Search results for: islamic financial engineering

Authors: Marco Barassi, Nicola Spagnolo

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This paper uses a DCC-GARCH model framework to examine mean and volatility spillovers (i.e. causality in mean and variance) dynamics between financial centers and the stock market indexes of the BRICS countries. In addition, tests for changes in the transmission mechanism are carried out by first testing for structural breaks and then setting a dummy variable to control for the 2008 financial crises. We use weekly data for nine countries, four financial centers (Germany, Japan, UK and USA) and the five BRICS countries (Brazil, Russia, India, China and South Africa). Furthermore, we control for monetary policy using domestic interest rates (90-day Treasury Bill interest rate) over the period 03/1/1990 - 04/2/2014, for a total of 1204 observations. Results show that the 2008 financial crises changed the causality dynamics for most of the countries considered. The same pattern can also be observed in conditional correlation showing a shift upward following the turbulence associated to the 2008 crises. The magnitude of these effects suggests a leading role played by the financial centers in effecting Brazil and South Africa, whereas Russia, India and China show a higher degree of resilience.

Keywords: financial crises, DCC-GARCH model, volatility spillovers, economics

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Authors: Giulia Dal Maso

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Within the contemporary financial capitalist configuration, the interplay of Chinese statecraft and financialization has shaped a new ‘ecology of financial expertise.’ This indicates the emergence of a new financial technocratic governance; that is increasingly changing the Chinese economy, reducing the state’s administrative and fiscal functions and increasing state assets in accordance with a new shareholder logic. In this shift, the creation of the stock market by the state was conceived not only as a new redistributor of wealth but as a ‘clearing house’ for social discontent resulting from work casualization, wage repression and a lack of social welfare. Since its inception in the wake of Deng Xiaoping’s reforms, the Chinese state has used the stock market as a means of securing social legitimation by providing a prearranged space where the disaggregated and vulnerable subjects left behind by the dismantlement of the collective work units of the Maoist period (danwei) can congregate. However, fieldwork which included both participant observation as well as interviews with investors in brokerage rooms in Shanghai (where one of only two mainland Chinese stock exchanges is situated) reveals that both new formal and informal financial experts—namely the haigui (Chinese returnees with a financial degree abroad) and sanhu (individual Chinese scattered players), are equally dissatisfied with their investing activities. They express discontent with the state, which they hold responsible for the summer 2015 financial crisis and for the financial turmoil that jeopardizes China’s financial and political project. What the investors want is a state that will guarantee the continuation of the current gupiaore ‘stock fever’. This paper holds that, by embracing financialization, the state is undermining the contract at the base of its legitimacy.

Keywords: Chinese state, Deng Xiaoping, financial capitalism, individual investors

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Authors: Chow Fah Yee, Eu Chye Tan

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The main purpose of developing a modern and sophisticated financial system is to mobilize and allocate the country’s resources for productive uses and in the process contribute to economic growth. Financial liberalization introduced in Malaysia in 1978 was said to be a step towards this goal. According to Mc-Kinnon and Shaw, the deregulation of a country’s financial system will create a more efficient and competitive market driven financial sector; with savings being channelled to the most productive users. This paper aims to assess whether financial liberalization resulted in bank credit being allocated to the more productive users, for the case of Malaysia by: firstly, using Chi-square test to if there exists a relationship between financial liberalization and bank lending in Malaysia. Secondly, to analyze on a comparative basis, the share of loans secured by 9 major economic sectors, using data on bank loans from 1975 to 2003. Lastly, present value analysis and rank correlation was used to determine if the recipients of bigger loans are the more efficient users. Chi-square test confirmed the generally observed trend of an increase in bank credit with the adoption of financial liberalization. While the comparative analysis of loans showed that the bulk of credit were allocated to service sectors, consumer loans and property related sectors, at the expense of industry. Results for rank correlation analysis showed that there is no relationship between the more productive users and amount of loans obtained. This implies that the recipients (sectors) that received more loans were not the more efficient sectors.

Keywords: allocation of resources, bank credit, financial liberalization, economics

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Authors: Devina Aprilia Gunawan, Tasya Aspiranti, Inugrah Ratia Pratiwi

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This research aims to classify the mining sector companies based on Altman’s Z-score model, and providing an analysis based on the Altman’s Z-score model’s financial ratios to provide a picture about the financial condition in mining sector companies in Indonesia and their viability in the future, and to find out the partial and simultaneous impact of each of the financial ratio variables in the Altman’s Z-score model, namely (WC/TA), (RE/TA), (EBIT/TA), (MVE/TL), and (S/TA), toward the financial condition represented by the Z-score itself. Among 38 mining sector companies listed in Indonesia Stock Exchange (IDX), 28 companies are selected as research sample according to the purposive sampling criteria.The results of this research showed that during 3 years research period at 2010-2012, the amount of the companies that was predicted to be healthy in each year was less than half of the total sample companies and not even reach up to 50%. The multiple regression analysis result showed that all of the research hypotheses are accepted, which means that (WC/TA), (RE/TA), (EBIT/TA), (MVE/TL), and (S/TA), both partially and simultaneously had an impact towards company’s financial condition.

