

Streamlining the accounting system in accordance with "world's best practices" will result in consistency and transparency in the financial management of the country, ensure good governance, boost the confidence of investors, and contribute to strengthening the economy. The public sector accounting system in Pakistan has been overhauled recently. The reforms have been implemented by the Federal Government of Pakistan (GOP), with the assistance of World Bank, through Project to Improve Financial Reporting and Auditing (PIFRA). This study describes the accounting reforms implemented by the GOP and the adoption of cash basis International Public Sector Accounting Standards (IPSAS) for financial reporting. We first describe the contents of the accounting reforms implemented in all levels of the country beginning in the 1990s and briefly introduce cash basis IPSAS. Second, we assess the compliance of Pakistan's accounting system with cash basis IPSAS and IPSAS-2 cash flow statement. Finally, we conclude that the financial statements of the GOP comply with the requirements of cash basis IPSAS. This study recommends transitioning from cash to accrual accounting system because Pakistan has reflected a satisfactory margin after the new reforms have been implemented.

Raj S Dhankar   Barnali Chaklader   and Amit Gupta   

This study examines the perception of Public Sector Banks in India towards the implementation of IFRS. The paper provides insights into the IFRS adoption process based on a questionnaire sent to Public Sector Banks in India in 2015. The 291 responses received indicate: (1) Loan Impairment will affect the bank's financial performances; (2) transparency of the results of the Banks will be increased; (3) global operations of the Banks will be impacted in positive direction; (4) the accessibility of the global capital market will increase; (5) corporate governance of the banks will increase; (6) the quality of financial information provided to the regulators and shareholders will improve; (7) the comparability aspect of financial statements will increase; (8) market capitalization of banks will improve; (9) the training needs of the staff will increase; (10) the opportunities for the accounting professionals will expand; (11) the flow of FDI in the banking sector will increase.

Trishit Bandyopadhyay   David Bobst   Tobias Hummel   and Galia Kondova   

This paper applies a data envelopment analysis (DEA) to study the efficiency and productivity changes in the Swiss cantonal bank sector in the period 2006-2014. The efficiency analysis is conducted by applying the production input-oriented DEA variable returns to scale model in a three-stage procedure. The productivity is studied by estimating a DEA-based Malmquist Productivity Index (MPI) that provides evidence of increasing productivity growth on average for the sector in the studied period. The main source of productivity growth as per the components of the Banker, Charnes and Cooper (BCC) MPI model is related to a frontier-shift (technological innovation) rather than to improvements in the technical efficiency. The decreasing average DEA scores in the post-global financial crisis period of 2008-2014 further support this finding. In the second stage of the efficiency analysis, the environmental factors influencing the productivity growth are analysed by conducting a general method of moments (GMM) regression. The results provide evidence of a positive and statistically significant relationship between the stock of residential buildings per canton and technical efficiency. In the third stage, the environmental variables from the second-stage regression are included within the constraints of the first-stage DEA model as proposed by Ray [1]. The third-stage DEA scores support the evidence of slightly decreasing average post-global crisis technical efficiency. The overall average technical efficiency in the Swiss cantonal banking sector, however, remains at a relatively high level in the studied period.

Katharina Beyenburg   Dirk Braun   and Lina Kuckelkorn   

This study primarily focuses on the explanation of momentum effects regarding different transparency standards of particular stock segments. Based on theories of efficient markets and information diffusion it can be expected that a momentum can rather be observed in those stock segments which do not require high transparency obligations. Regarding the results of this study on the effect of transparency, no significant correlation can be proven for the intensity of transparency obligations and the level of the momentum. Hence, the theory on the intensity of transparency obligations affecting the level of the momentum has to be rejected. However, it has to be pointed out that in contrary to the theoretical assumption, the momentum of Prime Standard has not only been most constant but also highest. Especially in times of strong market turbulences, high volatility and uncertainties in the market, investors seem to invest in titles which show highest transparency and for which a lot of public information is accessible. Thus, they regard stocks of Prime Standard as security values.

Ogilo Fredrick   Omwoyo Jeremiah   and Zipporah Onsomu   

This study sought to establish the relationship between liquidity risk and failure of commercial banks in Kenya in the years 2013 to 2016. Additionally, the study endeavoured to establish the effect of capital adequacy, asset quality, management quality, earnings, sensitivity to market and size on the failure of banks in Kenya. To achieve this goal, secondary data was collected from the websites of operational banks while data for failed banks was collected from reports published by the central bank of Kenya, corroborated with publications in past years newspapers. Panel logit regression was used to analyze the data using Eviews 9.5 student version. The results of the regression revealed that there was a positive and significant relationship between liquidity risk and bank failure, implying that liquidity increased the likelihood of failure. The study also found a positive and significant relationship between bank failure and asset quality and earnings indicating that they increased the likelihood of failure. The study found a negative and significant relationship between bank failure and management quality and sensitivity to market implying that they decreased the likelihood of bank failure. Capital adequacy and bank size were found to have insignificant relationship with the failure of commercial banks in Kenya. These findings are valuable to managers in understanding how the variables of the study increase or decrease the likelihood of failure so that they may come up with appropriate strategies for managing the various risks facing their banks

Alper Erserim   and Barış Tektekin   

Depending on the geographical richness of Turkey, it can be seen that the music culture took place here highly immense. This richness make producing musical instruments with different types and schemes possible and by enabling production of these materials, high quality hand-made musical instrument production becomes highly feasible. The leading product in the world in this sector is considered as cymbal. This research, aims to grasp how a little local business becomes a big leading international business when it comes to producing cymbal. The main purpose of this commitment is to analyze historically how hand-made cymbal producers grow and endure their living. In this context, Istanbul Mehmet Cymbals and Bosphorus Cymbals businesses are contacted and obtained information are analyzed. Regional distribution information of hand-made musical instrument producers are also tried to be given in this perspective. It can be seen from the gathered information that to endure their living, producers in Turkey needs to take a lot of conditions into consideration, nevertheless, again can be seen that eligible products were brought to the future under the names of different brands.

Hui Yang   Mohammad Meysami   and Alex Meisami   

This paper examines capital structure decisions in the 1990s. We test a number of capital structure theories and find notable differences between investment- and junk-grade issuers in this period. Consistent with the trade-off theory, 67% of junk-grade issues were equity as opposed to only 9% of investment-grade issues. In addition, consistent with the trade-off theory, for junk-grade issuers, we find a direct relationship between collateral and debt issuance and an inverse relationship between debt issuance and the treasury yield. However, contrary to the predictions of the trade-off theory, we do not find similar evidence for investment-grade issuers. Moreover, our analysis suggests that junk-grade issuers are concerned with the wealth-transfer consequences of choosing equity over debt; this does not seem to be the case for investment-grade issuers. We find some evidence in support of market timing and little evidence for the pecking order theory or the equity undervaluation hypothesis.

Denise GĂłmez-Hernández   and Felipe PĂ©rez-Sosa   

The aim of this work is to analyze which is the required average real return that Latin American workers need to obtain from their retirement funds, in order to get a reasonable pension at retirement, according to each system parameters; and to discuss if those required returns are feasible in the current economical context, or if any changes in the pensions designs are necessary. The results are that from the eight countries under analysis (Chile, Colombia, Costa Rica, Dominican Republic, El Salvador, Mexico, Peru and Uruguay), three do not reach a replacement rate of 70% or more (Dominican Republic, Mexico and Peru). Hence, in order to increase the replacement rate at an acceptable level in those countries, the actual rate of return on pension assets has to increase as much as 1.6 times, which seems unlikely at the current market conditions. Therefore, the compulsory pension systems of those countries should increase their contribution rate in 2 times from the actual level, with the purpose to provide an appropriate retirement to their members.

Yuta Hoshino   

The International Financial Reporting Standards (IFRS) are becoming the leading principles and a special driver for the convergence of financial and management accounting in over 130 countries including the voluntary adoption. The purpose of this study is to examine the impact of the adoption of IFRS on management accounting. More specifically, this study investigates the differences in the importance of strategy goals, and financial and nonfinancial measures that have changed after its adoption. The results of a questionnaire survey conducted on Japanese manufacturing companies indicate that the effects of respondent firms provide with management accounting practices and techniques before and after the adoption of IFRS. My findings suggest that there seem to be considerable differences in the importance of strategy goals, and financial and nonfinancial measures before and after IFRS adoption.

Ammara Noreen   Rabia Asif   Sabahat Nisar   and Noman Qayyum   

In this research the data comprises of the bank credit to public and private sector from 1983 to 2013. The main objective of the research is to select suitable model for the bank credit to public and private sector. For analysis purpose E-views version 5 has been used. First of all stationarity of the series has been checked and it is observed that the series of bank credit to public sector is stationary at first difference and series of bank credit to private sector is stationary at second difference. For identification of suitable ARIMA model correlogram has been performed and a class of models has been estimated. Most appropriate model is selected by applying different diagnostic checks and comparing several descriptive measures. Finally forecast has been made for the year 2014.

Lin Cong   

This paper studies the effects of international cross-listing and delisting on the overall daily volatility, nontrading-hour volatility and trading-hour volatility of stock returns, with a focus on the U.S. firms cross-listed/delisted on the Tokyo Stock Exchange. We find that international cross-listing (delisting) reduces (increases) overall and trading-hour volatility while keeps non-trading-hour volatility unaffected. The findings are consistent with the hypothesis that international cross-listing (delisting) reduces (increases) the amount of private information and non-informed speculations.

Subrahmanyam Ganti   and Debashis Acharya   

This study clearly demonstrates analytically that financial inclusion as the aim of a supply leading strategy of financial development model can clearly create faster growth. Firstly, a multiplier model is used to demonstrating as to how financial inclusion creates more output than in case of a demand following model of financial development. Secondly, the most popular "AK" growth model framework is used to analytically demonstrating the superiority of financial inclusion in creating faster growth. Thirdly, with simple algebra of the well-known Harberger little triangle and rectangle, the superiority of financial inclusion is numerically demonstrated as an integral component of the supply leading financial development strategy.

