Template-Type: ReDIF-Article 1.0 Author-Name: Allam Mohammed Mousa Hamdan Author-X-Name-First: Allam Mohammed Mousa Author-X-Name-Last: Hamdan Title: Audit committee characteristics and earnings conservatism in banking sector: empirical study from GCC Abstract: We examine four audit committee characteristics, including the audit committee independence, size of audit committee, audit committee diligence and financial experience of the audit committee members to identify if any of these characteristics differentially impact the earnings conservatism. The sample included 59 banks from Gulf Cooperation Council (GCC) countries: Bahrain, Kuwait, Oman, Qatar, Saudi Arabia and United Arab Emirates during the period of 2012–2016. To achieve this goal, the study measures earnings conservatism using market-to-book approach. By using panel fixed-effect regression, our analysis reveals that bigger audit committees with more independence and members with financial experience are more likely to be associated with earnings conservatism in GCC banks. We also find that the audit committee diligence has no impact on earnings conservatism. Journal: Afro-Asian J. of Finance and Accounting Pages: 1-23 Issue: 1 Volume: 10 Year: 2020 Keywords: earnings/accounting conservatism; audit committee characteristics; GCC banks. File-URL: http://www.inderscience.com/link.php?id=104401 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:ids:afasfa:v:10:y:2020:i:1:p:1-23 Template-Type: ReDIF-Article 1.0 Author-Name: Emad Awadallah Author-X-Name-First: Emad Author-X-Name-Last: Awadallah Title: Measuring the effectiveness of selected corporate governance practices and their implications for audit quality: evidence from Qatar Abstract: Recent global financial scandals have led to a number of investigations into the effectiveness of corporate governance. Although evidence exists from developed economies, very scanty studies have been conducted in emerging economies where corporate governance is just evolving. The aim of this study is to provide evidence on the effectiveness of corporate governance practices and the implications for audit quality in Qatar, a fast-developing country. The paper conducts a market-based study. Data for analysis are gathered from the non-financial companies listed on the stock exchange, covering a four-year period 2013–2016. Logistic regression is used in investigating the questions that are raised in the study. Findings show that board independence, CEO duality and audit committees have a significant relationship with audit quality. The results also indicate that institutional investors and managerial ownership have no significant impact on audit quality. Furthermore, the size of the company, along with business complexity and leverage, are affecting audit quality. Journal: Afro-Asian J. of Finance and Accounting Pages: 24-47 Issue: 1 Volume: 10 Year: 2020 Keywords: non-financial companies; corporate governance practices; board independence; CEO duality; audit committees; institutional investors; managerial ownership; audit quality; Qatar; Qatar Stock Exchange; QSE. File-URL: http://www.inderscience.com/link.php?id=104402 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:ids:afasfa:v:10:y:2020:i:1:p:24-47 Template-Type: ReDIF-Article 1.0 Author-Name: Liem Nguyen Author-X-Name-First: Liem Author-X-Name-Last: Nguyen Author-Name: Canh Nguyen Author-X-Name-First: Canh Author-X-Name-Last: Nguyen Title: Financial constraints, corporate debt maturity and firm performance: the case of firms in Southeast Asian countries Abstract: This paper aims to examine the (nonlinear) link between debt maturity structure and firm performance in five Southeast Asian emerging markets. This nonlinearity could be the cause of the inconsistency in the extant findings on the impact of debt maturity on firm performance. Our research provides evidence supporting a nonlinear relationship between debt maturity structure and firm performance. The results further show that financially constrained firms are more susceptible to liquidity risk when constrained firms are heavily financed by short-term debt, while when these firms employ much long-term debt the agency cost of debt becomes more worrisome. Therefore, compared to unconstrained peers, financially constrained firms are more likely to benefit from the use of long-term debt at short debt maturity structure, but are more prone to be suffering from long-term debt use when the latter firms are already at long debt maturity structure. Journal: Afro-Asian J. of Finance and Accounting Pages: 48-59 Issue: 1 Volume: 10 Year: 2020 Keywords: debt maturity structure; firm performance; Southeast Asian countries; financial constraints. File-URL: http://www.inderscience.com/link.php?id=104404 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:ids:afasfa:v:10:y:2020:i:1:p:48-59 Template-Type: ReDIF-Article 1.0 Author-Name: Pham Thi Xuan Thoa Author-X-Name-First: Pham Thi Xuan Author-X-Name-Last: Thoa Author-Name: Nguyen Ngoc Anh Author-X-Name-First: Nguyen Ngoc Author-X-Name-Last: Anh Author-Name: Nguyen Khac Minh Author-X-Name-First: Nguyen Khac Author-X-Name-Last: Minh Title: The determinant of capital adequacy ratio: empirical evidence from Vietnamese banks (a panel data analysis) Abstract: The purpose of this study is to investigate the determinant of Vietnamese banks' capital adequacy ratio (CAR) by internal banking factors. Secondary data is collected from banks' annual reports in the period of 2009–2015. FGLS method and panel data are used to examine a regression model with CAR is the dependent variable and five independent variables: bank size (SIZE), loans (LOA), loan loss reserve (LLR), liquidity (LIQ), profitability (ROE). The results show that SIZE and LIQ impact negatively on CAR with significant meanings. On the other hand, LLR and LOA also affect CAR negatively but they are insignificant. Journal: Afro-Asian J. of Finance and Accounting Pages: 60-70 Issue: 1 Volume: 10 Year: 2020 Keywords: Basel; capital adequacy ratio; CAR; capital adequacy ratio; Vietnamese banks; panel data; FGLS. File-URL: http://www.inderscience.com/link.php?id=104406 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:ids:afasfa:v:10:y:2020:i:1:p:60-70 Template-Type: ReDIF-Article 1.0 Author-Name: Fasiha Kiran Author-X-Name-First: Fasiha Author-X-Name-Last: Kiran Author-Name: Naimat U. Khan Author-X-Name-First: Naimat U. Author-X-Name-Last: Khan Author-Name: Attaullah Shah Author-X-Name-First: Attaullah Author-X-Name-Last: Shah Title: The herding behaviour on Pakistan stock exchange – using