Keywords: Altman’s Z-score model, financial condition, mining companies, Indonesia

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Authors: Javid Zarei

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International buyback contracts are a type of contract service. These kinds of contracts are the most important instrument for attracting foreign investors in accordance with Iran's laws. These contracts have been the basis of commercial and economic relations between Iran and foreign companies for about 30 years. The legal structure of this type of contract has gradually evolved, so today, an advanced generation of it under the title of Iran Petroleum Contract is being used in the industry of Iran. This article has analytically examined the issue of Iran's commercial contracts in the oil industry and contracting services and allocated sections to examine the strengths and weaknesses of these oil contracts. Also, this research is an attempt to examine and compare the Concession regime with the Buyback contracts, each of which is derived from the common law legal system and the Islamic legal system, respectively.

Keywords: buyback contracts, concession regime, ownership, common law legal system, Islamic legal system of Iran

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Authors: Arzu K. Kamberli, Tolga Ulusoy

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Technological developments and the resulting global communication have made the 21st century when large capitals are moved from one end to the other via a button. As a result, the flow of capital inflows has accelerated, and capital inflow has brought with it crisis-related infectiousness. Considering the irrational human behavior, the financial crisis in the world under the influence of the whole world has turned into the basic problem of the countries and increased the interest of the researchers in the reasons of the crisis and the period in which they lived. Therefore, the complex nature of the financial crises and its linearly unexplained structure have also been included in the new discipline, econophysics. As it is known, although financial crises have prediction mechanisms, there is no definite information. In this context, in this study, using the concept of electric field from the electrostatic part of physics, an early econophysical approach for global financial crises was studied. The aim is to define a model that can take place before the financial crises, identify financial fragility at an earlier stage and help public and private sector members, policy makers and economists with an econophysical approach. 2001 Turkey crisis has been assessed with data from Turkish Central Bank which is covered between 1992 to 2007, and for 2001 Argentina crisis, data was taken from IMF and the Central Bank of Argentina from 1997 to 2007. As an econophysical method, an analogy is used between the Gauss's law used in the calculation of the electric field and the forecasting of the financial crisis. The concept of Φ (Financial Flux) has been adopted for the pre-warning of the crisis by taking advantage of this analogy, which is based on currency movements and money mobility. For the first time used in this study Φ (Financial Flux) calculations obtained by the formula were analyzed by Matlab software, and in this context, in 2001 Turkey and Argentina Crisis for Φ (Financial Flux) crisis of values has been confirmed to give pre-warning.

Keywords: econophysics, financial crisis, Gauss's Law, physics

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Authors: A. O. Talabi, F. M. Taib, D. J. Jalaludin

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The influence of sustainability reporting on Deposit Money Banks (DMBs)' financial performance both before and after mandated environmental, social, and governance (ESG) disclosure is examined in this article. Using a sample size of the top six strategically important listed banks in Nigeria, the study employed the paired sample t-test to assess the pre-mandatory ESG period (2009-2015) and the post-mandatory ESG period (2016-2022). According to the findings, there was no discernible difference between the performance of DMBs in Nigeria before and after the requirement for ESG disclosure. In the pre-mandatory requirement time, sustainability reporting is a major predictor of financial metrics, but in the post-mandatory requirement period, there was no discernible change in financial performance. Market authorities ought to have unrestricted authority to impose severe fines for noncompliance and bring legal action against corporations that fail to disclose ESG. This work contributes to the literature on ESG disclosure and financial performance by considering two different periods.

Keywords: financial, performance, sustainability, reporting

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Authors: Hussein El-Zohary

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This research aims at studying the late Alexandrian school of philosophy in the 6th century AD, the adaptation of its methodologies by the Islamic world, and its impact on Muslim philosophical thought. The Alexandrian school has been underestimated by many scholars who regard its production at the end of the classical age as mere interpretations of previous writings and delimit its achievement to the preservation of ancient philosophical heritage. The research reviews the leading figures of the Alexandrian school and its production of philosophical commentaries studying ancient Greek philosophy in its entirety. It also traces the transmission of its heritage to the Islamic world through direct translations into Syriac first and then into Arabic. The research highlights the impact of the Alexandrian commentaries on Muslim recognition of Plato and Aristotle as well as its philosophical teaching methodology starting with the study of Aristotle’s Categories as introductory to understand Plato’s philosophy.

