Search results for: corporate financial performance

Authors: Aleksandra Szunke

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Monetary policy is an important pillar of the economy, directly affecting on the condition of banking sector. Depending on the strategy may both support functioning of banking institutions, as well as limit their excessively risky activities. The literature studies indicate a large number of publications, which include characteristics of initiatives, implemented by central banks during the global financial crisis and the potential effects of the use of non-standard monetary policy instruments. However, the empirical evidence about their effects and real consequences for the financial markets are still not final. Even before the escalation of instability, Bernanke, Reinhart, and Sack (2004) analyzed the effectiveness of various unconventional monetary tools in lowering long-term interest rates in the United States and Japan. The obtained results largely confirmed the effectiveness of the zero-interest-rate policy and Quantitative Easing (QE) in achieving the goal of reducing long-term interest rates. Japan, considered as the precursor of QE policy, also conducted research about the consequences of non-standard instruments, implemented to restore financial stability of the country. Although the literature about the effectiveness of Quantitative Easing in Japan is extensive, it does not uniquely specify whether it brought permanent effects. The main aim of the study is to identify the implications of non-standard monetary policy, implemented by selected central banks (the Federal Reserve System, Bank of England and European Central Bank), paying particular attention to the consequences into three areas: the size of money supply, financial markets, and the real economy.

Keywords: consequences of modern monetary policy, quantitative easing policy, banking sector instability, global financial crisis

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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: Martin Bugeja, Helen Spiropolos

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Using a sample of U.S. firms during the period 1993-2015, this study examines whether mergers and acquisitions (M&A) impact the compensation of the Chief Financial Officer (CFO) in the bidding and integration phases of M&As. The study finds that after controlling for CEO power, CFOs’ total compensation is higher during M&A years and is driven by higher equity incentives. These results are robust to controlling for self-selection. Furthermore, CFOs receive a greater bonus during the year of acquisition and the year prior. The study also investigates if CFO compensation during M&A years is driven by M&A characteristics and finds that deal size and diversification are positively related to total compensation while completion time is negatively related. The results are robust to a number of sensitivity tests and additional analyses.

Keywords: chief financial officer, compensation, mergers, acquisitions

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Authors: Ginés Hernández-Cánovas, Mª Camino Ramón-Llorens, Johanna Koëter-Kant

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This paper uses a survey data-set of 837 Spanish SMEs to analyze the association between borrower discouragement and prior firm´s strategic decisions, while controlling for firm and owner characteristics. While existing literature has neglected factors limiting the demand for resources by an overreliance on arguments which attempt to explain the existence of discouraged borrowers solely in terms of lack of access to supply of credit. The objective of this paper is to show that factors limiting the demand for resources and, therefore, reducing the availability of funds, can be traced back to the firm manager´s decision. Our hypothesis is that managers that undertake strategic decisions seeking growth or improvement in their business performance participate more in the banking market than those showing contentment with their current business situation. Our results shows that SMEs that undertake an active role in research and development activities and that achieve improvements in the operating performance of their business are less likely to be discouraged from applying for a loan. Who needs credit and who applies for credit is important for firms, prospective lenders and policymakers interested in the financial health of these firms. Credit constrained firms are less likely to invest in R&D and to introduce new products, possibly harming long-term economic growth. Knowing how important borrower discouragement is in Europe, is important for judging the priority which should be attached to government policies aimed at reducing its effects. For example, policy makers could encourage the transparency about credit eligibility and conditions in order to reduce discouragement.

Keywords: discouragement, financial constraints, SMEs financing

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Authors: Ziba R. Tehrani, Sanaz Moayer

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In the age of the knowledge-based economy, knowledge management has become a key factor in sustainable competitive advantage. Knowledge management is discovering, acquiring, developing, sharing, maintaining, evaluating, and using right knowledge in right time by right person in organization; which is accomplished by creating a right link between human resources, information technology, and appropriate structure, to achieve organisational goals. Studying knowledge management financial institutes shows the knowledge management in banking system is not different from other industries but because of complexity of bank’s environment, the implementation is more difficult. The bank managers found out that implementation of knowledge management will bring many advantages to financial institutes, one of the most important of which is reduction of threat to lose subsequent information of personnel job quit. Also Special attention to internal conditions and environment of the financial institutes and avoidance from copy-making in designing the knowledge management is a critical issue. In this paper, it is tried first to define knowledge management concept and introduce existing models of knowledge management; then some of the most important models which have more similarities with other models will be reviewed. In second step according to bank requirements with focus on knowledge management approach, most major objectives of knowledge management are identified. For gathering data in this stage face to face interview is used. Thirdly these specified objectives are analysed with the response of distribution of questionnaire which is gained through managers and expert staffs of ‘Karafarin Bank’. Finally based on analysed data, some features of exiting models are selected and a new conceptual model will be proposed.