Chetna Singh   and Raj Kumar   

One of the biggest challenges of our country is women empowerment which can only be attained by making women educated, finance liberated and independent. Financial literacy can be understood as the ability to know how money works in a normal course of action. Specifically it refers to the set of skills and knowledge that allows an individual to make informed and effective decisions with all of their financial resources. In India, virtually women are the main spender of the family whereas the men are the principal earner of the family. Although women's access to financial services has increased substantially faster in the past 10 years, their ability to exploit this access is often still limited by the disadvantages they experience because of their gender. Women are good at budgeting and managing household expenses but many women take their steps back when it comes to take larger financial decisions and they generally leave it to their spouses, fathers, brothers, etc, believing them to be financial experts. A minimum basic level of financial literacy is very essential for every woman so that they can live their life according to their own choices hence contributing the healthy and prosperous life of their family as a whole. Women have enormous potential to contribute towards the growth of the economy hence a financially independent women can be a great source of economic development. The purpose of this study was to give an overview about the financial literacy among women in developing country like India.

Zi-xu Liu   

This paper examines the impact of political connections on financial flexibility of private firms in China. Using a nationwide survey of Chinese private firms, we find that political connections can decrease financial flexibility reserves when financial constraint, environmental uncertainty and other variables are controlled. We further find that the high strength of political connections decreases more financial flexibility reserves than the low strength of political connections does.

John Wei-Shan Hu   Yi-Chung Hu   and Tsan-Ping Yang   

Jesse L. Livermore was one of the World's greatest stock traders on Wall Street in the early twentieth century. He was also regarded as "the most fabulous US stock trader" by Time magazine. This study combined Livermore's financial key price logic with the decision- making trial and evaluation laboratory (DEMATEL) and analytic network process (ANP) methods (D-ANP). This investigation attempted to find the key factors and their cause- effect relationships. This study then combined the key factors with Livermore's key price logic to develop two strategies for forecasting the trend in the Taiwan Stock Exchange Capitalization Weighted Stock Index (TAIEX). This work also compared these two strategies with another strategy that did not incorporate Livermore's logic in order to determine the optimum strategy. This study then compared the return using the optimum strategy with that based on TAIEX futures during the test period. The process was performed as follows: First, integrated questionnaires were distributed to 12 financial experts on Taiwan's stocks and futures markets in order to select 3/7 key factors that might affect Taiwan's stock markets. (i.e., "net buying/selling volume by foreign institutional investors", "total market trading volume," "predictions of future trends by foreign institutional investors"). The key factors were incorporated into Livermore's key price logic to develop two trading strategies (Strategies A and B). In addition, Strategy C was simply developed using the D-ANP method and the three factors selected by financial experts. The major variables considered by Livermore (uptrend and downtrend) were not selected as the key factors by the financial experts, so Strategy C did not incorporate Livermore's logic. Ten transactions were examined during the period from January 1, 2013 to December 31, 2014 (the pre-test period), and only Strategy C was found to be effective because its winning percentage (WP) exceeded 50% (60%), whereas Strategies A and B had WPs less than 50% (30% each). Eight adjustments were then made to Strategy C to develop an amended Strategy C. The amended Strategy C was then tested against TAIEX futures during the period from January 1, 2015 to June 30, 2015 (test period). The empirical result obtained demonstrated that the amended Strategy C performed better than TAIEX futures during both periods (pre-test period and test period), as well as outperforming Strategies A and B, which were developed based on Livermore's key price logic.

Roberto Maglio   Francesco Agliata   and Danilo. Tuccillo   

The aim of this paper is to amend the research on the economic consequences of the proposed changes in equity and liabilities classification. The distinction between equity and liabilities is a challenging question for international standard setters. On this topic, the IASB and the FASB have developed a long-term project with the aim of addressing unresolved issues around classifying financial instruments as either equity or liabilities. With this regard, many approaches, which involve various effects on the gearing and on the reported earnings, have been proposed. In its 2008 discussion paper "Financial Instruments with Characteristics of Equity" the IASB exposed the alternative methods previously presented by the FASB in former Preliminary Views. Among the three different approaches, the Basic Ownership Approach was recommended in consideration of its simplicity with the hope of reducing structuring opportunities. Also the EFRAG gave its contribution to this debate by issuing its own discussion paper; it suggested a new classification method, the Loss Absorption Approach.

Addisu Karafo   

The aim of this study was to assess the role of Equb in Micro and Small Business Enterprises finance in Konso. For this purpose, data was collected through questionnaire from Equb members as well as interviewing with Equb organizers and non Equb MSE owners. The respondents were selected using both proportionate stratified and random sampling techniques. Besides, the collected data were analyzed using descriptive narrations through concurrent triangulation strategy. The result revealed that, People joined Equb to dig up large amount of money, save and even get loans at the lowest interest. Banks/Micro Finance Institutions fail to cater for the saving and credit needs of poor and small business holders, mainly due to their lending terms and conditions of creating financial gap which informal financial institutions try to fill. In Konso, Equb dominates other sources in the finance establishment of Micro and Small Enterprises, expansion and their working capital finance, followed by personal saving, families and relatives.

Sang-Hoon Kim   and Dong-Kyoon Kim   

Under current low interest rates, the decision whether or not to refinance a mortgage is a timely and practically useful topic. However, the home mortgage refinancing decision is also affected by other variables such as personal tax rate. In addition, financial institutions provide different types of mortgage loans in terms of maturity (loan period), interest rate, processing cost, points (bank fee), and so forth. Several websites are available which can be used to aid making the refinancing decision. However, these websites programs are not explicitly geared towards selecting a low cost mortgage loan. Furthermore, these websites are limited in their usefulness due to inadequate assumptions or the difficulty of acquiring information required for the program. For example, a certain website requires information such as the expected future interest rate, the expected inflation rate, the standard deviation of mortgage interest rates, and so forth. To be practically useful, the assumptions should be simple and reasonably realistic. The objective of this paper is to prepare, under realistically reasonable assumptions, an Excel program which can select a low cost mortgage loan after consideration of the tax deductibility of mortgage interest rate. This paper can be used as a case problem for both undergraduate and MBA students. From the case, students learn how Excel (or any spread sheet program) can be programed and used to analyze finance problems.

Mohammad Mizanur Rahman   

The purpose of this study is to provide a comprehensive financial performance evaluation of scheduled commercial banking companies in Bangladesh. The nature of this study is descriptive and relational. This inductive research uses financial ratio analysis technique of cross- sectional data to measure, describe and analyze the financial performance of publicly traded commercial banks in Bangladesh. The financial performance issue has been grouped into profitability ratio, market ratio, and value added metrics for the assessment of internal based, market -based, and economic based performance respectively. Ranking of banks has been done on the basis of financial performance in the period of 2015; and it has been found that Dutch Bangla Bank Ltd. is one of the leading banks. The study findings have revealed that most of the banks except a few have shown poor economic performance, negative economic value added (EVA), and undervalued market price per share. The study findings have also shown the significant correlation between "EVA and Profitability Ratio" and "EVA and Market Ratio", and termed EVA as an independent measure of performance. The concerned research on evaluation of financial performance has covered mainly publicly traded commercial banking companies in Bangladesh only certain time duration, and therefore has raised the issue of generalization of the results. The analysis of financial performance is used by most of the business communities. So, the study findings may provide useful guidance for trade creditors, management for banks, and the general investors. In addition, the assessment of bank's financial performance can be a useful source of information for the Bangladesh government's policy makers.

Malik R. Elhaj   and Shah Saeed H. Chowdhury   

One important gap in finance literature is the seasonality in volatility. Just like the seasonality in stock returns it is possible that volatility may also have a pattern. Time series volatility is related to previous values and it is sticky in nature. Thus, detection of seasonality in volatility may be difficult. Therefore, we use cross-sectional volatility from daily returns of a cross-section of firms (in our case, sectors) and examine the relationship between daily cross-sectional volatility and day of the week, turn of the month and turn of the year. This paper examines how the cross-sectional volatility of the Jordanian stock market may change due to the day of the week, turn of the month and turn of the year. Results show strong evidence of reduction of volatility on Thursday compared to Sunday, and significantly lower volatility on the first three days of the month compared to the third day before the last day of the month. Thus, this finding is important for investors to better understand risk.

Yu-hong Liu   Yu-Chen Lin   and Ya-hsin Hung   

In this paper, we have constructed a model to price currency option. It contributes to releasing some assumptions the Black-Scholes' (1973) model makes. One of them is that the log price of asset doesn't follow a normal distribution any more. The other one is the interest rates in the domestic and foreign countries become stochastic. This general formula is first proposed by Amin and Jarrow (1991). Based on this model, we build extended normal distribution model [developed by Ki, Choi, Chang and Lee (2005)] under the assumption of stochastic interest rate economy. In numerical examples, our proposed model would be compared with Amin and Jarrow (1991) under CIR [Cox, Ingersoll and Ross (1985)] interest rate term structure. Furthermore, Monte Carlo simulation is used to provide another outcome to be another comparative example. Finally, we think that the proposed model provides more correct currency option prices when taking account of stochastic interests and extended normal distribution. The drawback of the Black-Scholes' formula which fails to catch the volatility smile effect is resolved by using the proposed model. The market participants can use the actual market data to calibrate the parameters of the proposed model and use the proposed model to price the currency options and derivatives accurately.

Zahid Anowar   

This study attempts to investigate the relationship between capital structure and profitability for a sample of 40-firm listed on Dhaka Stock Exchange (DSE) during the period of 1998-2013. Granger causality shows that bidirectional causality exists between firm size (FS) and profitability (ROA) in the short run. A large size firm has more scope to make more profit. Bidirectional causality also exists between liquidity and profitability. A more profitable company can uphold better liquidity without depends on external fund. However, unidirectional causality exists between capital structure and liquidity in the short run. This finding indicates liquid firms have less preference for debt in the short run. Moreover, unidirectional causality also exists among profitability to capital structure and firm size to liquidity in the short run. POLS fixed and random effects have been employed to check the relationship between capital structure and profitability and findings confirm that profitability, firm size and liquidity have statistically significant relationship with capital structure.

