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Book part
Publication date: 17 July 2014

Norasmila Awang and Azlan Amran

Tax compliance involves complying with the tax rules and regulation, which encompasses the filing, reporting and payment of tax. The two aspects of tax non-compliance are…

Abstract

Purpose

Tax compliance involves complying with the tax rules and regulation, which encompasses the filing, reporting and payment of tax. The two aspects of tax non-compliance are tax evasion and tax avoidance. While the ethicality of tax evasion as an illegal act of reducing tax is clear, the consensus regarding the morality of tax avoidance as a legal act of minimizing tax is mixed. This chapter will discuss the ethical perspective of tax (non)compliance.

Design/methodology/approach

We approach this topic by discussing the two important terms of tax non-compliance namely tax evasion and tax avoidance from the ethical point of view. The tax evasion and tax avoidance were critically evaluated to justify whether it is ethical or not. The tax non-compliance is also associated to the corporate governance which if do effectively help to protect the interest of larger stakeholder.

Findings

In a nutshell, tax non-compliance such as tax avoidance and tax evasion is unethical act and these acts of non-compliance go against the spirit of contemporary corporate governance which sought to protect the interest of the stakeholders.

Research limitations/implications

Tax non-compliance could enhance shareholders wealth (in terms of reduced tax); it affects the distribution of wealth (public benefits financed by tax revenues) among the society at large as another stakeholder affected by such act. Future research may be conduct to investigate this to the larger sample.

Social implications

Firms should avoid engaging in non-compliance activities such as engaging in tax evasion and aggressive tax avoidance as part of its social obligation to the society in line with the spirit espoused in the contemporary corporate governance.

Originality/value

This paper argues that tax non-compliance is unethical and highlights the importance of having efficient corporate governance for larger stakeholder’s interest.

Details

Ethics, Governance and Corporate Crime: Challenges and Consequences
Type: Book
ISBN: 978-1-78350-674-3

Keywords

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Article
Publication date: 31 July 2021

Ainul Huda Jamil, Zuraidah Mohd Sanusi, Najihah Marha Yaacob, Yusarina Mat Isa and Tarjo Tarjo

The purpose of this paper is to provide a conceptual discussion and analysis of the Covid-19 impact on financial crime and regulatory compliance. The analysis is conducted…

Abstract

Purpose

The purpose of this paper is to provide a conceptual discussion and analysis of the Covid-19 impact on financial crime and regulatory compliance. The analysis is conducted to make a comparison of the financial crime and regulatory compliance patterns before and after the Covid-19 pandemic occurred.

Design/methodology/approach

This paper contextualises the impact of Covid-19 on financial crime and regulatory compliance. Moreover, this paper explores different ways of conceptualising the Covid-19 impacts in terms of financial crimes and regulatory compliance patterns based on the surveys by PricewaterhouseCoopers and Deloitte.

Findings

The Covid-19 pandemic has brought both challenges and opportunities to financial crime and regulatory compliance. In the aspects of financial crime patterns, this study found a reduction in physical crime whilst on the other hand increment in cybercrime. Nevertheless, this study discovered regulatory compliance not at a satisfactory stage even before the Covid-19 pandemic, let alone during the pandemic.

Practical implications

This study implies that the financial institutions must work together to combat the risks of financial crimes, not only amongst the institutions but also with the regulators. Digitalisation and robust risk management need to be improved at a massive level to beat the criminals’ high fintech skills and systems. The initiatives of fund packages from the governments to assist the companies especially the small firms need to be fully used by the companies to improve regulatory compliance.

Originality/value

Whilst some studies discussed the impact of Covid-19 on the economy, there are still scarce resources on the comparative analysis on the financial crime and regulatory compliance, not to mention the before and after effect of the Covid-19 pandemic. This is the first paper to integrate the issues surrounding the Covid-19 impact, financial crimes and regulatory compliance in Malaysia.

