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International Journal of Accounting, Auditing and Performance Evaluation

International Journal of Accounting, Auditing and Performance Evaluation (IJAAPE)

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International Journal of Accounting, Auditing and Performance Evaluation (26 papers in press)

Regular Issues

  • Who is responsible for developing the non-core skills of entry-level public sector trainee auditors? The case of the Auditor-General South Africa   Order a copy of this article
    by Fortunate Mashabela, Barry Ackers 
    Abstract: Within the context of rising levels of corruption, financial mismanagement, fraud, and irregular, fruitless and wasteful expenditure in the South African public sector, as well as high profile audit failures, this paper investigates the employment readiness of recent auditing graduates, with particular emphasis on their non-core skill proficiency. The observations are based on a survey of respondents involved in appointing and training aspiring chartered accountants at the Auditor-General South Africa. Aspirant auditors graduating from the South African Institute of Chartered Accountants (SAICA) accredited universities lacked the necessary non-core skills of entry-level trainee auditors at expected levels of proficiency, necessitating additional training interventions. However, universities should not be solely responsible for developing all the skills of competent public sector auditors. Instead, an integrated and collaborative effort by the key stakeholders in the auditing profession is required. These parties include universities, audit firms and professional bodies and the students themselves, as well as other parties such as regulators. Despite extant studies examining the employment readiness of auditing graduates, this is one of the first that specifically focuses on the phenomenon within the public sector.
    Keywords: Auditor-General South Africa; chartered accountant; entry-level trainee auditor; non-core skills; pervasive skills; public sector.

  • Accrual accounting earnings around zero in Greek municipalities: the relevance of political factors   Order a copy of this article
    by Sandra Cohen, Ioanna Malkogianni 
    Abstract: This paper provides empirical evidence that Greek municipalities report small surpluses or zero earnings and that there is a statistically significant political effect related to this attitude. The analysis is based on the annual financial data of Greek municipalities for the period 2011-2017. The final sample includes 1417 annual observations. Based on the public choice theory, it is attempted to associate earnings management behaviour with political incentives and to uncover possible reasons that may induce it. By using the method of bootstrap kernel density estimation (bKDE) the hypothesis that municipalities tend to report earnings close to zero is supported. The findings suggest that core political factors, such as the oppositions strength and the mayors re-election, exert an effect on the appearance of discontinuities around zero reported earnings, contributing to the knowledge regarding earnings management. Sensitivity analysis confirms this political effect.
    Keywords: bootstrap kernel density estimation; earnings management; Greek municipalities; opposition; re-elected mayors.

  • Disclosure of forward-looking information: does overlapping audit committee membership matter?   Order a copy of this article
    by Hidaya Al Lawati, Khaled Hussainey 
    Abstract: We examine whether overlapping audit committee (AC) membership affects the forward-looking content of the chairman reports. We use content analysis to measure levels of forward-looking disclosure (FLD) for 48 bank-year observations from eight banks listed on Muscat Securities Market in Oman for the period 2014-2019. Our regression analysis shows that overlapping AC membership positively affects FLD. The evidence from this study suggests that a consideration of AC directors attributes (e.g. overcommitted AC members) is needed to understand their role in the boardroom or in the subcommittees. An implication of the result is that the Omani corporate governance code should provide guidelines on the type and proportion of the overlapping AC membership. Furthermore, the code could encourage AC members to be overlapped across different committees as this could have a positive impact on corporate disclosure practice. Our study has demonstrated, for the first time, that overlapped AC members enhance the forward-looking content of chairman reports.
    Keywords: overlapping audit committee membership; forward-looking disclosure; chairman reports; content analysis; Oman.

  • Changes in the value relevance of energy industries accounting information: the impact of the shale revolution   Order a copy of this article
    by Gee Jung Kwon 
    Abstract: This study investigates the value-relevant factors of companies in the global energy industry from the point of view of accounting information, and investigates how the value relevance of accounting factors is changing as a result of the shale revolution that began in 2012. The empirical analysis of this study shows that the value relevance of R&D expenditures has declined dramatically since 2012, when shale gas extraction began in the USA. It also shows that in the energy industry, operating cash flow and company size are not important value-related factors in increasing corporate value. Conversely, operating income is the most important value-relevant variable for corporate value since 2010. The results also suggest that accounting information from the energy equipment and services industry group are more useful than information about firms in the oil gas consumable fuel industry. This study shows that there is a change in the value relevance of firm value variables in the energy industry after the shale revolution. The study are expected to be useful for investors and stakeholders in making investment decisions in the global energy industry.
    Keywords: shale revolution; value relevance; accounting information; energy industry.