firm-level data Abstract: This paper analyses herding behaviour in the Pakistan stock exchange (PSX, formerly known as Karachi stock exchange, KSE) for a sample of 663 firms over a period of 13 years, from 2004 to 2017. For detecting herding behaviour, two dependent variables are used, i.e., cross-sectional standard deviation (CSSD) of Christie and Huang (1995) and cross-sectional absolute deviation (CSAD) of Chang et al. (2000). The results show no herding behaviour on the basis of both methods at different levels of market movements. The absence of the herding behaviour may be because these firms belong to different sectors which may follow their respective industry portfolios but not the overall market; for example, Shah et al. (2017) documented that firms in several industries herd toward their industry portfolios for Pakistani data. Future research can be done using a primary data collection method from investors about their opinion on herding behaviour. Journal: Afro-Asian J. of Finance and Accounting Pages: 71-84 Issue: 1 Volume: 10 Year: 2020 Keywords: herding; anomaly; efficient market hypothesis; behavioural finance; Pakistan. File-URL: http://www.inderscience.com/link.php?id=104407 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:ids:afasfa:v:10:y:2020:i:1:p:71-84 Template-Type: ReDIF-Article 1.0 Author-Name: Irwan Adi Ekaputra Author-X-Name-First: Irwan Adi Author-X-Name-Last: Ekaputra Author-Name: Bambang Sutrisno Author-X-Name-First: Bambang Author-X-Name-Last: Sutrisno Title: Empirical tests of the Fama-French five-factor model in Indonesia and Singapore Abstract: We examine the performance of the Fama-French three-factor (FF3) and five-factor (FF5) models in Indonesia and Singapore markets. We also investigate whether the book-to-market factor (HML) is redundant in both markets if profitability and investment factors are present. Different from previous studies, our empirical findings highlight that FF5 does not perform better than FF3 in explaining excess portfolio returns in both markets. Unlike the US market, we find that HML factor is not redundant in both markets. The results are robust for equally-weighted and value-weighted portfolios and also for various factor construction methods. Journal: Afro-Asian J. of Finance and Accounting Pages: 85-111 Issue: 1 Volume: 10 Year: 2020 Keywords: asset pricing; five-factor; Indonesia; Singapore. File-URL: http://www.inderscience.com/link.php?id=104408 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:ids:afasfa:v:10:y:2020:i:1:p:85-111 Template-Type: ReDIF-Article 1.0 Author-Name: Sushma Priyadarsini Yalla Author-X-Name-First: Sushma Priyadarsini Author-X-Name-Last: Yalla Author-Name: Karuna Jain Author-X-Name-First: Karuna Author-X-Name-Last: Jain Author-Name: Som Sekhar Bhattacharyya Author-X-Name-First: Som Sekhar Author-X-Name-Last: Bhattacharyya Title: Impact of monetary policy announcements on bank index in India Abstract: Understanding the impact of monetary policy announcements on systemic risk and abnormal returns (ARs) of banking sector indexes is important to assess the changes in the cost of equity capital and arrive at a fair rate of return of bank stocks. Empirical studies of this nature from the Indian context are scarce. The present study analyses the impact of monetary policy announcements on systemic risk and abnormal returns of bank index in India. Capital asset pricing model (CAPM) along with Kalman filter was used to estimate the daily systemic risk (beta) and abnormal returns. Ordinary least squares (OLS) regression and event study methodology were used to assess the impact of monetary policy announcements on systemic risk and abnormal returns. Journal: Afro-Asian J. of Finance and Accounting Pages: 112-130 Issue: 1 Volume: 10 Year: 2020 Keywords: India; monetary policy announcements; bank index; systemic risk; abnormal return; Kalman filter; event study methodology. File-URL: http://www.inderscience.com/link.php?id=104414 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:ids:afasfa:v:10:y:2020:i:1:p:112-130 Template-Type: ReDIF-Article 1.0 Author-Name: Tri M. Hoang Author-X-Name-First: Tri M. Author-X-Name-Last: Hoang Author-Name: An Thai Author-X-Name-First: An Author-X-Name-Last: Thai Title: An approach to corporate capital structure of Southeast Asian countries Abstract: This study investigates the determinants of capital structures of listed firms in Southeast Asia, including Vietnam, Thailand, Indonesia, Malaysia, the Philippines and Singapore, between 1995 and 2014. Based on the most up-to-date data from Thompson Innovation, we employ feasible generalised least squares (FGLS) to test funding behaviours of individual countries and the whole region. Empirical evidence supports neither the pecking order theory nor the trade-off model as the best-fit framework to understand the capital structures of firms in Southeast Asia, though the trade-off model has more precise predictions of the data than the pecking order model. Besides, the outcomes demonstrate that understanding firm nationality is necessary to determine countries' conventional corporate capital structure models. Journal: Afro-Asian J. of Finance and Accounting Pages: 131-150 Issue: 2 Volume: 10 Year: 2020 Keywords: corporate finance; capital structure; listed firms; panel data; Southeast Asia. File-URL: http://www.inderscience.com/link.php?id=106250 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:ids:afasfa:v:10:y:2020:i:2:p:131-150 Template-Type: ReDIF-Article 1.0 Author-Name: Ben Le Author-X-Name-First: Ben Author-X-Name-Last: Le Title: New evidence for the determinants of foreign investment in an Asian market Abstract: This paper examines foreign investment in Vietnamese stock markets from 2013 to 2016. Previous studies for sample periods prior to 2013 find that foreigners invested relatively more in low liquidity shares. In contrast, this paper shows that foreigners now invest relatively more in high liquidity stocks. This study also investigates the investment determinants of foreign blockholders who own at least 5% of shares outstanding separately from those of the other foreign investors. The results show that foreign blockholders are more available to assume certain types of risk than the other foreign investors. Further, the investment preferences are similar between foreign blockholders and local blockholders. The results of the paper suggest that the availability of investors to assume risk, which is dependent on their wealth levels, is a possible explanation of equity home bias. Journal: Afro-Asian J. of