Keywords: Alexandrian school of philosophy, categories, commentaries, Syriac

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Authors: Abdus-Samii Imam Arikewuyo

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The human rights phenomenon increasingly gains universal prominence in the contemporary age. This embraces the clamour for a just treatment of individuals in society. The human rights agitation is a global pursuit which virtually gave birth to many national and international human rights organizations. In particular, Nigeria accedes to a number of human rights covenants. Invariably, there are some provisions which are recognized as inalienable rights of man in his society by which his intrinsic worth and dignity are protected by law. Nonetheless, the constituents of human rights differ in various societies. Conversely, Islam, as a complete code of life, guarantees the rights of a man vis-à-vis the rights of others in his environment regardless of place and time. Human rights pressure in Nigeria in recent times prompted proactive steps to address the issue through various legal instruments. Amazingly, the struggle appears to be a rhetorical noise because the human rights violation subsists. This provokes the present research on a comparative study of the Nigerian legal provisions and the Islamic law perspectives on human rights. It is discovered that the first is simply theoretical, while the other contains both the theoretical framework and the practical measures for its enforcement. The study adopts analytical and descriptive methods. It concludes with the assertion that the Islamic law provisions are all-embracing, universal and more efficacious. Hence, it recommends the adoption of the Islamic law approach to human rights issues.

Keywords: human rights, Nigerian legal provisions, shariah law, comparative study, charter

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Authors: Bilal Ashraf, Qianxiao Zhang

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This study empirically investigated the linkage amid financial development and its important determinants such as information and communication technology, natural resource rents, economic growth, current account balance, and gross savings in 107 economies. This paper preferred to employ the second-generation unit root tests to handle the issues of slope heterogeneity and “cross-sectional dependence” in panel data. The “Kao, Pedroni, and Westerlund tests” confirm the long-lasting connections among the variables under study, while the significant endings of “cross-sectionally augmented autoregressive distributed lag (CS-ARDL)” exposed that NRR, CAB, and S negatively affected the financial development while ICT and EG stimulates the procedure of FD. Further, the robustness analysis's application of FGLS supports the appropriateness and applicability of CS-ARDL. Finally, the findings of “DH causality analysis” endorse the bidirectional causality linkages amongst research factors. Based on the study's outcomes, we suggest some policy suggestions that empower the process of financial development, globally.

Keywords: determinants of financial developments, CS-ARDL, financial development, global sample, causality analysis

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Authors: Farida, M. Shehu, Shehu U. R. Aliyu

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Access to finance has been recognized in the literature as one of the major impediments confronting small scale businesses (SSBs). This largely arises due to high lending rate, religious inclinations, collateral, etc. Islamic mode finance operates under Profit and Loss Sharing (PLS) arrangement between a borrower (business owner) and a lender (Islamic bank). This paper empirically assesses the determinants of predisposition of small scale business operators in Fagge local government area, Kano State, Nigeria, towards the PLS. Cross-sectional data from a sample of 291 small scale business operators was analyzed using logit and probit regression models. Empirical results reveal that while awareness and religion inclination positively drive interest towards the PLS, lending rate and collateral work against it. The paper, therefore, strongly recommends more advocacy campaigns and setting up of more Islamic banks in the country to cater for the financing and religious needs of SSBs in the study area.

Keywords: Islamic finance, logit and probit models, profit and loss sharing small scale businesses, finance, commerce

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Authors: Ben Kwame Agyei-Mensah

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This study investigated the influence of firm-specific characteristics which include proportion of Non-Executive Directors, ownership concentration, firm size, profitability, debt equity ratio, liquidity and leverage on the extent and quality of financial ratios disclosed by firms listed on the Ghana Stock Exchange. The research was conducted through detailed analysis of the 2012 financial statements of the listed firms. Descriptive analysis was performed to provide the background statistics of the variables examined. This was followed by regression analysis which forms the main data analysis. The results of the extent of financial ratio disclosure level, mean of 62.78%, indicate that most of the firms listed on the Ghana Stock Exchange did not overwhelmingly disclose such ratios in their annual reports. The results of the low quality of financial ratio disclosure mean of 6.64% indicate that the disclosures failed woefully to meet the International Accounting Standards Board's qualitative characteristics of relevance, reliability, comparability and understandability. The results of the multiple regression analysis show that leverage (gearing ratio) and return on investment (dividend per share) are associated on a statistically significant level as far as the extent of financial ratio disclosure is concerned. Board ownership concentration and proportion of (independent) non-executive directors, on the other hand were found to be statistically associated with the quality of financial ratio disclosed. There is a significant negative relationship between ownership concentration and the quality of financial ratio disclosure. This means that under a higher level of ownership concentration less quality financial ratios are disclosed. The findings also show that there is a significant positive relationship between board composition (proportion of non-executive directors) and the quality of financial ratio disclosure.

