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Privately financed infrastructure projects commonly use a project finance structure. Project finance is expected to facilitate investment flow in risky environments. The objective of this paper examines the link between the use of project finance and investments in risky environments.

Project Finance International database has been used as the data source for this study. 3,372 transactions from power, oil and gas, transportation, telecommunication, and water supply sectors have been considered means analysis and multi-variate regression models have been used in the analysis.

The average project cost in a developing country was higher than that of developed countries. Gearing ratio, however, was higher in the developed countries. This indicated that the projects had a lower level of inherent risk, which enabled them to get funded at high gearing levels. The proportion of foreign banks in the syndicate was higher in the developing countries, which indicated that the use of project finance has helped to attract investment from foreign investors.

Practitioners and project development companies in the developing countries should actively consider using project financing technique for achieving financial closure of large infrastructure projects. Simultaneously, policy makers should create appropriate supporting institutional framework (regulatory, legal, contractual arrangements) that supports the use of project finance.

As far as the authors know, this study uses a dataset that has not been used in the previous studies. The results of this paper strengthen the understanding of project financing.

This paper examines the inter‐relationship between profitability, cost of capital and capital structure among property developers and contractors in Hong Kong. Whilst major indigenous local developers are among the largest and the most profitable in the world, their contractor counterparts are generally small and nowhere near as profitable. An analysis of financial data suggests that gearing is generally higher among contractors than developers. However, it does not mean that contractors borrow more than developers. Indeed they do not need to borrow as much as developers even if they have the assets to pledge as collateral. Contractors do not have to pay for high land costs, and they obtain project finance from developers through interim payments in lump sum contracts that are widely adopted in the industry. Their high gearing reflects more their low equity base than high level of debts. Their costs of equities are about double the developers’, probably due to their usually low or negative profit margins. This conclusion is substantiated by further regression analysis of the data. The findings indicate that capital gearing is positively related with asset but negatively with profit margins. This article concludes with a discussion on implications of such profitability divide between the two sectors on the unequal relationship between developers and contractors, and on their competitiveness.

Outlines the UK law on insovency and asks whether the financial ratios banks use to assess credit worthiness can discriminate between the companies placed in administrative receivership (AR) by their lending banks which can or cannot be rescued. Applies both linear discriminant analysis and logistic regression to samples of UK companies placed into AR in 1998, explains the methodology and shows broadly similar results from the two methods; and a predictive accuracy of 85‐90 per cent for the rescued companies and 55‐60 per cent for the failures. Analyses the key ratios for survival in more detail, looking at debtor turnover, the gearing ratio and the current ratio. Recogises the limitations of the study but sees it as a promising approach to predicting survivability.

Outlines trends in UK personal bankruptcies and relevant research; and explores the reasons for their dramatic rise since 1990. Explains the process of econometric analysis used to interpet the statistics and presents the results, which support the argument that higher indebtedness leads to more bankruptcies, either through higher gearing or declining credit standards. Finds that both unemployment and real disposable income affect the bankruptcies ratio in the short run, but the effect of interest rates is smaller. Briefly considers the implications of the findings.

The purpose of this paper is to explore the levels and determinants of net asset value (NAV) premiums/discounts for publicly traded Australian Real Estate Investment Trust (A-REIT) market during the last decade. A-REITs were severely affected by the global financial crisis as S&P/ASX 200 A-REIT index-listed property stocks experienced 47 per cent discount to NAV, on average, in 2008–2009 crisis. Since 2013, A-REIT sector has exhibited a strong recovery from the financial crisis and traded at high premiums to date. Understanding the relationship between pricing in the public and private real estate markets has taken on great importance as A-REITs continue to trade at significant premium to NAV unlike their counterparts in the USA and Europe.

This paper follows a rational approach to explain variations in NAV premiums and explores the company-specific factors such as liquidity, financial leverage, size, stock price volatility and portfolio diversification behind the A-REIT NAV premiums/discounts. The study specifies and estimates a model of cross-sectional and time variation in premiums/discounts to NAV using semi-annual data for a sample of 40 A-REITs over the 2008–2018 period.

The results reveal that A-REIT premiums to NAV can be explained not only by the liquidity benefit of listed property stocks but also positive financial leverage effect. During the past decade, A-REITs have followed an aggressive approach in financing their growth by using borrowed funds to purchase assets as the income from the property offsets the cost of borrowing and the risk that accompanies it. Debt-to-equity ratio has to be considered as an important source of NAV premiums as highly geared A-REITs that favoured debt financing over equity financing traded at significant premiums to NAV of their underlying real estate assets.

The paper includes implications for the REIT market investors. The regression analysis shows that specialty A-REITs with a focus on creative market niches traded at higher premiums compared with other property stocks, especially in the post-GFC recovery period. Specialty REITs are more highly valued by the market than their traditional specialised counterparts (e.g. office and retail REITs), and those pursuing a diversified strategy.