Finance and Accounting Pages: 151-167 Issue: 2 Volume: 10 Year: 2020 Keywords: foreign investment; market liquidity; assume risk; blockholder; Vietnam. File-URL: http://www.inderscience.com/link.php?id=106251 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:ids:afasfa:v:10:y:2020:i:2:p:151-167 Template-Type: ReDIF-Article 1.0 Author-Name: Dorra Ellouze Author-X-Name-First: Dorra Author-X-Name-Last: Ellouze Author-Name: Wafa Cherif Author-X-Name-First: Wafa Author-X-Name-Last: Cherif Title: Corporate governance and investment cash-flow sensitivity: evidence from Tunisia Abstract: The aim of this paper is to investigate the effect of corporate governance quality on investment cash-flow sensitivity. We use panel data for a sample of 40 Tunisian non-financial firms listed on the stock exchange over the 2007 to 2016 period. Our results indicate that investment is sensitive to cash-flow but this investment cash-flow sensitivity is reduced when firms exhibit better governance quality. These findings suggest that improvement of corporate governance can solve agency problems and reduce financial constraints. We conclude that better governance leads to more efficient investment allocation in Tunisia. Journal: Afro-Asian J. of Finance and Accounting Pages: 168-183 Issue: 2 Volume: 10 Year: 2020 Keywords: investment cash-flow sensitivity; financial constraints; corporate governance. File-URL: http://www.inderscience.com/link.php?id=106254 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:ids:afasfa:v:10:y:2020:i:2:p:168-183 Template-Type: ReDIF-Article 1.0 Author-Name: Thuy An Chung Author-X-Name-First: Thuy An Author-X-Name-Last: Chung Author-Name: Quynh Trang Phan Author-X-Name-First: Quynh Trang Author-X-Name-Last: Phan Title: Debt maturity and the development of financial markets in Vietnamese listed firms Abstract: This study examines the determinants of the corporate debt maturity structure for the period from 2007 to 2016, utilising a sample of non-financial listed firms chosen from two stock exchanges: the Ho Chi Minh Stock Exchange (HOSE) and the Ha Noi Stock Exchange (HNX). The regression results partially support the theories of agency cost, signalling and liquidity risk and provide little evidence supporting the theory of tax minimisation. We find that leverage, firm size and lagged debt maturities are the important factors in the choice of corporate debt maturity. Other evidence documents that the development of the equity market plays an important role in the financial structure. Journal: Afro-Asian J. of Finance and Accounting Pages: 184-206 Issue: 2 Volume: 10 Year: 2020 Keywords: leverage; firm size; financial market; debt maturity; emerging markets. File-URL: http://www.inderscience.com/link.php?id=106258 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:ids:afasfa:v:10:y:2020:i:2:p:184-206 Template-Type: ReDIF-Article 1.0 Author-Name: Perumandla Swamy Author-X-Name-First: Perumandla Author-X-Name-Last: Swamy Author-Name: Kurisetti Padma Author-X-Name-First: Kurisetti Author-X-Name-Last: Padma Title: An empirical examination of correlation dynamics between commodity and equity derivative indices: evidence from India using DCC-GARCH models Abstract: This empirical study investigates the time-varying co-movements and volatility linkages between equity-commodity indices and inter-commodity indices. This paper deploys DCC-GARCH framework. Three versions of GARCH namely standard, threshold and exponential with both symmetric and asymmetric versions of dynamic conditional correlations (DCC) have been used. This study considers equity index Nifty 50, non-agricultural commodity indices MCX Energy and MCX Metal along with agricultural commodity indices Dhaanya and MCX Agri. Our results revealed that the combined portfolio of commodities-equity has low or negative correlations, which provide better diversification property rather than a portfolio without commodities. However, we notice a steep decline in time-varying correlations of equity with non-agricultural commodity portfolio since 2013. The mixed portfolio of the agricultural commodity with non-agricultural commodity can also offer diversifying benefits. We found high volatility shifts in time-varying co-movements of Nifty 50-MCX Agri pair. On the other hand, we observed an increasing trend in the co-movements of Nifty 50-Dhaanya, it indicates the interdependency of these two markets. Non-agricultural commodity pair (MCX Energy-MCX Metal) and agricultural commodity pair (MCX Agri-Dhaanya) fail to offer better-diversifying properties. This study provides an essential insight to policymakers, portfolio managers, domestic and international investors, risk analysts and financial researchers in an emerging market. Journal: Afro-Asian J. of Finance and Accounting Pages: 207-234 Issue: 2 Volume: 10 Year: 2020 Keywords: commodity derivative markets; equity market; DCC-GARCH; time-varying co-movements; diversifying portfolio; volatility; emerging markets. File-URL: http://www.inderscience.com/link.php?id=106259 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:ids:afasfa:v:10:y:2020:i:2:p:207-234 Template-Type: ReDIF-Article 1.0 Author-Name: Huey Chyi Ng Author-X-Name-First: Huey Chyi Author-X-Name-Last: Ng Author-Name: Fan Fah Cheng Author-X-Name-First: Fan Fah Author-X-Name-Last: Cheng Title: The impact of financial flexibility on debt maturity structure for Australian and Malaysian firms Abstract: Financial flexibility enables firms to respond positively to unanticipated shocks or investment opportunities. Financial flexibility and the debt maturity structure are important for a firm's survivability. During a crisis, highly leveraged firms cannot survive due to the inability to pay back and roll over their debt for longer maturity. Financial flexibility could contribute better capital structure decisions and reduce risk. This paper investigates financial flexibility and the impact on the debt maturity structure in Malaysian and Australian firms. The results suggested that Malaysian firms follow a pecking order theory, whereas Australian firms follow the trade-off theory. Financial flexibility firms are generally less leveraged. These firms were found to have less long-term debt in both countries. They prefer short-term debt since they are able to access financing resources at lower cost. Non-financial flexibility firms prefer long-term debt because of the reduced capability of repayment and the high rollover risk if they hold short-term debt. Journal: Afro-Asian J. of Finance and Accounting Pages: 235-261 Issue: 2 Volume: 