  • The impact of ownership structure and corporate governance on capital structure decisions in the UAE   Order a copy of this article
    by Mohammed Elgammal, Basil Al-Najjar 
    Abstract: This paper expands the capital structure literature by investigating how ownership shareholdings and corporate governance influence the capital structure decisions within an emerging market context, namely the United Arab Emirates (UAE). Our sample includes firms listed in both Abu Dhabi and Dubai Stock Exchanges for the period from 2008 to 2019. The UAE market is interesting because of the scarcity of research on the capital structure choices within this context. We employ panel models as well as the Two Stages Least Squares (2SLS) technique. Our results show that board structure has a negative effect on capital structure decisions. We also detect a positive impact of institutional ownership and managerial ownership on capital structure, while government ownership is inversely related to capital structure. Finally, we report that profitability negatively affects capital structure. Thus, we argue that the main determinants of capital structure reported in the developed markets literature do hold in the UAE settings. Accordingly, this study contributes to previous studies in the capital structure context and adds to its puzzle by introducing new insights into the capital structure choice in a free tax environment.
    Keywords: capital structure; ownership structure; corporate governance; panel data; UAE.

  • The challenges of implementing enterprise risk management: a study of manufacturing companies in the Tehran Stock Exchange   Order a copy of this article
    by Soghra Fasihi, Seyed Ali Hosseini, Nelson Waweru, Ali Rahmani 
    Abstract: Implementing enterprise risk management (ERM) is one of the important solutions in reducing the uncertainty and survival of companies. The ERM is very important owing to the varying conditions of Iran's business environment as well as the role of manufacturing companies in its prosperity and economic growth. Therefore, the present study aims to explore the challenges of implementing ERM in the manufacturing companies listed in the Tehran Stock Exchange. In the present study, semi-structured interviews with the experts in the field of ERM among selected Iranian manufacturing companies and other ERM experts in the pharmaceutical, automotive, and petrochemical industries are used. The identified challenges related to implementing ERM include intra-organisational and extra-organisational challenges. Intra-organisational challenges include risk governance, risk culture, enterprise risk management process, and infrastructures. Besides, extra-organisational challenges include the role of government and policymakers, political and economic conditions, international restrictions, and the lack of a competitive environment (exclusiveness).
    Keywords: enterprise risk management; Iranian manufacturing companies; contingency theory; risk governance; risk culture; institutional shareholder; international restrictions.

  • The causes of profitability: a panel study of the Indian IT and consulting sector   Order a copy of this article
    by Rohit Bansal, Sanjay Kar, Saroj Mishra 
    Abstract: The paper uses several methods of profit to examine the factors of profitability for the Indian IT and consulting sector. This reading aims to detect the association between the activity ratio or turnover ratio and the profitability of the Indian IT and consulting sector over the seven years from April 2012 to March 2018. Profitability was used as a dependent variable characterised by Profit Margin (PM); Debtors Turnover Ratio (DTR), Working Capital Turnover (WCT) and Assets Turnover Ratio (ATR) were used as independent variables. Financial statements and income statements of all listed IT and consulting companies on the Bombay stock exchange were gathered from companies websites. The data were then analysed with a descriptive research technique of panel data regression and verified with Hausmans measurement, which is a widely used technique for selecting the panel effect. Working capital turnover was found to be statistically positively significant against the profitability of the Indian IT and consulting sector. However, assets turnover ratio and debtor turnover ratio were found statistically insignificant with the profit margin of the Indian IT and consulting sector from 2012 to 2018. The findings of this research will support companies' internal management, auditors, policy-makers, financial executives, and investors in making investment decisions.
    Keywords: profitability determinants; profit margin; assets; debtor turnover; working capital; India; consulting industry; fixed effect panel; radom effect panel; panel regression.

