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Article
Publication date: 3 June 2021

Zukaa Mardnly, Zinab Badran and Sulaiman Mouselli

The purpose of this study is to examine the individual and combined effect of managerial ownership and external audit quality, as two control mechanisms, on earnings management.

Abstract

Purpose

The purpose of this study is to examine the individual and combined effect of managerial ownership and external audit quality, as two control mechanisms, on earnings management.

Design/methodology/approach

This study applies ordinary least squares estimates on fixed-time effects panel regression model to test the impact of the investigated variables on earnings management for the whole population of banks and insurance companies listed at Damascus Securities Exchange (DSE) during the period from 2011 to 2018.

Findings

The empirical evidence suggests a negative non-linear relationship between managerial ownership (as proxied by board of directors’ ownership) on earnings management. However, neither audit quality nor the simultaneous effect of the managerial ownership and audit quality (Big 4) affects earnings management.

Research limitations/implications

DSE is dominated by the financial sector and the number of observations is constrained by the recent establishment of DSE and the small number of firms listed at DSE. In addition, the non-availability of data on executive directors’ and foreign ownerships restrict our ability to uncover the impact of different dimensions of ownership structure on earnings management.

Practical implications

First, it stimulates investors to purchase stocks in financial firms that enjoy both high managerial ownership, as they seem enjoying higher earnings quality. Second, the findings encourage external auditors to consider the ownership structure when choosing their clients as the financial statements’ quality is affected by this structure. Third, researchers may need to consider the role of managerial ownership when analyzing the determinants of earnings management.

Originality/value

It fills the gap in the literature, as it investigates the impact of both managerial ownership and audit quality on earnings management in a special conflict context and in an unexplored emerging market of DSE. It suggests that managerial ownership exerts a significant role in controlling earnings management practices when loose regulatory environment combines conflict conditions. However, external audit quality fails to counter earnings management practices when conditions are fierce.

Details

Journal of Financial Reporting and Accounting, vol. 19 no. 5
Type: Research Article
ISSN: 1985-2517

Keywords

Article
Publication date: 30 May 2018

Zukaa Mardnly, Sulaiman Mouselli and Riad Abdulraouf

This study aims to examine the impact of aggregate and individual corporate governance provisions on firm performance on all firms listed at Damascus Securities Exchange (DSE) for…

3893

Abstract

Purpose

This study aims to examine the impact of aggregate and individual corporate governance provisions on firm performance on all firms listed at Damascus Securities Exchange (DSE) for the period between 2011 and 2015. In addition, it disentangles ownership structure provision to ownership concentration and foreign ownership and investigates which component of ownership structure stands behind the significance of ownership structure in explaining firm performance.

Design/methodology/approach

The study uses multiple linear regression models to analyze the relationship between aggregate corporate governance index and its provisions and firm performance. A corporate governance index is built on the basis of four mechanics (i.e. board of directors, audit, disclosure and ownership structure) for all firms listed at DSE. On the other hand, the dependent variable (firm performance) is measured using Earnings Per Share (EPS) and Return On Assets (ROA). The authors capture current war conditions using political stability and absence of violence indicator, one of Worldwide Governance Indicators accumulated by the World bank.

Findings

This study finds that ownership structure is the only significant corporate governance provision in determining Syrian firms’ performance, as it loads positively and significantly on firm performance proxies (ROA and EPS). Moreover, the analysis of ownership structure items shows that foreign ownership is the main source of this positive and significant impact. This result is robust for both measures of firm performance and in the presence of political stability indicator.

Originality/value

This paper provides evidence on corporate governance measures from Syrian Arab Republic, a developing country with an emerging stock exchange. It examines board structure, ownership structure, audit committee and disclosure in a period of crisis because of the war in this country. Moreover, it uncovers that foreign ownership is the only influential provision affecting firm performance at DSE. Furthermore, it combines firm-level governance indicators with country governance indicator of political stability and absence of violence.