Morris Irungu Kariuki   Fredrick Ogilo   and Cyrus Iraya Mwangi   

The study sought to establish the relationship between debt knowledge and indebtedness in Kenya. Positivism paradigm was used in this study. The study adopted a cross sectional and correlational descriptive research design. The study targeted about 2.4 million employees in the formal sector. Three stage sampling was done, first, cluster sampling and then, stratified sampling and finally random sampling. The study used primary data collected by use of self-administered questionnaires. A pilot test of the questionnaire was conducted on 40 respondents to check its validity and reliability. 1000 questionnaires were circulated. Of the returned, 581 questionnaires were considered usable. Cronbach's alpha for likert type items was found reliable (over 0.7). Data analysis used IBM SPSS statistics 21 for descriptive and correlation analysis. Further, OLS Multiple regression models were used to examine the relationships between the independent variable and the dependent variable. The findings reveal that debt experience has a significant effect on indebtedness. Results also found that aggregated debt literacy only explain a mere 9.8 % of respondent's indebtedness. The study will help to buttress economic theories of borrowing. Further the government, policy makers, employers and scholars will benefit from the findings of the study. Future research should explore the effect of dimensions like debt attitude and financial socialization on indebtedness. Further, debt literacy for individuals in the informal sector need to be related to their indebtedness while the lenders' perspective need to be sought.

Barbora Drugdová   

The article focuses on the commercial insurance of non-life risks and non-life commercial insurance market as part of the financial market in the Slovak Republic. The Slovak commercial insurance market is well-developed. There were 21 commercial insurance companies, and all of them were all associated in the Association of Slovak Insurance Companies and operated in the Slovak Republic until December 31, 2014. Development of insurance in the area of life insurance in recent years is more dynamic than in non-life insurance. The Slovak Republic is gradually closer to the European average on the insurance market, which is about 62 percent in favour of life insurance. Commercial insurers offer a wide variety of insurance products. Amongst them are also products aimed at insuring international risks, as a part of non-life risks.

Dhiaa Shamki   and Ibrahim Khalaf Alulis   

The paper examines whether company's characteristics, namely, stockholders number, listing status and company's age affect its accounting information relevance and which stock price measure, among average price, closing price and after three months price, is more dependable in pointing out the accounting information value relevance for a sample consists of 91 companies in the services and industrial sectors in Jordan within 2004-2013. Using price model, it is found that companies with larger stockholder numbers, listed on Amman Stock Exchange primary market, and that are older in age yield greater value relevance for per share earnings and book value. Book value has the greatest value relevance being the best predictor for firm value, while cash flows showed insignificant results. Finally, we concluded that closing price is the most dependable among the three stock price measures in detecting the accounting information value relevance in Jordan. The paper presents the ability of valuation theory/model to interact with other theories by including the effect of non-accounting information on the accounting information value relevance. Our findings might present evidence that can serve the educational institutions in their courses and provide a guideline to investors, managers and financial analysts to better summarize the firm value.

Fernando B. Sotelino   and Rodrigo B. Gonzalez   

This paper reviews the characteristics of the international incursions by banks since the early 1990s, examines the implications of the US subprime meltdown crisis and ensuing credit crunch for the pursuit of international banking activities, and provides a conceptual framework to help banks assess strategic decisions regarding the scope of their international operations in the years to come. We conclude that international banks, while remaining loyal to universal banking in terms of scope of activities, should become increasingly selective regarding the international reach of each and all components of their financial services offering portfolio.

Aziz Mossadak   Richard Fontaine   and Hanen Khemakhem   

The objective of this study is to examine the effect of ownership structure on dividend policy in the context of an emerging market. In the academic literature, covering various economic contexts, research shows contradictory results. Therefore, based on a sample of 146 observations, we analysed the relationship between the ownership structure and the dividend policy in Morocco. The results of our study show a positive and significant relationship between ownership structure and dividend policy; however, one of the ownership structures (institutional ownership) did not show a significant relationship with dividend policy. Our results are surprising as they contradict Aguenaou et al. [1] and Pablo and González [2] who instead find negative relationships. Our results add to the existing literature by providing unique results in an emerging market such as Morocco.

William Smart Inyang   

It is not clear why imprest funds which are solely used for the implementation of the overhead cost budget are not effectively released to spending units found within public institutions of developing countries. The current study was therefore, carried out to discover the reasons why academic departments of a public institution like Nigeria's university of calabar do not receive their monthly imprests every 9 out of 12 times per annum (i.e. imprest funds are not released 75 percent of the time!). Primary data were collected using a 5-point likert scale questionnaire while six hypotheses were formulated and tested for the study using multiple regressions. The study revealed that delay in the release of imprest funds to spending units of public institutions was due to management's lack of confidence in the spending units' overhead cost budgets, cumbersomeness of procedures for releasing imprest, late retirement of imprest and personal considerations while late budget approval and side-lining of units' finance officers had negligible or no association with the delay in the release of imprest. The study therefore, recommended that public institutions' managements should demonstrate commensurate confidence in their units' overhead cost budgets, adopt time-saving imprest procedures and place appropriate sanctions against late retirement of imprest and personal considerations.

John Wei-Shan Hu   Yi-Chung Hu   and Jenny Chien   

For decades, humans have been consuming large quantities of oil, coal and natural gas. Consequently, people must now take responsibility for having participated in productive activities that have caused the emissions of greenhouse gas (GHG) which has damaged the environment and caused problems associated with abnormal weather. Previous studies investigated the relationships between energy and carbon prices, between oil price and stock index, or between carbon price and macro-economic factors. Few have examined the relationships among EUA spot price, oil price and the stock index in individual nations. Owing to the fact that the European Emissions Trading Scheme (EU ETS) is the world's first carbon market and remains the largest globally, this study, based on the finding of Chevallier (2009) that capital markets are closely related to the commodity markets, examines the long-term equilibrium relationship and causality among European Union Allowance (EUA) spot price, Brent oil price and three European major stock indices from January 1, 2005 to Dec. 31, 2012. The sample period is further divided into three sub-periods of 2005 to 2007 (Phase 1 of the EU ETS), 2008 to 2010 (US subprime loan crisis and the first period of Phase 2 of the EU ETS), and 2011 to 2012 (European debt crisis and the second period of Phase 2 of the EU ETS). Numerous notable findings from the empirical findings are presented. First, EUA spot price, oil price and DAX index are co-integrated with each other during the second sub-period. Although oil price can be adjusted to the long-term equilibrium in German stock market during that period, adjusting EUA spot price to long-term equilibrium is rather difficult. Next, oil price is affected by EUA spot price unilaterally for the full sample period and the third sub-period. Moreover, EUA spot price is unaffected by any factor except itself during the first sub-period, and is affected by three European stock indices for the full sample period, and the third sub-period. Furthermore, the most explanatory power for Brent oil and EUA spot prices arises from themselves, respectively. Finally, the capital markets and commodity markets are closely related during the 2nd sub-period only.

Supriya Katti   and B.V. Phani   

Rock's [1] theory ascertains information asymmetry as a primary reason to answer 'Why New Issues are Underpriced?' Theoretical construct of this seminal work is based on information asymmetry between various classes of investors. Empirical manifestation of this theoretical explanation is based on considering different proxy measures to quantify the information asymmetry as perceived by various researchers over the past three decades. The growing IPO literature also explained underpricing with the help of agency theory, signaling, behavioural theories etc. Empirical research has identified various determinants of IPO underpricing. The influence of various factors predominantly depends upon country specific regulations, market microstructure and price discovery mechanism. Although many factors have justified the degree of underpricing, controlling for these factors does not completely eliminate the degree of under pricing. The justification of residual underpricing through these factors has limitations in terms of failure to completely explain the IPO underpricing. The paper reviews different factors presented in the extant literature that influence the price discovery mechanism of initial public offerings (IPO) in various economies. We conclude that the degree of underpricing is dynamic and various markets forces interact simultaneously in observing the variation in pricing the new equity issues. This paper points out the significance of regulatory framework in explaining the degree of IPO underpricing.

Johnmark Obura   and Cynthia Anyango   

Performance of Nairobi Securities Exchange (NSE) market has remained unpredictable. This could have led to past investor losses. If this situation continues, it could lead to continued loss of investor confidence in NSE market. However, literature links foreign exchange rates fluctuation and interest rates with NSE performance. In Kenya, exchange market is active. Further, stable interest rates attract investors. Despite this, exchange rates fluctuation and interest rates have not been considered as influencing securities market performance. Moreover, reviewed literatures have left theory building impoverished due to contradiction. The study attributed this to possible moderation of the relationship between foreign exchange rates fluctuation and securities market performance by interest rates. The study sought to determine the moderating effect of interest rates on the relationship. Corelational design on secondary data between January, 2006 and December, 2010 was utilized. Hierarchical regression established significant change in R² of 0.085 confirming moderation. The study concludes that interest rates moderate the relationship and recommends that policies governing the regulations of interest rates should be formulated since it moderates the relationship. Future researchers can adopt other techniques in the same area of study. In advancing a model and revealing moderation the study contributes to theory building.

Klaas J.A.   and Mavlina A.G.   

This article deals with the problem of assessment of commercial banks financial stability. In the framework of the article are approved methodology for assessing financial stability on the example of regional banks of the Republic of Tatarstan, as well as conclusions about the sustainability of the regional banking system in a worsening debt crisis and the increasing volatility in global financial markets are drawn. Economic and statistical techniques were used: grouping, ranking, a probabilistic assessment, analysis of volume indicators. We have produced results, indicating that there are problems in the activities of the regional banks that undermine stability of the regional banking system and also Russian banking sector as a whole.

William Smart Inyang   

The study investigated why MDAs in African countries cannot account for public funds. A 5-point likert scale questionnaire was used to collect primary data from 62 staff members of State and Local government auditor-general's offices who participated in the study. Five hypotheses were formulated and tested for the study using multiple regression. The study attributed the occurrence of unretired imprests in Cross River State MDAs to the following factors: lack of budgetary provisions, fraudulent delegation of imprest retirement and improper reimbursement of imprests and it was further revealed that off-budget expenditures and non-retirement of imprests by other heads of departments have little or no association with unretired imprests. The study therefore, recommended that overhead cost budgets of the MDAs be constantly revised and appropriate sanctions be levelled against MDA officials who engage in fraudulent delegation of accountability over the imprest funds and improper reimbursement of imprests.