10 Year: 2020 Keywords: capital structure; financial flexibility; debt maturity structure; Malaysia; Australia. File-URL: http://www.inderscience.com/link.php?id=106260 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:ids:afasfa:v:10:y:2020:i:2:p:235-261 Template-Type: ReDIF-Article 1.0 Author-Name: Saeed Fathi Author-X-Name-First: Saeed Author-X-Name-Last: Fathi Author-Name: Somaye Jalali Author-X-Name-First: Somaye Author-X-Name-Last: Jalali Author-Name: Alireza Ajam Author-X-Name-First: Alireza Author-X-Name-Last: Ajam Author-Name: Omid Mirmohammad Sadeghi Author-X-Name-First: Omid Mirmohammad Author-X-Name-Last: Sadeghi Title: Analysing the effect of trading characteristics on liquidity measures – a combined approach to liquidity: evidences from Tehran Stock Exchange Abstract: Liquidity estimation has always been of conspicuous importance to all investors as well as risk and return. The purpose of this study is to examine the impact of trading characteristics (price, trading volume, variability, return volatility, absolute stock return, and Beedles thin trading measure) on liquidity measures (Amihud illiquidity ratio, return reversal measure, stock turnover, zero return, turnover-volatility ratio and proportional bid-ask spread) in Tehran Stock Exchange. We extend previous studies by combining different liquidity measures using TOPSIS technique and by employing a multidimensional variable, namely TOPSIS output. Results reveal both of the liquidity measures are strongly related to trading characteristics including stock turnover and zero return. Also, stock price, trading volume, and Beedles thin trading measures are the most significant factors in estimating liquidity. Different effects of different liquidity measures indicate that liquidity is a multidimensional and complex concept, and each measure reflects only one aspect of liquidity. The results of examining the influence of trading characteristics on the combined (multidimensional) liquidity measure indicate that trading characteristics are the main determinants of liquidity. Journal: Afro-Asian J. of Finance and Accounting Pages: 262-277 Issue: 2 Volume: 10 Year: 2020 Keywords: liquidity; trading characteristics; liquidity measures; Tehran Stock Exchange. File-URL: http://www.inderscience.com/link.php?id=106263 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:ids:afasfa:v:10:y:2020:i:2:p:262-277 Template-Type: ReDIF-Article 1.0 Author-Name: Injoong Kim Author-X-Name-First: Injoong Author-X-Name-Last: Kim Title: Decomposition of the dividend forecast model: firm characteristics or market discrimination? Evidence from the Korean market Abstract: Historically, KOSPI firms have shown consistently higher chances of dividend payment compared to KOSDAQ firms. The counterfactual decomposition technique popularised by Oaxaca and Blinder is adapted to explain the dividend differentials between the two markets. Our results suggest that there exists market discrimination that cannot be explained by the traditional dividend forecast model of Fama and French (2001). After controlling for the group differences in firm characteristics such as size and profitability, KOSPI firms still have a higher probability of paying dividends, and, especially during the crisis period, they deal with risks better and are less affected by macroeconomic shocks. We observe the level difference after controlling for firm characteristics as well as the difference in the sensitivity of dividends with respect to the dividend predictors between two markets. For the crisis period, the explanatory power of firm characteristics drops, and the market effect plays a dominant role in explaining dividend behaviours. Journal: Afro-Asian J. of Finance and Accounting Pages: 278-294 Issue: 2 Volume: 10 Year: 2020 Keywords: dividend; decomposition; firm characteristics; Korea Composite Stock Price Index; KOSPI; Korea Securities Dealers Automated Quotation; KOSDAQ; Korea; propensity to pay dividends; discrimination. File-URL: http://www.inderscience.com/link.php?id=106265 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:ids:afasfa:v:10:y:2020:i:2:p:278-294 Template-Type: ReDIF-Article 1.0 Author-Name: Mwila J. Mulenga Author-X-Name-First: Mwila J. Author-X-Name-Last: Mulenga Author-Name: Meena Bhatia Author-X-Name-First: Meena Author-X-Name-Last: Bhatia Title: Value relevance of reported financials of NSE listed companies Abstract: The purpose of this paper is to examine value relevance of accounting information in Indian stock market. The study focuses exclusively on the listed firms under Nifty 100 from 2001 to 2015, and uses price and returns models. The findings under both models suggest that accounting information has the significant ability in influencing stock prices and stock returns during the entire period covered by this study. Further analysis shows that book value per share is more relevant for loss-making firms while earnings per share are more relevant for profit-making firms. Based on industry classification, the value relevance of accounting information reported is high in metal industry, infrastructure, energy, financial services, automobiles and services industry and low in consumption and pharma industry. Study concludes that accounting information is relevant for investment decisions and investors must focus on this information to make informed investment decisions. Journal: Afro-Asian J. of Finance and Accounting Pages: 295-319 Issue: 3 Volume: 10 Year: 2020 Keywords: accounting information; value relevance; stock market; price model; returns model; NSE; India; metal industry; infrastructure; energy; financial services; automobiles; services industry; loss making firms; profit making firms. File-URL: http://www.inderscience.com/link.php?id=108242 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:ids:afasfa:v:10:y:2020:i:3:p:295-319 Template-Type: ReDIF-Article 1.0 Author-Name: Nguyen Thi Canh Author-X-Name-First: Nguyen Thi Author-X-Name-Last: Canh Author-Name: Nguyen Thi Thuy Lien Author-X-Name-First: Nguyen Thi Thuy Author-X-Name-Last: Lien Title: The impacts of public investment on return and economic growth by economic industry in Vietnam Abstract: This study empirically analyses the impact of public investment from government budget on economic growth by measuring the indirect effects of public investment on return and private investment in 16 economic industries from 1990 to 2016. The findings show the positive relationship between private investment and return on total assets by industry. Economic growth, the share of public