International Journal of Accounting & Finance Review

Journal Information
ISSN / EISSN : 2576-1285 / 2576-1293
Total articles ≅ 115
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Alhassan Musah, Abigail Padi, Ibrahim Anyass Ahmed
International Journal of Accounting & Finance Review, Volume 12, pp 21-29; https://doi.org/10.46281/ijafr.v12i1.1804

Abstract:
This study examines the effect of the covid-19 pandemic on the profitability of commercial banks in Ghana. The study sampled 24 commercial banks over a 5-year study period from 2017 to 2021. The study collected data from the annual report of these banks. The study measured bank profitability using return on assets and return on equity. The main dependent variable was the covid-19 pandemic, measured as a dummy variable. The study relied on descriptive statistics, correlation analysis, and panel regression analysis to realize the research objectives. The correlation analysis, as well as the panel regression analysis, revealed that there is a positive coefficient between covid-19 pandemic and the return on assets of commercial banks in Ghana. The positive coefficient between covid-19 pandemic and return on assets is statistically significant at a 1% significance level which implies that covid-19 is a significant determinant of the increase in return on assets among commercial banks in Ghana. The correlation and panel regression analysis showed a positive relationship between covid-19 pandemic and returned on equity. However, the positive relationship between covid-19 pandemic and return on equity is not statistically significant, implying that the covid-19 pandemic is not a significant predictor of the changes in return on equity among commercial banks in Ghana. JEL Classification Codes: E44, G21, G41, E59, G01, G10, G29, L10.
Godekere Panchakshara Murthy Girish, Sweta Singh, Bharath Supra
International Journal of Accounting & Finance Review, Volume 12, pp 30-34; https://doi.org/10.46281/ijafr.v12i1.1805

Abstract:
India is one of the largest producer and consumer of electricity in the world owing to being one of the most populous country in the world signifying the demand for electricity is only set to grow further. World has witnessed an era of economic growth aided pertinently by electricity consumption and growing demand. With FDI indorsed downright to this vital utilities sector, it becomes imperative to cognize the relationship of Electricity Consumption, Economic Growth and FDI in India. In this study we investigate the causal direction of relationship among Foreign Direct Investment, Electricity Consumption and Economic Growth in India by using time-series data for the period 1986–2021 and employing econometric models. We find two uni-directional causalities running from Electricity Consumption to Economic Growth and Economic Growth to FDI and a bi-directional causality between Electricity Consumption and FDI. The results of the study provide a novel perspective for policy makers while formulating policies related to the power sector and foreign direct investments in India. The focus of Policy makers should be on enabling electricity service providers to offer best services to commercial and non-commercial participants as it aids in Economic growth of the country. For enhanced economic growth a country like India must have good and world-class infrastructure, efficient and effective regulatory mechanism equitable for all stakeholders, an improved living standard for people of all economic strata and a stable, healthy business friendly environment coupled with policy stability through stable government. JEL Classification Codes: Q43, Q47, O4.
Benjamin Bae, Nyakundi M. Michieka, Mahdy F. Elhusseiny
International Journal of Accounting & Finance Review, Volume 12, pp 11-20; https://doi.org/10.46281/ijafr.v12i1.1803

Abstract:
This study examines the effect on the security returns of a company named on the National Priority List (NPL) for the Superfund site. It investigates if the designation as a potentially responsible party (PRP) generates more negative abnormal returns after listing the NPL. Since this designation of firms as PRPs increase regulatory costs such as cleanup costs and disclosure requirements, an adverse market reaction is expected. This study employs several financial databases, such as Research Insight, CRSP, I/B/E/S, and the EPA's NPL database, which compile the Superfund listing for each firm in the sample. In the case of environmental liabilities, the potential future cost of environmental remediation makes estimating the firm's earnings more difficult. This implies that the earnings of PRP firms may not persist, resulting in noisier accounting information. The empirical results support the hypotheses that the markets react negatively to the bad news that the firm has been designated as a PRP in the Superfund site, implying that environmental liabilities negatively impact firm stock price and valuation. Significant findings provide financial statement users with helpful information about contingent environmental liabilities and help them make more informed investment decisions and better judge the firms' future performance.JEL Classification Codes: G1, G2, G3, M41, M48.
Ernie Capozolli, Josh McGowan, Maureen Flores
International Journal of Accounting & Finance Review, Volume 12, pp 1-10; https://doi.org/10.46281/ijafr.v12i1.1802