Keywords: voluntary disclosure, firm-specific characteristics, financial reporting, financial ratio disclosure, Ghana stock exchange

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Authors: Khawla Hlel

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Purpose: This study aims to examine whether critical audit matters (CAM) affect financial information quality. We also investigate the moderating role of the audit committee on the association between CAM and financial information quality. Design/Methodology/Approach: The analysis is based on GLS and GMM regressions explaining the absolute value of discretionary accruals by using 52 Tunisian listed firms on the Tunisia Stock Exchange (TSE) for the period 2017-2020. Findings: We find evidence that managers react to the CAM by increasing the quality of financial disclosures. This study provides insights into how a change in the auditor’s report model might impact the quality of financial information. It suggests that external auditors and audit committees serve as a beneficial mechanism for enhancing financial information quality by reducing information asymmetry. In addition, our results indicate that CAM is an efficient monitoring mechanism that increases financial reporting quality and supervises managers. Originality: This study is important for potential investors who should assess CAM when evaluating firms. Furthermore, the authors expect the findings to be interesting to firms, as this study highlights the effectiveness of the auditor in reducing managerial opportunistic behavior and improving information quality. The results could encourage audit regulators to ameliorate the standards, as this research reinforces the role of the auditor in increasing the quality of financial disclosure by offering the required information for shareholders.

Keywords: critical audit matters, audit committee, information quality, Tunisian firms

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Authors: Abongile Zweni

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As a post-apartheid strategy to redress the social imbalances of the past, local governments are tasked with the role of delivering crucial services to their constituents. Apart from political instability, evidence shows that managers in South African municipalities lack effective financial management skills and competencies. This resulted in a failure to fulfill its administrative obligations, particularly municipal financial management. Most municipalities have, however, failed in this role, which has led them to be placed under administration by the provincial government in terms of Section 139 of the constitution of the Republic of South Africa. Thus, this study proposed a leadership conceptual framework for effectively managing ever-eroding municipal finances in South Africa. The study adopted a desktop research approach to explore the key components of leadership and municipal financial management toward the development of the conceptual framework. The study fostered a better understanding of the need for transformation in relation to the current financial management practices and sustainability of a municipality. Moreover, the conceptual framework applies not only to municipalities but also to other government departments and public authorities in the country for financial management.

Keywords: leadership, municipal finance, financial performance, management skills, municipality

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Authors: Davoud Maleki, Neda Zamani

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The present study aims at exploring the effective accountability model of Islamic Azad University using a qualitative approach of grounded theory. The data of this study were obtained from semi-structured interviews with 25 professors and scholars in Islamic Azad University of Tehran who were selected by theoretical sampling method. In the data analysis, the stepwise method and Strauss and Corbin analytical methods (1992) were used. After identification of the main component (balanced response to stakeholders’ needs) and using it to bring the categories together, expressions and ideas representing the relationships between the main and subcomponents, and finally, the revealed components were categorized into six dimensions of the paradigm model, with the relationships among them, including causal conditions (7 components), main component (balanced response to stakeholders’ needs), strategies (5 components), environmental conditions (5 components), intervention features (4 components), and consequences (3 components). Research findings show an exploratory model for describing the relationships between causal conditions, main components, accountability strategies, environmental conditions, university environmental features, and that consequences.

Keywords: accountability, effectiveness, Islamic Azad University, grounded theory

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Authors: Mennani Maha, Attak El Houssain

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Under the massive effect of the Covid-19 health crisis, marked by a loss of competitiveness, a slowdown in growth and an accumulation of the repercussions of socio-economic inequalities, a considerable effort must be combined, in Morocco, to put into perspective macro-political, macro-economic and social opportunities. The development of a new economic and social approach is essential in order to respond to the authenticity of the new development model that will be used by the country. The appropriation of strategies of solidarity and social cohesion constitutes a participatory, competitive and inclusive approach to support the functionalities of the economic, social and political system. Therefore, the search for alternative financial resources has become a necessity to achieve the objectives of sustainable socio-economic growth on the one hand; and to promote, on the other hands, the dynamics, of large scale, social investments. The zakat remains a site of the Islamic economy dedicated to stimulating the bases of a collective adhesion of the population on the economic, as well as on the social level, thanks to a fair and equitable distribution of the zakat funds. However, Morocco is one of the few Muslim countries that has not yet had an institution for collecting and distributing this Islamic duty, which makes it difficult to measure the socio-economic impact of zakat. This theoretical document essentially ensures the development of the crucial utility of institutionalizing zakat in order to reinforce the objectives of social solidarity in Morocco in line with the process of conceptualizing a new development model.