Keywords: knowledge management, financial institute, knowledge management model, organisational knowledge

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Authors: Mohammad A. R. S. Almutairi

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This study will provide the introduction that constitutes the problem cornerstone of legal disputes of disclosure and transparency under Kuwaiti Capital market authority Law No. 7 of 2010. It also will discuss the reasons for the emergence of corporate governance and its purposes in the Capital Market Authority Law in Kuwait. In addition, it will show the legal disputes resulting from the unclear concept of disclosure and interest and will discuss the main reasons in support of the possible solution. In addition, this study will argue why the Capital Market Authority Law in Kuwait needs a clear concept and a straight structure of disclosure under section 100. This study will demonstrate why a clear disclosure is led to a better application of the law. This study will demonstrate the fairness in applying the law regarding the punishment against individual, companies and securities market. Furthermore, it will discuss added confidence between investors and the stock market with a clear concept under section 100. Finally, it will summarize arises problem and possible solution.

Keywords: corporate governors, disclosure, transparency, fairness

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Authors: Opemiposi Adegbulu

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Conflicts of interest is an elusive, diverse and engaging subject, a cross-cutting problem of governance; all levels of governance, ranging from local to global, public to corporate or financial sectors. In all these areas, its mismanagement could lead to the distortion of decision-making processes, corrosion of trust and the weakening of administration. According to Professor Peters, an expert in the area, conflict of interest, a problem at the root of many scandals has “become a pervasive ethical concern in our professional, organisational, and political life”. Conflicts of interest corrode trust, and like in the public sector, trust is mandatory for the market, consumers/clients, shareholders and other stakeholders in the private sector. However, conflicts of interest in the private sector are distinct and must be treated in like manner when regulatory efforts are made to address them. The research looks at identifying conflicts of interest in the private sector and differentiating them from those in the public sector. The public interest is submitted as a criterion which allows for such differentiation. This is significant because it would for the use of tailor-made or sector-specific approaches to addressing this complex issue. This is conducted through extensive review of literature and theories on the definition of conflicts of interest. This study will employ theoretical, doctrinal and comparative methods. The nature of conflicts of interest in the private sector will be explored, through an analysis of the public sector where the notion of conflicts of interest appears more clearly identified, reasons, why they are of business ethics concern, will be advanced, and then, once again, looking at public sector solutions and other solutions, the study will identify ways of mitigating and managing conflicts in the private sector. An exploration of public sector conflicts of interest and solutions will be carried out because the typologies of conflicts of interest in both sectors appear very similar at the core and thus, lessons can be learnt with regards to the management of these issues in the private sector. Conflicts of interest corrode trust, and like in the public sector, trust is mandatory for the market, consumers/clients, shareholders and other stakeholders in the private sector. This research will then focus on some specific challenges to understanding and identifying conflicts of interest in the private sector; origin, diverging theories, the psychological barrier to the definition, similarities with public sector conflicts of interest due to the notions of corrosion of trust, ‘being in a particular kind of situation,’ etc. The notion of public interest will be submitted as a key element at the heart of the distinction between public sector and private sector conflicts of interests. It will then be proposed that the appreciation of the notion of conflicts of interest differ according to sector, country to country, based on the public interest test, using the United Kingdom (UK), the United States of America (US), France and the Philippines as illustrations.

Keywords: conflicts of interest, corporate governance, global governance, public interest

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Authors: Mohamed Fairooz Abdul Khir

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The linkage between liability for risk and legitimacy of reward is a governing principle that must be fully observed in financial transactions. It is the cornerstone of any Islamic business or financial deal. The absence of risk taking principle may give rise to numerous prohibited elements such as ribā, gharar and gambling that violate the objectives of financial transactions. However, fiqhī domains from which it emanates have not been clearly spelled out by the scholars. In addition, the concept of risk taking in relation to contemporary risks associated with financial contracts, such as credit risk, liquidity risk, reputational risk and market risk, needs further scrutiny as regard their Sharīʿah bases. Hence, this study is imperatively significant to prove that absence of risk taking concept in Islamic financial instruments give rise to prohibited elements particularly ribā. This study is primarily intended to clarify the concept of risk in Islamic financial transactions from the fiqhī perspective and evaluate analytically the selected issues involving risk taking based on the established concept of risk taking from fiqhī viewpoint. The selected issues are amongst others charging cost of fund on defaulting customers, holding the lessee liable for total loss of leased asset under ijārah thumma al-bayʿ and capital guarantee under mushārakah based instruments. This is a library research in which data has been collected from various materials such as classical fiqh books, regulators’ policy guidelines and journal articles. This study employed deductive and inductive methods to analyze the data critically in search for conclusive findings. It suggests that business risks have to be evaluated based on their subjects namely (i) property (māl) and (ii) work (ʿamal) to ensure that Islamic financial instruments structured based on certain Sharīʿah principles are not diverted from the risk taking concept embedded in them. Analysis of the above selected cases substantiates that when risk taking principle is breached, the prohibited elements such as ribā, gharar and maysir do arise and that they impede the realization of the maqāṣid al-Sharīʿah intended from Islamic financial contracts.