Abstract:
This study explores the impact of regulatory accounting procedures (RAP) on the Savings and Loan industry during the 1980s. The Savings and Loan industry in the United States differs from commercial banks in that many of these entities are operated as cooperatives and focus on residential mortgages. Despite an increase in regulatory efforts in the 1980s, the S&L industry experienced significant failures and a lack of liquidity. Approximately one-third of the S&L entities failed during the years 1986 - 1995. This study explores multiple factors related to RAP and the S&L crisis. These factors include the voluntary adoption of RAP, organizational structure, and financial performance of the institutions. Data was collected on all S&L institutions in the state of Mississippi that were in operation as of the end of 1988. Utilizing stepwise regression this study finds that RAP was more likely to be adopted by S&L entities that operated under a mutual ownership structure when compared to S&Ls owned through stock. Results also show there was no economic benefit for those S&Ls that adopted RAP. Finally, Regulatory Net Worth was also found to be misstated in those entities that adopted RAP. The findings of this study suggest unintended consequences occurred regarding the adoption of RAP within the S&L industry. JEL Classification Codes: G21, M41, M48.
Afzal Ahmad
International Journal of Accounting & Finance Review, Volume 11, pp 69-75; https://doi.org/10.46281/ijafr.v11i1.1781

Abstract:
Microfinance is the concession of providing comprehensive financial services to unbaked rural people. It has become an empirically proven tool to fight against rural poverty in developing countries like Bangladesh. The performance of MFIs in the improvement procedure of an economy is impressive. In this study, researchers purposively select sixty (60) microfinance institutions as a sample and incorporate five years of panel data from 2015 to 2019. Researchers use return on assets (ROA) as a proxy of financial self-reliance, whereas size, experience, managerial efficiency, the breath of outreach, and depth of outreach are explanatory variables. For analyzing data, researchers employ Stata 12 software, and ordinary least square and fixed effect models are also used for assessing the stimulus of MFIs' financial self-reliance. The study revealed that size, experience, managerial efficiency, the breath of outreach & depth of outreach are explained by 73.75% variation of the dependent variable, i.e., financial self-reliance of MFIs in Bangladesh, which is statistically significant at a 1% level. Researchers outlined that size, experience, managerial efficiency, breadth of outreach, and depth of outreach are this study's statistically substantial stimulus for sample MFIs. JEL Classification Codes: G21, C23.
Shawn L. Robey, Mark A. McKnight, Reshowrn B. Thomas, Amy L. Mings
International Journal of Accounting & Finance Review, Volume 11, pp 59-68; https://doi.org/10.46281/ijafr.v11i1.1775

Abstract:
This study analyzed the effect cross-cultural differences in perceived horizontal equity and self-efficacy have on the creation of budgetary slack.  This research addressed the gap in the role of ethical ideology in business by empirically examining the influence of culture on an individual’s ethical ideology and their propensity to create budgetary slack.  A total of 803 subjects included 413 individuals from America and 390 from Brazil.   A series of analysis of variance testing identified statistical significance between horizontal equity and the creation of budgetary slack, as well as statistically significant differences between low/high years of experience and budgetary slack levels.  Additional cross tabulations were included related to both horizontal equity as well as self-efficacy.  The results highlight budgetary procedures that may impact a person’s perceptions of fairness in pay compared to colleagues or peers with similar positions in organizations.  Findings suggest that employees with more years of professional experience could benefit from education on potential negative unintended consequences of creating slack in their budgetary decisions.  Our findings may be used by managers to gain awareness of this significance and take necessary steps to create equitable pay policies and budgetary targets. Study results indicated no statistical difference in slack levels between Americans and Brazilians.JEL Classification Codes: F39, G31, G41, M10, M49.
Imene Guermazi
International Journal of Accounting & Finance Review, Volume 11, pp 49-58; https://doi.org/10.46281/ijafr.v11i1.1773