  • The effectiveness of government internal auditor: evidence from Indonesia   Order a copy of this article
    by Sutaryo Sutaryo, Arifudin Tri Anto 
    Abstract: We analyse the effectiveness of the internal audit of the governments in Indonesia. As independent variables, we examine the role of professional proficiency of internal auditors, quality of audit work, organisational independence, auditor career and advancement, and support from the leaders of internal audit entity, by geography, gender, education level and functional position of auditor as control variables. This study uses a structured questionnaire, distributed to 385 functional auditors as our respondents that came from the State Development Audit Agency (BPKP). The results show that professional proficiency of internal auditors, quality of audit work, organisational independence, career path and development, and the support from the internal audit entity leadership have positive influence on governments internal audit effectiveness in Indonesia. Nevertheless, all of the variables are still possible to develop appropriate additional test results. Internal audit entity requires internal auditors who have the professional proficiency, independence, and quality of the audit work results. Internal audit entity should also implement the career policy for auditors and give full support to the implementation of the audit. The findings are discussed in terms of how they can assist in enhancing internal audit effectiveness and provide added value to the auditee.
    Keywords: effectiveness of the internal audit; professional proficiency of internal auditors; organisational independence; support from internal audit entity leadership.

  • Government Investments Commitment to Internal Audit requirements The case of Jordan   Order a copy of this article
    by Mohammad Aladwan, Omar Alhwatmeh 
    Abstract: The study aims to examine the commitment of government companies to international internal auditing standards. The study employs both qualitative and quantitative research methods in addressing the problem. To achieve the study objective, the researchers distributed a questionnaire to 627 employees of 156 Jordanian companies that have government contribution, 582 (92%) of the questionnaires were returned. As a mean for analysing the study data; the researchers used the mean, standard deviation, percentages, and T-test. The general findings revealed that Jordanian companies with government contributions do not apply international internal auditing standards; instead they commit to practices that are enacted by government regulations but, unfortunately, these practices are found not fully similar to international internal auditing standards. Therefore, the results showed weak commitment from the sampled companies to such necessary standards. In the light of the study results, the researchers give a number of recommendations that are necessary to achieve effective internal auditing standards.
    Keywords: internal audit; internal audit standards; owned companies and government contributions; Jordan.

  • Social capital, external regulations and financial reporting quality: evidence from community banks   Order a copy of this article
    by Ziyun Yang, Xiaobo Dong, Wei-Chih Chiang 
    Abstract: Using a large sample of US community banks, we study how social capital affects bank managers opportunistic reporting behaviour. We argue that high social capital reduces information asymmetry between managers and stakeholders and increases the cost of opportunistic reporting for managers. Supporting this argument, we find that social capital is negatively associated with discretionary loan loss provisions. We further find that the negative relation between social capital and opportunistic reporting behaviour is weaker when in banks subject to stronger regulations, which suggests that strong regulations act as a substitute for high social capital in constraining banks opportunistic reporting behaviour. Our findings provide policy implications to regulators with regard to how to counteract the effect of declining social capital on financial reporting quality.
    Keywords: social capital; community banks; earnings management; financial reporting quality; discretionary loan loss provision; external regulations.

  • Corporate governance information disclosure on the websites   Order a copy of this article
    by Dhouha Khrifech, Walid Khoufi 
    Abstract: The purpose of this study is to explain the relationship between company-specific characteristics and the extent of enterprise government (GC) information disclosed on the websites of 91 SBF 120 companies. The empirical results show that, for the French context, the size of enterprises, profitability and board size are the most important factors influencing corporate governance disclosure through their websites.
    Keywords: corporate governance disclosure; corporate websites; firm characteristics; French listed companies.

  • Causality of developing a balanced scorecard under sustainable development: an applied study   Order a copy of this article
    by Salih Ibrahim Younis 
    Abstract: This paper looks for a causality relationship to developing a balanced scorecard according to sustainable development requirements. In addition, suggest some indicators to achieve task. Researcher use the descriptive approach to formulate the theoretical background and analytical approach to empirical testing. The main finding is that the traditional methods are no longer enough for the performance evaluation, so a balanced scorecard was adopted. Despite its benefits, it neglects the environmental side, therefore this work will have significant implication to urge companies to consider the environmental dimension when evaluating their performance, to ensure that their activities are in line with the requirements of sustainable development. In the company under discussion, the developed balanced scorecard was able to evaluate performance in accordance with the requirements of sustainable development by using the suggested indicators. The research has been designed for one company, but it could be a road map for other companies in any country.
    Keywords: balanced scorecard; sustainable development; environmental dimensions; strategy; environmental systems; performance evaluation.

  • Incorporating an analytics mindset into the audit curriculum   Order a copy of this article
    by Yan Luo 
    Abstract: Drawing on insights from recent academic and practitioner articles on audit data analytics (ADA), this paper explores the opportunities and resources available to auditing educators who are interested in integrating an analytics mindset into their curriculum, with the aim of improving auditing education. This study highlights the impact of ADA on the audit profession and the challenges of applying ADA to the full range of auditing tasks. It also provides a comprehensive summary of readily available educational resources that audit educators can use to update their curriculum and enhance students' analytics competency.
    Keywords: analytics; audit; curriculum.