Keywords: Islamic finance, ownership risk, ribā, risk taking

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Authors: Naser Zouri

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Purpose: Measures of formulate and implementation strategy shows amount of product rate-market based strategic management category such as courtesy, competence, and compliance to reach the high loyalty of financial ecosystem. Despite, it solves the market place error intention to fair trade organization. Finding: Finding shows the ability of executives’ level of management to motivate and better decision-making to solve the treatments in business organization. However, it made ideal level of each interposition policy for a hypothetical household. Methodology/design. Style of questionnaire about the data collection was selected to survey of both pilot test and real research. Also, divide of questionnaire and using of Free Scale Semiconductor`s between the finance employee was famous of this instrument. Respondent`s nominated basic on non-probability sampling such as convenience sampling to answer the questionnaire. The way of realization costs to performed the questionnaire divide among the respondent`s approximately was suitable as a spend the expenditure to reach the answer but very difficult to collect data from hospital. However, items of research survey was formed of implement strategy, environment, supply chain, employee from impact of implementation strategy on reach to better financial consequences and also formulate strategy, comprehensiveness strategic design, organization performance from impression on formulate strategy and financial consequences. Practical Implication: Dynamic capability approach of formulate and implement strategy focuses on the firm-specific processes through which firms integrate, build, or reconfigure resources valuable for making a theoretical contribution. Originality/ value of research: Going beyond the current discussion, we show that case studies have the potential to extend and refine theory. We present new light on how dynamic capabilities can benefit from case study research by discovering the qualifications that shape the development of capabilities and determining the boundary conditions of the dynamic capabilities approach. Limitation of the study :Present study also relies on survey of methodology for data collection and the response perhaps connection by financial employee was difficult to responds the question because of limitation work place.

Keywords: financial ecosystem, loyalty, Malaysian market error, dynamic capability approach, rate-market, optimization intelligence strategy, courtesy, competence, compliance

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Authors: Fatimah Opebiyi

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Economic growth promotion, inflation reduction and consumer protection are among the core public interest aims of governments. Nevertheless, higher rates of default by consumers in relation to credit card loans and mortgages in recent times illustrate that government’s performance in balancing the protection of the economy and consumer is subpar. This thereby raises an important question on the role of government in protecting consumers during prolonged spells of inflation, particularly when such inflationary trends may be traceable to the acts of the government. Adopting a doctrinal research methodology, this article investigates the evolution of the concept of consumer protection in the United Kingdom and also brings to the fore the tensions and conflicts of interests in the aims and practices of the main regulators within the financial services industry. Relying on public interest theories of regulation and responsive regulatory theory, the article explores the limitations in the state’s ability to strike the right balance in meeting regulatory aims of the regulatory agencies at the opposite ends of the spectrum.

Keywords: financial regulation, consumer protection, prudential regulation, public interest theories of regulation, central bank

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Authors: Abdurrahman Karacabey

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Threat paradigm has shifted throughout the history. Considering conjuncture of our time, a major threat for humanity is terrorism. Although variety of reasons are influential, financial, and human resources are the vital needs for terrorist groups. It is known that terrorism is a significant term while taking decisions in diplomatic, politic, and military issues. Even though the methods to provide resources for terrorism are quite similar, there are still some differences for deterrent terrorist groups being active in various regions of the globe. Due to social and psychological reasons activists have generally similar excuses to join terrorist groups.At the same time, terrorists’ fiscal activities to secure permanence of terrorism, occupy the politics of the countries. Besides, preventive actions are expensive creating huge burdens in host nation’s economy. This paper elaborates on how ISIS is providing human and economic resources, course of actions to overcome ISIS is on the agenda of all countries.