Keywords: zakat, socio-economic development, solidarity, social investment

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Authors: Mehry Daraei

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The goal of this study was to survey the components and affective factors on organizational commitment of Islamic Azad university Khoramabad Baranch’s faculty members. The research method was correlation by causal modeling and data were gathered by questionnaire. Statistical society consisted of 147 faculty members in Islamic Azad University Khoramabad Branch and sample size was determined as 106 persons by Morgan’s sample table that were selected by class sampling. Correlation test, T-single group test and path analysis test were used for analysis of data. Data were analyzed by Lisrel software. The results showed that organizational corporate was the most effective element on organizational commitment and organizational corporate, experience work and organizational justice were only in direct relation with organizational commitment. Also, job security had direct and indirect effect on OC. Job security had effect on OC by gender. Gender variable had direct and indirect effect on OC. Gender had effect on OC by organizational corporate. Job opportunities out of university also had direct and indirect effect on OC, which means job opportunities had indirect effect on OC by organizational corporate.

Keywords: organization, commitment, job security, Islamic Azad University

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Authors: Remy Jonkam Oben

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Using a time series approach, this study investigates how natural resources impact financial development from a global perspective over the 1980-2019 period. Some important determinants of financial development (economic growth, trade openness, population growth, and investment) have been added to the model as control variables. Unit root tests have revealed that all the variables are integrated into order one. Johansen's cointegration test has shown that the variables are in a long-run equilibrium relationship. The vector error correction model (VECM) has estimated the coefficient of the error correction term (ECT), which suggests that the short-run values of natural resources, economic growth, trade openness, population growth, and investment contribute to financial development converging to its long-run equilibrium level by a 23.63% annual speed of adjustment. The estimated coefficients suggest that global natural resource rent has a statistically-significant negative impact on global financial development in the long-run (thereby validating the financial resource curse) but not in the short-run. Causality test results imply that neither global natural resource rent nor global financial development Granger-causes each other.

Keywords: financial development, natural resources, resource curse hypothesis, time series analysis, Granger causality, global perspective

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Authors: Sana Tahzeeb

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Role of Muslim minority in a democratic state has been the most debatable as well as attractive issue in the writings of the contemporary Muslim scholars, never discussed in the classical Islamic literature of history. Islam as a dominant religion has been the issue of academic discussions in the entire classical literature of Islamic jurisprudence the division of world into Dar al-Islam (abode of Islam), Dar al-Harb (abode of war) has been the main division on the basis of which Islam’s relation with the remaining world were defined and formulated. Now living in a global society the classical division of territories seems to be irrelevant. The new division of the same became necessary in the present situation particularly in view of the pluralistic society and need of power sharing in non-Muslim countries. It is important to note that a number of Muslim scholars of modern period examined this problem and other issues of Muslim minorities from legal point of view. Fiqh al-Aqalliyat is a newly developed discipline of Islamic jurisprudence. The rationale for this development is that there are so many issues of the Muslim minorities particularly in the European countries which are required to be discussed and examined juridically by Muslim jurists and scholars. There was also need for reinterpreting the term Dar al-Harb and relevance of its applicability to the west. The present paper shed a light on these emerging trends in Islamic world.

Keywords: fiqh al Aqalliyat, Muslim minorities, Europe, Islam

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Authors: Zahra Ahmed Al-zadjali

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The influence of Islam on arts can be found primarily in calligraphy, arabesque designs and architecture. Also, geometric designs were used quite extensively. Muslim craftsmen produced stunning designs based on simple geometric principles and traditional motifs which were used to decorate many surfaces. The idea of interlacing simple rectilinear lines to form the patterns impressed Arabs. Nomads of Persia, Turks and Mongols were equally impressed with the designs so they begin to use them in their homes in carpet weaving. Islamic designs, motifs and colours which were used became common place and served to influence people’s tastes. Modern life style and contemporary products have changed the style of people’s daily lives, however, people still long for the nomadic way of life. This is clearly reflected in people’s homes. In a great many Muslim homes, Islamic decorative motifs can be seen along with traditional ‘Bedouin’ style furnishing, especially in homes of the Arabian Peninsula.