Details

Journal of Financial Crime, vol. ahead-of-print no. ahead-of-print
Type: Research Article
ISSN: 1359-0790

Keywords

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Article
Publication date: 31 July 2021

Md. Harun Ur Rashid, Ruma Khanam and Md. Hafij Ullah

This paper aims to examine the compliance status of Islamic banks in Bangladesh with Shari’ah-based accounting standards named Islamic Financial Services Board (IFSB…

Abstract

Purpose

This paper aims to examine the compliance status of Islamic banks in Bangladesh with Shari’ah-based accounting standards named Islamic Financial Services Board (IFSB) standard-4 and its association with corporate governance.

Design/methodology/approach

The six years of secondary data, including the annual reports of 2013–2018, were collected from the websites of all the seven listed Islamic banks, i.e. 100% of the population available during the period of study. The study used a content analysis approach for systematically categorizing and analysing the contents disclosed in the annual report. A total compliance score based on 133 reporting items of IFSB standard-4 were considered for content analysis. Furthermore, this study applied the ordinary least square to investigate the impact of corporate governance on IFSB standard-4.

Findings

This study found that the level of compliance with the IFSB standard by the Islamic banks in Bangladesh is poor, as the overall compliance status is 44.83%. Further, this study observed a significant and positive influence of the Shari’ah supervisory committee, the board size, accounting experts on the board, foreign ownership and institutional ownership on the level of compliance with IFSB standard-4. On the other hand, this study found a negative effect of directors’ ownership on the level of compliance with IFSB standard-4.

Practical implications

This study provides the management of Islamic banks an insight into developing their governance characteristics to comply with Islamic accounting and reporting standards. Moreover, this study expects to facilitate the management of Islamic banks in designing their accounting and reporting outlines to enhance the level of compliance with the IFSB standards.

Originality/value

This pioneering study on IFSB standards opens an avenue to the researchers exploring the accounting and reporting status of Islamic banks considering the requirements of the IFSB standards.

Details

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

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Article
Publication date: 27 July 2021

Saeed Awadh Bin-Nashwan, Hijattulah Abdul-Jabbar and Saliza Abdul Aziz

Although zakat is a principal way to redistribute wealth, a unique practice designed to achieve a sustainable Islamic economic and social system, zakat institutions and…

Abstract

Purpose

Although zakat is a principal way to redistribute wealth, a unique practice designed to achieve a sustainable Islamic economic and social system, zakat institutions and agencies in most Muslim countries still suffer from the perplexing issue of low zakat collections, ascribing this to the level of compliance among zakat payers. To provide more insight into this lacuna, this study aims to examine the role of trust in zakat institution through the relationship between socio-economic determinants (i.e. religiosity, moral reasoning, peer influence and system fairness) and zakat compliance decisions.

Design/methodology/approach

From a typical Islamic country, Yemen, a random sample of 274 entrepreneurs was drawn for a self-administered survey. To estimate and analyze the compliance model, SmartPLS structural equation modeling was used.

Findings

The results show that all hypothesized direct relationships are supported. Importantly, the trust-moderated interactions of religiosity, moral reasoning and peer influence on zakat compliance are significant, although its interaction with zakat system fairness is not.

Practical implications

The results should be helpful for policymakers and responsible institutions in Muslim communities to understand how different levels of trust can play an important role in Zakat payers’ compliance to boost or erode zakat funds. This research also contributes important inferences for managers about the necessity of inculcating religious and moral values among zakat payers, formulating a fair system and embarking on sensitization programs in society.

Originality/value

The research enriches the scanty literature by validating a viable compliance model drawing on the socio-economic theory of regulatory compliance. Moreover, the model integrates the moderating role of trust in socio-economic perspectives of zakat compliance.