Keywords: financial resources, human resources, isis, terrorism

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Authors: Eko Budi Santoso

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There is a growing interest in Corporate Social Responsibility (CSR) issues in developing countries such as Indonesia. Firms disclose their CSR activities, and some provide assurance to gain recognition as socially responsible firms. However, several of those socially responsible firms involve in tax scandals and raise a question of whether CSR disclosure is used to disguise firm misconduct or as a reflection of socially responsible firms. Specifically, whether firms engage in CSR disclosure and its assurance also responsible for their tax matters. This study examines the association between CSR disclosure and tax aggressiveness and the role of sustainability reporting assurance to the association. This research develops a modified index according to global reporting initiatives to measure CSR disclosure and various measurement for tax aggressiveness. Using a sample of Indonesian go public companies issued CSR disclosure, the empirical result shows that there is an association between CSR disclosure and tax aggressiveness. In addition, results also indicate sustainability reporting assurance moderate those association. The findings suggest that stakeholder in developing countries should examine carefully firms with active CSR disclosure before label it as socially responsible firms. JEL Classification: M14

Keywords: CSR disclosure, tax aggressiveness, assurance, business ethics

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Authors: Fotis Vouzas

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This paper is an attempt to investigate the Business Ethics link to Quality Management. Business Ethics as a management practice is well rooted in many organizations, but its contribution to quality management implementation programs and practices is not well documented. The ISO 9000 and the Business Excellence frameworks and Awards seem to provide a basis for the implementation of a TQM philosophy contributing to efficiency, enhanced performance and sustainability. The author examines a series of Corporate Ethics initiatives and investigates the relationship to Total Quality Management in an MNC operating in Greece. The data gathering was carried out through extensive and in-depth interviews with several multiple informants, i.e., the plant manager, the production manager, and the personnel manager, using a semi-structured questionnaire with open-ended questions.

Keywords: total quality management, business ethics, Greece, ISO 9000

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Authors: Muhammad Arsalan

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The efficiency of a financial intermediation system is assessed by its ability to achieve allocative efficiency, asset transformation, and the subsequent economic development. Islamic Banking and Finance (IBF) was conceived to serve as an alternate financial intermediation system adherent to the injunctions of Islam. A critical appraisal of the state of contemporary IBF reveals that it neither fulfills the aspirations of Islamic rhetoric nor is efficient in terms of asset transformation and economic development. This paper is an intuitive pursuit to explore the economic rationale of established principles of IBF, and the reasons of the persistent divergence of IBF being accused of ruses and sophistry. Disentangling the varying viewpoints, the underdevelopment of IBF has been attributed to misinterpretation of Riba, which has been explicated through a narrow fiqhi and legally deterministic approach. It presents a critical account of how incorrect conceptualization of the key injunction on Riba, steered flawed institutionalization of an Islamic Financial intermediation system. It also emphasizes on the wrong interpretation of the ontological and epistemological sources of Islamic Law (primarily Riba), that explains the perennial economic underdevelopment of the Muslim world. Deeming ‘a collaborative and dynamic Ijtihad’ as the elixir, this paper insists on the exigency of redefining Riba, i.e., a definition that incorporates the modern modes of economic cooperation and the contemporary financial intermediation ecosystem. Finally, Riba has been articulated in an agency theoretic framework to eschew expropriation of wealth, and assure protection of property rights, aimed at realizing the twin goals of a) Shari’ah adherence in true spirit, b) financial and economic development of the Muslim world.

Keywords: agency theory, financial intermediation, Islamic banking and finance, ijtihad, economic development, Riba, information asymmetry

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Authors: K. P. Fasalu Rahman

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The financial services industry of Islam include large number of institutions, such as investment banks and commercial banks, investment companies and mutual insurance companies. All types of these financial institutions should have to deal with many issues and risks in their field of work. Islamic banks should expect to face two types of risks: risks that are similar to those faced by conventional financial intermediaries and risks that are unique to the Islamic Banks due to their compliance with the Shariah. The use of financial services and products that comply with the Shariah principles cause special issues for supervision and risk management. Risks are uncertain future events that could influence the achievement of the bank’s objectives, including strategic, operational, financial and compliance objectives. In Islamic banks, effective risk management deserves special attention. As an operational problem, risk management is the classification and identification of methods, processes, and risks in banks to supervise, monitor and measure them. In comparison to conventional banks, Islamic banks face big difficulties in identifying and managing risks due to bigger complexities emerging from the profit loss sharing (PLS) concept and nature of particular risks of Islamic financing. As the developing of managing risks tool becomes very essential, especially in Islamic banking as most of the products are depending on PLS principle, identifying and measuring each type of risk is highly important and critical in any Islamic finance based systems. This paper highlights the special and general risks surrounding Islamic banking. And it investigates in detail the need for risk management in Islamic banks. In addition to analyzing the effectiveness of risk management strategies adopted by Islamic financial institutions at present, this research is also suggesting strategies for improving risk management process of Islamic banks in future.