This paper presents an Australian case study as the A-REIT market provides a suitable environment for testing the effect of financial gearing on the REIT premium to NAV. The study provides empirical evidence supporting the importance of debt-to-equity ratio in explaining the variation in A-REIT NAV premiums.

Outlines the rapid growth of “new economy” companies in Australia and compares their levels of earnings management with “old economy” firms, using data on all Australian listed companies. Reviews the relevant research, explains the methodology and presents the results. Shows that the old economy firms do engage in significant earnings management which is positively associated with leverage and free cash flow levels but, surprisingly, that this is far less evident in the new economic sector. Considers consistency with other research, the underlying reasons for the findings (including regulatory constraints) and opportunities for further research.

The article seeks to evaluate the capital structure of leading hotel chains of India to examine the role of financing decision in the overall performance of companies. It aims to analyze the debt‐equity structure of these hotels, try to discover the industry benchmark and scrutinize how capital structure plays a momentous role in the company's overall growth.

The paper is based on financial data collected on leading hotel chains in India. The consolidated financial results of the hotels have been considered for selecting these hotel companies.

From the financial perspective, capital structure is one of the most important determinants of a company's sustainable growth. Leverage seems to be working only for a few companies, whilst affecting others negatively. Firms that have been moderately geared have been able to generate a good return on equity.

The paper would be of specific use for top and middle level management of the selected hotel chains to reassess their capital structure for enhanced financial performance. For the hospitality industry in general, it would divulge best financial practices in terms of debt‐equity mix and would assist in fixing on better financing decisions.

The findings of the research are pertinent for the industry, as no explicit study in this area has been conducted in the Indian context. More so, because it focuses on the high turnover segment of the industry which captures the major market share in the business, it would beg the question – “Does being big always mean being better?”

The paper aims to explore the impact of the transition to International Financial Reporting Standards (IFRS) on Greek listed companies' financial statements with a focus on net profit, shareholders' equity, gearing and liquidity. It also seeks to examine any differences in the impact across the sub‐samples of companies with Big 4 and non‐Big 4 auditors.

In line with recent literature, the paper employs Gray's comparability index. The sample consists of 238 Greek companies, representing 75 per cent of the companies listed on the Athens Stock Exchange at the end of March 2006.

Implementation of IFRS had a significant impact on financial position and reported performance as well as on gearing and liquidity ratios. On average, impact on shareholders' equity and net income was positive while impact on gearing and liquidity was negative. Only companies with non‐Big 4 auditors faced significant impact on net profit and liquidity. They also faced a significantly greater impact on gearing than companies with Big 4 auditors. A large number of companies with material negative changes is identified, suggesting that transition to IFRS and the fair value option does not necessarily result in higher shareholders' equity figures. Many companies provided inadequate transitional disclosures. This is significantly related to auditor size.

The findings suggest that reporting quality has improved under the new accounting regime, especially for companies with non‐Big 4 auditors.

Prior literature indicates that the impact revealed in companies' reconciliation statements can have significant effects on users' decision making. On that basis, the study can stimulate future research and is relevant to standard setters and regulators.

This paper examines the lobbying behaviour of UK managers who commented on Accounting Standard Board proposals to re‐introduce full provision deferred taxation accounting. Although there were no direct cash‐flow implications associated with these proposals, they had the potential to affect a company’s reported net income and revenue reserves. Using published comments and financial statements data, the paper tests: (a) the conventional positive accounting theory gearing hypothesis, using debt/equity ratios and (b) a new dividend hypothesis that is presented in the paper. The findings did not provide support for the gearing hypothesis and are therefore consistent with recent work of various other authors. However, the new dividend hypothesis was supported and the paper therefore suggests that the potential impact that an accounting treatment has on the revenue reserves of a company, and thus its dividend paying capacity, is a plausible reason for observed lobbying behaviour in the UK.

CURRENT HELICOPTER MAIN TRANSMISSION SYSTEMS must reduce the gas‐turbine engine speed by a typical ratio of 80:1 to drive the main rotor. Existing technology dictates that this ratio is achieved in 3 or 4 stages of gearing, where each stage is either an epicyclic gear assembly, a spiral bevel gear pair or a helical gear pair. Gear tooth reaction forces can be as high as 20,000lbf (90kN) both axially and radially, so large gears and as many as 3 heavy duty rolling elements bearings per gear shaft are required. Transmission systems thus typically account for 10 per cent of all‐up‐weight, the main gearbox taking up 75 per cent of this and the bearings accounting for 20 per cent of the gearbox weight. Scheduled overhaul periods are seldom more than 1,000 flying hr due partly to the likelihood of rolling element bearing fatigue failure and many require overhaul before this time is reached. Thus the research effort on transmission systems, and specifically on gearboxes, is directed in general terms towards achieving:—