investment in infrastructure and the share of public investment in education also have a positive impact on return on total assets by industry. However, total state sector investment has the negative effect on the return on total assets by industry. In addition, when observing after tax profit by industry, there appears that the share of total investment in GDP is positively affected by the share of manufacturing industry in GDP and labour productivity by industry. Journal: Afro-Asian J. of Finance and Accounting Pages: 320-340 Issue: 3 Volume: 10 Year: 2020 Keywords: public investment; private investment; state sector investment; return on investment; investment in education; labour productivity; Vietnam. File-URL: http://www.inderscience.com/link.php?id=108243 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:ids:afasfa:v:10:y:2020:i:3:p:320-340 Template-Type: ReDIF-Article 1.0 Author-Name: Robert W. Odewale Author-X-Name-First: Robert W. Author-X-Name-Last: Odewale Title: Board attributes and voluntary disclosure in an emerging economy: evidence from Nigeria Abstract: This study examines the effect of board attributes (board size, board composition and CEO duality) on the extent of voluntary disclosure using data for 237 firm-year observations from 75 firms listed on the Nigerian Stock Exchange from 2009 to 2012. The study constructs disclosure index score comprising 36 items. Using random-effects regression model, the result shows that CEO duality is negatively related to voluntary disclosure. This study also finds that board size and board composition do not have any significant relationship with voluntary disclosure. This study has implications for future researchers, regulators, and investors. Future researchers may find it interesting to examine board behaviour in order to understand the complexities of board operations as it affects their monitoring role. There is no evidence that the introduction of Corporate Governance Code by the Nigerian Securities and Exchange Commission has led to improvement in the voluntary disclosure made by listed companies. There is therefore the need for regulators to improve their enforcement and compliance mechanism at ensuring that listed companies comply with the disclosure requirements. It may also be appropriate that certain disclosures be made mandatory, since the management may not have the incentives to make such disclosures. Journal: Afro-Asian J. of Finance and Accounting Pages: 341-363 Issue: 3 Volume: 10 Year: 2020 Keywords: board attributes; corporate governance; voluntary disclosure; emerging economy; board size; board composition; CEO duality; disclosure index; Nigeria. File-URL: http://www.inderscience.com/link.php?id=108244 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:ids:afasfa:v:10:y:2020:i:3:p:341-363 Template-Type: ReDIF-Article 1.0 Author-Name: Mohammad Asif Author-X-Name-First: Mohammad Author-X-Name-Last: Asif Author-Name: Rana Afreen Author-X-Name-First: Rana Author-X-Name-Last: Afreen Title: The stability of money demand in India in the post reform period: an empirical analysis Abstract: This paper provides an empirical analysis of the stability of demand for money in India using ARDL cointegration framework. The study of stability of money demand plays an important role in deciding the appropriate instruments of monetary policy. The present study examines the demand for money by using annual data over the period 1991-2015. The ARDL model bound test procedure has confirmed that a stable, long relationship exists between M1 and its determinants such as income, interest rates, exchange rates and inflation. Through results we conclude that income elasticity coefficient is positive and significant while the coefficient of inflation and interest rate is negative. Based on the Bahmoni-Oskooee and Pourhedrian (1990) argument, exchange rates negatively affect the demand for money. This study also examines the cointegration in the presence of structural break by using Gregory-Hansen single structural break approach. The study does not find any cointegration in presence of single structural break. Our result also reveals that M1 is stable between the sample period when we incorporated the CUSUM and CUSUMSQ tests. Journal: Afro-Asian J. of Finance and Accounting Pages: 364-379 Issue: 3 Volume: 10 Year: 2020 Keywords: money demand; ARDL; structural break; stability; India. File-URL: http://www.inderscience.com/link.php?id=108245 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:ids:afasfa:v:10:y:2020:i:3:p:364-379 Template-Type: ReDIF-Article 1.0 Author-Name: Afrin Rifat Author-X-Name-First: Afrin Author-X-Name-Last: Rifat Author-Name: Anika Bushra Author-X-Name-First: Anika Author-X-Name-Last: Bushra Author-Name: Nabila Nisha Author-X-Name-First: Nabila Author-X-Name-Last: Nisha Title: Factors that drive dividend payout decisions: an investigation in the context of Bangladesh Abstract: Generally, dividend policies guide the financial rewards of the shareholders. It is often a challenging decision for companies to determine the appropriate level of dividend for the shareholders. While some past studies argue that microeconomic factors drive the decision of dividend policies, many other researchers claim that it is the macroeconomic factors of a country which ultimately influence the dividend payouts. However, there is a paucity of research in this area for emerging countries like Bangladesh. This study thus examines impacts of a set of pre-determined microeconomic and macroeconomic factors upon cash dividend payouts by analysing a sample of listed firms of the Dhaka Stock Exchange (DSE), Bangladesh. Findings are analysed based on liquidity, leverage, growth, and size of the sample firms for microeconomic factors; while, macroeconomic factors are analysed upon dividends on an average basis. The results provide policy implications for shareholders, management, policymakers and the government of Bangladesh. Journal: Afro-Asian J. of Finance and Accounting Pages: 380-408 Issue: 3 Volume: 10 Year: 2020 Keywords: dividends; microeconomic variables; macroeconomic variables; profitability; company-specific; country-specific; emerging economy; Bangladesh. File-URL: http://www.inderscience.com/link.php?id=108246 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:ids:afasfa:v:10:y:2020:i:3:p:380-408 Template-Type: ReDIF-Article 1.0 Author-Name: Neha Seth Author-X-Name-First: Neha Author-X-Name-Last: Seth Author-Name: Laxmidhar Panda Author-X-Name-First: Laxmidhar Author-X-Name-Last: Panda Title: Volatility interdependency: a