Keywords: Islamic banking, management, risk, risk management

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Authors: Mohamad Reza Asariha

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The development and extension of modern communication innovations at an extraordinary speed has caused crucial changes in all financial, social, social and political areas of the world. The improvement of toady and cable innovations, in expansion to expanding the generation and dissemination needs of worldwide programs; the financial defense made it more appealing. The alter of the administration of mechanical economy to data economy and benefit economy in created nations brought approximately uncommon advancements within the standards of world exchange and as a result, it caused the extension of media organizations in outside measurements, and the advancement of financial speculations in many Asian nations, beside the worldwide demand for the utilization of media merchandise, made new markets, and the media both within the household scene of the nations and within the universal field. Universal and financial are of great significance and have and viable and compelling nearness within the condition of picking up, keeping up and expanding financial control and riches within the world. Moreover, mechanical progresses and mechanical joining are critical components in media auxiliary alter. This auxiliary alter took put beneath the impact of digitalization. That’s, the method that broke the boundaries between electronic media administrations. Until presently, the direction of mass media was totally subordinate on certain styles of data transmission that were for the most part utilized. Digitization made it conceivable for any content to be effortlessly transmitted through distinctive electronic transmission styles, and this media merging has had clear impacts on media approaches and the way mass media are controlled.

Keywords: media, digital era, digital ages, media convergence

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Authors: Levan Sabauri

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The purpose of this article is an examination of the meaning of theoretic aspects of audit in the context of solving of specific problems of the audit. The audit’s aim is the estimation of financial statements by the auditor, i.e. if they are prepared according to the basic requirements of current financial statements. By examination of concrete examples, we can clearly see problems created in an audit and in often cases, those contradictions which can be caused by incompliance of matters regulated by legislation and by reality. An important part of this work is the analysis of reform in the direction of business accounting, statements and audit in Georgia and its comparison with EU countries. In the article, attention is concentrated on the analysis of specific problems of auditing practice and ways of their solving by taking into consideration theoretical aspects of the audit are proposed.

Keywords: audit, auditor, auditors’ ethic code, auditor’s risk, financial statement, objectivity

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Authors: Saurabh Ahluwalia, Sul Kassicieh

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The conventional wisdom has maintained that being in proximity to entrepreneurial ecosystems helps startups to raise financing, develop and grow. In this paper, we examine the effect of a major component of an entrepreneurial ecosystem- financial or venture capital clusters on the exit of a startup through mergers and acquisitions (M&A). We find that the presence of a venture capitalist in a venture capital (VC) cluster is a major success factor for M&A exits. The location of startups in the top VC clusters did not turn out to be significant for success. Our results are robust to different specifications of the model that use different time periods, types of success, the reputation of VC, industry and the quality of the startup company. Our results provide evidence for VCs, startups and policymakers who want to better understand the components of entrepreneurial ecosystems and their relation to the M&A exits of startups.

Keywords: financial institution, mergers and acquisitions, startup financing, venture capital

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Authors: Longqing Li

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The paper addresses the inefficiency of the classical model in measuring the Value-at-Risk (VaR) using a normal distribution or a Student’s t distribution. Specifically, the paper focuses on the one day ahead Value-at-Risk (VaR) of major stock market’s daily returns in US, UK, China and Hong Kong in the most recent ten years under 95% confidence level. To improve the predictable power and search for the best performing model, the paper proposes using two leading alternatives, Extreme Value Theory (EVT) and a family of GARCH models, and compares the relative performance. The main contribution could be summarized in two aspects. First, the paper extends the GARCH family model by incorporating EGARCH and TGARCH to shed light on the difference between each in estimating one day ahead Value-at-Risk (VaR). Second, to account for the non-normality in the distribution of financial markets, the paper applies Generalized Error Distribution (GED), instead of the normal distribution, to govern the innovation term. A dynamic back-testing procedure is employed to assess the performance of each model, a family of GARCH and the conditional EVT. The conclusion is that Exponential GARCH yields the best estimate in out-of-sample one day ahead Value-at-Risk (VaR) forecasting. Moreover, the discrepancy of performance between the GARCH and the conditional EVT is indistinguishable.

