Search results for: financial regulation

Authors: Sana Masmoudi Mardassi, Yosra Makni Fourati

Abstract:

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

Procedia PDF Downloads 138

Authors: Safa’ Abdelkarim Hammad

Abstract:

The electrical power system is one of the main parts of the nation's infrastructure, and the availability and cost of electricity are critical factors in industrial competitiveness and strategy. Restructuring of the electricity supply industries is a very complex exercise based on national energy strategies and policies, macroeconomic developments, and national conditions, and its application varies from country to country. Electricity regulation of natural monopolies is a challenging task. Regulators face the problem of providing appropriate incentives for improvement of efficiency. Incentive regulation is often considered as an efficient regulatory tool to handle the problem, and it is widely applied in several countries. However, the exact regulation methodologies differ from one country to another. Network quantitative reliability evaluation is an essential factor with regard to the quality of supply. The main factors used to judge the reliability of supply is measured by the number and duration of interruptions experienced by customers. Several indicators are used to evaluate reliability in distribution networks. This paper addresses the impact of incentive regulation and performance benchmarking in the field of electricity distribution in Jordan. The theory of efficiency measurement and the most common models; NCSQS and DEA models are presented.

Keywords: incentive regulations, reliability, restructuring, Tarrif

Procedia PDF Downloads 85

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

Abstract:

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

Procedia PDF Downloads 214

Authors: T. S. Terence Ma, Irene T. Ho

Abstract:

Conducting adequate assessment of the challenges students with ASD (Autism Spectrum Disorder) face and the support they need is imperative for promoting their school adjustment. Students with ASD often show deficits in communication, social interaction, emotional regulation, and self-management in learning. While targeting these areas in intervention is often helpful, we argue that not enough attention has been paid to weak self-regulation being a key factor underlying their manifest difficulty in all these areas. Self-regulation refers to one’s ability to moderate their behavioral or affective responses without assistance from others. Especially for students with high functioning autism, who often show problems not so much in acquiring the needed skills but rather in applying those skills appropriately in everyday problem-solving, self-regulation becomes a key to successful adjustment in daily life. Therefore, a greater understanding of the construct of self-regulation, its relationship with other daily skills, and its role in school functioning for students with ASD would generate insights on how students’ school adjustment could be promoted more effectively. There were two focuses in this study. Firstly, we examined the extent to which self-regulation is a distinct construct that is differentiable from other daily skills and the most salient indicators of this construct. Then we tested a model of relationships between self-regulation and other daily school skills as well as their relative and combined effects on school adjustment. A total of 1,345 Grade1 to Grade 6 students with ASD attending mainstream schools in Hong Kong participated in the research. In the first stage of the study, teachers filled out a questionnaire consisting of 136 items assessing a wide range of student skills in social, emotional and learning areas. Results from exploratory factor analysis (EFA) with 673 participants and subsequent confirmatory factor analysis (CFA) with another group of 672 participants showed that there were five distinct factors of school skills, namely (1) communication skills, (2) pro-social behavior, (3) emotional skills, (4) learning management, and (5) self-regulation. Five scales representing these skill dimensions were generated. In the second stage of the study, a model postulating the mediating role of self-regulation for the effects of the other four types of skills on school adjustment was tested with structural equation modeling (SEM). School adjustment was defined in terms of the extent to which the student is accepted well in school, with high engagement in school life and self-esteem as well as good interpersonal relationships. A 5-item scale was used to assess these aspects of school adjustment. Results showed that communication skills, pro-social behavior, emotional skills and learning management had significant effects on school adjustment only indirectly through self-regulation, and their total effects were found to be not high. The results indicate that support rendered to students with ASD focusing only on the training of well-defined skills is not adequate for promoting their inclusion in school. More attention should be paid to the training of self-management with an emphasis on the application of skills backed by self-regulation. Also, other non-skill factors are important in promoting inclusive education.

