scholarly journals Corporate Governance and Accounting Conservatism: The Moderating Role of Family Ownership

2019 ◽  
Vol 3 (2) ◽  
pp. 119
Author(s):  
Nishtiman Mohammed ◽  
Ku Nor Izah Ku Ismail ◽  
Noor Afza Amran
Keyword(s):  
Corporate Governance ◽  
Audit Committee ◽  
Accounting Conservatism ◽  
Family Ownership ◽  
Minority Shareholders ◽  
Study Objective ◽  
Board Characteristics ◽  
The Family ◽  
The Impact

This study objective is to investigate the influence of board characteristics and audit committee characteristics on accounting conservatism with respect to the influence of family ownership in Turkey. The findings explained that clients’ demand for accounting conservatism improved because of board characteristics (e.g. board size, independence & women on board) and the audit committee characteristics (e.g. audit committee independence and audit committee expertise). Hence, the family ownership undermines the impact of board characteristics and the audit committee characteristics to demand accounting conservatism, which will be unfavorable outcome for the minority shareholders. Thus, this study suggests that regulators should increase law enforcement to improve corporate governance in Turkey to accommodate the unique characteristics of family ownership and offer a protected environment for minority shareholders.

scholarly journals Finance Impact of corporate governance on the valuation of IPOs in Pakistan stock exchange listed Firms. A moderating role of the family Ownership.

2021 ◽  
Vol 2 (1) ◽  
pp. 101-112
Author(s):  
Muhammad Waris ◽  
Dr. Badariah Haji Din
Keyword(s):  
Corporate Governance ◽  
Stock Exchange ◽  
Gender Diversity ◽  
Moderating Effect ◽  
Family Ownership ◽  
Board Independence ◽  
Ipo Performance ◽  
The Family ◽  
The Impact

The objective of our study is to investigate the impact of the corporate governance on the IPO performance with moderating impact of the family ownership. To investigate that relationship, we used the data of IPOs registered from 2008 to 2017 in Pakistan Stock exchange. We used the OLS methods to analysis of the data. Our findings shows that Board independence (BIND) has positive significant relationship with IPO return, it means that independent directors have the more technical knowledge and experience in maintaining the IPO return and making the strong policy for the organizations. CEO duality has the significant negative relationship with IPO return with (P=0.0833), it means that when CEO has the combine rule then decisions are not distributed, and monopoly existed in decisions that leads to the negative impact on the IPO performance. Board diligence, Board size, ownership concentration and gender diversity have no impact are being seen in our analysis. In the moderating effect of the family ownership in reference to board diligence (BD) the results changed to significant positive relationship, it means that with the family-owned firms when board meetings increased then increased in the IPO return due to some factors. With the moderation of the family ownership the results of the Board independence also improved that shows the role of the family-owned firm in between them. Women in the board that means the gender diversity has no impact but with the moderating effect of the family ownership women in the board has significant positive impact. This study is helpful for the financial managers, investors, and the finance students and also for the government, in maintaining the code of the corporate governance.

The Role of Foreign, Family Ownership and Audit Committee in Evaluating the Company as a Going Concern: Evidence from Jordan

2014 ◽  
Vol 1 (1) ◽  
pp. 329 ◽  
Author(s):  
Bilal Nayef Zureigat ◽  
Faudziah Hanim Fadzil ◽  
Syed Soffian Syed Ismail
Keyword(s):  
Corporate Governance ◽  
Significant Relationship ◽  
Audit Committee ◽  
Listed Companies ◽  
Foreign Ownership ◽  
Family Ownership ◽  
Ols Regression ◽  
Going Concern ◽  
Relationship Of

This study discusses the association between foreign, family ownership and audit committee on the going concern evaluation among Jordanian listed companies for the years 2011 and 2012. The data reveal through using OLS regression that there is a negative and not significant relationship between foreign ownership and going concern evaluation, while a negative significant relationship with family ownership. In addition, this study also finds a positive and significant relationship of audit committee with the going concern evaluation.The results alsoshow that most of the Jordanian companies have violated some of Corporate Governance requirements. For instance, approximately 43% of Jordanian firms did not have an audit committee. This study shows valuable insights to the understanding of factors that may affect going concern evaluation among Jordanian firms. Therefore, the findings of this study provide important conclusions for investors, regulators and policymakers and academics to shed the light on the mechanisms that ensure the continuity of companies.

scholarly journals Corporate Governance Compliance in Banking Industry: The Role of the Board

2020 ◽  
Vol 6 (4) ◽  
pp. 137
Author(s):  
Rudi Zulfikar ◽  
Niki Lukviarman ◽  
Djoko Suhardjanto ◽  
Tubagus Ismail ◽  
Kurniasih Dwi Astuti ◽  
...  
Keyword(s):  
Corporate Governance ◽  
Audit Committee ◽  
Banking Industry ◽  
Stock Exchange ◽  
Sampling Technique ◽  
Analysis Method ◽  
The Public ◽  
Board Characteristics ◽  
Compliance Level

This study seeks to supply empirical evidence for how board characteristics influence corporate governance compliance in the Indonesian banking industry. Corporate governance compliance level represents a company’s actions to fulfill regulatory obligations that aim to protect the public from potential investment losses in the banking industry. This research was conducted by analyzing the influence of board characteristics, specifically how a board of commissioners’ institutions and their instruments affect corporate governance compliance. The entire banking industry, which was listed on the Indonesia Stock Exchange from 2010 to 2015, was employed as the population for this research. Purposive sampling was used as the sampling technique, resulting in 195 observations. To test this study’s hypotheses, multiple regression was applied as the data analysis method. The results revealed that the size of the board of commissioners, the proportion of independent commissioners, the experience of commissioners, and the size of the audit committee were factors that encouraged management in the banking industry to improve their firms’ corporate governance compliance. This indicates that monitoring from the board acts as an effective mechanism for reducing information asymmetry. This research also proves that open innovation following regulations can increase compliance with laws.