Keywords: Value-at-Risk, Extreme Value Theory, conditional EVT, backtesting

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Authors: David Abad, M. Encarnación Lucas-Pérez, Antonio Minguez-Vera, José Yagüe

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We examine explicitly the relation between the gender diversity on corporate boards and the levels of information asymmetry in the stock market. Based on prior evidence that suggests that the presence of women on director boards increases the quantity and quality of public disclosure by firms, we expect firms with higher gender diversity on their boards to show lower levels of information asymmetry in the market. Using a Spanish sample for the period 2004-2009, proxies for information asymmetry estimated from high-frequency data, and a system GMM methodology, we find that the gender diversity on boards is negative associated with the level of information asymmetry in the stock market. Our findings support legislative changes implemented to increase the presence of women on boards in several European countries by providing evidence that gender diverse boards have beneficial effects on stock markets.

Keywords: corporate board, female directors, gender diversity, information asymmetry, market microstructure

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Authors: Patrick O. Bobbie, Prince S. Attrams

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In recent times, the rapid change in new technologies has spurred up the way and manner records are handled in educational institutions. Also, there is a need for reliable access and ease-of use to these records, resulting in increased productivity in organizations. In academic institutions, such benefits help in quality assessments, institutional performance, and assessments of teaching and evaluation methods. Students in educational institutions benefit the most when advanced technologies are deployed in accessing records. This research paper discusses the use of biometric technologies coupled with smartcard technologies to provide a unique way of identifying students and matching their data to financial records to grant them access to restricted areas such as examination halls. The system developed in this paper, has an identity verification component as part of its main functionalities. A systematic software development cycle of analysis, design, coding, testing and support was used. The system provides a secured way of verifying student’s identity and real time verification of financial records. An advanced prototype version of the system has been developed for testing purposes.

Keywords: biometrics, smartcards, identity-verification, fingerprints

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Authors: Usman Yakubu, Muktar Haruna

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The paper examines the impact of the audit committee on the earning quality of the listed consumer goods sector in Nigeria. The study used data collected from annual reports and accounts of the 13 sampled companies for the periods 2007 to 2018. Data were analyzed by means of descriptive statistics to provide summary statistics for the variables; also, correlation analysis was carried out using the Pearson correlation technique for the correlation between the dependent and independent variables. Regression was employed using the Generalized Least Square technique since the data has both time series and cross sectional attributes (panel data). It was found out that the audit committee had a positive and significant influence on the earning quality in the listed consumer goods companies in Nigeria. Thus, the study recommends that competency and personal integrity should be the worthwhile attributes to be considered while constituting the committee; this could enhance the quality of accounting information. In addition to that majority of the committee members should be independent directors in order to allow a high level of independency to be exercised.

Keywords: earning quality, corporate governance, audit committee, financial reporting

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Authors: B. Vikram, Y. Anu Leena, Y. Anu Neena, M. V. Krishna Rao, V. S. S. Kumar

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The industry is often criticized for inefficiencies in outcomes such as time and cost overruns, low productivity, poor quality and inadequate customer satisfaction. To enhance the chances for construction projects to be successful, selecting an able contractor is one of the fundamental decisions to be made by clients. The selection of the most appropriate contractor is a multi-criteria decision making (MCDM) process. In this paper, multi-attribute utility theory (MAUT) is employed utilizing the multiplicative form of utility function for ranking the prequalified contractors. Performance assessment criteria covering contracting company attributes, experience record, past performance, performance potential, financial stability and project specific criteria are considered for contractor evaluation. A case study of multistoried building for which four contractors submitted bids is considered to illustrate the applicability of multiplicative approach of MAUT to rank the prequalified contractors. The proposed MAUT decision making methodology can also be employed to other decision making situations.

Keywords: multi-attribute utility theory, construction industry, prequalification, contractor

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Authors: Wassamon Kun-Amornpong