quantile regression analysis in Asian stock markets Abstract: The purpose of this paper to investigate the structure of volatility interdependency among the Asian stock markets during the period of the global financial crisis (GFC) and the European sovereign debt crisis (ESDC). This paper uses quantile regression (QR) technique in the conditional volatility series obtained from the result of ARIMA (p, q)-GARCH (1, 1) model. The sample includes eight emerging and three developed stock markets covering the period from 2nd January 2000 to 31st March 2016. The results of the QR model strongly support volatility interdependency among the Asian stock markets during the period of financial crisis. The results of this paper also indicated that emerging markets are majorly affected by conditional volatility generated from developed markets in periods of financial crisis. This paper provides valuable information regarding the complex volatility structure among the Asian stock markets during the crisis period which may help to domestic and foreign investors in taking major decisions on portfolio diversification during periods of global financial turbulence. Journal: Afro-Asian J. of Finance and Accounting Pages: 409-429 Issue: 3 Volume: 10 Year: 2020 Keywords: financial contagion; volatility interdependence; quantile regression; Asian stock markets; global financial crisis; European debt crisis. File-URL: http://www.inderscience.com/link.php?id=108247 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:ids:afasfa:v:10:y:2020:i:3:p:409-429 Template-Type: ReDIF-Article 1.0 Author-Name: Imen Tebourbi Author-X-Name-First: Imen Author-X-Name-Last: Tebourbi Author-Name: Irene Wei Kiong Ting Author-X-Name-First: Irene Wei Kiong Author-X-Name-Last: Ting Author-Name: Qian Long Kweh Author-X-Name-First: Qian Long Author-X-Name-Last: Kweh Author-Name: Harith Ali Hamood Al Huseini Author-X-Name-First: Harith Ali Hamood Al Author-X-Name-Last: Huseini Title: Capital structure and profitability in a tax-free country: evidence from the UAE Abstract: The balance between debt and equity is a key factor explaining profitability. This study examines how capital structure affects the profitability of firms listed on stock exchanges in the United Arab Emirates (UAE), a country that does not have a federal corporate income tax regime. The proxies of capital structure used include total, short-term, and long-term debt ratios, while those of profitability are return on assets and return on equity. Over a 2001-2016 sample period, this study documents a significantly negative association between capital structure and profitability. This study finds that the negative association is mainly found in companies with a high level of debts. The results of this study not only imply that information asymmetry exists, they also highlight how capital structure and profitability are associated in the context of a corporate tax-free country. Journal: Afro-Asian J. of Finance and Accounting Pages: 430-444 Issue: 3 Volume: 10 Year: 2020 Keywords: capital structure; profitability; debt; information asymmetry; United Arab Emirates. File-URL: http://www.inderscience.com/link.php?id=108257 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:ids:afasfa:v:10:y:2020:i:3:p:430-444 Template-Type: ReDIF-Article 1.0 Author-Name: Doddy Setiawan Author-X-Name-First: Doddy Author-X-Name-Last: Setiawan Author-Name: Lian Kee Phua Author-X-Name-First: Lian Kee Author-X-Name-Last: Phua Author-Name: Hong Kok Chee Author-X-Name-First: Hong Kok Author-X-Name-Last: Chee Author-Name: Irwan Trinugroho Author-X-Name-First: Irwan Author-X-Name-Last: Trinugroho Title: The effect of audit committee characteristics on earnings management: the case of Indonesia Abstract: We investigate the effectiveness of audit committee in mitigating earnings management in the context of Indonesia. Audit committee is expected to reduce earnings management. This study examines the effect of several audit committee characteristics: independence of audit committee members, number of audit committee members, number of meetings, expertise in finance and gender on earnings management. We study 393 Indonesian listed firms during the 2006-2010 period. Results show that female member(s) of audit committee mitigate earnings management. However, financial expertise and number of meetings have positive effect on earnings management. This result shows that both variables might not be effective to constraint earnings management. On the other hand, number of audit committee members and independence of audit committee member do not have any significant influence on earnings management. Further, this study shows that audit firms and leverage have negative effect on earnings management. However, institutional investors tend to push earnings management higher and growth has no significant effect on earnings management. Journal: Afro-Asian J. of Finance and Accounting Pages: 447-463 Issue: 4 Volume: 10 Year: 2020 Keywords: audit committee; earnings management; financial expertise; gender; number of meetings; Indonesia. File-URL: http://www.inderscience.com/link.php?id=110488 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:ids:afasfa:v:10:y:2020:i:4:p:447-463 Template-Type: ReDIF-Article 1.0 Author-Name: Sarah Aulia Andriana Author-X-Name-First: Sarah Aulia Author-X-Name-Last: Andriana Author-Name: Yunieta Anny Nainggolan Author-X-Name-First: Yunieta Anny Author-X-Name-Last: Nainggolan Title: Relationship between debt maturity and IPO: the case of Indonesian firms Abstract: Initial public offering (IPO) is a big step in company life cycle as the time when company evolves from private to public firm by adding another source of financing. Studying the impact of IPO to debt maturity structure choices in Indonesia is important because debt maturity has an important role in emerging markets' macroeconomic condition. Based on literature review, it is expected for companies to take debt with longer maturity post-IPO for the benefits and accessibility. Company sample is taken from Indonesia Stock Exchange, using data of companies that have undergone IPO from 2008-2011. After analysis, it is found that one and two years after IPO, newly listed firms increase the use of long-term debt. Other statistically significant variables are firm's asset maturity, leverage, and growth opportunity. Result of this research would be an addition to Indonesia's financial literature and give insight of IPO's implication to Indonesian firms. Journal: Afro-Asian J. of Finance and Accounting Pages: 464-479 Issue: 4 Volume: 