  • External vs. governmental auditing: insights from Spain   Order a copy of this article
    by Aura Nicolaescu, Francisco López-Arceiz 
    Abstract: We aim to determine the existence of a difference in the opinions given by external and governmental auditors in the context of public foundations. Moreover, we analyse if some organisational and environmental variables, related to return, risk and geographical location, have any influence on this difference. To answer this aim, we accessed a sample composed of 174 public foundations located in Spain during the period 2012-2017. We performed the asymptotic chi-squared test and the Fisher exact test to measure the existence of a difference of opinion and a logit regression model to examine the influence and impact of return, risk and geographical location on the above-mentioned difference. The obtained results show the existence of discrepancies between external and governmental auditors, which are influenced by the geographical location. We highlight the need for higher level of harmonisation in regional civil laws via the enforcement of a fundamental law as a regulatory instrument.
    Keywords: public foundation; non-profit; government auditor; external auditing.

  • The role of internal control weakness in debt selection   Order a copy of this article
    by Bambi Hora, Edward Walker, Yinghong Zhang 
    Abstract: We investigate the impact of internal control weakness (ICW) on debt selection. We categorise debt structure in two ways: 1) bank debt, bonds, program debt, private placements, convertible debt, and other debts; and 2) secured, senior unsecured, and subordinated debts. We hypothesise that the existence of ICWs reduces accounting information quality and increases firm risk and default risk. Therefore, bank debt is borrowed to provide better monitoring. Additionally, the presence of ICW is also positively associated with the usage of secured debts, which are collateralised by assets. Our findings are consistent with our predictions. Our findings suggest that ICW information provides incremental value to creditors and that changes in debt selection are one economic consequence of companies reporting ICWs.
    Keywords: debt structure; internal control weakness; secured debt; senior unsecured debt; subordinated debt; bank debt; bonds; program debt; private placement; convertible debt.

  • Does foreign ownership affect audit committee adoption? Evidence from Brazilian companies   Order a copy of this article
    by Daniel Vancin, Clea Macagnan, Lucas Cervo, Cristiano Costa 
    Abstract: The aim of this article is to verify whether the voluntary constitution of the audit committee in companies listed in the Brazilian stock market could be explained by the presence of foreign stockholders. The method used was a probit model with instrumental variables, and the results confirmed the hypothesis, indicating that there is an U-shaped relationship: the probability of adoption of the audit committee slightly decreases at low levels of foreign participation and increases after reaching a cutoff level. This result is in line with previous literature on the role of foreign investors in improving corporate governance in companies in developing countries to protect themselves from expropriation by local stockholders and managers.
    Keywords: voluntary audit committee; foreign stockholders; corporate governance; monitoring; determinants.

  • Enterprise risk management disclosure and creative accounting practices: evidence from Nigeria   Order a copy of this article
    by Olayinka Erin, Paul Olojede 
    Abstract: This study investigates the impact of Enterprise Risk Management (ERM) disclosure on creative accounting practices of listed firms in Nigeria for the period of 2013-2018. With a sample of 120 firms in Nigeria, we drew insights from the contingency theory. The study used panel data with fixed effects regression analysis to analyse the dataset. The findings empirically revealed that ERM disclosure has a significant impact on the reduction of creative accounting practices. Our findings call for clear responsibility and a strong drive for ERM disclosure by corporate institutions in Nigeria and other emerging economies. The empirical approach used in this study emphasises the need for corporate organisations to embrace ERM practices and to integrate ERM information into their business strategies and operations. Our findings contribute to the growing literature in the area of ERM disclosure, creative accounting practices, business ethics, and corporate transparency in Nigeria and, by extension, other Sub-Saharan African countries.
    Keywords: board risk committee; cash based earnings management; creative accounting practices; contingency theory; chief risk officer; enterprise risk management.

  • Factors inhibiting effective organisational performance management: insights from the South African public sector   Order a copy of this article
    by Asogan Moodley, Barry Ackers, Elza Odendaal 
    Abstract: Despite a quarter of a century of democracy, the South African government continues facing civil unrest relating to poor delivery of public goods and services. To address this deficiency, the South African government adopted organisational performance management (OPM), as a tool to improve strategic management and operational performance. Despite this directive, service delivery does not appear to have improved. This study therefore aims to establish the factors that inhibit the effective implementation of OPM and accordingly impair service delivery. The study, which adopts a multiphase mixed methods research approach, uses both quantitative and qualitative data collected through surveys, interview and focus groups, as well as from a content analysis of pertinent documents and records. Non-alignment between planning and budgeting, focusing on outcomes rather than impacts, the adoption of a compliance-driven orientation rather than focusing on effective organisational performance, inadequate stakeholder management, poor technical skills, and a lack of effective consequence management were amongst the factors identified as inhibiting OPM and effective service delivery.
    Keywords: consequence management; governance; monitoring and evaluation; organisational performance management; performance information reporting; public sector.

  • Sahara: when regulators radar strikes   Order a copy of this article
    by Palka Chhillar 
    Abstract: Sahara India Parivar, an Indian conglomerate with many companies under its umbrella, had experienced phenomenal growth in the business for decades. The activities by the conglomerate to raise capital through different means were finally caught in the regulators radar resulting in years' long litigation and surrender of Sahara chief. The case provides relevant details to understand the timeline of the events, and the roles of the chairman, other company officials, and the regulator. The case draws attention to the role of regulators in the capital markets, quality of financial reporting, investor protection, financing vehicles, and corporate governance. The case study is written based on the information available in the public domain and other secondary sources.
    Keywords: capital markets; regulator; India; family-owned business; corporate frauds; earning management; financial statement analysis.

  • Shariah review of duration models: issues and future research directions   Order a copy of this article
    by Syed Alamdar Ali Shah, Raditya Sukmana, Bayu Arie Fianto 
    Abstract: This research performs a Shariah review of Macaulays duration and all subsequently developed related models. It finds that there are 21 models of duration that have been introduced so far but none of them is fully Shariah compliant for use in Islamic banks. The research identifies a variety of future research directions that include development of separate yield curves for assets and liabilities of Islamic banks; how book value based models are more compliant with Shariah; and the need for incorporation of specific factors in an Islamic financial model to make them more Shariah effective in Islamic bank risk management.
    Keywords: banks; duration models; Shariah review; interest rate risk; maturity gap risk management.

  • The UK public sector VfM audit expectations gap: evidence from the informed groups   Order a copy of this article
    by Abdelhafid Benamraoui, Yousef Alwardat, Yusuf Karbhari 
    Abstract: This paper investigates the current practice of Value for Money (VfM) auditing in the UK public sector organisations. We focus primarily on two main research questions: to what extent an expectation gap exists between the VfM auditors and auditees, and what lessons can be drawn from VfM audit practice. To address these critical research questions, we conducted 39 semi-structured interviews with key external auditors and public sector organisations representatives who have direct experience of VfM process and audit. The study results reveal significant differences between auditors and managers perceptions of VfM audit materiality, audit evidence and the true and fair view of auditors reports and public sector performance audit. Intriguingly, the study finds evidence that auditors are not performing their VfM audit responsibility with the level of professional and technical expertise as expected by the organisations managers. Overall, our findings provide further empirical evidence on the public VfM audit practice in the UK and draws attention to some of the ambiguities associated with what auditors perceive as their roles and what auditees expect from them.
    Keywords: audit expectation gap; audit evidence; materiality; performance audit; public sector; true and fair view; UK; VfM audit.

  • Earnings management and environmental performance from a political cost perspective: an Indonesian case   Order a copy of this article
    by Alex Johanes Simamora 
    Abstract: This study aims to examine the moderating role of industry sensitivity, profitability, and size of companies on the effect of environmental performance on earnings management. The samples are manufacturing companies listed on the Indonesian Stock Exchange and PROPER assessment 2015-2019. Based on the year-fixed effect regression, companies with lower environmental performance are more likely to manage earnings downward if companies are included in an environmentally sensitive industry and have higher profitability. This indicates that, to avoid the political cost of lower environmental performance, companies that are in an environmentally sensitive industry and have higher profitability tend to manage earnings downward to reduce societal, regulators, and environmental activist attention and pressure. Surprisingly, companies with lower environmental performance are more likely to manage earnings downward for smaller companies than bigger ones. This indicates that smaller companies with lower environmental performance have less market pressure to fulfil earnings targets and tend to manage earnings downward.
    Keywords: earnings management; environmental performance; company’s size; industry sensitivity; political cost; profitability.