Details

International Journal of Islamic and Middle Eastern Finance and Management, vol. 11 no. 4
Type: Research Article
ISSN: 1753-8394

Keywords

Article
Publication date: 14 November 2023

Masah Alomari and Ibrahim Aladi

Financial inclusion is considered one of the strategic tools for sustainable development and one of the types of corporate social responsibility disclosures. This study aims to…

Abstract

Purpose

Financial inclusion is considered one of the strategic tools for sustainable development and one of the types of corporate social responsibility disclosures. This study aims to focus on the association between the disclosure of financial inclusion activities and Syrian banking companies’ performance.

Design/methodology/approach

Different regression models were suggested to examine the hypotheses leading to a better understanding of the relationship between financial inclusion and Syrian banking performance for the period 2005 to 2020 using the STATA 17.

Findings

The results showed a positive association between financial inclusion disclosure and Syrian bank performance, with low participation in financial inclusion activities (8%).

Research limitations/implications

The study recommends that the Central Bank of Syria work on developing an index of financial inclusion for the Syrian environment, with the issuance of legislation and laws that obligate all listed banks to disclose their financial inclusion activities as a part of their social responsibility.

Originality/value

This study incorporates the relationship between the disclosure of financial inclusion activities and the performance of Syrian banking companies, which has been neglected by most studies on financial inclusion. Therefore, this study sheds light on this positive relationship, which could have important repercussions in reviving the deteriorating Syrian economy following the crisis it went through, which, in turn, led to Syria’s high inflation affecting the poor and vulnerable disproportionately.

Details

Journal of Financial Economic Policy, vol. 16 no. 1
Type: Research Article
ISSN: 1757-6385

Keywords

Article
Publication date: 12 November 2021

Albert Ochien’g Abang’a, Venancio Tauringana, David Wang’ombe and Laura Obwona Achiro

This paper aims to report the results of an investigation into the effect of aggregate and individual corporate governance factors on the financial performance of state-owned…

2533

Abstract

Purpose

This paper aims to report the results of an investigation into the effect of aggregate and individual corporate governance factors on the financial performance of state-owned enterprises (SOEs) in Kenya.

Design/methodology/approach

The paper uses balanced panel data regression analysis on a sample of 45 SOEs in Kenya for a four-year period (2015–2018).

Findings

The panel data analysis results show that board meetings, board skill and gender diversity individual provisions of corporate governance are significantly and positively associated with capital budget realization ratio (CBRR). Moreover, the study finds that aggregate corporate governance disclosure index, board sub-committees, board size and independent non-executive directors are positive but insignificantly related to CBRR.

Research limitations/implications

The current study is based on secondary data, other methods of knowledge inquiry such as interviews and questionnaires may provide additional insights on the effectiveness of corporate governance on financial performance.

Practical implications

Overall, the results imply that corporate governance influences the performance of SOEs in Kenya. The results suggest that Mwongozo Code of Corporate Governance provisions should be changed to increase the number of women representations on board and the number of directors with doctoral qualifications because of their positive impact on the financial performance of SOEs in Kenya. Also, policymakers with remit over SOEs should re-evaluate why other corporate governance appear not to have an impact with a view of making the necessary changes.

Originality/value

The paper contributes to the dearth of literature on the efficacy of corporate governance on the financial performance of SOEs in developing countries.

Details

Corporate Governance: The International Journal of Business in Society, vol. 22 no. 4
Type: Research Article
ISSN: 1472-0701

Keywords

Article
Publication date: 8 April 2020

Hesham I. Almujamed and Mishari M. Alfraih

This paper aims to explore how the characteristics of the board of directors (BoD) shape earnings and book value information available to market participants.

Abstract

Purpose

This paper aims to explore how the characteristics of the board of directors (BoD) shape earnings and book value information available to market participants.

Design/methodology/approach

The authors investigated the impact of board size, presence of non-executives and role duality as proxies of effective corporate governance on the value relevance of financial reporting for 178 firms on the Kuwait stock exchange in 2013. Regression analysis based on Ohlson’s (1995) valuation model was used to test hypotheses.