Keywords: art, craft, design, Oman, weaving

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Authors: Sana Masmoudi Mardassi, Yosra Makni Fourati

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Regulators highlight the importance of the Audit Committee (AC) as a key internal corporate governance mechanism. One of the most important roles of this committee is to oversee the financial reporting process. The purpose of this paper is to examine the link between the characteristics of an audit committee and the financial reporting quality by investigating whether the characteristics of audit committees are associated with improved financial reporting quality, especially the Real Earnings Management. In the current study, a panel data from 80 nonfinancial companies listed on the Amsterdam Stock Exchange during the period between 2010 and 2017 were used. To measure audit committee characteristics, four proxies have been used, specifically, audit committee independence, financial expertise, gender diversity and AC meetings. For this research, a linear regression model was used to identify the influence of a set of board characteristics of the audit committee on real earnings management after controlling for firm audit committee size, leverage, size, loss, growth and board size. This research provides empirical evidence of the association between audit committee independence, financial expertise, gender diversity and meetings and Real Earnings Management (REM) as a proxy of financial reporting quality. The study finds that independence and AC Gender diversity are strongly related to financial reporting quality. In fact, these two characteristics constrain REM. The results also suggest that AC- financial expertise reduces to some extent, the likelihood of engaging in REM. These conclusions provide support then to the audit committee requirement under the Dutch Corporate Governance Code rules regarding gender diversity and AC meetings.

Keywords: audit committee, financial expertise, independence, real earnings management

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Authors: Zakaria S. G. Hegazy, Walid M. A. Ahmed

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This paper examines the dependence structure of Islamic stock markets on Bitcoin’s realized volatility components in bear, normal, and bull market periods. A quantile regression approach is employed, after adjusting raw returns with respect to a broad set of relevant global factors and accounting for structural breaks in the data. The results reveal that upside volatility tends to exert negative influences on Islamic developed-market returns more in bear than in bull market conditions, while downside volatility positively affects returns during bear and bull conditions. For emerging markets, we find that the upside (downside) component exerts lagged negative (positive) effects on returns in bear (all) market regimes. By and large, the dependence structures turn out to be asymmetric. Our evidence provides essential implications for investors.

Keywords: cryptocurrency markets, bitcoin, realized volatility measures, asymmetry, quantile regression

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Authors: Shuofen Hsu, Ya-Yi Chao, Chao-Wei Li

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This paper investigates the factors of whether firms’ quarterly consolidated financial statements to be voluntary reviewed by auditor. To promote the information transparency, the Financial Supervisory Commission of Executive Yuan in Taiwan ruled the Taiwanese listed companies should announce the first and third quarterly consolidated financial statements since 2008 to 2012, while the Commission didn’t require the consolidated financial statements should be reviewed by auditors. This is a very special practice in emerging market, especially in Taiwan. The valuable data of this period is suitable for us to research the determinants of firms’ voluntary review decision in emerging markets. We collected the auditors' report of each company and each year of Taiwanese listed companies since 2008 to 2012 for our research samples. We use probit model to test and analyze the determinants of voluntary review decision of the first and third quarterly consolidated financial statements. Our empirical result shows that the firms whose first and third quarterly consolidated financial statements are voluntary to be reviewed by auditors have better ranking of information transparency, higher audit quality, and better corporate governance, suggesting that voluntary review is a good signal to firms’ better information and corporate governance quality.

Keywords: voluntary review, information transparency, audit quality, quarterly consolidated financial statements

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Authors: Adel Fatima Zohra, Guendouz Abdelkader

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The solitary sector seems to appear nowadays as a third sector along the private and public ones, because of their ineptitude to take in charge the social exigency of the society regarding the lack in their local assets and the weakness of their financial institutions. The role of this sector is promoting a set of activities in the field of the charity, without aiming neither the individual profit nor a power practice. With the rise in the need of domestic resources, it is possible to count on the Zakat funding to realize some investment projects in order to develop the local society in many sectors as health, agriculture … etc. In the Islamic financial system, the Zakat is likely one of the most important instruments in financing the local development with the respect of the “Charia” rules: the amount of the Zakat is 2.5% of a wealth equivalent of each 85 gr of gold possessed since one year at least. In Algeria a fund of Zakat, was created since 2003 as an alternative to the public finding of development. This fund is a religious and social institution under the supervision of the ministry of religious affairs. This supervision covers two tasks: the first is traditional witch concern the distribution and the forwarding of the zakat to the poor people, and the second is modern concerning the financing of microcredits in the aim to enhance social and economic development. In this paper, we try to highlight the main role of the Zakat fund and its impact on the both social and economic development in Algeria.