Claire Richards   Mary Ann Reynolds   and Jesse Dillard   

The purpose of this paper is to explore whether there are extant mechanisms that are utilized to meet the challenges of diverse corporate governance needs in modern global society. We adopt the nonlinear lens utilized in complex adaptive systems. The examination is advanced using three examples drawn from published academic research. The three examples selected allow consideration of differing levels of analysis, regions and entity types. Levels of analysis include societal, institutional and firm. Regions include Asia Pacific, United States and international. The governance types are governmental, charitable and corporate. Distinct world views are represented by considering the holistic worldview of the indigenous Maori as well as an emerging CSR agenda for an international corporation. Diverse objectives are exemplified by the inclusion of required not-for-profit reporting.

Piotr Tworek   

Both in theory and in practice, we can distinguish many financial methods used in the evaluation of investment projects in enterprises. Among them, the most important group constitutes the discount methods, primarily because of their advantages. First of all, they take into account the changing value of money over time. Moreover, knowing not only the advantages but also disadvantages of these methods is a prerequisite for their proper use in practical investment. Knowledge of the mutual relationships and dependencies between these methods is equally important for the success of the investment process. This directly affects the final investment decisions in enterprises, where, in today's practice, on the one hand, the financial viability of projects is being assessed, and, on the other hand, the risks associated with the investment. Therefore, the aim of this paper is to present the methodological problems associated with measuring the financial efficiency of investment projects implemented by the enterprise. In particular, the paper presents both the advantages and disadvantages of discount methods as well as mutual relationships and dependencies between the results of these methods.

Sarbjit Singh   

All organizations whether manufacturing or service have to keep inventory for smooth running of their business processes. This study is devoted to the items like medicines, cosmetics which are having a fixed shelf life, i.e. they will be of no use after some prescribed time. This model also considers the permissible delay which means that the buyer can pay for goods after some fixed time and has to pay interest after that fixed time. The demand considered here is fixed constant demand. The lead time varies as per the availability of the product and follows normal distribution.

Muleye Tarekegn   

Tax evasion in most developing countries is so widespread and development is much exacerbate by the fact that not many of these countries have made an effort to measure the ethical reasons that taxpayers give. This study, therefore, is designed to describe the ethics tax evasion in Dessie town administration, Ethiopia by taking evidence from 336 randomly selected self-employed taxpayers through a 7 point likert scale questionnaire. Accordingly, this study result shows that tax evasion is ethical in certain situations, and sometimes it is unethical in some other situations. The top mean score ranked arguments that taxpayers gave to justify tax evasion include government corruption, unfair tax system, government discrimination against political affiliation, tax un-affordability, when the money collected is wasted, and high tax rate. In contrary, tax evasion is not ethical when most of the money collected is spent wisely, if the money collected is spent on worthy projects, when the money collected is spent on projects that do benefit taxpayers, and when the money collected is spent on projects that do not benefit taxpayers. The other finding of this study is that the ethics of tax evasion is different among gender, as well as over academic status of the respondents. Females oppose tax evasion than male i.e. females are more ethical than male. Likewise, educated are more ethical than uneducated, this is with the view that tax evasion is unethical. In general, the overall finding of this study indicated that the government should aware the taxpayers that there is proper administration, fair tax system and money collected are spent wisely.

Ogilo Fredrick   

This study sought to establish the determinants of bear market performance by taking a survey of investors at the Nairobi Securities Exchange. To achieve this, a quantitative and qualitative research design was adopted and the study involved administering questionnaires to 500 retail investors participating at the Nairobi Securities Exchange through five purposively selected stock brokerage firms based in Mombasa Town. Convenient sampling technique was used to administer questionnaires to respondents. Data was analyzed by the use of descriptive statistics and correlation analysis was carried out to determine the relationship between the variables. A multiple regression model was employed to analyze the independent variables and their effect on bear market performance. The ANOVA result at a p-level of .05 showed that all the four variables; transaction cost, mobilization of resources by retail investors, financial literacy and cultural values had an influence on bear market performance. The Pearson Moment correlation analysis showed that bear market performance was weakly associated with transaction costs and financial literacy while the relationship between bear market performance and mobilization of resources by retail investors as well as cultural values was largely insignificant. The study recommends that further research should be carried out on the economic cycle and its influence on bear market performance.

Michael S Long   

This study attempts to explain why the equity market earns greater returns for bearing risk when a Democrat is President in the USA versus a Republican. I look at data from 1929 through 2012. The data show that the value weighted return minus the corresponding period's risk free rate is 10.83% when a Democrat is President, versus a corresponding return of -1.20% under Republican Presidents. Two basic macroeconomic arguments exist that should affect market value between the two parties: differences in the risk free interest rates and differences in economic growth. On average the Democrats follow a policy of low interest rates. The rate of return on short-term T-bills averages 4.55% under the Republicans and a 2.48% under Democrats. Further, the Democrats overall economic policies create a higher average real growth rate with a 4.8% average versus only 1.8% under Republican administrations. Unfortunately, the growth and interest rate differences together do not explain the observed difference in equity market returns. A basic OLS approach with annual value weighted market returns minus the corresponding risk free rate as the dependent variable is run. Neither risk free interest rates nor real economic growth are significant in explaining the observed market returns though the party in power is significant predictor.

Zahra Hashemi Oskouei   and Rasoul Baradaran Hasan Zadeh   

The main purpose of this research is to investigate the future stock return considering the features of different stages of the life cycle based on the cash flow statement. In this research the stock return has been considered as dependent variable, Earning per share and the change in earnings as independent variables, and risk factors (the book value of equity to the market value of equity ratio, loss, firm size, market model beta) have been considered as control variables. Firstly, the statistical sample has been separated using cash flow pattern to the firms at the stage of the Introduction, Growth, Mature, Shake-Out and Decline, then in order to analyze the raw data and converting them to the information needed for making decision about hypotheses and explaining the relationships among the variables, the regression testing is used. The results obtained from the investigation of 1123 firms-years during the period between 2002 and 2011 indicate that generally the change in earnings per share has significant and positive effects on predicting the future stock return. But the effect of the earning per share on future stock return is insignificant and positive. In addition, the results of the test show that the lowest of the book value to market value ratio in mature stage has a positive effect on future stock return and the highest ratio in this stage has a negative effect on future stock return.

Oxana L. Wieland   

Social investing will be examined as an example of modern institutional innovations with respect to the complexity of financial markets. Social impact bonds will be used as a case study of a particular innovative financial instrument in order to understand the complexity and resulting challenges of these potential market dynamics. The author argues that post-crisis regulatory regime governing US and European markets require substantial work to fully address the challenges derived from financial innovations. In particular, existing regulation, technologies, information asymmetry, agency cost, and innovation pace need to be considered in order to understand the factors which will determine likely outcomes of social impact bonds. Social Investing and the embryonic stage of current development reflect certain 'unknown areas'. This paper addresses the needs of the post-embryonic stage of the theoretical framework of financial market innovations.

Ogilo Fredrick   and Benard Nthenge Muiva   

The study sought to examine the relevance of firm fundamentals in explaining stock returns of non-financial firms listed at the Nairobi Securities Exchange. The study employed a descriptive research design. A census targeting the 44 non-financial firms listed between the years 2004 and 2013 was conducted. The study used secondary data obtained from Nairobi Securities Exchange. The relationship between stock returns and three fundamentals was measured using the Karl Pearson moment correlation coefficient while regression analysis was used to determine the effect of change in total assets, change in revenue and change in financial leverage on stock returns. The overall significance of the model was tested using F test while the significance of the individual independent variable was tested using t-test. The study found a weak positive correlation between stock returns and change in total assets, while change in revenue and change in financial leverage exhibited a negative relationship with stock returns. However, the relationship between stock returns, change in total assets, change in revenue and change in financial leverage was found not to be significant. The study concluded that change in total assets, change in revenue and change in financial leverage cannot be used to meaningfully estimate stock returns for non-financial firms listed at the Nairobi Securities Exchange. Further studies may explore the fundamental factors that significantly influences stock returns at the Nairobi Securities Exchange by further analyzing the information reported in financial statements.

Eddy Winarso   and Joung Hyun Park   

Intellectual capital is a unique resource, categorized in intangible assets, so that not all companies can replicate it. Then the intellectual capital is a key resource for the company to create value added which will further creating a competitive advantage. Intellectual capital can be used as an indicator of the success of the company's financial performance. The company is able to manage and utilize the available resources, to create added value for the company so that the company's financial performance will increase. The purpose of this study was to determine the influence of intellectual capital consists of Human Capital, Structural Capital and Customer Capital on the company's financial performance is measured by using the approach of return on assets (ROA). Sample is the banking industry, which is listed on the Indonesian Stock Exchange (IDX) period 2008 - 2012 there were 22 companies. Data is the banking industry's financial statements in the period 2008-20012 are listed in Indonesia Stock Exchange (IDX). Using multiple regression analysis, intellectual Capital measurement model is using a model Pulic (1998) i.e. Value Added Intellectual Co-efficiency (VAIC^TM) as well as elements of Human Capital Value Added (VAHU), Customer Value added Capital (VACA), and Structural Capital Value Added (STVA). The results showed, partially (1) Human Capital (HC) effect on the financial performance of +2.085 regression coefficient, that means the higher Human Capital (HC), the better the financial performance. (2) Customer Capital (CC) effect on financial performance of + 3.568 regression coefficient. It means the higher Customer Capital, the better financial performance. (3) Structure Capital (SC) effect on the financial performance of positive regression coefficient 2.064. This means that the higher the Capital Structure, the higher the company's financial performance. Simultaneously measured by the Intellectual Capital Value added efficiency (VAIC^TM) consists of Human Capital (HC), Customer Capital (CC) and Structure Capital (SC) significant effect on financial performance as measured by return on assets (ROA) of: ROA = 0.089 + 0.112 (HC) + 1.501 (CC) + 0.708 (SC). The Intellectual Capital component Human Capital, Customer Capital and Structural Capital affect the company's financial performance 72.20 %, while the rest is influenced by other factors.

Kuang-hua Hu   Da-bai Shen   and Jin-Long Huang   

This paper uses listed cross-strait (China and Taiwan) companies during 2006–2010 to demonstrate the application of a logistic regression to establish financial distress pre-warning models. The bankruptcy indicators are selected by three stages, namely a Wilcoxon test, a ridge regression, and a stepwise refinement. We attempt to determine whether predictors can be obtained by incorporating corporate governance variables that could increase failure predictability. Both non-outstanding state shares and share-holding of placement institutions are flagged positively and significantly in the pre-warning model in China; this finding conforms with the "conflicts of interest hypothesis." The share-holding by foreign institutions negatively impacts the financial crisis, a finding that is in keeping with the "efficient supervisions hypothesis." The negative and significant relation associated with the director share-holding and financial crisis in Taiwan is in accordance with the "convergence of interest hypothesis." Cross-shareholding has a positive effect on a firm's failure in Taiwan. The results also demonstrate that the integrated model has the best capacity to identify pre-warning models among all models. For the models of estimation, Taiwan's model is slightly superior to China's model.

Rao Fu   Yugui Hao   and Xiaomin Chen   

Climate change has become a political and economic problem in the world, with the formally effective of the "Kyoto Protocol" in 2005, carbon auditing issues is increasingly attracting the attention of the theorists and practitioners. Low carbon governance elements and carbon audit relationship theory analysis is Based on realistic background and the government - market - enterprise level. The analysis shows that, the low carbon governance goal is higher, the greater the demand of carbon auditing. Carbon auditing plays an important role in the realization of the goal of low carbon management, which is an important part of low carbon governance, constructing scientific and effective carbon audit mechanism, and playing as the immune function in the low carbon governance.

Ane Elixabete Ripoll-Zarraga   

This paper focuses on comparing the efficiency of the Spanish airports for four years (2009 to 2012). The Spanish airports are government owned and managed (AENA) under an airport-system network where non-profitable airports are cross-subsidized by profitable airports. The main discussion is if the decision-making process based on the centralisation of management may influence the efficiency of airports (technical efficiency). Furthermore, a financial analysis is performed to compare which airports although being not profitable from an accounting perspective may be using their current resources (infrastructure) efficiently. Since airports achieving profits cross-subsidized the ones that achieve negative gross margin, it could be discussed that airports with negative gross margins when technically efficient could obtain better financial results if competition is allowed. The methodology to calculate the technical efficiency level of the Spanish airports is based on non-parametric models DEA (Data Envelopment Analysis). The results show that the improvements among the years in the gross margin of the larger airports (such Barcelona and Madrid) are not a fair and true reflection their current operational performance, but a result of a centralised making-decision process (centralised management) among investments; depreciation and air fares. The results also show that airports increase significantly their technical efficiency when competing with similar-size airports, being the medium airports the ones that experience a higher increase of efficiency.

Bedanta Bora   and Anindita Adhikary   

Investment in stock market is subjected to diverse risks. The same is made in expectation of return which is in excess of a risk-free rate. The actual return the investor receives from stock may vary from his expected return and risk is expressed in terms of variability of return. As such, it becomes essential to understand magnitude of the rate of returns and the degree of risk involved. One noteworthy measure of systematic risk associated with an investment is Beta. It refers to the volatility of a stock in comparison with rest of the market. The stability of beta is of great significance as it happens to be an important tool for investment decision. In these contexts, the study has explored the relationship between returns of securities and market returns and also the stability of beta for a variety of stocks that formed a part of BSE Sensex. The methodology adopted here is empirical in nature. The required information for undergoing the research has been accumulated from secondary sources. The sample size for this study consists of 30 corporate firms that are listed on BSE and included in Sensex. Descriptive statistics and multiple regression model are being used to study the relationship between returns of securities and market returns. Stability of beta is tested as well. Findings indicate that there seems to be positive association between returns of securities and market returns and betas are unstable overtime.

Veliota Drakopoulou   

The goal of this research was to investigate the controversy surrounding the inability of Statement of Financial Accounting Standard No. 133 (SFAS 133), Accounting for Derivative Instruments and Hedging Activities to portray the economics of hedging. This research examined whether or not the possibility of increased volatility evolved from economic hedges that do not qualify for hedge accounting under SFAS 133 prompted Bank Holding Companies (BHCs) to adjust their corporate risk management strategy to one that is more accounting responsive. Based on the results of this research, BHCs' which increased the level of accounting hedges and decreased the level of economic hedges experienced a significant decrease in earnings volatility relative to pre-SFAS 133. The findings suggest that BHCs' ability to reduce earnings volatility and increase earnings smoothing to meet analysts' expectations after the 2008 amendment of SFAS 133 has an adverse impact on BHCs' continual use of economic hedges. Analysts and investors are recommended to evaluate further BHCs' risk strategies to gain a better representation of their risk paradigm with derivatives. This study extends prior research on corporate risk management activities of BHCs and contributes to social change by presenting new affirmation to investors of the influence of SFAS 133 economic hedges on earnings volatility.

Adamova Karine   

The process of globalization of the world economy affects all areas of the world financial market and considerably affected and even forms the main trends in the national financial markets of developed and developing countries. Globalization promotes greater openness of financial markets, facilitating access to national markets of capitals, unification of norms and rules of realization of operations, regulation and supervision of financial sphere, standardization of requirements to the transaction and payment and settlement servicing of participants of operations.

Adamova Karine   

Each of us during their working life should create a reserve of funds needed to ensure a secure and carefree old age in the future. The last 20 years, with independence, the citizens of the countries of the former USSR did accumulation of funds in various ways, but in most cases this led not to their growth, but mainly to the loss, while in the leading foreign countries, nationals of their savings not only ensure a decent life in old age, but made a huge contribution to the prosperity of their country in General. What is the accumulation? As we understand this concept, and as I see it abroad? The answers to these and many other questions do not lie only in their understanding, but in the psychological aspects invested in person at the time of its formation in the early years of life.

Mehmet Ali Canbolat   and Abdurrahman GĂĽmrah   

The mission of the loan associations is simply to convert deposits collected with lower interest rates, into credits with higher interest rates. However, return of this cycle involves high potential of risk. In order to minimize the risk, several financial models are utilized. Since these models are insufficient, new models are required to be developed. The purpose of this study is to compile literature reviews on credit risk measurement methods used for assessment of credit demands. The method used is literature scan. This scan was conducted with printed publications and articles from the databases scanned. The information is compiled from these sources. It is discussed that risk mitigation should be given importance instead of guarantee, for evaluation of credit demands with Basel II criteria. A credit requesting entity's future prediction by examining financial statements can only be possible utilizing financial statements analysis techniques (comparative financial statements analysis, vertical analysis, ratio analysis and cash flow statements) together. As a consequence, in 2009 a software ,named “Scoring Model” has been developed for giving credit decisions which uses the techniques together mentioned above. This software merely based on a model is proposed to be integrated into banking system after being reprogrammed as commercial software.

Xiaomin Guo   Lin Zhong   and Huijian Dong   

This paper calculates the per quarter pairwise correlation coefficients (Rho) of the daily returns from December 5, 2005 to December 8, 2014 of 30 stocks randomly selected from the Russell 3000 index. For the time series correlation coefficients of 435 pairs of assets, we employ the Elliot-Rothenberg-Stock Point Optimal procedure to examine the stability of correlation coefficients. Our results indicate the inappropriateness of using correlation coefficients in portfolio management and Monte Carlo simulation. More than one-third of the correlation coefficient series generate non-asymptotic simulation volatility and using ex post correlation coefficients in Cholesky decomposition performance forecast can lead to severe deviation from the investment policy mandate.

Muhammad Raquib   and Khairul Alom   

Efficient Market Hypothesis (EMH) has attracted a considerable number of studies in empirical finance, particularly in determining the market efficiency of an emerging financial market that is Dhaka Stock Exchange (DSE). Conflicting and inconclusive outcomes have been generated by various existing studies in EMH. In addition, efficiency tests in the emerging financial markets are rarely definitive in reaching a conclusion about the issue. This paper recommend a paradigm of non-parametric tests of market efficiency for an emerging stock market, that is DSE, consisting of non-parametric test which is autocorrelation function tests (ACF), to establish a more definitive conclusion about EMH in emerging financial markets. The result of this research using Dhaka Stock Exchange General Index (DGEN) demonstrates that a positive autocorrelation on Dhaka Stock Exchange returns exists particularly in the period of 2001-2013 and DSE doesn't hold weak form of efficiency and not following the Random walk model. The inefficiency of the Dhaka Stock Exchange follows on from the violation of the necessary conditions for an efficient market with a developed financial system and also implies financial markets and institutional imperfections.

V. R. Palanivelu   and G. Madhupriya   

This paper is based on role of viable entrepreneurial ventures to be developed in the women entrepreneurs in rural areas. Women's development is directly related with national development. The effective management and development of women's resources, their abilities, interests, skills and other potentialities are of paramount importance in human resources development. Rural women entrepreneurship plays a catalytic role in activating the factors of production leading to an overall economic development in India. Entrepreneurship development and income generating activities are a feasible solution for empowering women. It generates income and also provides flexible working hours according to the needs of homemakers. Economic independence is the need of the hour. This paper makes a strong case for entrepreneurial ventures as a new development paradigm for bringing about gender equity among rural women in India by creating self-employment opportunities through microcredit. This study is based on the premise that poor women can internalize production possibilities in groups only. They are better – equipped to overcome the negative social pressure and gender biases operating against them through ventures identity and activity.

Varalakshmi M.   and Manjusree Naidu K.   

Gender empowerment, in terms of economic empowerment, played a significant role since historical times in upbringing of children, education of children and decision making; also it took care of widowhood and old age of women. Women with economic entitlement earned more respect and security than women without any such economic asset. While empowerment through education is the best way to empower women, economic empowerment certainly plays a difference in the quality of lives of women; especially illiterate, poor and women suffering with various types of ill treatment from domestic front and outside the home. In this context World Bank's Plan as Smart Economics: Gender Action Plan (2007-2010) came out with an objective to support women and girls to reach the main stream through its studies and support. The objective of the third goal of the "UN Millennium Development Goals" too, is for Gender equality and empowerment. How far we achieved this goal since its inception? It is in this context the present paper discusses the World Bank's Plan on Smart Economics; its concept; features and further considerations.

Abdullah Hiz   

The purpose of this study is to investigate the association between productivity and market value of firms. This study relies on the data that is derived from COMPUSTAT for the time period of 2002-2012 to address the differences of productivity and firm value associations in firms that comply with US GAAP and firms that comply with IFRS. The findings of this study reveal that the productivity is meaningful for associating with the firm's market value in US GAAP adopter firms and there is a strong correlation between productivity and firm value in US GAAP adopter firms. Meanwhile, the association of productivity and firm market value is not significant in IFRS adopter firms. This is consistent with Best [1] study, which finds that the increase in productivity may cause corporate profitability to be zero even negative.

Golam Mohiuddin   

Banking sector is one of the fastest growing sectors in Bangladesh. Modern banking sector is becoming more complex than before. Evaluating Bangladeshi banking sector is challenging task. There are so many factors, which need to be taken care while differentiating good banks from bad ones. Sound financial health of a bank is the guarantee not only to its depositors but is equally significant for the shareholders, employees and whole economy of a country as well. As a result to this statement, efforts have been made from time to time, to measure the financial position of each bank and manage it efficiently and effectively. In this study, an effort has been made to evaluate the financial performance of the two major banks (one is NCB and another one is PCB) operating in Bangladesh. This evaluation has been done by using CAMEL Parameters, the latest model of financial analysis. Through this model, it is highlighted that the position of the banks under the study is sound and satisfactory so far as their capital adequacy, asset quality, management capability and liquidity is concerned.

Pao-Chen Lee   

Shareholders and stakeholders expect effective supervisory mechanism of corporate governance. Since Audit Committees (ACs) and Supervisory Boards (SBs) act simultaneously as the monitors in governance structure, it is questioned which system is more effective. Currently, both systems co-exist in Taiwan, giving the reasons to collect the data and evidence from Taiwan. Two approaches were adopted to compare corporate performance between the listed companies with ACs and those without (with Supervisors). The results of the first approach indicate that companies with Supervisors (without ACs) perform better than those companies with ACs. The results of second approach verify the results of the first approach showing adverse effects of ACs. Based on comparing both results, this study is inclined to suggest that ACs should not replace Supervisors in Taiwan. This finding may also assist users in assessing which governance structure could make companies to perform better as well as more effective within organization.

Lin Yi Hua   and Chen Nai Hua   

Within the 1970s, due to the environmental accounting began getting focus throughout the energy crisis. Recently, environmental accounting research has become an attractive area. Several studies have suggested the benefit of facilitative in disclosing company environmental accounting information. The data of this study is collected from Hitachi annual report and Hitachi group corporate social responsibility report over the period 2008-2012. The case study analyzes whether the investment in environmental protection can reduce GHG emissions, waste processing and energy conservation etc. This study mainly explores the relationship between carbon emission and financial investment in Hitachi Company according to the environmental disclosures. Furthermore, this study also observes the indicator of the efficiency of environmental load reduction and environmental economic effects. The results showed that Hitachi invests environmental protection does not definitely get positive efficiency. However, Hitachi still concerned environmental protection issue, for example, Hitachi enhances energy efficiency of their products and reduces CO₂ emissions in energy productions. In conclusion, Hitachi has long-term plans for environment protection, in order to reach the goal that they increase the ratio of eco-products which enhance energy efficiency of their products. Although the study has limitation, it presents some results of cost-benefit analysis of environmental investment through environmental accounting data that could strength the contribution of environmental accounting report..

Mohammad Akter Hossan   Mohammad Ziaul Hoque   and Bishajit Dey   

This study examines effect of operating efficiency on the returns of portfolios that are constructed for the banking sector stocks of Dhaka Stock Exchange of Bangladesh. For this purpose, this study firstly measures operating efficiency of the sample banks applying Data Envelopment Analysis (hereafter DEA) techniques. Secondly, sample banks are grouped into efficient and inefficient portfolios on the basis of these efficiency scores. Thirdly, Mann Whitney – U test is applied to test the alternative hypothesis that return of efficient portfolio is significantly different from the same of inefficient portfolio. Results of Mann Whitney – U test reject the alternative hypothesis. Therefore, this study observes no significant difference between returns of operationally efficient and inefficient portfolios in Dhaka Stock Exchange. Results of this study also find that inefficient use of inputs and unfavorable financial environment are the reasons of observing no significant difference between returns of portfolios.

G. V. Satya Sekhar   

Reputation risk is not a unique risk, it is a consequence of other risks like operational risk and other poor risk management practices. It also emerges due to lack of good capital as well as human capital management. At the same time, negative news about the organization or negative blogs created by employees leads to more damage to reputation. This paper also aims on risk management in mutual fund organizations, because they are dependent on confidence of investors. Lack of reputation and confidence leads to decline in the component of investor proportion. In this context, this paper is intended to address three issues: i) reputation risk measures, ii) risk analysis for mutual fund industry and iii) how to sustain reputation to reap long term gains.

Pao-Chen Lee   

This study empirically explores China’s supervisory mechanisms whether the listed companies with Audit Committees (G2) are more effective than those without (G1). Using a panel data base of 2148 compared to 1873 firm-year observations over the 2005 to 2007 period by the multiple linear regressions, the findings report Chinese listed companies with Audit Committees have better independence, expertise and activities proved by 12 of 15 variables of better G2 coefficient than G1; and statistically significant evidences present in 5 aspects, the listed companies with Audit Committees have (1)less proportion of independent directors receiving remuneration; (2-3) more legal and internal auditing expertise in Supervisory Boards; (4) more meeting times on the BoD; and (5)the quantity of Supervisory Boards’ size may not impact upon the effective quality of supervisory mechanisms. The findings of which may provide impetus for further research in Chinese setting and help refine general knowledge on the role of supervisory mechanisms in corporate governance.

Mir Askari Akbari   Samira Rahmani   Reza Ahmadi   and Hooman Shababi   

The Present study investigates the relationship between deviation from optimal level of cash holdings and future performance in 188 active accepted firms of Tehran Stock Exchange (TSE) during 2003-2012. To do so, Opler et al. model was extended to determine optimal cash level and positive and negative deviation from optimal level of cash holding are applied as excess and sufficient cash. Also regression model with panel data is used to investigate the relationship between cash holdings and future performance. Furthermore, cumulative abnormal returns (CAR) variable is used as future performance indices. The results indicate that there is a negative and significant relationship between deviation from optimal level of cash holdings and future performance. It shows that companies which hold more or less cash than optimal cash will have lower investment returns.

Omar Juhmani   

The aim of this study is to investigate the level of social and environmental information disclosure practices in websites of companies listed on Bahrain Bourse, also to determine the influence of firm size, profitability, financial leverage, firm age and audit firm size on the level of social and environmental information disclosures under legitimacy theory. To achieve the aims of this study, content analysis and statistical analysis were used. Content analysis by word count is used to determine the level of social and environmental disclosures on websites of Bahraini companies. To determine the factors that explain the level of social and environmental information disclosures, descriptive statistics and multiple regressions analysis were used. The findings indicate that 57.57% of the sampled listed companies provided social and environmental information in their 2012 annual reports and their websites. Commercial banks and insurance companies made the most disclosure of social and environmental information, while the least disclosure was made by companies in the hotels and tourism sector and industrial sector. Multiple regression analysis revealed that financial leverage and audit firm size had a significant relationship with the level of social and environmental information disclosure.

Ming-Chang Lee   and Li-Er Su   

Capital Asset Pricing Model (CAPM) is a general equilibrium model. It not only allows improved understanding of market behavior, but also practical benefits. However, there exists a risk-free asset in the assumption of the CAPM. Investors are able to borrow and lend freely at the rate may not be a valid representation of the working of the marketplace. Therefore, in this paper, it studies that the efficient frontier of portfolio in different borrowing and lending rate. This paper solves the highly difficult problem by matrix operation method. It first denotes the efficient frontier of Markowitz model with the matrix expression of portfolio. Then it denotes the capital market line (CML) with the matrix expression too. It is easy to calculate by using Excel function. The aim of this study is to develop the mean- variance analysis theory with regard to market portfolio and provide algorithmic tools for calculating the efficient market portfolio. Then explain that the portfolio frontier is hyperbola in mean-standard deviation space. It constructs CML in order to get more returns than that of efficient frontier if risk-free securities are included in the portfolio. A proposed step for CML on efficient frontier of portfolio with borrowing and lending rate is presented. Under these tools, it is easy calculation SML and CML by using Excel function. An example show that proposed method is correct and effective, and can improve the capability of the mean-variance portfolio efficiency frontier model.

Nadia Cipullo   and Rosa Vinciguerra   

Accounting standards can have a significant impact on the liquidity of an entity: both management decisions and the control exercised by supervisory Authorities are influenced by accounting information. Nevertheless the objective of the IASB is to provide users of financial statements with “relevant and useful information […] for their assessment of the amounts, timing and uncertainty of the entity’s future cash flows”, there are some critical points associated with those requirements, in particular for the banking sector. Indeed, it lacks to define the concept of liquidity and to pay attention to the economic maturity of certain items, which is important as well as their amounts. Moreover, given that the information contained in the statement of financial position and the statement of cash flows serves some limitations for the assessment of the liquidity profile of an entity, it is expected that these gaps are filled by the disclosure. Nevertheless, even IFRS 7 presents some deficiencies that will be underlined in this paper. It is believed that current requirements could be profitably complemented.

Shamsaddeen Faraj   and Essa El-Firjani   

This study examines the factors that may be considered as challenges or difficulties facing the implementation of the International Accounting Standards (IASs), and International Financial Reporting Standards (IFRS), by Libyan companies listed on the Libyan Stock Market (LSM). A qualitative approach was employed using semi-structured interviews to collect data. The results reveal that most listed companies prepare their financial statements taking into account the existing laws and the financial regulations, such as the Tax Law, and Libyan Commercial Law, prior to the GAAP with which they comply. The study also finds that the challenges facing the IASs/IFRS implementation in the preparation of listed companies’ financial reports include the following: 1) most listed companies do not offer training programmes, and those that do have only weak provision in this respect, 2) accountants lack adequate skills, awareness and capabilities in implementing IASs/IFRS, 3) accounting education curricula do not include the IASs/IFRS on their syllabus, 4) the vast majority of participants are unable to use the English language in preparing accounts, 5) there is an absence of enforcement from the LSM and external auditors, and 6) the LSM governance mechanisms are weak.

Nadia Cipullo   and Rosa Vinciguerra   

Recent crisis has shown the failure of capital markets in satisfying the liquidity needs of agents. As a consequence, the Basel Committee on Banking Supervision is now paying attention to the matter of Liquidity Risk introducing provisions banks must comply with, in order to promote short-term and long-term resilience. At the same time, the IASB amended IAS 39 by introducing IFRS 9, which regulates the accounting treatment of financial instruments. Nevertheless the intent of the BCBS to discipline the Liquidity Risk and the effort of the IASB to introduce provisions designated to give relevant and useful information on the entity’s future cash flows, there are some critical points associated with those requirements and coming from the combined observations of both disciplines. The problems that will highlight derive from the different objectives of the regulatory and the accounting frameworks. The first one is to serve the safety and soundness of banks and the other is to serve the public interest in terms of transparency. For this reason the IASB should think about the chance to issue a standard specific for the banking sector. Indeed, the management of financial instruments while represents the core business in the latter, has just a secondary role in non-financial entities, so it is desirable to have a differential treatment. Moreover, as the dual reporting deriving forms the differences in both disciplines may generate political costs, it could be useful to recompose the different perspectives providing a supplementary disclosure to justify the two special purposes.

N. V. Chandrasekara   and C. D. Tilakaratne   

In the current financial world, prediction of stock returns has become a vital task. Many prediction techniques available recently depend on the return distribution of stock index. Identifying return distribution of stock return has an immense interest among researchers nowadays. Many researchers have proposed different distributions to model the return distribution of stock market indices. However a study aimed at finding the distribution of return series of local stock indices was not found. In this study return distributions of All Share Price Index (ASPI) of the Colombo stock exchange was examined. The study period consists of 5 years daily data from 1st August 2007 to 31st July 2012 of the ASPI. Results display that the return distribution of ASPI cannot be modeled using Normal distribution and Student's t distribution. The Scaled t distribution with parameters mu = 0.0000613719, sigma = 0.00619983 and nu = 2.54137 can be introduced as the best distribution to model the return distributions of All share price index. Kolmogorov-Smirnov (K-S) Test has been used to access the suitability of fitted distribution. Random numbers were generated using Scaled t distribution with above mentioned parameters and the K-S test was carried out using the generated series and the return series of ASPI. The same procedure was repeated 100 times in order to improve the accuracy of results. Minimum p-value of 0.0534 was obtained in the simulation study and exhibit that the test is not significant under 5% level of significance above 95% times. Finding of this research will help many researches in the financial sector of Sri Lanka to use an appropriate distribution for modeling the ASPI returns and hence to enhance the forecasting accuracy.

Ludmila Verovska   

Audit activity is a variety of service industries, and cannot be developed independently from the major trends in this area. A strategic direction in the development of audit is creation of the international market of auditing services with unified rules and standards regulating audit, and also creation of uniform quality criteria. This article examines the concept of quality audit service, analyzes the main problems of legislative and methodological character in the area of external and internal audit control in Latvia, and considers opportunities and ways of improvement based on international experience. The research results can be applied to the construction and development of the systems of external and internal audit control, which will be providing the most reliable information about the state of business of companies-customers, their performance and prospects for sustainable development. The financial stability of a company, confirmed by the independent, objective opinion of an auditor, increases the growth of investments, the price of shares, improves the company’s reputation in the financial market and ultimately contributes to the stable development of a region.

Muhammad Salman Khan   

The study examines the relationships between the KSE-100 index and a set of macroeconomic variables over sampling period from (1992) to (2011) Statistical tools i.e. Multiple Regressions and Pearson’s correlation models were used to study the relationship between stock prices (KSE-100index) and macroeconomic variables. The finding from the test shows (80%) variations in the dependent variable were explained by the independent variable. Therefore, the model was good fitted and there was a strong relationship between dependent and independent variables, variation in the stock prices explained up to (80%) by the variation in the independent variables. The results further suggested that exchange rate, inflation and GDP (Gross domestic product) growth rate were positively related with stock prices (KSE-100index). While negative impact found on the stock prices of KSE-100 index of the interest rate

Oladipupo Muhrtala   and Mathias Gboyega Ogundeji   

The purpose of this paper is to examine the primary determinants of commercial accounting packages acquisition specifically amongst non-financial quoted companies, in Nigeria. The study analyses accounting software deployment decision using a sample of 178 participants across 5 industries listed on the Nigerian Stock Exchange. A logistic regression model was performed in order to determine which of the factors has the greatest influence. The authors found factors such as operational, commercial, strategic, technical and security considerations as primary determinants of accounting software deployment. In addition, the study also revealed that all companies surveyed have implemented at least one type of commercial accounting package. Special purpose and generalized systems were however found to be most common applications across surveyed firms. This study is the first of its kind in Nigeria to examine the determinants of accounting software deployment with particular reference to quoted companies in the non-financial firms.

Robert Keng’ara   

The Official Development Assistance (ODA) to Kenya excluding debt relief experienced marked variation in donor commitmentsover the last decade with a low of US $ 400 million in 2002 and a high of US $ 1.2 billion in 2007.However, actual disbursement of aid lagged behind, only 63% of 2007 aid commitment was realized hence uncertainty in implementation and eventually stalling. The study was guided by a conceptual framework where independent variable was funds disbursement while dependent variable was project implementation. The validity of the data was conducted through examination by experts. There is delayed receipt of funds by projects of up to 15 months with a positive correlation coefficient of 0.689 at 0.000 significance level between suppliers’ inability to honour contractual obligations and projects incurring cost overruns. Unresolved audit issues result in donors suspending aid and returning huge unspent funds to Treasury yielded a positive correlation coefficient of 0.681 at 0.000 significance level .Provision of staff to man key departments by donors is not a guarantee to completion of projects as scheduled with a negative correlation coefficient of 0.421 at 0.011level of significance. The study contributes to knowledge on disbursement of funds and project implementation in Kenya’s public sector.

Lu Lin   and Dan Lin   

This study investigates the relevance of Jensen’s (1986) free cash flow theory to the market for corporate control in Australia. We introduce two proxies of free cash flow, excess cash holdings and excess accounting cash flow and test the relationship between the level of excess cash and bidders’ long-run post-acquisition performance. Results indicate that the level of excess cash holdings does not provide a significant explanation for the cross-sectional variation in long-run post-acquisition performance. Results from the flow measure of cash indicate that the acquisitions carried out by bidders with excess accounting cash flow are not value-decreasing. This finding is contrary to the free cash flow hypothesis proposed by Jensen (1986).

Walid Zakaria Siam   

This study aimed to identify to what extent the accounting departments at the Universities of Jordan contribute to improving the structure of financial reports through the support which the teaching staff at the Accounting Departments of the Universities of Jordan lend to the need for tackling developments and enhancing the structure of financial reports in the aftermath of the international financial crisis, and teaching and stressing in the accounting courses the importance of factors affecting the quality and improvement of financial reports. These factors include quality features of the accounting information, sufficiency of the accounting disclosure in the financial statements, effectiveness of auditing committees, tendency towards e-auditing, governance in companies, implementation of standards for preparation of financial reports, and e-publishing of accounting information. In order to realize the objectives of the study, the researcher has designed a questionnaire which was distributed to a sample of the teaching staff members along with the employees of the accounting departments at both public and private universities in Jordan during the academic year 2012/2013. Some (200) questionnaires were distributed via the e-mail to the study sample, and the number of questionnaires returned and approved for the purposes of statistical analysis was (138) questionnaires, i.e. 69% of the questionnaires distributed. According to the analysis of questionnaire responses, several conclusions were reached, including the following: - Availability of scientific efficiency and practical experience on the part of the teaching staff members of the accounting departments, and this in fact qualifies them to contribute to improving the structure of financial reports; - Teaching staff members’ support of the need to address developments and enhance the structure of financial reports in the aftermath of the international financial crisis;- Incorporating into the accounting courses the factors that actually affect the quality and improvement of the structure of financial reports. Nevertheless, teaching and highlighting the importance of these factors vary according to e-publishing of accounting information and the tendency to adopt e-auditing.

R. Steven Flynn   

California’s passage of the Nonprofit Integrity Act in 2004, followed by the enactment of similar legislation in other American states, has resulted in a series of new financial reporting requirements for many larger nonprofit organizations. Chief among the provisions of several of these legislative pieces is the requirement for nonprofit entities to form separate audit committees. Following the lead established in the for-profit sector, advocates have strongly urged nonprofit organizations to include at least one financial expert among audit committee members to augment actual and perceived financial reporting integrity. However, advocates’ acknowledgement of the challenge of recruiting these individuals leads one to question their ultimate worth to nonprofit organizations. Recognizing the significance of this issue, this study investigates individual donors’ impressions regarding the inclusion of financial experts among nonprofit audit committee members. Using an experimental case as the basis for exploration, the study finds that donors generally do not perceive financial experts as enhancing the credibility of nonprofit organizations’ financial statements. In light of the significance of individual donor contributions to entities’ continued financial sustainability, these findings represent potentially important considerations for nonprofit organizations as they weigh the costs and benefits of enlisting busy financial professionals for audit committee service.

Naz Sayari   and F.N. Can Simga Mugan   

In this study, the effect of cash flow components on financial distress score is examined for 124 companies selected from Istanbul Stock Exchange (ISE). It is further analyzed whether cash flow components have an explanatory effect on bankruptcy risk and financial health of companies. Four separate models are constituted and Linear Regression Model is used to evaluate company age, company size, cash flow from operations (CFO), cash flow from investing (CFI) and cash flow from financing (CFF) activities as a function of financial distress score of companies. The results show that there is a negative relationship between CFO, company size and financial distress score of companies. On the contrary, CFF is observed to be positively related with the financial distress score. Meanwhile, it is further observed that the standardized coefficient of CFI is statistically insignificant and hence it does not provide any evidence for the financial weakness or bankruptcy risk of companies.

Raymond Leung   and Joe Ilsever   

Prior studies illustrate the issues of agency theory stemmed from the separation between ownership and management. As such, information asymmetry between the agent and principal is the major reason why agent can take advantages from adverse selection and moral hazard, which is the obvious problem in recent accounting scandals. Boards of directors therefore have fiduciary duties to exercise effective corporate governance mechanism to control information asymmetry. We have reviewed the extant literature on whether corporate governance is positively related to more and better disclosure as an attempt to reduce information asymmetry. Also, when IFRS requires more disclosure and IFRS adoption becomes mandatory for many jurisdictions, we examined recent studies on whether firms adopting IFRS with corporate governance regimes can reduce information asymmetry by making themselves more transparent. In general, empirical findings are mixed due to the complex and inter-related nature of corporate governance systems including single-country or cross-country studies, self-constructed or comprehensive corporate governance metrics and whether self-selection and endogeneity can be controlled in modeling.

Georgios L. Thanasas 

This paper analyzes the data that compose the cost structure of Greek Public Hospitals. Moreover, an attempt is made to explore the main operating factors that affect the total cost of public hospitals. This study, tries to contribute to literature in order to group into categories the expenses of public hospitals, while also it provides information to users on the cost structure of those hospitals. In order to do so, a big Public University Hospital of Greece was taken into account, for the period 2005-2009 in a quarterly basis for both financial and operative factors. Eleven cost categories which constitute the cost structure of the Hospital and four operative factors were taken into account for this analysis. The results show the cost factors who significantly affect the cost structure of this particular University Hospital.

Siti Khadijah. A. M N. E. P. Saleh M. F. Kamarudin and Haryadi A  

Islamic micro finance was introduced as an option for the low-income people to get funds in order for them to uplift their well-being and to get themselves out of the poverty. Nevertheless, the borrowers face unwarranted event such as illness, death, fire or theft that may cause improbable setbacks which in turn lead to non-performance of financing. These probable risks will certainly affect the sustainability of the micro finance institutions thus defeating the very reason of its establishment. In this respect, the implementation of risk mitigating instrument via micro Takaful to under privilege group is an interesting issue to ponder. This study explores the implementation of micro Takaful as a way of mitigating the potential risk among micro finance borrowers. A series of interviews was conducted with the practitioners of the respective institutions in the selected sample country (Indonesia) to get a closer look at the practice. Finding of the study indicates that micro Takaful helps a lot in sustaining Islamic micro finance institutions in the country. Nevertheless, this new trend is still lacking of empirical research, more so when we talk about its offering in the market. Hence, further research in this area is necessary and very much recommended.

Daniele Gervasio and Damiano Montani 

The study shows the benefits of more discretion and less guidance in IFRS by presenting an arbitrariness and subjectivity index. The measurement of discretion proposed is based on a scale of values which improves the accuracy of information on measurements, allowing stakeholders to understand independently the level of subjectivity inherent in any accounting items. The study illustrates the matrix format statement, in which retrospective and dynamic accounting results, based on historical cost and fair value are combined, associated with an “accounting discretion view”. By highlighting the degree of accounting discretion, this approach provides users with a clear and realistic vision in which accounting choices or estimates can be credible signals of a firm’s financial performance. Regulators and users of accounting information have to accept a limited subjectivity in pursuit of more informative financial reporting because results seem to suggest that discretion, in spite of all the opportunities to manipulate reported outcomes and mislead users, appears to add value: reasonable and legal management decision making and reporting tend to achieve stable and predictable financial results.

Pier Luigi Marchini and Ennio Lugli 

The shareholders agreement is an agreement drawn up by the shareholders when the company is founded, or after its foundation, to rule one or more aspects of the relationships held by the shareholders. The shareholders agreement phenomenon is particularly relevant in the Italian context, where it is possible to observe a lot of companies with fragmentized ownership in which it is not often possible to find an economic subject that holds so many shares to manage the company. Therefore, it is interesting to investigate the typologies and the diffusion of the shareholders agreements of the Italian listed companies, with the aim to analyze their influence on the corporate governance policies. The paper wants to answer to the following question: do some enterprise characteristics exist that makes more probable that a company adopt a shareholder agreement respects to another one? The empirical analysis is developed on the Italian listed companies at the date of 30, April 2010, belonging to all the sectors classified by Milan Stock Exchange.

Md. Afzalur Rahaman Md. Bokhtiar Hasan and A. F. M. Mainul Ahsan 

While there are many factors that influence stock market activity, the main focus of this paper is to examine stock market performance under different political leadership in Bangladesh. This study mainly considers two different daily DSE indices’ (DSI and DGEN) return and some key market indicators for the sample period March 20, 1991 to April 30, 2013. We basically analyzed average market return, volatility and risk for each government term (five terms) individually. By means of descriptive observation and statistical analysis we found evidence that the performance of stock market was superior under government term 4 (2006 to 2009) while performance was worst under government term 2 (1996 to 2001) and term 5 (2009 to 2013). It was also found that the government term 4 was led by nonpolitical party, i.e. Caretaker government whereas the government terms 2 & 5 were led by the same political party.

Tijani Oladipupo Muhrtala and Mathias Ogundeji 

Tax revenues constitute a major source of income for governments in most countries. However, the increasing concern on the extent of tax evasion has induced a lot of studies in different countries on the amount of unreported incomes and factors accounting for this phenomenon especially in emerging economies. To analyse this topic, Nigeria has been chosen as a reference point. In order to enhance objectivity, an empirical study has been carried out through a structured survey directed at tax professionals. This information was collected in order to explain the determinants of tax evasion. The results show that tax evasion in Nigeria is largely influenced by complexity in the tax structure, perceived financial and economic benefits associated with tax evasion, and lack of trust in governance over financial resource utilization. This outcome suggest that there should be adequate implementation of appropriate recommendations made in this study towards enhancing a better tax policy and improved tax administration in the country. The study also provides information for future research that might contribute to establish the most adequate mechanisms for taxation.

Odoyo Collins Otieno Moses Oginda John Mark Obura Fredrick O. Aila Patrick B. Ojera and Elijah M. Siringi 

This paper examined the effect of Information Systems on revenue collection of Local Authorities in Homa Bay, Kenya. Study objectives included establishing the relationship between internal control systems, Information Systems and revenue collection in Kenyan Local Authorities; determining the levels of quality service offered to the clients by Local Authorities and investigating whether Information Systems relate to effectiveness and efficiency of Revenue Collection. A structured cross-section survey was used to collect data from 2,007 individuals, of which 165 were Local Authorities staff and 1,842 were traders in Homa Bay Municipality. The study found that: there is a relationship between Information Systems and both efficiency and effectiveness in revenue collection, there is a strong positive relationship between Internal Control Systems and revenue collection as reported by 97% of the respondents, and that resistance to change by the council staff was derailing the full implementation of Information Systems. The study is useful in reviewing the institutions’ Act and statutes to cater fully for the integration of IS in the management activities of Homa Bay Municipal Council, to managers at all levels, public sector, policy makers and scholars.

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Assets structure has been widely reported by corporate finance literature to significantly affect financial structure of firms. However, according to the capital structure theories and empirical research in the field, the direction of the relationship between assets tangibility and capital structure is not obvious. This study aims at verifying the significance and the direction of the way assets structure correlates with capital structure on a large sample of private firms across 9 EU countries. The correlation between several assets structure ratios and capital structure ratios is examined across countries, industries and size groups of firms in order to find out how the country-specific factors, the industry-specific factors and the factors related to firm size influence this relationship in the period 2000-2010. The data is provided by the BACH-ESD database published by the European Commission. Findings provide evidence that the firm size has relatively the weakest impact on the way assets structure correlate with capital structure. However, both the direction and the significance of the relationship are considerably influenced by country and industry specificity.

Tijani Oladipupo Muhrtala and Mathias Ogundeji 

The concept of IT as a business enabler is enshrined in the widespread use of computerized accounting information system the world over. However, this milestone in accounting portends imminent challenges in terms of the integrity of underlying accounting transactions processed by IT equipment and facility, an important question arises: what are the likely threats to computerized accounting information systems resulting from the deployment of IT in business and how can these challenges be overcome especially in developing economies? To analyse this area of interest, Nigerian companies has been chosen as reference. An empirical study was conducted through a structured survey directed to the users of computerized accounting systems. Information was collected in order to explain the perceived threats common to CAIS’s as well as determine what categories of threats were most significant. Results show that employees and outsiders constitute key threats to information assets used in computerized accounting when not controlled effectively. This suggests that management should put in place authorization procedures on a “need to know basis” only. Authorized users should have access to only applications and data required to perform specific tasks only. Also, there should be regular logging and monitoring of logical access to systems and data, policies and procedures on segregation of duties, access and transaction logs.

Ali Asghar Anvary Rostamy Tahereh Aliheidri Bioki Farideh Bakhshi Takanlou and Amin Anvary Rostamy 

Most of firms are interested to know about the real cost of products and services they provide. In order to measure the real cost, several methods and techniques have been provided in literature. One of the most important and prominent methods is the Activity Based Costing (ABC) method. Determination of cost drivers in ABC is regarded as a very difficult and tiresome task. Although various methods have been introduced for this purpose but each method suffers from certain disadvantages. This paper introduces the Data Mining (DM) and Factor Analysis (FA) methods to improve the effectiveness of the ABC method. The proposed combined methods let decision makers to consider several cost drivers respect to their effects on costing, simultaneously. In 2010, we have applied the proposed method in Export Development Bank of Iran: EDBI (one of the Iranian leading banks). The results confirmed the usefulness and effectiveness of the proposed methods for bank ABC system and its economic decisions.