Findings

The authors found that board size was significantly associated with company value and that Kuwaiti firms with large boards increased the value-relevance of earnings and book value. The influence of role duality was positive although not significant. The presence of non-executives on the board had a negative correlation with market value (not significant).

Research limitations/implications

These findings deliver empirical support for the prediction that the characteristics of the BoD improve the value relevance of financial reporting. Limitations such as small sample size and one-year duration of the study did not negate the basic findings, however. Future studies will use larger samples, longer duration and additional board characteristics.

Practical implications

This study provides empirical support for the hypothesis that board size influences market valuation. This study may benefit managers, investors and other decision-makers.

Originality/value

This study delivers empirical evidence on the impact of board characteristics on the value relevance of accounting information. It will be useful for regulators and market participants monitoring the influence of board characteristics on the value relevance of accounting information.

Details

International Journal of Ethics and Systems, vol. 36 no. 2
Type: Research Article
ISSN: 2514-9369

Keywords

Article
Publication date: 21 June 2021

Abdelkader Derbali, Kamel Naoui and Lamia Jamel

The purpose of this paper is to examine empirically the impact of COVID-19 pandemic news in USA and in China on the dynamic conditional correlation between Bitcoin and Gold.

Abstract

Purpose

The purpose of this paper is to examine empirically the impact of COVID-19 pandemic news in USA and in China on the dynamic conditional correlation between Bitcoin and Gold.

Design/methodology/approach

This paper offers a crucial viewpoint to the predictive capacity of COVID-19 surprises and production pronouncements for the dynamic conditional correlation (DCC) among Bitcoin and Gold returns and volatilities using generalized autoregressive conditional heteroskedasticity-DCC-(1,1) through the period of study since July 1, 2019 to June 30, 2020. To assess the unexpected impact of COVID-19, this study pursues the Kuttner’s (2001) methodology.

Findings

The empirical findings indicate strong important correlation among Bitcoin and Gold if COVID-19 surprises are integrated in variance. This study validates the financialization hypothesis of Bitcoin and Gold. The correlation between Bitcoin and Gold begin to react significantly further in the case of COVID-19 surprises in USA than those in China.

Originality/value

This paper contributes to the literature on assessing the impact of COVID-19 confirmed cases surprises on the correlation between Bitcoin and Gold. This paper gives for the first time an approach to capture the COVID-19 surprise component. Also, this study helps to improve financial backers and policymakers' comprehension of the digital currencies' market elements, particularly in the hours of amazingly unpleasant and inconspicuous occasions.

Details

Pacific Accounting Review, vol. 33 no. 5
Type: Research Article
ISSN: 0114-0582

Keywords

Article
Publication date: 3 June 2022

Omar Ikbal Tawfik, Hamada Elsaid Elmaasrawy and Khaldoon Albitar

This study aims to investigate the relationship between political connections, financing decisions and cash holding.

Abstract

Purpose

This study aims to investigate the relationship between political connections, financing decisions and cash holding.

Design/methodology/approach

Based on historical data from 181 active non-financial firms listed on Gulf Cooperation Council (GCC) Stock Exchange Markets during the period of 2009–2016, this study uses ordinary least squares and dynamic system-generalized method of moments to test the research hypotheses. The final data set comprises a total of 1,448 firm-year observations from ten major non-financial industry classifications.

Findings

This study finds a positive relationship between political connections and each of internal financing proxied by retained earnings ratio and external financing proxied by short- and long-term debt to total asset. The findings also show a positive relationship between political connections and cash holding.

Practical implications

The findings of the study provide a better understanding of the role of politically connected directors in financing decisions and cash holding in the GCC. Investors can consider the presence of royal family members in the board of directors when making investment decision. Policymakers are encouraged to develop more effective policies that encourage listed firms to provide information on the political positions of the board of directors, managers and major shareholders/owners of companies.

Originality/value

This study contributes to the literature by providing empirical evidence on the relationship between political connections and financing decisions by focusing on the GCC region. This study also highlights that boards in connected firms in the GCC have lower monitoring role owing to political interventions, and that connected firms face higher agency problems as they have weak governance and boards compared with non-connected firms.