Keywords: dogmatic instrument, solidary sector, zakat fund, micro project

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Authors: Azzah Aldeghather, Sara Alkhodair

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In the modern urban planning and architecture landscape, with western ideologies and styles becoming the mainstay of experience and definitions globally, the Islamic world requires a methodology that defines its expression, which transcends cultural, societal, and national styles. This paper will propose a methodology as an objective system to define, evaluate and apply traditional Islamic knowledge to Islamic urban planning and architecture, providing the Islamic world with a system to manifest its approach to design. The methodology is expressed as Four Pillars which are based on traditional meanings of Arab words roughly translated as Pillar One: The Principles (Al Mabade’), Pillar Two: The Foundations (Al Asas), Pillar Three: The Purpose (Al Ghaya), Pillar Four: Presence (Al Hadara). Pillar One: (The Principles) expresses the unification (Tawheed) pillar of Islam: “There is no God but God” and is comprised of seven principles listed as: 1. Human values (Qiyam Al Insan), 2. Universal language as sacred geometry, 3. Fortitude© and Benefitability©, 4. Balance and Integration: conjoining the opposites, 5. Man, time, and place, 6. Body, mind, spirit, and essence, 7. Unity of design expression to achieve unity, harmony, and security in design. Pillar Two: The Foundations is based on two foundations: “Muhammad is the Prophet of God” and his relationship to the renaming of Medina City as a prototypical city or place, which defines a center space for collection conjoined by an analysis of the Medina Charter as a base for the humanistic design. Pillar Three: The Purpose (Al Ghaya) is comprised of four criteria: The naming of the design as a title, the intention of the design as an end goal, the reasoning behind the design, and the priorities of expression. Pillar Four: Presence (Al Hadara) is usually translated as a civilization; in Arabic, the root of Hadara is to be present. This has five primary definitions utilized to express the act of design: Wisdom (Hikma) as a philosophical concept, Identity (Hawiya) of the form, and Dialogue (Hiwar), which are the requirements of the project vis-a-vis what the designer wishes to convey, Expression (Al Ta’abeer) the designer wishes to apply, and Resources (Mawarid) available. The Proposal will provide examples, where applicable, of past and present designs that exemplify the manifestation of the Pillars. The proposed methodology endeavors to return Islamic urban planning and architecture design to its a priori position as a leading design expression adaptable to any place, time, and cultural expression while providing a base for analysis that transcends the concept of style and external form as a definition and expresses the singularity of the esoteric “Spiritual” aspects in a rational, principled, and logical manner clearly addressed in Islam’s essence.

Keywords: Islamic architecture, Islamic design, Islamic urban planning, principles of Islamic design

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Authors: Zuwaira Abubakar

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Islam is the Divine religion which guides Man ways of leading a prosperous life in this life and the hereafter. This study was conducted in order to investigate the possible relationship between adherence to Islamic principles of success and academic performance of university students. Accordingly, a questionnaire based on Islamized principles of success (referred to as 'Islamic character quotient inventory (ICQi)') was correlated with CGPA (Cumulative Grade Point Averages) of 343 students of Usmanu Danfodiyo University Sokoto. The empirical testing indicates that the total score on ICQi correlated positively and significantly with academic performance of the respondent. Students with either high or medium adherence have a significantly (P<0.01) higher CGPA than their counterparts with the low-adherence level. However, the result did not show a significant relationship between the CGPA of highly adherent individuals and that of those with medium adherence level. This may suggests that Islam is not for spiritual life only but also relevant and useful for our practical life.

Keywords: academic, Islam, principles, success

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Authors: Olivier Mesly

Abstract:

This research presents a conceptual framework termed “Consumer Financial Spinning” (CFS) to analyze consumer behavior in the financial/economic markets. This phenomenon occurs when consumers of high-stakes financial products accumulate unsustainable debt, leading them to detach from their initial financial hierarchy of needs, wealth-related goals, and preferences regarding their household portfolio of assets. The daring actions of these consumers, forming a dark financial triangle, are characterized by three behaviors: overconfidence, the use of rationed rationality, and deceitfulness. We show that we can incorporate CFS into the traditional CAPM and Markovitz’ portfolio optimization models to create a framework that explains such market phenomena as the global financial crisis, highlighting the antecedents and consequences of ill-conceived speculation. Because this is a conceptual paper, there is no methodology with respect to ground studies. However, we apply modeling principles derived from the data percolation methodology, which contains tenets explicating how to structure concepts. A simulation test of the proposed framework is conducted; it demonstrates the conditions under which the relationship between expected returns and risk may deviate from linearity. The analysis and conceptual findings are particularly relevant both theoretically and pragmatically as they shed light on the psychological conditions that drive intense speculation, which can lead to market turmoil. Armed with such understanding, regulators are better equipped to propose solutions before the economic problems become out of control.