Keywords: autism, assessment, factor analysis, self-regulation, school adjustment

Procedia PDF Downloads 79

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

Procedia PDF Downloads 11

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

Procedia PDF Downloads 66

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

Procedia PDF Downloads 60

Authors: Fady Tawakol

Abstract:

BitCoin is a decentralized cryptocurrency that can be used without the need of traditional central banks to accomplish any e-commerce trade. The use of such currency could facilitate new economic interactions and linkages. However, without effective and efficient regulations, cryptocurrency transactions are mostly used by criminals to commit crimes such as money laundering, theft, and blackmailing. And because law is one step behind technological developments, this paper discusses the importance of regulations and supervision for the BitCoin-system, to provide unified regulatory solutions for our digital future in the Middle East. It will provide a detailed analysis of the legal nature of BitCoin along with, its regulation with respect to criminal and civil law.

Keywords: BitCoin, financial protection, crypto currency, money laundering

Procedia PDF Downloads 176

Authors: Ibtissam Mharzi Alaoui, Camélia Sehaqui

Abstract:

The success of a bank depends upon its effective risk management. With the growing complexity and diversity of financial products and services, as well as the accelerating pace of globalization over the past decade, risk management is becoming increasingly difficult. thus, all measurement and monitoring functions must be much more vigorous, relevant and adequate. The Shariah non-compliance risk is specific aspect of Islamic finance which ipso facto, deserves particular attention. It affects the validity of all Islamic financial contracts and it turns out to be likely to result in considerable losses on the overall Islamic financial institutions (IFIs). The purpose of this paper is to review the theoretical literature on Shariah non-compliance risk in order to give a clearer understanding of its sources, causes and consequences. Our intention through this work is to bring added value to the Islamic finance industry all over the world. The findings provide a useful reference work for the Islamic banks in structuring (or restructuring) of their own system of shariah risk management and internal control.

Keywords: Shariah non-compliance, risk management, financial products, Islamic finance.

Procedia PDF Downloads 45

Authors: S. Forughi, A. De Zoysa, S. Bhati

Abstract:

The present study focuses on the environmental performance of the companies in the electricity-producing sector and its relationship with their financial performance. We will review the major studies that examined the relationship between the environmental and financial performance of firms in various industries. While the classical economic debates consider the environmental friendly activities costly and harmful to a firm’s profitability, it is claimed that firms will be rewarded with higher profitability in long run through the investments in environmental friendly activities. In this context, prior studies have examined the relationship between the environmental and financial performance of firms operating in different industry sectors. Our study will employ an environmental indicator to increase the accuracy of the results and be employed as an independent variable in our developed econometric model to evaluate the impact of the financial performance of the firms on their environmental friendly activities in the context of companies operating in the Australian electricity-producing sector. As a result, we expect our methodology to contribute to the literature and the findings of the study will help us to provide recommendations and policy implications to the electricity producers.

Keywords: Australian electricity sector, efficiency measurement, environmental-financial performance interaction, environmental index

Procedia PDF Downloads 280

Authors: Alexandra Aslanidou

Abstract:

The General Data Protection Regulation (GDPR), concerning the protection of natural persons within the European Union with regard to the processing of personal data and on the free movement of such data, became applicable in the European Union (EU) on 25 May 2018 and transformed the way personal data were being treated under the Data Protection Directive (DPD) regime, generating sweeping organizational changes to both public sector and business. A social practice that is considerably influenced in the way of its day-to-day operations is Human Resource (HR) management, for which the importance of GDPR cannot be underestimated. That is because HR processes personal data coming in all shapes and sizes from many different systems and sources. The significance of the proper functioning of an HR department, specifically in human-centered, service-oriented environments such as the education field, is decisive due to the fact that HR operations in schools, conducted effectively, determine the quality of the provided services and consequently have a considerable impact on the success of the educational system. The purpose of this paper is to analyze the decisive role that GDPR plays in HR departments that operate in schools and in order to practically evaluate the aftermath of the Regulation during the first months of its applicability; a comparative use cases analysis in five highly dynamic schools, across three EU Member States, was attempted.