Details

Journal of Financial Reporting and Accounting, vol. ahead-of-print no. ahead-of-print
Type: Research Article
ISSN: 1985-2517

Keywords

Article
Publication date: 16 March 2022

Mahdi Salehi and Fatemeh Norouzi

This study aims to assess the effect of corporate lobbying power on fraud and money laundering in listed firms on the Tehran Stock Exchange. For the study, the information of 173…

Abstract

Purpose

This study aims to assess the effect of corporate lobbying power on fraud and money laundering in listed firms on the Tehran Stock Exchange. For the study, the information of 173 firms is assessed during 2013–2020, and a total number of 1,384 year-companies are analysed.

Design/methodology/approach

In this paper, the Beneish model is used for fraud detection, and the clause of the auditor’s report on money laundering is used for the variable of money laundering. The multivariate regression, Logistic regression, the fixed effects of panel data, additional random effects tests, Hausman, least generalised squares and T + 1 are used by using the Stata Software.

Findings

The obtained results indicate a direct and significant relationship between lobbying and fraud and lobbying and money laundering. Suppose the board members of firms are among the parliament members or the government cabinet (politicians) and/or major shareholders affiliated with state-owned and/or quasi-governmental institutions. In that case, the likelihood of corporate lobbying will be increased.

Originality/value

The outcomes of the current study give great insight to developing countries due to the high volume of money laundering to reduce such a financial crime.

Details

Journal of Money Laundering Control, vol. 26 no. 3
Type: Research Article
ISSN: 1368-5201

Keywords

Article
Publication date: 1 April 2014

Ali Bassam Mahmoud and William D. Reisel

This paper aims at investigating the relationships among patient satisfaction, and nurses' job security, job satisfaction, and obedience OCBs within the setting of private…

2962

Abstract

Purpose

This paper aims at investigating the relationships among patient satisfaction, and nurses' job security, job satisfaction, and obedience OCBs within the setting of private hospitals in Damascus and Rural Damascus Governorates.

Design/methodology/approach

A cross-sectional survey conducted within private hospitals in Damascus and Rural Damascus Governorates had resulted in (325) subjects of nurses, and (393) subjects of patients. Double-translation, face validation, exploratory factor analysis, and Cronbach's alpha were used to validate measures used in this study with respect to the Syrian context. Afterwards, the two samples were aggregated on the basis of hospital-department. That is, 217 cases had resulted, and were used to test the proposed model, and revise it if required.

Findings

The results indicate that job security positively influences both job satisfaction and obedience OCBs. Both job satisfaction and obedience OCBs fully mediate the relationship between job security and patient satisfaction. Obedience OCBs partially mediate the relationship between job satisfaction and patient satisfaction.

Research limitations/implications

Further investigations in other service-providing settings (e.g. telecommunications) are needed for more evidence of the model validity. Using cross-sectional design in testing causalities has been criticized by several researchers, so longitudinal method is recommended in further investigations for the model. Wider views could be delivered if more of other attitudinal variables are included in the model.

Practical implications

Better levels of patient satisfaction could be achieved through enhancing nurses' perceptions towards job security. Job satisfaction would be an important factor in keeping positive levels of patient satisfaction, especially when employment at one private hospital lacks security and stability.

Originality/value

This research comes to be one of the first studies to provide evidence of the full mediation that job satisfaction and obedience OCBs play regarding the relationship between job security and patient satisfaction. In addition, this study proves the partial mediation that obedience OCBs play between job satisfaction and patient satisfaction.

Details

International Journal of Pharmaceutical and Healthcare Marketing, vol. 8 no. 1
Type: Research Article
ISSN: 1750-6123

Keywords

Expert briefing
Publication date: 11 September 2023

The demonstrations were triggered by Assad’s mid-August announcement of big fuel price increases, only partly mitigated by rises in salaries and pensions. However, they have been…

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