Asian Journal of Finance & Accounting

Journal Information
EISSN : 1946-052X
Published by: Macrothink Institute, Inc. (10.5296)
Total articles ≅ 376
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Latest articles in this journal

Nidhal Al Shanti
Asian Journal of Finance & Accounting, Volume 14, pp 21-39; https://doi.org/10.5296/ajfa.v14i1.18939

Abstract:
This research investigates the impact of auditor experience, auditor education, client’s internal controls, and audit procedures performed on audit quality in the UAE. An online Likert scale-based questionnaire was distributed to auditors with financial audit experience in the UAE. Multiple regression analysis was adopted to analyze data since more than one independent variable was investigated. The results demonstrate that auditor experience and auditor education are significantly and positively associated with audit quality, while client’s internal controls and audit procedures are not associated with audit quality.
Arindam Banerjee
Asian Journal of Finance & Accounting, Volume 13, pp 107-118; https://doi.org/10.5296/ajfa.v13i2.18932

Abstract:
Dividend policy continues to be a much debated research topic ever since the seminal works of John Lintner (1956), and Miller and Modigliani (1961). Among the many answered questions, doubt continues to remain on the specific factors that determine dividend policy and whether dividend policy can be structured dependently or independently. The aim of this study is to investigate the determinants of dividend payout policy on the South Korean firms listed on the South Korean Stock Exchange (KRX). In this study, five variables are considered as potential determinants of dividend payout policy. The study develops five research hypotheses, which are used to represent the main theories of corporate dividend payouts. Fixed effect regression model was applied on a sample of thirty listed companies on South Korean Stock Exchange for the period of four years from 2014 to 2017. The model was chosen to test the relationship between dividend determinants and dividend payout policy. The study hopes to potentially increase knowledge in the area of dividend payout policy with a view to improve prediction and establish a relationship between dividend determinants and dividend payout of South Korean firms.
Mazrah Malek
Asian Journal of Finance & Accounting, Volume 13, pp 89-106; https://doi.org/10.5296/ajfa.v13i2.18707

Abstract:
Diversity of board members has become a recent topic by which it has been linked to board’s effectiveness. It can be postulated that directors from a different generation will exhibit different values, knowledge and behavior that can influence the decisions and actions of a firm. However, earlier studies have produced mixed findings on the effect of director's age and firm performance. This study proposes that in order to examine the influence of age diversity, researchers must capture the difference in the age cohort of directors. Different generations carry its own common and unique characteristics. Consistent with the diversity concept, age diversity should be examined based on the inclusion of different generations to the board, and not just the average number of directors’ age as practiced in earlier studies.
Janesh Sami
Asian Journal of Finance & Accounting, Volume 13, pp 79-88; https://doi.org/10.5296/ajfa.v13i2.14674

Abstract:
The main goal of this paper is to investigate the random walk hypothesis in Fiji using monthly data from January 2000 to October 2017. Applying augmented Dickey Fuller (ADF 1979, 1981) and Phillips-Perron (1988), Zivot-Andrews (1992), and Narayan and Popp (2010) unit root tests, this study finds that stock prices is best characterized as non-stationary. The estimated multiple structural break dates in the stock prices corresponds with devaluation of Fijian dollar by 20 percent in 2009 and General Elections in September 2014, which Fiji First Party won by majority votes. The empirical results indicate that stock prices are best characterized as a unit root (random walk) process, indicating that the weak-form efficient market hypothesis holds in Fiji’s stock market. Hence, it will be difficult to predict future returns based on historical movement of stock prices in Fiji’s stock market.
May Elewa
Asian Journal of Finance & Accounting, Volume 13, pp 1-22; https://doi.org/10.5296/ajfa.v13i2.18846

Abstract:
The purpose of this paper is to identify the impact of market capital MC and net profit NP on stock price SP and trade volume (TV) in the developing Egyptian business context. This study collects data from 29 non-financial organizations registered on the EGX 30 during the 6 month, 1/1/2020 to 30/6/2020, lockdown in Egypt due to the first wave of COVID-19. Data for the monthly confirmed cases and death cases of COVID-19 are collected for the 6 months of the study and compared to the monthly records of closing prices and trade volume in Egyptian poundsEGP. The study population represents 174 firm year observations. The firms studied operate in cash, have annual financial reports during the period 1/1 to 31/12, obtain complete financial data, and have not been eliminated all throughout the study. In this work the pooled model, the fixed effects model, and the random effects model are used.SPSSis applied to achieve the required statistical analysis. The study is a panel data analysis. Outcomes demonstrate existing substantial effects between market capital MC and stock price SP during the first wave of COVID-19. However, no significant effect is evident of the market capital MC and net profit NP with the trade volume TV during the first wave of this pandemic. This literature is advantageous for external and internal stakeholders and regulatory bodies. The study is a modest contribution that may help boost the business processes to reach better financial performance in times of unexpected catastrophes.
Zubaidah Mohd Ali, Rozaidy Mahadi
Asian Journal of Finance & Accounting, Volume 13, pp 23-38; https://doi.org/10.5296/ajfa.v13i2.18926