Keywords: consumer financial spinning, rationality, deceitfulness, overconfidence, CAPM

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Authors: Judit Nagy

Abstract:

Many scientific studies claim that financial education should start as early as possible. Children are much more capable of and willing to absorb new concepts than adults. If we introduce children to financial knowledge early, their behaviour and attitudes to this subject will change, increasing later success in this area of life. However, poor financial decisions may entail severe consequences, not only to individuals but even to the wider society. Good financial decisions and economic attitudes may contribute to economic growth and well-being. Whilst in several countries, education about financial awareness and fundamentals is available, the understanding and acquisition of complex economic knowledge and the development of children’s independent problem-solving skills are still lacking. The results suggest that teaching economic and financial knowledge through accounting and making lectures interactive by using special tools of positive education is critical to stimulating children’s interest. Eighty percent of the students in the study liked the combined and interactive lecture. Introducing this kind of knowledge to individuals is a relevant objective, even at the societal level.

Keywords: positive psychology, education innovation, primary school, gender, economics, accounting, finance, personal finance, mathematics, economic growth, well-being, sustainability

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Authors: Mohammad Abu-Taleb

Abstract:

The final report of the Royal Commission into Australian financial services misconduct, released in February 2019, has had a significant impact on the financial advice industry. The recommendations released in the Commissioner’s final report include changes to ongoing fee arrangements, a new disciplinary system for financial advisers, and mandatory reporting of compliance concerns. This thesis aims to explore the impact of the Royal Commission’s recommendations on the operating model of financial advice firms in terms of advice products, processes, delivery models, and customer segments. Also, this research seeks to investigate whether the Royal Commission’s outcome has accelerated the use of enhanced technology solutions within the operating model of financial advice firms. And to identify the key challenges confronting financial advice firms whilst implementing the Commissioner’s recommendations across their operating models. In order to achieve the objectives of this thesis, a qualitative research design has been adopted through semi-structured in-depth interviews with 24 financial advisers and managers who are engaged in the operation of financial advice services. The study used the thematic analysis approach to interpret the qualitative data collected from the interviews. The findings of this thesis reveal that customer-centric operating models will become more prominent across the financial advice industry in response to the Commissioner’s final report. And the Royal Commission’s outcome has accelerated the use of advice technology solutions within the operating model of financial advice firms. In addition, financial advice firms have started more than before using simpler and more automated web-based advice services, which enable financial advisers to provide simple advice in a greater scale, and also to accelerate the use of robo-advice models and digital delivery to mass customers in the long term. Furthermore, the study identifies process and technology changes as, long with technical and interpersonal skills development, as the key challenges encountered financial advice firms whilst implementing the Commissioner’s recommendations across their operating models.

Keywords: hayne royal commission, financial planning advice, operating model, advice products, advice processes, delivery models, customer segments, digital advice solutions

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Authors: Salma Krafessi

Abstract:

The financial markets have a multifaceted, intricate environment, and enormous volumes of data are produced every day. To find investment possibilities, possible fraudulent activity, and market oddities, accurate anomaly identification in this data is essential. Conventional methods for detecting anomalies frequently fail to capture the complex organization of financial data. In order to improve the identification of abnormalities in financial time series data, this study presents Tucker Decomposition as a reliable multi-way analysis approach. We start by gathering closing prices for the S&P 500 index across a number of decades. The information is converted to a three-dimensional tensor format, which contains internal characteristics and temporal sequences in a sliding window structure. The tensor is then broken down using Tucker Decomposition into a core tensor and matching factor matrices, allowing latent patterns and relationships in the data to be captured. A possible sign of abnormalities is the reconstruction error from Tucker's Decomposition. We are able to identify large deviations that indicate unusual behavior by setting a statistical threshold. A thorough examination that contrasts the Tucker-based method with traditional anomaly detection approaches validates our methodology. The outcomes demonstrate the superiority of Tucker's Decomposition in identifying intricate and subtle abnormalities that are otherwise missed. This work opens the door for more research into multi-way data analysis approaches across a range of disciplines and emphasizes the value of tensor-based methods in financial analysis.

Keywords: tucker decomposition, financial markets, financial engineering, artificial intelligence, decomposition models

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