Details

Journal of Islamic Accounting and Business Research, vol. 12 no. 5
Type: Research Article
ISSN: 1759-0817

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Article
Publication date: 9 July 2021

Camillus Abawiera Wongnaa, John-Eudes Andivi Bakang, Maxwell Asiamah, Patrick Appiah and Joshua Kani Asibey

There is a huge gap between actual and achievable yields of maize which threatens household food security in Ghana. Low adoption of improved maize production technologies…

Abstract

Purpose

There is a huge gap between actual and achievable yields of maize which threatens household food security in Ghana. Low adoption of improved maize production technologies coupled with poor compliance with Council for Scientific and Industrial Research (CSIR) recommended maize production practices is identified as the cause of low yields. This study assessed farmers' compliance with CSIR recommended production practices and its effects on yield.

Design/methodology/approach

Using a structured questionnaire, a cross-sectional survey of 150 respondents were interviewed for the study. Descriptive statistics, awareness and compliance indices, probit model and Garret ranking technique were the methods of analysis employed in the study.

Findings

The results showed that farmers are highly aware, have adopted and hardly comply with standards of applications of CSIR recommended production practices. Farm size, age, educational level and female gender significantly influenced compliance with recommended production practices. Also, compliance with recommended production practices increase maize yield.

Originality/value

Policies aim at addressing yield gap in maize production should be targeted at improving farmers' level of compliance with production practices by addressing some constraints through farmer credit and subsidy programmes to help farmers increase their level of compliance. The fact that farmers have adopted recommended production practices does not necessarily mean they will have higher yields. The study generates important insights about how well farmers have been adhering to standards of adoption of recommended production practices.

Details

World Journal of Science, Technology and Sustainable Development, vol. ahead-of-print no. ahead-of-print
Type: Research Article
ISSN: 2042-5945

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Article
Publication date: 1 July 2021

Abraham Gyamfi Ababio and Arthur Gnonsio Mangueye

Improving tax compliance would drive the needed development in Ghana. Small and medium scale enterprises (SME) constitute a sizable proportion of the Ghanaian economy but…

Abstract

Purpose

Improving tax compliance would drive the needed development in Ghana. Small and medium scale enterprises (SME) constitute a sizable proportion of the Ghanaian economy but its contribution to tax revenue is below expectation. This study aims to determine whether SME's perception of state legitimacy affects tax compliance.

Design/methodology/approach

A structured questionnaire was administered to 200 SMEs randomly drawn from Dodowa in the Shai-Osudoku District of Greater Accra Region. Descriptive statistics and the Probit model with sample selection were used to analyse the data.

Findings

The study found that SME's perception of government legitimacy exerts a significant negative effect on reducing profit to avoid tax liability (ß = −0.0305, p < 0.05). Other factors such as education and fear of fines and penalties were also found to reduce the likelihood that the firm would reduce profit to avoid high tax liability. Still, tax knowledge had a positive effect on this behaviour.

Practical implications

This study would help deepen policymakers' knowledge of how to improve tax compliance among SMEs in Ghana.

Originality/value

The originality of this work is that it explicitly models the role of fiscal exchange theory in explaining tax compliance among SMEs in Ghana by using robust methodology.

Details

Journal of Financial Crime, vol. ahead-of-print no. ahead-of-print
Type: Research Article
ISSN: 1359-0790

Keywords

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Article
Publication date: 8 May 2018

Scott R. Anderson, James Audette and Kate S. Poorbaugh

To summarize the Municipal Securities Rulemaking Board’s 2017 Compliance Advisory for brokers, dealers and municipal securities dealers.

Abstract

Purpose

To summarize the Municipal Securities Rulemaking Board’s 2017 Compliance Advisory for brokers, dealers and municipal securities dealers.

Design/methodology/approach

Summarizes several Municipal Securities Rulemaking Board (MSRB) rules that the Compliance Advisory highlights as presenting key compliance risks for brokers, dealers and municipal securities dealers. Discusses the factors included in the Compliance Advisory that dealers should consider when evaluating compliance procedures and controls.

Findings

By highlighting some key compliance risks and providing considerations tailored to those risks, the Compliance Advisory can be used as a tool to aid dealers in developing and assessing effective compliance programs.

Practical implications

Dealers should consider reviewing their firm’s existing compliance policies and procedures in light of the considerations discussed in the Compliance Advisory.

Originality/value

Practical guidance from experienced securities and financial services regulatory lawyers.

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Article
Publication date: 4 January 2008

Jackie Johnson

To gauge the extent to which the global financial system is anti‐money laundering (AML)/countering the financing of terrorism (CFT) prepared by analysing and comparing the…

Abstract

Purpose

To gauge the extent to which the global financial system is anti‐money laundering (AML)/countering the financing of terrorism (CFT) prepared by analysing and comparing the AML/CFT systems of Financial Action Task Force (FATF) members with countries belonging to regional AML organisations.

Design/methodology/approach

Mutual evaluation data of 16 FATF members and 21 non‐FATF countries is analysed and compared using Kruskal‐Wallis and paired‐t tests to determine similarities and differences across the two groups of countries.

Findings

AML/CFT systems of FATF members and non‐FATF countries are poor. The lack of compliance with global AML/CFT standards leaves so many holes in these countries' regulatory, financial, and legal systems that money laundering with or without any relationship to the financing of terrorism, would be relatively easy to achieve.

Research limitations/implications

In using an analytical approach it has been necessary to put numerical values on compliance levels used by the FATF. Given that these are very broad, substituting a single value for each compliance level will provide only a crude measure of compliance for comparisons to be made. The results should therefore be used as a guide to the ranking and compliance of countries rather than some exact measurement of compliance.

Practical implications

There will need to be follow‐up visits to this round of mutual evaluations to evaluate country responses to their poor assessments.

Originality/value

Publication of mutual evaluations by the FATF and a number of regional bodies has enabled a comparison of AML/CFT systems from countries around the world. Lack of data has not enabled this to be done before.

Details

Journal of Financial Crime, vol. 15 no. 1
Type: Research Article
ISSN: 1359-0790

Keywords

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Article
Publication date: 5 September 2016

Scott R. Anderson and Kate S. Poorbaugh

To summarize the Municipal Securities Rulemaking Board’s 2016 Compliance Advisory for brokers, dealers and municipal securities dealers.

Abstract

Purpose

To summarize the Municipal Securities Rulemaking Board’s 2016 Compliance Advisory for brokers, dealers and municipal securities dealers.

Design/methodology/approach

Summarizes several Municipal Securities Rulemaking Board (MSRB) rules that the Compliance Advisory highlights as presenting key compliance risks for brokers, dealers and municipal securities dealers. Discusses the factors included in the Compliance Advisory that dealers should consider when evaluating compliance procedures and controls.

Findings

By highlighting some key compliance risks and providing considerations tailored to those risks, the Compliance Advisory can be used as a tool to aid dealers in developing and assessing effective compliance programs.

Practical implications

Dealers should consider reviewing their firms’ existing compliance policies and procedures in light of the considerations discussed in the Compliance Advisory.

Originality/value

Practical guidance from experienced securities and financial services regulatory lawyers.

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Article
Publication date: 1 January 1997

Isaac Alfon

The increasing use of cost‐benefit analysis (CBA) in financial regulation is bringing a sharper focus on the benefits conferred by regulation. This paper addresses the…

Abstract

The increasing use of cost‐benefit analysis (CBA) in financial regulation is bringing a sharper focus on the benefits conferred by regulation. This paper addresses the impact of that sharper focus on the compliance culture of regulated firms. Why focus on the benefits of regulation? What does CBA have to offer to the compliance culture of authorised firms? How does the introduction of CBA fit in with other developments in the regulatory arena? This paper offers some tentative answers to these questions.

Details

Journal of Financial Regulation and Compliance, vol. 5 no. 1
Type: Research Article
ISSN: 1358-1988

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