Abstract:
Having substantial accountability standards and practices is a vital practice to ensure the survival of Religious-Based Non-Profit Organisations (RNPOs). This is because the RNPOs are not only representing the religion’s ideals but at the same time, there are also responsible in disseminating ethical massage and good values in the community. Since the RNPOs played a significant role in society, many studies have highlighted the need to explore more accountability issues involving RNPOs. Hence, this study aims to provide a taxonomical review of literature that examined RNPOs’ accountability practices and subsequently, suggesting plausible contextual and application gaps for future research. In so doing, this study utilised van Helden and Nortcott’s (2010) and Rozaidy, Siti Nabiha, Rasid, and Raman (2017) taxonomical methods in categorising accountability studies in RNPOs. As a result, four main themes have been identified from 60 selected high-impact journal articles. The four themes are 1) examining the outcomes of corporate integrity and accountability practices; 2) evaluating the RNPOs’ internal control practices; 3) identifying financial reporting disclosures practices among RNPOs; and 4) exploring the influence of leadership skills on RNPOs’ accountability practices.
Ifeyinwa Elizabeth Nnajieze, Nwabuisi Anthony Okorie, Igwe Alex Onyeji
Asian Journal of Finance & Accounting, Volume 13, pp 53-78; https://doi.org/10.5296/ajfa.v13i2.18929

Abstract:
This study empirically investigated the effect of macroeconomic variables on financial performance in Nigeria healthcare sector. It spanned for the period of 2008-2018 and utilized annual time series secondary data extracted from annual reports and financial statements of the selected firms. Ex-post facto research design was adopted while analytical techniques employed were descriptive statistics, fully modified ordinary least squares panel regression and Pearson correlation analysis. Findings revealed that changes in macroeconomic indices play significant roles on the financial position of Healthcare manufacturing firms in Nigeria. Particularly, result showed that exchange rate, interest rate, external debt and trade openness have negative effect while inflation rate exert positive influence to financial position of Healthcare manufacturing firms in Nigeria. Among the selected macroeconomic variables, the effects of exchange rate and inflation rate were significant. Implication of the result is that unstable macroeconomy is harmful to healthy growth of Healthcare manufacturing firms in Nigeria. The study therefore recommended among other things that exchange rate should be monitored while economic policy measures aimed at controlling exchange rate in Nigeria should be established. High rate of interest should also be regulated and set to a rate favourable to the growth of Healthcare manufacturing companies in Nigeria. Federal government of Nigeria should work towards reducing their level of borrowing from foreign countries and as well reduce volume of trade openness for overall performance of manufacturing sector in Nigeria.
Rim El Houcine
Asian Journal of Finance & Accounting, Volume 13, pp 39-52; https://doi.org/10.5296/ajfa.v13i2.18930

Abstract:
This paper analyzes the financial crisis effect on French companies accounting conservatism. The study is conducted on a sample of 120 French firms, observed from the year 2005 to 2009. We used the Basu model (1997) to test the effect of the financial crisis on the level of accounting conservatism pre-crisis (2005-2007) and during the crisis (2008-2009). The results showed that companies during the crisis period are not conservative. Managers will tend to be more aggressive by reporting the good news and delaying the recognition of the bad. The effect of the financial crisis is still an important topic to study. In that regard, this study is important. It contributes to the understanding of the relationship between accounting conservatism and financial crisis. The main limitation of the present study is that it limited to the effects in Frensh listed companies.
San Lio
Asian Journal of Finance & Accounting, Volume 13, pp 119-135; https://doi.org/10.5296/ajfa.v13i2.18927

Abstract:
Human Capital (HC) is the sole intervening factor for a competitive hedge in all firms: merchandising, manufacturing, or servicing. However, the need for HC is enhanced in service firms because only they can act. All requisite tangible and intangible assets of firms are accounted for as material investments in their financial reports for improved decisions by managers and other stakeholders. However, contemporary organizations are unable to account for their HC investments because there is no Generally Accepted Legal Framework (GALF). This is even though HC accounting discipline has attracted attention in most jurisdictions, although it was largely disregarded in some parts of the world and the deliberations date back to the early sixties of the last century. Could the exploration of HC accounting underpinning theories offer practitioners research insights?
Mihir Dash, Rita S.
Asian Journal of Finance & Accounting, Volume 13, pp 35-44; https://doi.org/10.5296/ajfa.v13i1.18589

Abstract:
This study proposes a vector autoregressive form for the market model and tests its significance against the market model for information technology (IT) sector stocks in the Indian stock market. The analysis was performed for a sample of nineteen IT sector stocks listed on the National Stock Exchange of India, of which nine stocks were large-cap, six were mid-cap, and four were small-cap. The study period considered was Jan. 1, 2018 – Dec. 31, 2018. The key contribution of the study was the finding that the vector autoregressive model is a better model of stock returns than the market model for IT sector stocks. Thus, IT sector stocks seem to react more to market movements from the previous day than on the day itself. The implication for asset pricing modelling is that systematic risk may be further decomposed into a component corresponding to sensitivity to market movements on the day and a component corresponding to sensitivity to market movements on the previous day. The asset pricing model would be extended to include market risk premia for both of these components of systemic risk. Keywords: market model, vector autoregressive model, IT sector, asset pricing modelling, systematic risk.
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