Keywords: general data protection regulation, human resource management, educational system

Procedia PDF Downloads 73

Authors: Nicole Christiansen, Hanne Marie Motzfeldt

Abstract:

In recent years, more and more HR professionals have been using cyber-vetting in job recruitment in an effort to find the perfect match for the company. These practices are growing rapidly, accessing a vast amount of data from social networks, some of which is privileged and protected information. Thus, there is a risk that the right to privacy is becoming a duty to manage your private data. This paper investigates to which degree a job applicant's fundamental rights are protected adequately in current and future legislation in the EU. This paper argues that current data protection regulations and forthcoming regulations on the use of AI ensure sufficient protection. However, even though the regulation on paper protects employees within the EU, the recruitment sector may not pay sufficient attention to the regulation as it not specifically targeting this area. Therefore, the lack of specific labor and employment regulation is a concern that the social partners should attend to.

Keywords: AI, cyber vetting, data protection, job recruitment, online privacy

Procedia PDF Downloads 43

Authors: Lawrence Ngalim

Abstract:

The paucity of entrepreneurial finance in Sub-Saharan Africa (SSA) can plausibly be tied to her comparatively less-developed capital markets, which potentially hurts entrepreneurial activities. The high rate of informality in SSA worsens information asymmetry, which restricts the supply of funds in a heavily bank-led environment. In this paper, we ask whether the adoption of recent technological improvements in delivering financial services, such as crowdfunding, assists the financially excluded within Africa. Secondly, we investigate the individual determinants of crowdfunding, such as income, level of education, demographics, culture/trust, and the effects of crowdfunding on households’ usage of formal financial services. The paper discusses the long-term policy implications of this particular type of fintech in achieving financial inclusion within the regional bloc and its advantage for Africa-Agenda-2063.

Keywords: fintech, banks, entrepreneurship, regional integration

Procedia PDF Downloads 44

Authors: Renny Wulandari

Abstract:

This study aims to determine how the influence of Non Performing Financing, Financing Deposit Ratio, Operating Expenses and Operating Revenue and Net Income Margin on the disclosure of financial risk in Sharia banks. To achieve these objectives conducted associative research method with data source in the form of secondary data that is annual report data with period 2013-2016. The population in this study is the sharia banking industry in Indonesia and who issued the annual financial statements. A method of sampling use probability sampling. Analysis in this research is with SEM-PLS. The result is Net Income Margin has a significant effect on financial risk disclosure while Non Performing Financing (NPF) Financing to Deposit Ratio (FDR), Operating Expenses and Operating Revenue (OEOR) have no effect on the disclosure of financial risk in sharia bank.

Keywords: Sharia banks, disclosure of risk financial, non performing financing, financing deposit ratio, operating expenses and operating revenue, net income margin

Procedia PDF Downloads 204

Authors: Adisorn Bansong, Walai Isarankura Na Ayudhaya, Aumporn Makanong

Abstract:

A Development of an Instructional Model for Health Education was the aim to develop and study the effectiveness of an instructional model for health education to enhance self-regulation and learning achievement of lower secondary school students. It was the Quasi-Experimental Designs, used a Single-group Interrupted Time-series Designs, conducted by 2 phases: 1. To develop an instructional model based on Social Cognitive Theory and Strategic Life Planning. 2. To trial and evaluate effectiveness of an instructional model. The results as the following: i. An Instructional Model for Health Education consists of five main components: a) Attention b) Forethought c) Tactic Planning d) Execution and e) Reflection. ii. After an Instructional Model for Health Education has used for a semester trial, found the 4.07 percent of sample’s Self-Regulation higher and learning achievement on post-test were significantly higher than pre-test at .05 levels (p = .033, .000).

Keywords: social cognitive theory, strategic life planning, self-regulation, learning achievement

Procedia PDF Downloads 424

Authors: Yu-Chi Chou

Abstract:

The purpose of this study was to establish a logical path of an instructional model of empathy and social regulation, providing feasibility evidence on the model implementation in students with autism spectrum disorder (ASD). This newly developed Emotional Bug-Out Bag (BoB) curriculum was designed to enhance the empathy and socially shared regulation of students with ASD. The BoB model encompassed three instructional phases of basic theory lessons (BTL), action plan practices (APP), and final theory practices (FTP) during implementation. Besides, a learning flow (teacher-directed instruction, student self-directed problem-solving, group-based task completion, group-based reflection) was infused into the progress of instructional phases to deliberately promote the social regulatory process in group-working activities. A total of 23 junior high school students with ASD were implemented with the BoB curriculum. To examine the logical path for model implementation, data was collected from the participating students’ self-report scores on the learning nodes and understanding questions. Path analysis using structural equation modeling (SEM) was utilized for analyzing scores on 10 learning nodes and 41 understanding questions through the three phases of the BoB model. Results showed (a) all participants progressed throughout the implementation of the BoB model, and (b) the models of learning nodes and phases were positive and significant as expected, confirming the hypothesized logic path of this curriculum.