Role of Corporate Governance in Shareholders Value Creation

2017 ◽  
Vol 8 (2) ◽  
pp. 70-82
Author(s):  
Muhammad Atif Khan ◽  
Muhammad Asif Khan ◽  
Idrees Liaqat
Keyword(s):  
Corporate Governance ◽  
Financial Performance ◽  
Value Creation ◽  
Performance Optimization ◽  
Audit Committee ◽  
Positive Impact ◽  
Firm Financial Performance ◽  
Long Run ◽  
The Impact

The mechanism of governing corporate affairs in line with strategic goal of shareholders' value creation (SVC) has been pivotal debate among academic and institutional scholars over last few decades. Most of the studies in developing countries including Pakistan, have considered more conventional measures, like firm financial performance to examine the impact of corporate governance (CG). Theoretically, firm financial performance optimization has little role in maximizing SVC, that rarely streams to shareholders' exchequer. Therefore, the study is unique in its nature that identifies market capitalization, the most appropriate measure of value creation for shareholders over long run. The authors gathered panel and longitudinal data pertaining to PSX-100 listed firm over the period of 10 years ranging from 2006-15, which is analyzed using multivariate regression. Hausman and Likelihood tests guide the process of appropriate econometrics model selection. Empirical findings reveal that CG dimensions such as audit committee independence (ACI), managerial ownership (MO) and ownership concentration (OC) have positive impact on SVC, except board size (BS) and board independence (BI). The study offers valuable policy recommendations to make CG practices more effective, however, application of the model proposition at macro and micro level can be a substantial extension to literature incorporating some controlling dimensions.

scholarly journals The role of an audit committee in bank solvency: An emerging market case

2019 ◽  
Vol 8 (1) ◽  
pp. 38-46 ◽  
Author(s):  
Hussein Salia ◽  
Emmanuel Budu Addo ◽  
Nicholas Adoboe-Mensah
Keyword(s):  
Corporate Governance ◽  
Audit Committee ◽  
Banking Sector ◽  
Emerging Market ◽  
Audit Committees ◽  
Regulatory Body ◽  
Effective Functioning ◽  
Governance Systems ◽  
The Impact

Recent discourse on corporate failures gives prominence to the impact of weak corporate governance systems in most corporate entities, hence reasons for investors and creditors pessimism. This literature review article seeks to articulate how audit committee could strengthen corporate governance in organizations. The paper reviews the guidelines developed by the Bank of Ghana to curb the degeneration of the Banking sector in Ghana following the collapse of seven indigenous banks between 2017 and 2018. The objective of this paper is to underscore the effective functioning of audit committees as a panacea to the corporate governance weaknesses in Ghana. The paper observes that albeit the Bank of Ghana, as a regulatory body, underscored weak corporate governance systems – it failed to emphasize mechanisms for strengthening audit committees in its guidelines to regulate the sector. The paper, therefore, promotes the presence and effective functioning of the audit committees as an additional layer to strengthen the monitoring and supervisory functions within corporate bodies. It recommends that the Bank of Ghana must emphasize the establishment of audit committees as a core part of corporate governance systems of all banks to ensure that the interest of all stakeholders is protected adequately through the oversight role of the audit committees.

Family involvement, corporate governance and dividends in Turkey

2019 ◽  
Vol 45 (5) ◽  
pp. 602-621 ◽  
Author(s):  
Pinar Sener ◽  
Elif Akben Selcuk
Keyword(s):  
Corporate Governance ◽  
Family Involvement ◽  
Positive Association ◽  
Family Management ◽  
Family Ownership ◽  
Board Structure ◽  
Minority Shareholders ◽  
Content Type ◽  
Dividend Payments

Purpose The purpose of this paper is to investigate the relationship between dividends and family involvement as well as corporate governance characteristics among Turkish public firms. Design/methodology/approach Using panel data on Turkish firms listed on the Borsa Istanbul 100 index for 2006–2014, three models are estimated. For the first two models, where the dependent variables are the dividend payout ratio and dividend yield, respectively, tobit regressions are run. The last model, which employs a dividend dummy as the dependent variable, is estimated with logistic regression. Findings There is a positive and concave relationship between family ownership and dividends. The existence of a family chairman reduces dividends. There is a positive association between board size and dividends and this relationship is weaker for firms with higher levels of family ownership. Finally, the ratio of independent directors on the board is negatively associated with dividends. Practical implications The findings imply that firms with substantial family ownership and active family participation in management are more likely to send a negative signal to minority shareholders by paying lower dividends. In addition, minority shareholders should pay attention to the board structure of firms in which they invest. Originality/value This study is one of the few to analyze the nonlinear relationship between family ownership and dividend payments as well as the role of family management in a developing country. Second, it investigates the role of board characteristics in explaining dividend payment decisions.

Accounting conservatism and corporate governance: evidence from India

2021 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Meena Sharma ◽  
Rajbir Kaur
Keyword(s):  
Corporate Governance ◽  
Board Of Directors ◽  
Audit Committee ◽  
Accounting Conservatism ◽  
Annual Reports ◽  
Content Type ◽  
The Board Of Directors ◽  
Relationship Of ◽  
The Impact ◽  
The Relationship

Purpose The paper aims to study the impact of corporate governance variables on the adoption of accounting conservatism by S&P BSE 500 index firms. