Search results for: financial risk

Authors: Saadia Drissi

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The cloud computing is an innovative paradigm that introduces several changes in technology that have resulted a new ways for cloud providers to deliver their services to cloud consumers mainly in term of security risk assessment, thus, adapting a current risk assessment tools to cloud computing is a very difficult task due to its several characteristics that challenge the effectiveness of risk assessment approaches. As consequence, there is a need of risk assessment model adapted to cloud computing. This paper requires a new risk assessment model based on multi-agent system and AHP model as fundamental steps towards the development of flexible risk assessment approach regarding cloud consumers.

Keywords: cloud computing, risk assessment model, multi-agent system, AHP model, cloud consumer

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Authors: Francis Edum-Fotwe, Tony Thorpe, Charles Afetornu

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Risk perception informs the outcome of how issues are responded to in either solving or overcoming a problem or improving a situation. Risk perception is established to be affected by some key factors reflecting in the varying ways in which work is done as well as the level of efficiency achieved. These factors potentially would influence risk perception to different extents. Such that if these factors are said to determine risk perception, how does a change in any affect risk perception. Since the ability to address risk is influenced by risk perception, establishing and developing awareness of that perception should enable construction professionals to make viable decisions. Any act to improve the construction industry cannot be overemphasised, considering its contribution to national development. A survey questionnaire was conducted in Ghana to elicit data that measures the risk perception and the essential factors as well as the necessary demographics of the respondents, who are construction professionals. This study finds out the sensitivity of the critical factors of risk perception. It uses the Relative Importance Index analysis tool to investigate the differential effect of these essential factors on risk perception, such that a slight change in a factor makes a significant change in risk perception, having established that it is influenced by essential factors. The findings can lead to policy formation for employers on the prioritisation factors to undertake to improve the risk perception of employees. Other areas in which this study can be useful in team formation for sensitive and complex projects where efficient risk management is critical.

Keywords: construction industry, risk, risk management, risk perception

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Authors: Rym Ghariani, Younes Boujelbene

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This study aimed to examine the impact of digitalization and supply chain integration on the financial performance of companies in the agro-industrial sector in Tunisia, highlighting the growing importance of digital technologies in modern economies. The results were analyzed using a questionnaire and using principal component analysis, as well as linear regression modeling with SPSS26. The results demonstrate that the digitalization and integration of the supply chain have a significant impact on the financial results of Tunisian agro-industrial companies. In theory, this study provides a better understanding of the effects of digital advancements and supply chain strategies on financial results in this specific area. This study, therefore, studies the relationship between these variables and financial efficiency, highlighting the significant impacts of these technological and strategic elements on the financial results of agro-industrial companies in Tunisia.

Keywords: digitalization, supply chain integration, financial performance, Tunisian agro-industrial sector

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Authors: Hai Chien Pham, Thi Phuong Anh Vo, Chansik Park

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Risks management in construction projects is important to ensure the positive feasibility of the projects in which financial risks are most concerned while construction projects always run on a credit basis. Credit risks, therefore, require unique and technical tools to be well managed. Underwriting technique in credit risks, in its most basic sense, refers to the process of evaluating the risks and the potential exposure of losses. Risks analysis and underwriting are applied as a must in banks and financial institutions who are supporters for constructions projects when required. Recently, construction organizations, especially contractors, have recognized the significant increasing of credit risks which caused negative impacts to project performance and profit of construction firms. Despite the successful application of underwriting in banks and financial institutions for many years, there are few contractors who are applying this technique to analyze and mitigate the credit risks of their potential owners before signing contracts with them for delivering their performed services. Thus, contractors have taken credit risks during project implementation which might be not materialized due to the bankruptcy and/or protracted default made by their owners. With this regard, this study proposes a model using the underwriting technique for contractors to analyze and assess credit risks of their owners before making final decisions for the potential construction contracts. Contractor’s underwriters are able to analyze and evaluate the subjects such as owner, country, sector, payment terms, financial figures and their related concerns of the credit limit requests in details based on reliable information sources, and then input into the proposed model to have the Overall Assessment Score (OAS). The OAS is as a benchmark for the decision makers to grant the proper limits for the project. The proposed underwriting model is validated by 30 subjects in Asia Pacific region within 5 years to achieve their OAS, and then compare output OAS with their own practical performance in order to evaluate the potential of underwriting model for analyzing and assessing credit risks. The results revealed that the underwriting would be a powerful method to assist contractors in making precise decisions. The contribution of this research is to allow the contractors firstly to develop their own credit risk management model for proactively preventing the credit risks of construction projects and continuously improve and enhance the performance of this function during project implementation.

Keywords: underwriting technique, credit risk, risk management, construction project

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Authors: Batool Zarei

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This study aims to answer this question whether control criterion with two elements of power and benefit which is introduced as 'control criterion of consolidation scope' in national and international standards of accounting in public sector (and also private sector) is efficient enough or not. The methodology of this study is comparative and the results of this research are significantly generalizable, due to the given importance to the sample of countries which were studied. Findings of this study states that in spite of pervasive use of control criterion (including 2 elements of power and benefit), criteria for determining the existence of control in public sector accounting standards, are not efficient enough to determine the consolidation scope of whole of government financial statements in a way that meet decision making and accountability needs of managers, policy makers and supervisors; specially parliament. Therefore, the researcher believes that for determining consolidation scope in public sector, in addition to economic view, it is better to pay attention to budgetary, legal and statistical concepts and also to practical and financial risk and define indicators for proving the existence of control (power and benefit) which include accountability relationships (budgetary relation, legal form and nature of activity). these findings also reveals the necessity of passing a comprehensive public financial management (PFM) legislation in order to redefine the characteristics of public sector entities and whole of government financial statements scope and review Statistics organizations and central banks duties for preparing government financial statistics and national accounts in order to achieve sustainable development and resilient economy goals.

Keywords: control, consolidation scope, public sector accounting, government financial statistics, resilient economy

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Authors: Narvada Ramdhany, Reena Bhattu Babajee

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The 2007-2008 Global Financial Crisis which initiated in the US had a global outreach, impacting the financial and banking sectors of several economies; such as European countries, developing and emerging countries in Asia, Latin America and Africa. European countries represent one of the main sources of export earnings for Mauritius and given that Europe has been quite profoundly affected by the crisis, the Mauritian economy also could have been negatively affected. This study is being undertaken to see if the crisis had a spill-over effect on the Mauritian banking system. It will also enable to determine if the measures put in place to counteract the crisis by regulatory authorities have been effective. The study will be carried out on 17 banks and data will be collected over a time frame of seven years; with a pre-crisis period from 2005 to 2007 and a post-crisis period from 2009 to 2011. The impact of the crisis as such will be measured through the financial performance of the banks, using financial ratios and regression analysis. The results show that during the period concerned Mauritian banks have remained solvent and relatively stable. One of the main explanations put forward to explain the resilience of the banking sector to the crisis is that foreign exposure was relatively low. Another explanation put forward is that Mauritian banks normally transact mainly with prime borrowers unlike most the banks which were affected by the financial crisis.  

Keywords: global financial crisis, banking sector, financial performance, Mauritian banks

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Authors: Xiaojing Wang, Ann-Marie Ward, Tony Wall

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The problem of over-indebtedness has increased since deregulation of the banking industry in the 1980s, and now it has become a major problem for most countries in Europe, including Germany. Consumer debt issues have attracted not only the attention of academics but also government and debt counselling institutions. Overall, this research aims to contribute to the knowledge gap regarding the causes of consumer over-indebtedness in Germany and to develop predictive models for assessing consumer over-indebtedness risk at consumer level. The situation of consumer over-indebtedness is serious in Germany. The relatively high level of social welfare support in Germany suggests that consumer debt problems are caused by other factors, other than just over-spending and income volatility. Prior literature suggests that the overall stability of the economy and level of welfare support for individuals from the structural environment contributes to consumers’ debt problems. In terms of cultural influence, the conspicuous consumption theory in consumer behaviour suggests that consumers would spend more than their means to be seen as similar profiles to consumers in a higher socio-economic class. This results in consumers taking on more debt than they can afford, and eventually becoming over-indebted. Studies have also shown that financial literacy is negatively related to consumer over-indebtedness risk. Whilst prior literature has examined structural and cultural influences respectively, no study has taken a collective approach. To address this gap, a model is developed to investigate the association between consumer over-indebtedness and proxies for influences from the structural and cultural environment based on the above theories. The model also controls for consumer demographic characteristics identified as being of influence in prior literature, such as gender and age, and adverse shocks, such as divorce or bereavement in the household. Benefiting from SOEP regional data, this study is able to conduct quantitative empirical analysis to test both structural and cultural influences at a localised level. Using German Socio-Economic Panel (SOEP) study data from 2006 to 2016, this study finds that social benefits, financial literacy and the existence of conspicuous consumption all contribute to being over-indebted. Generally speaking, the risk of becoming over-indebted is high when consumers are in a low-welfare community, have little awareness of their own financial situation and always over-spend. In order to tackle the problem of over-indebtedness, countermeasures can be taken, for example, increasing consumers’ financial awareness, and the level of welfare support. By analysing causes of consumer over-indebtedness in Germany, this study also provides new insights on the nature and underlying causes of consumer debt issues in Europe.

Keywords: consumer, debt, financial literacy, socio-economic

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Authors: Yuzhi Cai

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In this paper, we introduce a newly developed quantile function model that can be used for estimating conditional distributions of financial returns and for obtaining multi-step ahead out-of-sample predictive distributions of financial returns. Since we forecast the whole conditional distributions, any predictive quantity of interest about the future financial returns can be obtained simply as a by-product of the method. We also show an application of the model to the daily closing prices of Dow Jones Industrial Average (DJIA) series over the period from 2 January 2004 - 8 October 2010. We obtained the predictive distributions up to 15 days ahead for the DJIA returns, which were further compared with the actually observed returns and those predicted from an AR-GARCH model. The results show that the new model can capture the main features of financial returns and provide a better fitted model together with improved mean forecasts compared with conventional methods. We hope this talk will help audience to see that this new model has the potential to be very useful in practice.

Keywords: DJIA, financial returns, predictive distribution, quantile function model

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Authors: Kwadwo Yeboah

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Background and Aims: The adoption of International Accounting Standards (IAS) is considered to be one of the most significant developments in the accounting profession. The adoption of IAS aims to improve financial reporting quality by ensuring that financial information is transparent and comparable across borders. However, there is a lack of research on the impact of IAS on financial reporting quality in emerging economies. This study aims to fill this gap by evaluating the impact of IAS on financial reporting quality in emerging economies. Methods: This study uses a sample of firms from emerging economies that have adopted IAS. The sample includes firms from different sectors and industries. The financial reporting quality of these firms is measured using financial ratios, such as earnings quality, financial leverage, and liquidity. The data is analyzed using a regression model that controls for firm-specific factors, such as size and profitability. Results: The results show that the adoption of IAS has a positive impact on financial reporting quality in emerging economies. Specifically, firms that adopt IAS exhibit higher earnings quality and lower financial leverage compared to firms that do not adopt IAS. Additionally, the adoption of IAS has a positive impact on liquidity, suggesting that firms that adopt IAS have better access to financing. Conclusions: The findings of this study suggest that the adoption of IAS has a positive impact on financial reporting quality in emerging economies. The results indicate that IAS adoption can improve transparency and comparability of financial information, which can enhance the ability of investors to make informed investment decisions. The study contributes to the literature by providing evidence of the impact of IAS adoption in emerging economies. The findings of this study have implications for policymakers and regulators in emerging economies, as they can use this evidence to support the adoption of IAS and improve financial reporting quality in their respective countries.

Keywords: accounting, international, standards, finance

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Authors: Mohamed Anouar Razgallah

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This paper examines in the context of a one-period model the impact of background risk on the optimal secondary prevention. We conduct our study based on various configurations of the background risk. We intend to show that in most cases the level of secondary prevention effort varied after the introduction of background risk, however, in very few cases this level remains constant.

Keywords: secondary prevention, primary prevention, background risk, ecomomics

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Authors: Amira Kaddour

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To curb the problem of liquidity in times of financial crises, two cases arise; the Bailout or Bailin, two opposite choices that elicit the analysis of their effect on moral hazard. This paper attempts to empirically analyze the effect of these two types of events on the behavior of investors. For this end, we use the Emerging Market Bonds Index (EMBI-JP Morgan), and its excess of return, to detect the change in the risk premia through a Markov switching model. The results showed the transition to two types of regime and an effect on moral hazard; Bailout is an incentive of moral hazard, Bailin effectiveness remains subject of credibility.

Keywords: Bailout, Bailin, Moral hazard, financial crisis, Markov switching

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Authors: E. Cenderelli, E. Bruno, G. Iacoviello, A. Lazzini

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The financial sector is exposed to the risk of cyber-attacks like any other industrial sector. Furthermore, the topic of CybeRisk (cyber risk) has become particularly relevant given that Information Technology (IT) attacks have increased drastically in recent years, and cannot be stopped by single organizations requiring a response at international and national level. IT risk is never a matter purely for the IT manager, although he clearly plays a key role. A bank's risk management function requires a thorough understanding of the evolving risks as well as the tools and practical techniques available to address them. Upon the request of European and national legislation regarding CybeRisk in the financial system, banks are therefore called upon to strengthen the operational model for CybeRisk management. This will require an important change with a more intense collaboration with the structures that deal with information security for the development of an ad hoc system for the evaluation and control of this type of risk. The aim of the work is to propose a framework for the management and control of CybeRisk that will bridge the gap in the literature regarding the understanding and consideration of CybeRisk as an integral part of business management. The IT function has a strong relevance in the management of CybeRisk, which is perceived mainly as operational risk, but with a positive tendency on the part of risk management to the identification of CybeRisk assessment methods that are increasingly complete, quantitative and able to better describe the possible impacts on the business. The paper provides answers to the research questions: Is it possible to define a CybeRisk governance structure able to support the comparison between risk and security? How can the relationships between IT assets be integrated into a cyberisk assessment framework to guarantee a system of protection and risks control? From a methodological point of view, this research uses a case study approach. The choice of “Monte dei Paschi di Siena” was determined by the specific features of one of Italy’s biggest lenders. It is chosen to use an intensive research strategy: an in-depth study of reality. The case study methodology is an empirical approach to explore a complex and current phenomenon that develops over time. The use of cases has also the advantage of allowing the deepening of aspects concerning the "how" and "why" of contemporary events, on which the scholar has little control. The research bases on quantitative data and qualitative information obtained through semi-structured interviews of an open-ended nature and questionnaires to directors, members of the audit committee, risk, IT and compliance managers, and those responsible for internal audit function and anti-money laundering. The added value of the paper can be seen in the development of a framework based on a mapping of IT assets from which it is possible to identify their relationships for purposes of a more effective management and control of cyber risk.

Keywords: bank, CybeRisk, information technology, risk management

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Authors: Hossein Emari, Hossein Vazifehdoust, Hashem Nikoo Maram

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This study aims to develop an original framework of Environmental Consciousness (EC) to explore the positive effect of environmental consciousness on financial performance through the partial mediator - green intellectual capital. A questionnaire survey on the environmental consciousness, intellectual capital, and financial performance of Iran’s manufacturing firms was conducted, and 324 samples were analyzed. This study utilizes structural equation modeling to explore the direct and indirect influences of EC on financial performance. Research results reveal that environmental consciousness had an indirect impact on financial performance through investment in green intellectual capital. It was thus known that green intellectual capital is a mediator of the relationship between environmental consciousness and financial performance. This paper may serve as a reference for firms mapping out future environmental policies and provide an input of various perspectives and arguments into the discipline of green management.

Keywords: environmental consciousness, social responsibility, green intellectual capital, financial performance

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Authors: Levan Sabauri

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In this paper, we discuss the deteriorated standing of engineering companies, some of the reasons behind it and the problems facing engineering enterprises during the financial crisis. We show the part that financial analysis plays in the detection of the main factors affecting the standing of a company, classify internal problems and the reasons influencing efficiency thereof. The publication contains the analysis of municipal engineering companies in post-Soviet transitional economies. In the wake of the 2008 world financial crisis the issue became even more poignant. It should be said though that even before the problem had been no less acute for some post-Soviet states caught up in a lengthy transitional period. The paper highlights shortcomings in the management of transportation companies, with new, more appropriate methods suggested. In analyzing the financial stability of a company, three elements need to be considered: current assets, investment policy and structural management of the funding sources leveraging the stability, should be focused on. Inappropriate management of the three may create certain financial problems, with timely and accurate detection thereof being an issue in terms of improved standing of an enterprise. In this connection, the publication contains a diagram reflecting the reasons behind the deteriorated financial standing of a company, as well as a flow chart thereof. The main reasons behind low profitability are also discussed.

Keywords: efficiency, financial management, financial analysis funding structure, financial sustainability, investment policy, profitability, solvency, working capital

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Authors: Charles Amoatey

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The issue of risk in the mining industry is a global phenomenon and the Ghanaian mining industry is not exempted. The main purpose of this study is to identify the critical risk factors affecting the mining industry. The study takes an integrated view of the mining industry by examining the contribution of various risk factors to mining project failure in Ghana. A questionnaire survey was conducted to solicit the critical risk factors from key mining practitioners. About 80 respondents from 11 mining firms participated in the survey. The study identified 22 risk factors contributing to mining project failure in Ghana. The five most critical risk factors based on both probability of occurrence and impact were: (1) unstable commodity prices, (2) inflation/exchange rate, (3) land degradation, (4) high cost of living and (5) government bureaucracy for obtaining licenses. Furthermore, the study found that risk assessment in the mining sector has a direct link with mining project sustainability. Mitigation measures for addressing the identified risk factors were discussed. The key findings emphasize the need for a comprehensive risk management culture in the entire mining industry.

Keywords: risk, assessment, mining, Ghana

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Authors: Taeho Park, Ming Zhou, Sangryul Shim

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With the emergence of the global economy, today’s business environment is getting more competitive than ever in the past. And many supply chain (SC) strategies and operations have significantly been altered over the past decade to overcome more complexities and risks imposed onto the global business. First, offshoring and outsourcing are more adopted as operational strategies. Manufacturing continues to move to better locations for enhancing competitiveness. Second, international operations are a challenge to a company’s SC system. Third, the products traded in the SC system are not just physical goods, but also digital goods (e.g., software, e-books, music, video materials). There are three main flows involved in fulfilling the activities in the SC system: physical flow, information flow, and financial flow. An advance of the Internet and electronic communication technologies has enabled companies to perform the flows of SC activities in electronic formats, resulting in the advent of an electronic supply chain management (e-SCM) system. A SC system for digital goods is somewhat different from the supply chain system for physical goods. However, it involves many similar or identical SC activities and flows. For example, like the production of physical goods, many third parties are also involved in producing digital goods for the production of components and even final products. This research aims at identifying process flows of both physical and digital goods in a SC system, and then investigating all risk elements involved in the physical, information, and financial flows during the fulfilment of SC activities. There are many risks inherent in the e-SCM system. Some risks may have severe impact on a company’s business, and some occur frequently but are not detrimental enough to jeopardize a company. Thus, companies should assess the impact and frequency of those risks, and then prioritize them in terms of their severity, frequency, budget, and time in order to be carefully maintained. We found risks involved in the global trading of physical and digital goods in four different categories: environmental risk, strategic risk, technological risk, and operational risk. And then the significance of those risks was investigated through a survey. The survey asked companies about the frequency and severity of the identified risks. They were also asked whether they had faced those risks in the past. Since the characteristics and supply chain flows of digital goods are varying industry by industry and country by country, it is more meaningful and useful to analyze risks by industry and country. To this end, more data in each industry sector and country should be collected, which could be accomplished in the future research.

Keywords: digital goods, e-SCM, risk analysis, supply chain flows

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Authors: Luan Vardari, Dena Arapi-Vardari

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Financial stability is a critical component of economic growth and development, and it has been recognized as a key policy objective in many countries around the world. In the Western Balkans, financial stability has been a key issue in recent years, with a number of challenges facing the region, including high levels of public debt, weak banking systems, and economic volatility. Corporate finance, which refers to the financial management practices of firms, is an important factor that can impact financial stability. This paper aims to investigate corporate finance's impact on financial stability in Western Balkan countries. This study will use a mixed-methods approach to investigate the impact of corporate finance on financial stability in the Western Balkans. The study will begin with a comprehensive review of the existing literature on corporate finance and financial stability, focusing on the Western Balkan region. This will be followed by an empirical analysis of regional corporate finance practices using data from various industries and firms. The analysis will explore the relationship between corporate finance practices and financial stability, taking into account factors such as regulatory frameworks, economic conditions, and firm size. The results of the study are expected to provide insights into the impact of corporate finance on financial stability in the Western Balkans. Specifically, the study will identify the key corporate finance practices that contribute to financial stability in the region, as well as the challenges and obstacles that firms face in implementing effective corporate finance strategies. The study will also provide recommendations for policymakers and firms looking to enhance financial stability and resilience in the region.

Keywords: financial regulation, debt management, investment decisions, dividend policies, economic volatility, banking systems, public debt, prudent financial management, firm size, policy recommendations

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Authors: Jolanta Tamošaitienė

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The article focuses on a developed comprehensive model to be used in an agile environment for the risk assessment and selection based on multi-attribute methods. The model is based on a multi-attribute evaluation of risk in construction, and the determination of their optimality criterion values are calculated using complex Multiple Criteria Decision-Making methods. The model may be further applied to risk assessment in an agile construction environment. The attributes of risk in a construction project are selected by applying the risk assessment condition to the construction sector, and the construction process efficiency in the construction industry accounts for the agile environment. The paper presents the comprehensive risk assessment model in an agile construction environment. It provides a background and a description of the proposed model and the developed analysis of the comprehensive risk assessment model in an agile construction environment with the criteria.

Keywords: assessment, environment, agile, model, risk

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Authors: Ons Triki, Fathi Abid

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The basic objective of this paper is twofold. It resides in designing a model for a contingent convertible lease contract that can ensure the financial stability of a company and recover the losses of the parties to the lease in the event of default. It also aims to compare the convertible lease contract on inefficiencies resulting from the debt-overhang problem and asset substitution with other financing policies. From this perspective, this paper highlights the interaction between investments and financing policies in a dynamic model with existing assets and a growth option where the investment cost is financed by a contingent convertible lease and equity. We explore the impact of the contingent convertible lease on the capital structure. We also check the reliability and effectiveness of the use of the convertible lease contract as a means of financing. Findings show that the rental convertible contract with a sufficiently high conversion ratio has less severe inefficiencies arising from risk-shifting and debt overhang than those entailed by risky debt and pure-equity financing. The problem of underinvestment pointed out by Mauer and Ott (2000) and the problem of overinvestment mentioned by Hackbarth and Mauer (2012) may be reduced under contingent convertible lease financing. Our findings predict that the firm value under contingent convertible lease financing increases globally with asset volatility instead of decreasing with business risk. The study reveals that convertible leasing contracts can stand for a reliable solution to ensure the lessee and quickly recover the counterparties of the lease upon default.

Keywords: contingent convertible lease, growth option, debt overhang, risk-shifting, capital structure

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Authors: Stamataki Erofili Nellie, Benardos Andreas

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Winemaking and aging in Greece has been performed so far in special facilities, designed either as above ground or shallow underground buildings. The latter are well-known in Santorini as “canaves,” dating back to the 1700s. Canaves were mainly used for wine storage and aging, although occasionally, they included a winepress to complete there the whole wine production. On the other hand, wine caves are subterranean caves of the same use as canaves in the wine manufacturing industry, but they are excavated at a much greater depth of more than 53 meters or 175 feet. Whereas canaves or a typical wine cellar is around 10 feet deep, with is equivalent to almost 3 meters. This paper discusses the advantages and the disadvantages of creating a wine cave for the vinification of a winery in Greece and the financial investment or risk that has to be taken. The data presented and analysed are given from wineries in Greece and especially from those located in Santorini island. The estimation of the cost for the excavation of the model selected as a wine cave will be compared with the financial budget of the existing premises and facilities above ground in Greek wineries. In order to show whether it is viable for a greek winery to invest in a wine cave.

Keywords: underground space use, subterranean winery, wine cave, underground winery, greece

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Authors: Rania Mousa, Peterson Ozili

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A key agenda of policymakers in developed and developing countries is to increase the level of financial inclusion. Microlending institutions have been recognized as important agents of financial inclusion, which have the potential to achieve this objective and help move toward a more accessible, inclusive, and equitable path to financial sustainability. In that respect, this case study attempts to identify and assess the key initiatives undertaken by Grameen America as it responded to the COVID-19 pandemic within the framework of selected United Nations’ Sustainability Development Goals (UN’s SD Goals). This study goes beyond the stated objective by using the vulnerable group theory and special agent theory of financial inclusion to support the analysis of financial and non-financial information collected from Grameen America’s Annual Reports and audited financial statements. The study follows a qualitative content analysis method to precisely gauge the shift in Grameen’s strategy and focus, as well as to assess the impact of its initiatives on the small business community before and after the pandemic. The findings showcase that Grameen’s longstanding mission to alleviate poverty is in line with the UN’s Sustainability Development Goal 1. Furthermore, Grameen’s commitment to creating partnerships with external organizations to offer credit and non-credit services and support is consistent with UN’s Sustainability Development Goal 17. The study suggests that policymakers should foster the creation of more member-based financial and non-financial institutions which are ethically and morally responsible to their members in both good and bad times.

Keywords: COVID-19, financial inclusion, microfinance, sustainable development, microlending

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Authors: Dinesh Sivaguru, Kamal Thilakasiri

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Preventing money laundering and terrorist financing is a major national and international problem today. Several attempts have been made to prevent money laundering by national and international dimension. These are often counteracted by the multi dynamic nature of the crimes. However, launders are often to use remittance systems to clean their ill-gotten money. This study presents the role of domestic financial institutions and the effective practices and actions should implement within domestic financial institutions to control and prevent financial crimes. This thesis highlights the progress that is required to prevent money laundering and terrorist financing, further it is an original contribution to the knowledge in an under researched field in Sri Lanka.

Keywords: money laundering, terrorists financing, financial institutions, regulatory bodies

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Authors: Piotr Prewysz-Kwinto, Grazyna Voss

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In June 2013, the European Parliament and the Council adopted a directive on financial reporting (Directive 2013/34/EU). The main objective was to simplify the principles of the preparation of financial statements, including the principles of the presentation and disclosures of financial information by adapting reporting burdens to the type and size of an undertaking. Therefore, the Directive introduced a classification of all undertakings into five groups, i.e. micro, small, medium-sized, large and public-interest entities, and defined in detail the classification criteria. The principles of the preparation of financial statements and the presentation of financial information as well as applicable simplifications were defined for each group. The EU Member States had to implement the provisions of Directive 34 relating to accounting and financial reporting into domestic norms until January 1, 2016. In Poland, the provisions of Directive 34 were implemented into domestic accounting norms specified in the Polish Accounting Act on a gradual basis. On July 11, 2014, the Polish Parliament adopted an amendment to the Act, introducing the Directive's solutions for micro-undertakings and on July 23, 2015, for the remaining undertakings. The aim of this paper is to present Polish solutions relating to financial reporting after the implementation of Directive 34 and the results of the survey conducted among accountants regarding the evaluation of the implemented simplifications for micro and small undertakings.

Keywords: accounting standards, financial reporting, financial statement, simplification

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Authors: Ying-Hsiu Chen, Pao-Peng Hsu

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This paper adopts a two-stage data envelopment analysis to explore the impacts of financial development and bank operational scale on bank efficiencies. The sample comprises of unbalanced panel data of 32 Taiwanese enlisted in domestic commercial banks over the period 1998 to 2013. Empirical results show that technical efficiency is positively related to financial development, whereas the effect of financial development on scale efficiency is insignificant. The effect of operational scale exerts a significantly positive effect on bank efficiencies, but the gain of efficiency is decreased gradually when operational scale increases. Furthermore, increase in capital adequacy ratio and market power of banks leads to a growth of bank efficiencies.

Keywords: financial development, operational scale, efficiency, DEA

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Authors: Jamila Garba Audu, Shehu Usman Hassan

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The widespread failure in the financial information quality has created the need to improve the financial information quality and to strengthen the control of managers by setting up good firms structures. Published accounting information in financial statements is required to provide various users - shareholders, employees, suppliers, creditors, financial analysts, stockbrokers and government agencies – with timely and reliable information useful for making prudent, effective and efficient decisions. The relationship between corporate governance and performance to financial reporting quality is imperative; this is because despite rapid researches in this area the findings obtained from these studies are constantly inconclusive. Data for the study were extracted from the firms’ annual reports and accounts. After running the OLS regression, a robustness test was conducted for the validity of statistical inferences; the data was empirically tested. A multiple regression was employed to test the model as a technique for data analysis. The results from the analysis revealed a negative association between all the regressors and financial reporting quality except the performance of listed manufacturing firms in Nigeria. This indicates that corporate governance plays a significant role in mitigating earnings management and improving financial reporting quality while performance does not. The study recommended among others that the composition of audit committee should be made in accordance with the provision for code of corporate governance which is not more than six (6) members with at least one (1) financial expert.

Keywords: corporate governance, financial reporting quality, manufacturing firms, Nigeria, performance

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Authors: Roberto M. G. Velásquez, Jonas R. Gazoli, Nelson Ponce Jr, Valério L. Borges, Alessandro Sete, Fernanda M. C. Tomé, Julian D. Hunt, Heitor C. Lira, Cristiano L. de Souza, Fabio T. Bindemann, Wilmar Wounnsoscky

Abstract:

Nowadays, society is working toward reducing energy losses and greenhouse gas emissions, as well as seeking clean energy sources, as a result of the constant increase in energy demand and emissions. Energy loss occurs in the gas pressure reduction stations at the delivery points in natural gas distribution systems (city gates). Installing pressure reduction turbines (PRT) parallel to the static reduction valves at the city gates enhances the energy efficiency of the system by recovering the enthalpy of the pressurized natural gas, obtaining in the pressure-lowering process shaft work and generating electrical power. Currently, the Brazilian natural gas transportation network has 9,409 km in extension, while the system has 16 national and 3 international natural gas processing plants, including more than 143 delivery points to final consumers. Thus, the potential of installing PRT in Brazil is 66 MW of power, which could yearly avoid the emission of 235,800 tons of CO2 and generate 333 GWh/year of electricity. On the other hand, an economic viability analysis of these energy efficiency projects is commonly carried out based on estimates of the project's cash flow obtained from several variables forecast. Usually, the cash flow analysis is performed using representative values of these variables, obtaining a deterministic set of financial indicators associated with the project. However, in most cases, these variables cannot be predicted with sufficient accuracy, resulting in the need to consider, to a greater or lesser degree, the risk associated with the calculated financial return. This paper presents an approach applied to the technical-economic viability analysis of PRTs projects that explicitly considers the uncertainties associated with the input parameters for the financial model, such as gas pressure at the delivery point, amount of energy generated by TRP, the future price of energy, among others, using sensitivity analysis techniques, scenario analysis, and Monte Carlo methods. In the latter case, estimates of several financial risk indicators, as well as their empirical probability distributions, can be obtained. This is a methodology for the financial risk analysis of PRT projects. The results of this paper allow a more accurate assessment of the potential PRT project's financial feasibility in Brazil. This methodology will be tested at the Cuiabá thermoelectric plant, located in the state of Mato Grosso, Brazil, and can be applied to study the potential in other countries.

Keywords: pressure reduction turbine, natural gas pressure drop station, energy efficiency, electricity generation, monte carlo methods

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Authors: Fahad Ahmed Qureshi

Abstract:

There were abundant renowned financial markets in Pre-Islamic Arabs. Most of those were patterned and settled during pre-particularized sunshine. Those markets were classified either as vernacular markets helping the neighboring clans, or habitual markets that people sojourned to from all articulations of the Arabian Peninsula, such as Okaz near Mecca. Some of those markets had leading significance due to their geographical positions, such as Prime market of Eden, because of their entanglement in international trade i.e. with the markets of Sub-Continent, Abyssinia, Persia and China. Other markets such as Market of Yamamah annex its gist from being situated on the caravan crossroads. Islamic worldview and Islamic epistemology base of Financial Market’s realistic theory, pragmatic model and operative approach is moderately constrained in terms of its growth. The existent situation only parasol the form of accommodative-modification and splendid-methodologies, which due to depleted and decorous endeavor in explaining Islamic financial market theoretically. This is the demand of time that particular studies should be conduct to magnify the devours in developing theoretical framework for Islamic Financial Market.

Keywords: Islam, financial market, history, research, product development

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Authors: Ahmet Parlak, Celalettin Bilgen

Abstract:

In order to create an effective early warning system, Identification of the risks, preparation and carrying out risk modeling of risk scenarios, taking into account the shortcomings of the old disaster scenarios should be used to improve the system. In the light of this, the importance of risk modeling in creating an effective early warning system is understood. In the scope of TAFRISK project risk modeling trend analysis report on risk modeling developed and a demonstration was conducted for Risk Modeling for flood and mass movements. For risk modeling R&D, studies have been conducted to determine the information, and source of the information, to be gathered, to develop algorithms and to adapt the current algorithms to Turkey’s conditions for determining the risk score in the high disaster risk areas. For each type of the disaster; Disaster Deficit Index (DDI), Local Disaster Index (LDI), Prevalent Vulnerability Index (PVI), Risk Management Index (RMI) have been developed as disaster indices taking danger, sensitivity, fragility, and vulnerability, the physical and economic damage into account in the appropriate scale of the respective type.

Keywords: disaster, hazard, risk modeling, sensor

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Authors: Krishna Prasad Sharma

Abstract:

Nepal’s financial sector has become deeper and wider, and the number and types of financial intermediaries have grown rapidly over the past two decades. However, access to financial services remains limited for many people in many parts of rural Nepal. While financial institutions have been expanding rapidly in an urban area in recent years, the access to the rural poor is excessively inadequate due to financial illiteracy and limited numbers of financial institutions that confined only to the district headquarters. Based on the focus group discussion, semi-structured interview of key people and literature review, this paper aims to examine the supply of and demand for financial services in Nepal and the constraints to increasing access to them, and offers way forward for making the financial sector work for all of Nepal’s people, especially the rural poor. While Nepal’s government has tried to increase access to formal financial services for small businesses and low-income households through directed lending programs for small businesses and low-income households, created specialized wholesale and retail institutions, and lowered market entry requirements, formal financial services are declining, and financial intermediation is stagnating. Supply and demand indicators show that, despite government efforts, formal financial institutions do not serve the needs of most of the Nepalese population. While access to and use of formal financial services are limited, in general, the problem is acute for small businesses and low-income households. Indeed, both access and use are closely correlated with business loan size and household income. This study concludes that banks and microfinance institutions with the use of mobile phones can connect hundreds of millions of unbanked and low-income people, especially rural poor to financial services at low costs. While there are many challenges ahead in expanding the service to rural areas, the mobile financial services will be beneficial that makes payments faster and cheaper, more convenient and accessible to a greater number of senders and recipients in rural areas. In rural areas, clients will benefit from money transfer and other mobile and online services.

Keywords: financial inclusion, financial enabling environment, microfinance, branchless banking, rural poor

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Authors: Lemuel David

Abstract:

The importance of the Micro, Small, and Medium Enterprises sector is well recognized for its legitimate contribution to the Macroeconomic objectives of the Republic of Liberia, like generation of employment, input t, exports, and enhancing entrepreneurship. Right now, Medium and Small enterprises accounts for about 99 percent of the industrial units in the country, contributing 60 percent of the manufacturing sector output and approximately one-third of the nation’s exports. The role of various financial institutions like ECO bank and Non-financial Institutions like Bearch Limited support promoting the growth of Micro, Small, and Medium Enterprises is unique. A small enterprise or entrepreneur gets many types of assistance from different institutions for varied purposes in the course of his entrepreneurial journey. This paper focuses on the factors related to financial institutional support and non-financial institutional support entrepreneurs to the growth of Medium and Small enterprises in the Republic of Liberia. The significance of this paper is to support Policy and Institutional Support for Medium and Small enterprises to know the views of entrepreneurs about financial and non-financial support systems in the Republic of Liberia. This study was carried out through a survey method, with the use of questionnaires. The population for this study consisted of all registered Medium and Small enterprises which have been registered during the years 2004-2014 in the republic of Liberia. The sampling method employed for this study was a simple random technique and determined a sample size of 400. Data for the study was collected using a standard questionnaire. The questionnaire consisted of two parts: the first part consisted of questions on the profile of the respondents. The second part covers (1) financial, promotional factors and (2) non-financial promotional factors. The results of the study are based on financial and non-financial supporting activities provided by institutions to Medium and Small enterprises. After investigation, it has been found that there is no difference in the support given by Financial Institutions and non-financial Institutions. Entrepreneurs perceived “collateral-free schemes and physical infrastructure support factors are highest contributing to entry and growth of Medium and Small enterprises.

Keywords: micro, small, and medium enterprises financial institutions, entrepreneurship

Procedia PDF Downloads 98