Keywords: autism spectrum disorder, empathy, regulation, socially shared regulation

Procedia PDF Downloads 33

Authors: Alev Atak

Abstract:

In this paper, we aim to create a financial sentiment index by investigating the company’s voluntary information disclosures. We retrieve structured content from BIST 100 companies’ financial reports for the period 1998-2018 and extract relevant financial information for sentiment analysis through Natural Language Processing. We measure strategy-related disclosures and their cross-sectional variation and classify report content into generic sections using synonym lists divided into four main categories according to their liquidity risk profile, risk positions, intra-annual information, and exposure to risk. We use Word Error Rate and Cosin Similarity for comparing and measuring text similarity and derivation in sets of texts. In addition to performing text extraction, we will provide a range of text analysis options, such as the readability metrics, word counts using pre-determined lists (e.g., forward-looking, uncertainty, tone, etc.), and comparison with reference corpus (word, parts of speech and semantic level). Therefore, we create an adequate analytical tool and a financial dictionary to depict the importance of granular financial disclosure for investors to identify correctly the risk-taking behavior and hence make the aggregated effects traceable.

Keywords: financial sentiment, machine learning, information disclosure, risk

Procedia PDF Downloads 67

Authors: Josiel Delgadillo, Johnson Kinyua, Charles Mutigwe

Abstract:

The purpose of sentiment analysis is to determine the sentiment strength (e.g., positive, negative, neutral) from a textual source for good decision-making. Natural language processing in domains such as financial markets requires knowledge of domain ontology, and pre-trained language models, such as BERT, have made significant breakthroughs in various NLP tasks by training on large-scale un-labeled generic corpora such as Wikipedia. However, sentiment analysis is a strong domain-dependent task. The rapid growth of social media has given users a platform to share their experiences and views about products, services, and processes, including financial markets. StockTwits and Twitter are social networks that allow the public to express their sentiments in real time. Hence, leveraging the success of unsupervised pre-training and a large amount of financial text available on social media platforms could potentially benefit a wide range of financial applications. This work is focused on sentiment analysis using social media text on platforms such as StockTwits and Twitter. To meet this need, SkyBERT, a domain-specific language model pre-trained and fine-tuned on financial corpora, has been developed. The results show that SkyBERT outperforms current state-of-the-art models in financial sentiment analysis. Extensive experimental results demonstrate the effectiveness and robustness of SkyBERT.

Keywords: BERT, financial markets, Twitter, sentiment analysis

Procedia PDF Downloads 116

Authors: M. Marjaneh, M. Y. Narazah, H. Shahrul

Abstract:

Array-based gene expression analysis is a powerful tool to profile expression of genes and to generate information on therapeutic effects of new anti-cancer compounds. Anti-apoptotic effect of thymoquinone was studied in MCF7 breast cancer cell line using gene expression profiling with cDNA micro array. The purity and yield of RNA samples were determined using RNeasyPlus Mini kit. The Agilent RNA 6000 Nano LabChip kit evaluated the quantity of the RNA samples. AffinityScript RT oligo-dT promoter primer was used to generate cDNA strands. T7 RNA polymerase was used to convert cDNA to cRNA. The cRNA samples and human universal reference RNA were labelled with Cy-3-CTP and Cy-5-CTP, respectively. Feature Extraction and GeneSpring software analysed the data. The single experiment analysis revealed involvement of 64 pathways with up-regulated genes and 78 pathways with down-regulated genes. The MAPK and p38-MAPK pathways were inhibited due to the up-regulation of PTPRR gene. The inhibition of p38-MAPK suggested up-regulation of TGF-ß pathway. Inhibition of p38 - MAPK caused up-regulation of TP53 and down-regulation of Bcl2 genes indicating involvement of intrinsic apoptotic pathway. Down-regulation of CARD16 gene as an adaptor molecule regulated CASP1 and suggested necrosis-like programmed cell death and involvement of caspase in apoptosis. Furthermore, down-regulation of GPCR, EGF-EGFR signalling pathways suggested reduction of ER. Involvement of AhR pathway which control cytochrome P450 and glucuronidation pathways showed metabolism of Thymoquinone. The findings showed differential expression of several genes in apoptosis pathways with thymoquinone treatment in estrogen receptor-positive breast cancer cells.