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When a financial crisis occurs, there will be a law and regulatory reform in order to manage the turmoil and prevent a future crisis. One of the most important regulatory efforts to help cope with systemic risk and a financial crisis is the third version of the Basel Accord. Basel III has introduced some measures and tools (e.g., systemic risk buffer, countercyclical buffer, capital conservation buffer and liquidity risk) in order to mitigate systemic risk. Nevertheless, the effectiveness of these measures in Basel III in adequately addressing the problem of contagious runs that can quickly spread throughout the financial system is questionable. This paper seeks to contribute to the knowledge regarding the role of the Basel Accords in mitigating systemic risk. The research question is to what extent the Basel Accords can help control systemic risk in the financial markets? The paper tackles this question by analysing the concept of systemic risk. It will then examine the weaknesses of the Basel Accords before and after the Global financial crisis in 2008. Finally, it will suggest some possible solutions in order to improve the Basel Accord. The rationale of the study is the fact that academic works on systemic risk and financial crises are largely studied from economic or financial perspective. There is comparatively little research from the legal and regulatory perspective. The finding of the paper is that there are some problems in all of the three pillars of the Basel Accords. With regards to Pillar I, the risk model is excessively complex while the benefits of its complexity are doubtful. Concerning Pillar II, the effectiveness of the risk-based supervision in preventing systemic risk still depends largely upon its design and implementation. Factors such as organizational culture of the regulator and the political context within which the risk-based supervision operates might be a barrier against the success of Pillar II. Meanwhile, Pillar III could not provide adequate market discipline as market participants do not always act in a rational way. In addition, the too-big-to-fail perception reduced the incentives of the market participants to monitor risks. There has been some development in resolution measure (e.g. TLAC and MREL) which might potentially help strengthen the incentive of the market participants to monitor risks. However, those measures have some weaknesses. The paper argues that if the weaknesses in the three pillars are resolved, it can be expected that the Basel Accord could contribute to the mitigation of systemic risk in a more significant way in the future.

Keywords: Basel accords, financial regulation, risk-based supervision, systemic risk

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Authors: Alireza Naserpoor

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Derivatives are the most important innovation which has happened in the past decades. When it comes to financial markets, it has changed the whole way of operations of stock, commodities and currency market. Beside a lot of advantages, Conventional derivatives contracts have some disadvantages too. Some problems have been caused by derivatives contain raising Volatility, increasing Bankruptcies and causing financial crises. Standard Parallel Salam contract as an Islamic financial product meanwhile is a financing instrument can be used for risk management by investors. Standard Parallel Salam is a Shari’ah-Compliant contract. Furthermore, it is an alternative to conventional derivatives. Despite the fact that the unstructured types of that, has been used in several Islamic countries, This contract as a structured and standard financial instrument introduced in Iran Mercantile Exchange in 2014. In this paper after introducing parallel Salam, we intend to examine a collection of international experience and local measure regarding launching standard parallel Salam contract and proceed to describe standard scenarios for trading this instrument and practical experience in Iran Mercantile Exchange about this instrument. Afterwards, we make a comparison between SPS and Futures contracts as a conventional derivative. Standard parallel salam contract as an Islamic financial product, can be used for risk management by investors. SPS is a Shariah-Compliant contract. Furthermore it is an alternative to conventional derivatives. This contract as a structured and standard financial instrument introduced in Iran Mercantile Exchange in 2014. despite the fact that the unstructured types of that, has been used in several Islamic countries. In this article after introducing parallel salam, we intend to examine a collection of international experience and local measure regarding launching standard parallel salam contract and proceed to describe standard scenarios for trading this instrument containing two main approaches in SPS using, And practical experience in IME about this instrument Afterwards, a comparison between SPS and Futures contracts as a conventional derivatives.

Keywords: futures contracts, hedging, shari’ah compliant instruments, standard parallel salam

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Authors: Shu Yin, Zhiyang Ding, Jianzhong Huang, Xiaojun Ruan, Xiaomin Zhu, Xiao Qin

Abstract:

Since large-scale and data-intensive applications have been widely deployed, there is a growing demand for high-performance storage systems to support data-intensive applications. Compared with traditional storage systems, next-generation systems will embrace dedicated processor to reduce computational load of host machines and will have hybrid combinations of different storage devices. The advent of flash- memory-based solid state disk has become a critical role in revolutionizing the storage world. However, instead of simply replacing the traditional magnetic hard disk with the solid state disk, it is believed that finding a complementary approach to corporate both of them is more challenging and attractive. This paper explores an idea of active storage, an emerging new storage configuration, in terms of the architecture and design, the parallel processing capability, the cooperation of other machines in cluster computing environment, and a disk configuration, the hybrid combination of different types of disk drives. Experimental results indicate that the proposed HcDD achieves better I/O performance and longer storage system lifespan.