Abstract:
This paper aims to study Equity holders'(EHs) discipline in three GCC countries, Bahrain, the UAE, and KSA for the period (2004-2014). We test bank risk monitoring in the 2008 crisis period by comparing the perceived risk proxied by BETA during the pre-and post-crisis episodes. We find significant differences in BETA values in Bahrain and the UAE. Then, we use the fixed effect model and the random effect model to regress BETA on CAMEL variables measuring bank risk. We study bank reaction by regression relevant CAMEL variables to EH monitoring on BETA of a lagged period. Our results show that in Bahrain, the coefficients of the variables Liquidity and Size are significant. Thus, EHs, in Bahrain, monitor their bank using financial information on Liquidity and Size. However, we find no responsiveness of the banks to this monitoring. Thus, there is no evidence of EHs' discipline in GCC countries. We contribute first, to fulfilling the gap in market discipline literature in Emerging countries, specifically, Bahrain, KSA, and the UAE. Second, we shed light on the market discipline of a special type of banking-IBs. Third, we innovate a new monitoring signal, BETA values assessed by EHs.JEL Classification Codes: G21, G12, M41.
Jadallah Jadallah, Amirali Moeini Chaghervand, Michele D. Meckfessel, R. Drew Sellers
International Journal of Accounting & Finance Review, Volume 11, pp 37-48; https://doi.org/10.46281/ijafr.v11i1.1770

Abstract:
The purpose of this paper is to provide an integrated pedagogical approach that professors can use with doctoral students to immerse students in a decision-making process that is critical to a successful research project: variable operationalization.  Using articles from well-regarded journals to evaluate the operationalization choice of the “restatement” variable, the authors assemble a pedagogical approach that includes exercises professors can use with doctoral students.  The setting chosen explores three methods used to operationalize the financial restatement variable in empirical archival accounting literature that students can explore: announcement date, first occurrence, and all occurrences.  Students are first tasked with identifying the elements influencing measurement choice.  Next, students assess whether findings reveal that statistically distinct results arise from each of the three measurement choices evaluated.  Finally, students come to realize that an incorrect measurement choice may subject research findings to reductions in explanatory power, risk of type 1 and type 2 errors, and altered direction (sign) of coefficients.  Achieving clarity in measurement choice and exposition are challenges inherent in accounting scholarship.  This pedagogical approach helps nascent scholars work through these challenges using an actual empirical research setting, i.e., financial restatements.  The insights gained can be applied by doctoral students in their own research efforts.JEL Classification Codes: M4, C8, C0.
Guoyu Lin
International Journal of Accounting & Finance Review, Volume 11, pp 24-36; https://doi.org/10.46281/ijafr.v11i1.1743

Abstract:
This paper explores the role investor sentiment plays in the relationship between analyst forecast dispersion and stock returns. With short sale constraints, stock prices are determined by the optimistic investors. There are more optimistic investors during the high sentiment periods when investors suffer more from psychological bias. This is the first paper to document that following the high sentiment periods, stocks with the most analyst forecast dispersion are overpriced, earning significantly negative returns, while those with the least analyst forecast dispersion are not overpriced as the degree of belief dispersion is low. However, following the low sentiment periods, both are not overpriced. A portfolio that longs the least dispersed stocks and shorts the most dispersed stocks yields significantly positive returns only following the high sentiment periods. My findings can potentially reconcile the puzzling risk effect and mispricing effect in the literature. The risk (mispricing) effect suggests a positive (negative) relation between analyst forecast dispersion and future stock returns. Presumably, the magnitude of the mispricing effect depends on the proportion of irrational investors and their bias, which is positively related to investor sentiment. During the high sentiment period, the mispricing effect takes over, and the overall effect is negative. During the low sentiment period, the percentage of irrational investors is mediate, and the mispricing effect and the risk effect counter each other, leading to insignificant relation.JEL Classification Codes: G12, G40, G41.
Roucham Benziane, Sagou Roqiya, MahmoudI Houcine
International Journal of Accounting & Finance Review, Volume 11, pp 8-23; https://doi.org/10.46281/ijafr.v11i1.1715

Abstract:
This research aims to investigate the Fintech Start-up phenomenon and trends through collecting 124 manuscripts published between 2016 and 2021 in Scopus database, A bibliometric analysis was used with their two main divisions; performance analysis and mapping sciences to find out the most productive and influential studies, journals, authors, in addition, to examine the level of collaboration, various soft programs were adopted such as VosViewer for network visualization and Biblioshiny which is a web application based on R-studio and have required open-source codes that carried out by the authors for citation metrics, The findings have revealed that the most productive journal is Sustainability Switzerland but the most influential is Business Horizon, besides, Leong has the most publications while have the record citations and Muthukannan is the furthermost collaborated, Univ of Sydney is the most active University, However,  result don't comply neither Lotka nor Bradford Law, U.S. has led the production and was reference in the field, new keywords have emerged approximatively to the field  like business model, Ecosystem, Blockchain and Crowdfunding, the study recommends to explore the targeted field in specified time and data bases using another quantitative or qualitative tools with developed softwares. JEL Classification Codes: E51, M13, C55, C81.
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