Keywords: cDNA microarray, thymoquinone, CARD16, PTPRR, CASP10

Procedia PDF Downloads 311

Authors: Chrysthia Papacleovoulou

Abstract:

The era of de-regulation, off-shore and tax haven jurisdictions, and shelf companies has come to an end. The usage of complex corporate structures involving trust instruments, special purpose vehicles, holding-subsidiaries in offshore haven jurisdictions, and taking advantage of tax treaties is soaring. States which raced to introduce corporate friendly legislation, tax incentives, and creative international trust law in order to attract greater FDI are now faced with regulatory challenges and are forced to revisit the corporate form and its tax treatment. The fiduciary services industry, which dominated over the last 3 decades, is now striving to keep up with the new regulatory framework as a result of a number of European and international legislative measures. This article considers the challenges to the company and the corporate form as a result of the legislative measures on tax planning and tax avoidance, CRS reporting, FATCA, CFC rules, OECD’s BEPS, the EU Commission's new transparency rules for intermediaries that extends to tax advisors, accountants, banks & lawyers who design and promote tax planning schemes for their clients, new EU rules to block artificial tax arrangements and new transparency requirements for financial accounts, tax rulings and multinationals activities (DAC 6), G20's decision for a global 15% minimum corporate tax and banking regulation. As a result, states are found in a race of over-regulation and compliance. These legislative measures constitute a global up-side down tax-harmonisation. Through the adoption of the OECD’s BEPS, states agreed to an international collaboration to end tax avoidance and reform international taxation rules. Whilst the idea was to ensure that multinationals would pay their fair share of tax everywhere they operate, an indirect result of the aforementioned regulatory measures was to attack private clients-individuals who -over the past 3 decades- used the international tax system and jurisdictions such as Marshal Islands, Cayman Islands, British Virgin Islands, Bermuda, Seychelles, St. Vincent, Jersey, Guernsey, Liechtenstein, Monaco, Cyprus, and Malta, to name but a few, to engage in legitimate tax planning and tax avoidance. Companies can no longer maintain bank accounts without satisfying the real substance test. States override the incorporation doctrine theory and apply a real seat or real substance test in taxing companies and their activities, targeting even the beneficial owners personally with tax liability. Tax authorities in civil law jurisdictions lift the corporate veil through the public registries of UBO Registries and Trust Registries. As a result, the corporate form and the doctrine of limited liability are challenged in their core. Lastly, this article identifies the development of new instruments, such as funds and private placement insurance policies, and the trend of digital nomad workers. The baffling question is whether industry and states can meet somewhere in the middle and exit this over-regulation frenzy.

Keywords: company, regulation, TAX, corporate structure, trust vehicles, real seat

Procedia PDF Downloads 105

Authors: Maria Jędrzejczak, Patryk Pieniążek

Abstract:

The European legal reality is on the eve of significant change. In European Union law, there is talk of a “fourth industrial revolution”, which is driven by massive data resources linked to powerful algorithms and powerful computing capacity. The above is closely linked to technological developments in the area of artificial intelligence, which has prompted an analysis covering both the legal environment as well as the economic and social impact, also from an ethical perspective. The discussion on the regulation of artificial intelligence is one of the most serious yet widely held at both European Union and Member State level. The literature expects legal solutions to guarantee security for fundamental rights, including privacy, in artificial intelligence systems. There is no doubt that personal data have been increasingly processed in recent years. It would be impossible for artificial intelligence to function without processing large amounts of data (both personal and non-personal). The main driving force behind the current development of artificial intelligence is advances in computing, but also the increasing availability of data. High-quality data are crucial to the effectiveness of many artificial intelligence systems, particularly when using techniques involving model training. The use of computers and artificial intelligence technology allows for an increase in the speed and efficiency of the actions taken, but also creates security risks for the data processed of an unprecedented magnitude. The proposed regulation in the field of artificial intelligence requires analysis in terms of its impact on the regulation on personal data protection. It is necessary to determine what the mutual relationship between these regulations is and what areas are particularly important in the personal data protection regulation for processing personal data in artificial intelligence systems. The adopted axis of considerations is a preliminary assessment of two issues: 1) what principles of data protection should be applied in particular during processing personal data in artificial intelligence systems, 2) what regulation on liability for personal data breaches is in such systems. The need to change the regulations regarding the rights and obligations of data subjects and entities processing personal data cannot be excluded. It is possible that changes will be required in the provisions regarding the assignment of liability for a breach of personal data protection processed in artificial intelligence systems. The research process in this case concerns the identification of areas in the field of personal data protection that are particularly important (and may require re-regulation) due to the introduction of the proposed legal regulation regarding artificial intelligence. The main question that the authors want to answer is how the European Union regulation against data protection breaches in artificial intelligence systems is shaping up. The answer to this question will include examples to illustrate the practical implications of these legal regulations.

Keywords: data protection law, personal data, AI law, personal data breach

Procedia PDF Downloads 10

Authors: Bita Mashayekhi, Hamid Kalhornia

Abstract:

One of the most important roles of financial reporting is improving the firms’ investment decisions; however, there is not much supporting evidence for this claim in emerging markets like Iran. In this study, the effect of financial reporting transparency in investment efficiency of Iranian firms has been investigated. In order to do this, 336 listed companies on Tehran Stock Exchange (TSE) has been selected for time period 2012 to 2015 as research sample. For testing our main hypothesis, we classified sample firms into two groups based on their deviation from expected investment: under-investment and over-investment cases. The results indicate that there is positive significant relationship between financial transparency and investment efficiency. In the other words, transparency can mitigate both underinvestment and overinvestment situations.

Keywords: corporate governance, disclosure, investment decisions, investment efficiency, transparency

Procedia PDF Downloads 336

Authors: Zain Khalid

Abstract:

The paper outlines the trends of cyber financial crimes and frauds – approximating upto – in Pakistan after the enactment of The Prevention of Electronic Crimes Act in 2016. The paper elaborates on the newer methods that fraudsters have adopted after tighter preventive and counter measures were employed in Pakistan partly as a result of following the international finance related commitments, particularly the FATF regulations. The paper adopts case studies methods to highlight various aspects of the financial frauds and crimes committed and later investigated jointly by Pakistan’s one of the federal law enforcement agencies, the Federal Investigation Agency, and Mobilink Microfinance Bank , Pakistan’s premier microfinance bank. It additionally enriches the data through expert interviews – with crime investigators and the experts to carry out an in-depth analysis of the various factors involving the crime. This paper emphasizes the structural and situational factors that shape up the cyber financial crimes in Pakistan vis-à-vis digital illiteracy and lack of awareness among the users of financial services. This paper, thus, on the basis of findings and expert interviews, suggests policy reforms to reduce the instances of the financial crimes, especially in the remotest areas of the country.

Keywords: financial crimes, cyber crimes, digital literacy, terrorism financing, banking sector

Procedia PDF Downloads 51

Authors: Huseyin Duran, Yesim Benal Oztekin, Kazim Kubilay Vursavus, Ilker Huseyin Celen

Abstract:

There are two main approaches to manufacturing, market and usage of plant protection machinery in Turkey. The first approach is called as ‘Product Safety Approach’ and could be summarized as minimum health and safety requirements of consumer needs on plant protection equipment and machinery products. The second approach is the practices related to the Plant Protection Equipment and Machinery Directive. Product safety approach covers the plant protection machinery product groups within the framework of a new approach directive, Machinery Safety Directive (2006/42 / AT). The new directive is in practice in our country by 03.03.2009, parallel to the revision of the EU Regulation on the Directive (03.03.2009 dated and numbered 27158 published in the Official Gazette). ‘Pesticide Application for Machines’ paragraph is added to the 2006/42 / EC Machinery Safety Directive, which is, in particular, reveals the importance of primary health care and product safety issue, explaining the safety requirements for machines used in the application of plant protection products. The Ministry of Science, Industry and Technology is the authorized organizations in our country for the publication and implementation of this regulation. There is a special regulation, carried out by Ministry of Food, Agriculture and Livestock General Directorate of Food and Control, on the manufacture and sale of plant protection machinery. This regulation, prepared based on 5996 Veterinary Services, Plant Health, Food and Feed Law, is ‘Regulation on Plant Protection Equipment and Machinery’ (published on 02.04.2011 whit number 27893 in the Official Gazette). The purposes of this regulation are practicing healthy and reliable crop production, the preparation, implementation and dissemination of the integrated pest management programs and projects for the development of human health and environmentally friendly pest control methods. This second regulation covers: approval, manufacturing, licensing of Plant Protection Equipment and Machinery; duties and responsibilities of the dealers; principles and procedures related to supply and control of the market. There are no inspection procedures for the application of currently used plant protection machinery in Turkey. In this study, content and application principles of all regulation approaches currently used in Turkey are summarized.

Keywords: plant protection equipment and machinery, product safety, market surveillance, inspection procedures

Procedia PDF Downloads 233

Authors: Lucy Novianti

Abstract:

The purpose of this study is to determine the effect of corporate governance, ownership structure, and cash holdings on firm value, either direct or indirect through profitability as an intervening variable for non-financial companies listed on the Indonesia Stock Exchange during 2006 to 2014. Samples of 176 firms are chosen based on purposive sampling method. The results of this study conclude that profitability, the size of Audit Committee, audit quality, and cash flow have positive effects on firm value. This study also shows that the meeting frequency of the Board of Directors and free cash flow have negative effects on firm value. In addition, this study finds that the size of the Board of Directors, Independent Commissioner, and ownership structure do not have significant effects on firm value. In this study, the function of profitability as an intervening variable can only be done on the impact of the meeting frequency of the Board of Directors and cash flow on firm value. This study provides a reference for management in decision making concerning the application of corporate governance, cash holdings, and financial performance. Moreover, it can be used as additional information for investors in assessing the feasibility of an investment. Finally, it provides a suggestion for the government regarding the regulation of corporate governance.

Keywords: cash holdings, corporate governance, firm value, ownership structure, profitability

Procedia PDF Downloads 223

Authors: Wael Bakhit, Salma Bakhit

Abstract:

This paper employs a quarterly time series to determine the timing of structural breaks for interest rates in USA over the last 60 years. The Chow test is used for investigating the non-stationary, where the date of the potential break is assumed to be known. Moreover, an empirical examination of the financial sector was made to check if it is positively related to deviations from an assumed interest rate as given in a standard Taylor rule. The empirical analysis is strengthened by analysing the rule from a historical perspective and a look at the effect of setting the interest rate by the central bank on financial imbalances. The empirical evidence indicates that deviation in monetary policy has a potential causal factor in the build-up of financial imbalances and the subsequent crisis where macro prudential intervention could have beneficial effect. Thus, our findings tend to support the view which states that the probable existence of central banks has been a source of global financial crisis since the past decade.

Keywords: Taylor rule, financial imbalances, central banks, econometrics

Procedia PDF Downloads 361

Authors: Luisa Unda, Kamran Ahmed, Paul Mather

Abstract:

We examine the effect of board characteristics on the performance and asset quality of credit unions in Australia, using a large sample covering the period 2004-2012. Credit unions are unique in that they are customer-owned financial institutions and directors are democratically elected by members, which is distinctly different from other financial institutions, such as commercial banks. We find that board remuneration, board expertise, and attendance at board meetings have significantly positive impacts on credit union performance and asset quality, while board members who hold multiple directorships (busy directors), have a significant negative impact on credit union performance. Financial performance also improves with larger boards and long-tenured directors in credit unions. All of these relations hold after we control for alternative measures of performance, credit union characteristics and endogeneity problem.

Keywords: credit unions, corporate governance, board of directors, financial performance, Australia, asset quality

Procedia PDF Downloads 469

Authors: Changju Lee, Seungmo Ku, Sondo Kim, Woojin Chang

Abstract:

How to detecting financial bubble? Addressing this simple question has been the focus of a vast amount of empirical research spanning almost half a century. However, financial bubble is hard to observe and varying over the time; there needs to be more research on this area. In this paper, we used abnormal difference between common stocks price and those preferred stocks price to explain financial bubble. First, we proposed the ‘W-index’ which indicates spread between common stocks and those preferred stocks in stock market. Second, to prove that this ‘W-index’ is valid for measuring financial bubble, we showed that there is an inverse relationship between this ‘W-index’ and S&P500 rate of return. Specifically, our hypothesis is that when ‘W-index’ is comparably higher than other periods, financial bubbles are added up in stock market and vice versa; according to our hypothesis, if investors made long term investments when ‘W-index’ is high, they would have negative rate of return; however, if investors made long term investments when ‘W-index’ is low, they would have positive rate of return. By comparing correlation values and adjusted R-squared values of between W-index and S&P500 return, VIX index and S&P500 return, and TED index and S&P500 return, we showed only W-index has significant relationship between S&P500 rate of return. In addition, we figured out how long investors should hold their investment position regard the effect of financial bubble. Using this W-index, investors could measure financial bubble in the market and invest with low risk.

Keywords: financial bubble detection, future return, forecasting, pairs trading, preferred stocks

Procedia PDF Downloads 335

Authors: Pepur Sandra, Bulog Ivana, Rimac Smiljanić Ana

Abstract:

During the COVID-19 pandemic, stress and family financial fragility arose worldwide. Economic and health uncertainty created new pressure on the everyday life of families. The work from home, homeschooling, and care of other family members caused an increase in unpaid work and generated a new division of intrahousehold. As many times before, women have taken the higher burden. This paper analyzes family stress and finance during the COVID-19 pandemic. We propose that women's inclusion in paid and unpaid work and their financial literacy influence family finances. We build up our assumptions according to the two theories that explain intrahousehold family decision-making: traditional and barging models. The traditional model assumes that partners specialize in their roles in line with time availability. Consequently, partners less engaged in payable working activities will spend more time on domestic activities and vice versa. According to the bargaining model, each individual has their preferences, and the one with more household bargaining power, e.g., higher income, higher level of education, better employment, or higher financial knowledge, is likely to make family decisions and avoid unpaid work. Our results are based on an anonymous and voluntary survey of 869 valid responses from women older than 18 conducted in Croatia at the beginning of 2021. We found that families who experienced delays in settling current obligations before the pandemic were in a worse financial situation during the pandemic. However, all families reported problems settling current obligations during pandemic times regardless of their financial condition before the crisis. Women from families with financial issues reported higher levels of family and personal stress during the pandemic. Furthermore, we provide evidence that more women's unpaid work negatively affects the family's financial fragility during the pandemic. In addition, in families where women have better financial literacy and are more financially independent, families cope better with finance before and during pandemics.

Keywords: family financial fragility, stress, unpaid work, women's financial literacy

Procedia PDF Downloads 41

Authors: Gladie Lui

Abstract:

The global credit crisis of 2008 aroused renewed interest in the effectiveness of corporate governance mechanisms to safeguard investor interests. In this paper, we measure the effect of the crisis from 2008 to 2009 on the stock performance of 976 Hong Kong-listed companies and examine its link to corporate governance mechanisms. It is evident that the crisis and the economic downturn affected different industries. Empirical results show that firms with an independent board and a high concentration of ownership and management ownership had lower abnormal stock returns, but a lower price volatility during the global financial crisis. These results highlight that no single corporate governance mechanism is fit for all types of financial crises and time frames. To strengthen investors’ confidence in the ability of companies to deal with such swift financial catastrophes, companies should enhance the dynamism and responsiveness of their governance mechanisms in times of turbulence.

Keywords: board of directors, capital market, corporate governance, financial crisis

Procedia PDF Downloads 403