Special Issue on: EAMMIS 2021 Accounting and Big Data Analytics

  • The fraud theories: triangle, diamond, pentagon   Order a copy of this article
    by Parvati T. Soneji 
    Abstract: Early indications of fraud play an important role in detection and prevention. Murphy and Dacin (2011) state that frauds mostly occur in three ways: error lacking awareness; intuition supporting fraud avoiding negative emotions or effects; and awareness of fraud coupled with cost-benefit analysis. Hutchison (2013) comparing management fraud to human behaviour says fraud is intentional, multidimensional and complex fallout of several interactive factors, analysis fraud through different abstracts organizational systems, conflicts of interest, rational choice, social constructiveness, psychodynamic and developmental outlook. The proposed unrealistic goals rewarding attractive compensations purports indulgence in frauds. The desire for achievements, fear of losing job, challenges meeting financial targets for bonuses, unhealthy competition and criminal collaborations are causes of financial frauds. Management fraud results from decision making, influenced by personality traits, belief, attitude, social customs, institutional rules and regulations, ethical values, and organizational culture. The paper aims to understand fraud and the theories related to fraud.
    Keywords: fraud; fraud theory; management fraud; financial fraud; fraud triangle theory; fraud diamond theory; fraud pentagon theory.

  • Do Islamic banks react due to the impact of Charia Supervisory Board on their financial performance? A joint worldwide analysis   Order a copy of this article
    by Achraf Haddad, Abdelfattah Bouri 
    Abstract: The real impacts generated by the Charia Supervisory Board (CSB) on the Islamic banks financial performance have not yet been thoroughly investigated in detail. To explore the relationship between the selected variables through the application of the fixed and random effects method, we used 180 Islamic banks from 56 countries during the period (2010-2019). The empirical results revealed that the CSB size, the number of meetings and the presence of Charia advisers improved the Islamic banks financial performance. However, the presence of financial or accounting experts in the CSB degraded their financial performance. The IBs CSB size ensured the skills diversification, since the number offers them the necessary time to discuss monetary exchanges, investment choices and complaints from other committees, while the existence of specialist advisers has optimised the respect for Charia standards. Nevertheless, the impact type coming from the experts confirmed either their qualification insufficiency or their training inadequacy in terms of Fikh Al-Muamalat.
    Keywords: financial performance; Islamic banks; Charia Supervisory Board; financial stability period.

Special Issue on: New Trends in Accounting and Auditing for SMEs

  • Is solvency influencing EPS growth in Poland, Austria and Germany: a comparison study of markets with a similar bankruptcy law   Order a copy of this article
    by Agata Gniadkowska - Szymanska, Monika Bolek 
    Abstract: The goal of this paper is related to the comparison analysis of the companies listed on exchange markets in Poland, Austria and Germany under the issue of insolvency affected by financial liquidity that can influence the earnings per share growth in the light of the bankruptcy law. Financial liquidity is mentioned in the bankruptcy law as the phenomenon directly influencing the possible default of a business entity. The growth of earnings per share is considered as a measure of companies economic condition, also mentioned in the bankruptcy law, indicating the value creation for shareholders. To analyse the influence of financial liquidity on the growth of EPS, the linear and logit models are applied to compare the relationship between variables. The results showed that financial liquidity affects the earnings per share growth in Germany in a higher degree, while in Poland and Austria such an influence is much weaker.
    Keywords: financial liquidity; bankruptcy; the economic condition of companies.

  • The relationship between organisational decentralisation, balanced scorecard and its perceived benefits in Moroccan SMEs   Order a copy of this article
    by Azzouz Elhamma 
    Abstract: Since the paper published by Kaplan and Norton (1992), the balanced scorecard (BSC) has been the subject of several research studies especially in large companies in the developed countries. However, the use and the benefits of this tool for strategic performance management in SMEs remains a field that has not yet been sufficiently explored, especially in the MENA region. In this context, this article aims to examine the BSC use and its perceived benefits according to the organisational decentralisation in Moroccan SMEs. The main results obtained, by using linear logistic regression and Student's t-test for a difference in means, show that 30% of the surveyed SMEs use the BSC. In addition, the study finds that in centralised SMEs, the impact of the BSC use on the three dimensions of the global firm's performance (competitiveness, profitability and productivity) is significant. However, in decentralised SMEs, this impact is not significant.
    Keywords: balanced scorecard; organisational decentralisation; competitiveness; profitability; productivity; SMEs; Morocco.