10 Year: 2020 Keywords: Asian capital market; capital structure; debt maturity; financing; funding; going public; Indonesia market; initial public offering; IPO; leverage; liquidity risk. File-URL: http://www.inderscience.com/link.php?id=110489 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:ids:afasfa:v:10:y:2020:i:4:p:464-479 Template-Type: ReDIF-Article 1.0 Author-Name: Ahmad Danu Prasetyo Author-X-Name-First: Ahmad Danu Author-X-Name-Last: Prasetyo Author-Name: Camelia Magdalena Author-X-Name-First: Camelia Author-X-Name-Last: Magdalena Author-Name: Brian Charvia Author-X-Name-First: Brian Author-X-Name-Last: Charvia Author-Name: Mandra Lazuardi Kitri Author-X-Name-First: Mandra Lazuardi Author-X-Name-Last: Kitri Title: Should Indonesia adopt a basket currency regime? Abstract: Exchange rate regime is a system in which a country manages its currency about other currencies and the foreign exchange market. Currently, there are two major types of exchange rate regimes, i.e., free-float system and pegged system. Many countries, including Indonesia, adopted the free-float system since it is believed as the best regime for absorbing external economic shocks. However, some economists argued that a moderate exchange rate regime, such as currency basket system, is a better approach for achieving the government's goals. The research aims to provide an arrangement for optimal basket weights of Indonesian currency basket to minimise GDP volatility as well as exchange rate volatility. We develop an optimisation model in the extension of Yoshino et al. (2017) by adding five currencies in the basket. We found that the weight currencies in the free-float regime would reflect the trade intensities of the respective countries. Further, the government should monitor the change of exchange rates of currencies in the foreign reserves and change the weight accordingly. In addition, we also found that, whether the government implementing basket currency regime or free-float regime, it will make no significant differential effect on GDP gap volatility. Journal: Afro-Asian J. of Finance and Accounting Pages: 494-513 Issue: 4 Volume: 10 Year: 2020 Keywords: exchange rate regime; basket currency; foreign reserve; GDP gap; exchange rate gap; Indonesia. File-URL: http://www.inderscience.com/link.php?id=110490 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:ids:afasfa:v:10:y:2020:i:4:p:494-513 Template-Type: ReDIF-Article 1.0 Author-Name: Muhamed Zulkhibri Author-X-Name-First: Muhamed Author-X-Name-Last: Zulkhibri Author-Name: Muhammad Rizky Prima Sakti Author-X-Name-First: Muhammad Rizky Prima Author-X-Name-Last: Sakti Title: Macroprudential policy and financing behaviour in emerging markets: bank-level evidence from Indonesian dual banking Abstract: The loan-to-funding ratio-based reserve-requirement (RR-LFR) is a macroprudential instrument used by Bank Indonesia (central bank) to maintain the stability of Indonesian financial system by considering the bank liquidity conditions. This paper examines the impact of RR-LFR on financing behaviour in a dual banking system (Islamic and conventional banks) using generalised method of moment estimation (GMM) technique to address the endogeneity of explanatory variables and reduce the possible biases from residual correlation. Using bank-level data for both Islamic and conventional banks covering the period 2001-2015, we analyse the reaction of bank financing behaviour toward RR-LFR policy. The findings indicate that RR-LFR is effective in curtailing financing behaviour of banking institutions. Further, we show that RR-LFR exerts more impacts on managing credit expansion of conventional banks than of Islamic banks. The study suggests that a specific macroprudential framework should be put in place to address systemic concerns for each type of banks. Hence, the supervisory authorities will be able to identify the channel of macroprudential transmission and to devise an optimum policy mix for their banking system. Journal: Afro-Asian J. of Finance and Accounting Pages: 514-536 Issue: 4 Volume: 10 Year: 2020 Keywords: macroprudential; financing behaviour; Indonesia; GMM method. File-URL: http://www.inderscience.com/link.php?id=110491 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:ids:afasfa:v:10:y:2020:i:4:p:514-536 Template-Type: ReDIF-Article 1.0 Author-Name: Md Arafat Hossain Author-X-Name-First: Md Arafat Author-X-Name-Last: Hossain Author-Name: Vahid Biglari Author-X-Name-First: Vahid Author-X-Name-Last: Biglari Title: Day of the week effect anomaly in Dhaka Stock Exchange post crisis period: evidence from Bangladesh capital market Abstract: This study examines day of the week effect anomaly in Dhaka Stock Exchange (DSE), during post crisis period. The Bangladesh stock market crashed on 19 December 2010, and the stock market remained sluggish for long time. This study used the daily closing prices of two important indexes (DGEN and DSI) during post crisis period, from 19 December 2010 to 31 December 2013. Regression statistics modelled with dummy variables, one-sample T-test statistics, paired-sample T-test statistics and ANOVA (one-way) for parametric test and Kruskal-Wallis and Wilcoxon signed rank test for non-parametric test, have been used to observe the day of the week effect anomaly in DSE. The results revealed irregularities in daily mean returns with different returns volatility in week. The study provides implications for policy makers to develop appropriate post-crisis policy tools and incentives to re-stabilise the market. Journal: Afro-Asian J. of Finance and Accounting Pages: 537-553 Issue: 4 Volume: 10 Year: 2020 Keywords: Dhaka Stock Exchange; DSE; day of the week effect anomaly; stock market crash; regression with dummy variables; Kruskal-Wallis test; Wilcoxon signed rank test; weekday effect; post crisis period; Bangladesh capital market; Asia. File-URL: http://www.inderscience.com/link.php?id=110492 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:ids:afasfa:v:10:y:2020:i:4:p:537-553 Template-Type: ReDIF-Article 1.0 Author-Name: Rohani Md-Rus Author-X-Name-First: Rohani Author-X-Name-Last: Md-Rus Author-Name: Kamarun Nisham Taufil Mohd Author-X-Name-First: Kamarun Nisham Taufil Author-X-Name-Last: Mohd Author-Name: Rohaida Abdul Latif Author-X-Name-First: Rohaida Abdul Author-X-Name-Last: Latif Title: Analysing the stability of bankruptcy prediction models Abstract: The aim of this study is to assess the predictive power of logit model and hazard model in predicting bankruptcy and to analyse the stability of the models. Using