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1 – 10 of 83Baba Adibura Seidu, Yaw Ndori Queku and Emmanuel Carsamer
This paper focused on financial constraints scenario and tax planning activities of banks in Ghana. The study explores how financial constraints could motivate the banks to pursue…
Abstract
Purpose
This paper focused on financial constraints scenario and tax planning activities of banks in Ghana. The study explores how financial constraints could motivate the banks to pursue tax planning mechanism and the implication on tax revenue mobilisation.
Design/methodology/approach
The paper followed generalised method of moments and fixed effect estimators to investigate the financial constrained-tax planning activity nexus. Simulation approach is adopted to provide financially constrained bank scenario. Besides contemporaneous analysis, sensitivity analysis is conducted to determine time varying effect. Data from all the 20 commercial banks which have operated from 2008 to 2018 were used.
Findings
The paper found that when banks are faced with financial constraints, they exhibit lower cash-effective-tax-rate. The decomposition analysis also revealed that financially constrained banks are likely to take on both short- and long-term tax planning opportunities. The paper also found evidence of persistence in the tax planning activities under financial constrained scenario.
Originality/value
This paper is one of the few studies which have extended the tax planning literature to the Ghanaian banking sector. Further novelty is seen from the development of financial constraint scenario from liquidity and solvency. Liquidity and solvency are the anchors for continuity of banking operation and sensitive to regulatory watch and sanctions. Therefore, by applying simulation approach to trigger financial constraints scenarios from these fundamental indicators reveals the extent to which commercial banks rely on tax planning opportunities to mitigate the consequence of financial constraints.
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Abongeh A. Tunyi, Geofry Areneke, Tanveer Hussain and Jacob Agyemang
This study proposes a novel measure for management’s horizon (short-termism or myopia vs long-termism or hyperopia) derived from easily obtainable firm-level accounting and stock…
Abstract
Purpose
This study proposes a novel measure for management’s horizon (short-termism or myopia vs long-termism or hyperopia) derived from easily obtainable firm-level accounting and stock market performance data. The authors use the measure to explore the impact of managements’ horizon on firms’ investment efficiency.
Design/methodology/approach
The authors rely on two commonly used but uncorrelated measures of management performance: accounting performance (return on capital employed, ROCE) and stock market performance (average abnormal return, AAR). The authors combine these measures to develop a multidimensional framework for performance, which classifies firms into four groups: efficient (high accounting and high market performance), poor (low accounting and low market performance), myopic (high accounting and low market performance) and hyperopic (low accounting and high market performance). The authors validate this framework and deploy it to explore the relationship between horizon and firms’ investment efficiency.
Findings
In validation tests, the authors show that management myopia (hyperopia) explains firms’ decision to cut (grow) research and development investments. Further, as expected, myopic (hyperopic) firms are associated with significantly more (less) accrual and real earnings management. The empirical tests on the link between horizon and investment efficiency suggest that myopic managers cut new investments while their hyperopic counterparts grow the same. Ultimately, the authors find that myopia (hyperopia) exacerbates(mitigates) the over-investment of free cash flow problem.
Originality/value
The authors introduce a framework for assessing management’s horizon using easily obtainable measures of performance. The framework explains inconsistencies in prior empirical research using different measures of performance (accounting versus market). The authors demonstrate its utility by showing that the measure explains decisions around research and development investment, earnings management and firm investments.
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Adele Irving, Jamie Harding and Oliver Moss
The adoption of a research-informed approach to teaching about homelessness has allowed the authors to provide diverse groups of learners with a range of traditional and more…
Abstract
The adoption of a research-informed approach to teaching about homelessness has allowed the authors to provide diverse groups of learners with a range of traditional and more embodied educative experiences, both inside and outside of the classroom. While conventional research methods and outputs have provided a useful starting point for learners with no or limited working knowledge of homelessness, innovative approaches to research and outputs – which have prioritised giving a voice to homeless people themselves – have been particularly important in developing the critical empathy of learners towards the subject. To ensure an effective relationship between research and teaching (particularly when teaching those who work in the homelessness sector), the authors needed a good understanding of the prior learning and experiences, roles, operating contexts and needs of their learners, to teach from a position of empathy, and to work collaboratively with learners to further understanding.
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Muhammad Hafeez, Ida Yasin, Dahlia Zawawi, Shoirahon Odilova and Hussein Ahmad Bataineh
This study aims to investigate the effect of organizational ambidexterity (OA) and organizational green culture (OGC) on corporate sustainability (CS) while incorporating the…
Abstract
Purpose
This study aims to investigate the effect of organizational ambidexterity (OA) and organizational green culture (OGC) on corporate sustainability (CS) while incorporating the mediating role of green innovation (GI) to provide a detailed insight into CS. The study also presents a research framework based on the Organizational Ambidexterity theory and Natural Resource-based view to explain the factors contributing to CS.
Design/methodology/approach
Using stratified sampling, the study collected data through survey-based empirical research from 307 textile companies registered with the Securities and Exchange Commission of Pakistan (SECP) or the All-Pakistan Textile Mills Association (APTMA). The collected data were analysed using path analysis, mediation analysis and moderation analysis through smart PLS-SEM version 4.0 to assess the composition and causal association of factors.
Findings
The study found a significant relationship between OA and OGC with CS. Furthermore, the study revealed that green innovation partially mediates the relationship between OGC and CS. The proposed research framework can be valuable for promoting and recommending actions to enhance CS.
Research limitations/implications
The study on CS in the textile sector of Pakistan has limitations such as a narrow focus, cross-sectional design and reliance on self-reported data. Future research should explore additional factors, conduct longitudinal research, investigate contextual factors, scrutinize specific green innovation practices and broaden the scope of the study to include SMEs and other textile organizations.
Practical implications
The research framework can help senior executives to foster CS by promoting OGC, OA and GI. Practitioners and academicians can also utilize or further investigate the proposed framework for validation and to foster CS.
Originality/value
This study fills gaps in the existing literature by investigating the mediating effect of GI between OGC and CS. The proposed research framework provides a comprehensive understanding of the factors contributing to CS based on the Organizational Ambidexterity theory and Natural Resource-based view.
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Joel O. Powell and Rylan Fitzpatrick
Viral videos of police violence create demands for new police narratives about using force. Public reactions to videos lead spokespeople to provide justifications that support…
Abstract
Viral videos of police violence create demands for new police narratives about using force. Public reactions to videos lead spokespeople to provide justifications that support narrative structures of the necessity and inevitability of police violence. Ultimately, video is presented as lacking context and credibility when it is viewed unaccompanied by police explanations.
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This chapter examines the concepts of race and racism, critically reviewing their historical and contemporary applications in everyday life as well as in academic and policy…
Abstract
This chapter examines the concepts of race and racism, critically reviewing their historical and contemporary applications in everyday life as well as in academic and policy debates. Racism has been extensively researched, with various theories and conceptualisations developed across social science. However, there is a great deal of disagreement regarding its nature, contemporary significance and empirical validation. This chapter examines these and attempts to synthesise some of the common definitions of racism provided in the literature. It explores related concepts and underlying themes pertaining to expressions of race and racism. Furthermore, it unpacks current knowledge about racial issues and discusses recent advances in the conceptual understanding of various forms of racism. It also elucidates the social, political and analytical applications of racism as a concept and the significance of racism in contemporary societies. The chapter concludes by highlighting how racism is a dynamic phenomenon, continuously evolving with the social, political and technological transformations in contemporary societies.
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Nermine Medhioub and Saoussen Boujelbene
This study examines the association between corporate tax avoidance and the cost of debt (COD). It also investigates the moderating effect of integrated report (IR) assurance on…
Abstract
Purpose
This study examines the association between corporate tax avoidance and the cost of debt (COD). It also investigates the moderating effect of integrated report (IR) assurance on tax avoidance/COD relationship.
Design/methodology/approach
Based on a sample of 76 South African companies listed on the Johannesburg Stock Exchange (JSE) from 2010 to 2020, the authors built and estimated regression models using the feasible generalized least squares (FGLS) method. The authors significantly mitigated the endogeneity concerns using propensity score matching (PSM), difference-in-differences (DID) analysis and fixed effects regression.
Findings
The authors found that tax-avoiding firms pay higher costs of debt due to information asymmetries and agency problems. Bankers systematically reflect the increase in tax avoidance by adjusting the COD upward. However, results show that the assured IR disclosure mitigates these problems, which decreases the COD for tax avoidance strategies adopters. Using a quasi-natural experiment, well-grounded evidence was provided showing that the decrease in the COD for debtors who engage in tax avoidance practices is attributed to the availability of an assured IR.
Practical implications
This study provides plausible evidence in favor of the role that an assured IR can play in capital allocation decisions. Consequently, it is likely to push policymakers in South Africa and other countries to set standards for IR assurance.
Originality/value
This is the first study that investigates and validates the role of IR assurance in solving the controversy about the “tax saving effect” vs. “risk exposure effect” that bankers face while identifying debtors with successful (non-risky/cash-saving) tax avoidance practices and those with non-successful (risky) ones.
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Hoyoung Kim and Maretno Agus Harjoto
This study examines the relationship between economic policy uncertainty (EPU) and managers' ex ante strategic choice on firms’ fixed and variable costs structure, i.e. cost…
Abstract
Purpose
This study examines the relationship between economic policy uncertainty (EPU) and managers' ex ante strategic choice on firms’ fixed and variable costs structure, i.e. cost rigidity and the moderating effect of government contracts and political connections.
Design/methodology/approach
Using a sample of 4,162 US firms during 2003–2019 and EPU measure from Baker et al. (2016), the authors examine the association between EPU and cost rigidity using multivariate regression analysis. The authors also examine the moderating effects of government customers and political connections using the subsampling method.
Findings
This study finds that increases in EPU leads to higher cost rigidity, suggesting that managers tend to look ahead and make an ex ante commitment to invest more in fixed costs to avoid congestion costs in anticipation of future product demand during EPU. The study also finds that the presence of government customers and political connections moderates the need for adopting greater cost rigidity.
Research limitations/implications
This study measures firms' cost rigidity based on archival data. Future studies could utilize managers' cost structure choices using firms' internal management cost structure forecasts data to measure cost rigidity to examine the relationship between cost rigidity and EPU.
Practical implications
This study demonstrates that managers tend to make a proactive commitment to invest in fixed inputs when facing demand uncertainty from EPU to avoid congestion costs. This study also highlights the value of having government contracts and political connections by demonstrating that managers are less concerned about the congestion costs, hence weakening the impact of EPU on cost rigidity when they have government as major customers and/or political connections.
Originality/value
This study extends the management accounting literature by documenting that cost rigidity is related to EPU and that the relationship between cost rigidity and EPU also depends on whether the firm has government as major customers and/or political connections or not.
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Karren Lee-Hwei Khaw, Hamdan Amer Ali Al-Jaifi and Rozaimah Zainudin
This study aims to revisit the relationship between Shariah-compliant firms and earnings management. Specifically, the authors examine whether Shariah-certified firms have lower…
Abstract
Purpose
This study aims to revisit the relationship between Shariah-compliant firms and earnings management. Specifically, the authors examine whether Shariah-certified firms have lower earnings management than non-Shariah-certified firms and how often a firm must hold its certification to observe considerably reduced earnings management. This study also explores how senior management ethnic dualism affects the association of Shariah certification and earnings management.
Design/methodology/approach
The authors analyze the hypothesized association between Shariah certification and earnings management using a panel regression model and several robustness tests, including the Heckman selection model. The sample consists of 547 nonfinancial firms listed on the Bursa Malaysia stock exchange, with 5,478 firm-year observations over the 2001–2016 sample period.
Findings
Shariah certification is found to mitigate earnings management, particularly for firms that consistently retain their Shariah status. The longer firms retain their Shariah certification continually, the lower the earnings management. Additionally, the results indicate that the negative impact of Shariah certification on earnings management is driven by ethnic duality when a specific ethnic group dominates the top management.
Research limitations/implications
Firms’ commitment to religious-based screening and continuation of certification plays a significant role in improving earnings quality. Firms are committed to abiding by the Shariah code of conduct instead of using the Shariah status for reputation purposes to attract investors.
Practical implications
For investors, the continuous compliance status is a crucial indicator of a firm’s commitment to comply with Shariah principles and to mitigate earnings management. Regarding policy implications, Shariah-compliance guidelines can constrain earnings manipulation, especially among firms lacking ethnic diversity.
Originality/value
The study shows that Shariah certification must be maintained consecutively to reduce earnings management. Shariah certification’s governance function is crucial in ethnically homogeneous firms, primarily when one ethnic group dominates the senior management.
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