Keywords: arallel storage system, hybrid storage system, data inten- sive, solid state disks, reliability

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Authors: Maruf Ariyo Raheem, Patrick Oseloka Ezepue

Abstract:

This research aimed at determining most appropriate heteroskedastic model to predicting volatility of 10 major Nigerian banks: Access, United Bank for Africa (UBA), Guaranty Trust, Skye, Diamond, Fidelity, Sterling, Union, ETI and Zenith banks using daily closing stock prices of each of the banks from 2004 to 2014. The models employed include ARCH (1), GARCH (1, 1), EGARCH (1, 1) and TARCH (1, 1). The results show that all the banks returns are highly leptokurtic, significantly skewed and thus non-normal across the four periods except for Fidelity bank during financial crises; findings similar to those of other global markets. There is also strong evidence for the presence of heteroscedasticity, and that volatility persistence during crisis is higher than before the crisis across the 10 banks, with that of UBA taking the lead, about 11 times higher during the crisis. Findings further revealed that Asymmetric GARCH models became dominant especially during financial crises and post crises when the second reforms were introduced into the banking industry by the Central Bank of Nigeria (CBN). Generally, one could say that Nigerian banks returns are volatility persistent during and after the crises, and characterised by leverage effects of negative and positive shocks during these periods

Keywords: global financial crisis, leverage effect, persistence, volatility clustering

Procedia PDF Downloads 506

Authors: Libor Zachoval, Daire O Broin, Oisin Cawley

Abstract:

E-learning platforms, such as Blackboard have two major shortcomings: limited data capture as a result of the limitations of SCORM (Shareable Content Object Reference Model), and lack of incorporation of Artificial Intelligence (AI) and machine learning algorithms which could lead to better course adaptations. With the recent development of Experience Application Programming Interface (xAPI), a large amount of additional types of data can be captured and that opens a window of possibilities from which online education can benefit. In a corporate setting, where companies invest billions on the learning and development of their employees, some learner behaviours can be troublesome for they can hinder the knowledge development of a learner. Behaviours that hinder the knowledge development also raise ambiguity about learner’s knowledge mastery, specifically those related to gaming the system. Furthermore, a company receives little benefit from their investment if employees are passing courses without possessing the required knowledge and potential compliance risks may arise. Using xAPI and rules derived from a state-of-the-art review, we identified three learner behaviours, primarily related to guessing, in a corporate compliance course. The identified behaviours are: trying each option for a question, specifically for multiple-choice questions; selecting a single option for all the questions on the test; and continuously repeating tests upon failing as opposed to going over the learning material. These behaviours were detected on learners who repeated the test at least 4 times before passing the course. These findings suggest that gauging the mastery of a learner from multiple-choice questions test scores alone is a naive approach. Thus, next steps will consider the incorporation of additional data points, knowledge estimation models to model knowledge mastery of a learner more accurately, and analysis of the data for correlations between knowledge development and identified learner behaviours. Additional work could explore how learner behaviours could be utilised to make changes to a course. For example, course content may require modifications (certain sections of learning material may be shown to not be helpful to many learners to master the learning outcomes aimed at) or course design (such as the type and duration of feedback).

Keywords: artificial intelligence, corporate e-learning environment, knowledge maintenance, xAPI

Procedia PDF Downloads 105

Authors: Maciej Kozlowski, Agnieszka Piotrowska-Piatek

Abstract:

Purpose: This article analyses the most important financial participation programmes (FPP) in Poland to show the relationship between the programmes applied and the socio-economic results of enterprises and assesses the impact of participation on these results and the impact of selected factors on the introduction of FPP. Methodology: The research has been based on a questionnaire answered by senior management of listed Polish companies that had at least one out of three major FPPs in operation, namely share ownership, profit-sharing, or a stock option scheme. Findings: The results of the empirical study conducted indicate the existence of some peculiar relationships. The vast majority of schemes in Polish public companies are aimed at the participation of the management personnel; these programmes are narrow-based (only for management) and rather hermetic, with a high concentration of stocks or shares in the hands of the management. Conclusion: FPPs generally have a positive influence on enterprise functioning. However, the effects are more social than economic (no significant economic improvement after programme implementation). The paper contributes to the debate about financial participation and suggests actions to popularize these programmes on a wider scale.

Keywords: financial participation, profit sharing, stock options, worker attitude, worker ownership

Procedia PDF Downloads 117

Authors: S. Turkan

Abstract:

In this paper, the Turkey’s Top 500 Industrial Enterprises data in 2014 were analyzed by data envelopment analysis. Data envelopment analysis is used to detect efficient decision-making units such as universities, hospitals, schools etc. by using inputs and outputs. The decision-making units in this study are enterprises. To detect efficient enterprises, some financial ratios are determined as inputs and outputs. For this reason, financial indicators related to productivity of enterprises are considered. The efficient foreign weighted owned capital enterprises are detected via super efficiency model. According to the results, it is said that Mercedes-Benz is the most efficient foreign weighted owned capital enterprise in Turkey.

Keywords: data envelopment analysis, super efficiency, logistic regression, financial ratios

Procedia PDF Downloads 310