Malaysian listed companies and a sample span from 1998 to 2014, this study found that, for the hazard model, all variables were significant while for the logit model only five variables were significant. The results also show that the logistic and hazard models both had predictive accuracies of more than 90%. However, the hazard model had a predictive accuracy of 99.4% while logit model had a predictive accuracy of 91.8%. The hazard model was more stable than logit model as the predictive accuracy of the hazard only changed a little when a smaller sample was chosen. Lastly, the study showed that, even though both models were good in predicting distress, the hazard model is better than logit model. Journal: Afro-Asian J. of Finance and Accounting Pages: 554-568 Issue: 4 Volume: 10 Year: 2020 Keywords: logit model; hazard model; bankruptcy prediction; stability; profitability; leverage; growth; cash flow; size; Malaysia. File-URL: http://www.inderscience.com/link.php?id=110493 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:ids:afasfa:v:10:y:2020:i:4:p:554-568 Template-Type: ReDIF-Article 1.0 Author-Name: Sita Deliyana Firmialy Author-X-Name-First: Sita Deliyana Author-X-Name-Last: Firmialy Author-Name: Akbar Adhiutama Author-X-Name-First: Akbar Author-X-Name-Last: Adhiutama Title: Investigation on leveraging effect of women directors on board to R%D investment and firms' financial performance in the context of developing countries: evidence from Indonesia Abstract: This study examines the leveraging effect of gender diversity, specifically women directors on board (WDB), to the relationship between research and development (R%D) investment to the financial performance. Additionally, the study aims to deepen our understanding of the main behavioural driver of corporate financial performances in Indonesia, one of the fast developing countries within South East Asia. Data from 227 public companies listed in Indonesian stock exchange (IDX) are extracted from their 2015 annual reports and corporate websites. Tobin's Q is employed as the dependent variable, along with R%D investment and WDB as main testing variables. Using regression, the study finds that firms' with higher number of women directors on board and more focus on their R%D investment activities, will be able to generate higher financial performance than those firms with lower gender diversity and R%D investments. This paper contributes to literature on R%D investment in Indonesia, which is still limited, to the best of the authors' knowledge. The reported findings also uncover the main important finding of leveraging effect of number of WDB to the relationship between R%D investment and firms' financial performance in Indonesia. Journal: Afro-Asian J. of Finance and Accounting Pages: 480-493 Issue: 4 Volume: 10 Year: 2020 Keywords: R%D investment; financial performance; women directors on board; WDB; moderating effect; developing countries; Indonesia. File-URL: http://www.inderscience.com/link.php?id=110494 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:ids:afasfa:v:10:y:2020:i:4:p:480-493 Template-Type: ReDIF-Article 1.0 Author-Name: Gizelle D. Willows Author-X-Name-First: Gizelle D. Author-X-Name-Last: Willows Author-Name: Lawrence W.K. Ho Author-X-Name-First: Lawrence W.K. Author-X-Name-Last: Ho Author-Name: Darron West Author-X-Name-First: Darron Author-X-Name-Last: West Title: The effect of dividend payouts on future earnings Abstract: The conventional expectation of the relationship between the level of dividend payout and future earnings growth, based on established finance theories, is that it is negative. This expectation stems from the perceived attractiveness of having enough available retained earnings to fund any potential future growth opportunities. However, research performed in various markets at the turn of the century has challenged this belief. This paper seeks to update this theory by investigating the relationship in a more current dataset, from 1988 to 2014. Furthermore, given the investment opportunities within emerging markets, the dataset pertains to South African listed companies. Assessing two different earning measures, over multiple years, a multivariate regression analysis revealed a statistically significant positive relationship between dividend payout and future earnings. Dividend payout decisions are seen by investors as a predictor for future value growth and, as such, management should be aware of their associated dividend distribution decisions. Journal: Afro-Asian J. of Finance and Accounting Pages: 569-583 Issue: 4 Volume: 10 Year: 2020 Keywords: dividends; earnings; emerging market; value growth; payouts; future earnings; retained earnings; dividend distributions; leverage; earnings yield. File-URL: http://www.inderscience.com/link.php?id=110495 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:ids:afasfa:v:10:y:2020:i:4:p:569-583 Template-Type: ReDIF-Article 1.0 Author-Name: Wael Mostafa Author-X-Name-First: Wael Author-X-Name-Last: Mostafa Title: Operating performance and earnings management in Egypt Abstract: This research contributes to the literature addressing the phenomenon of earnings management in global markets. The research setting is Egypt, and due to data limitations in this setting, this research examines earnings management based on firm operating performance. In particular, the question of whether ineffectively performing firms engage more in earnings management strategies compared to their effectively performing counterparts is investigated. Sign change ratio analysis, correlation analysis, and regression analysis were employed to determine the extent to which the strength of the relationship between earnings and cash flows differs between ineffectively and effectively performing firms. The results show that considered against effectively performing firms, ineffectively performing firms in the emerging market of Egypt are associated with a greater level of earnings management. Overall, this finding suggests that for listed Egyptian firms, company operating performance is a significant incentive of earnings management. Furthermore, this finding encourages the argument in favour of Egyptian corporate governance reform. Journal: Afro-Asian J. of Finance and Accounting Pages: 584-605 Issue: 4 Volume: 10 Year: 2020 Keywords: earnings management; operating performance; earnings; cash flows from operations; Egypt. File-URL: http://www.inderscience.com/link.php?id=110512 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:ids:afasfa:v:10:y:2020:i:4:p:584-605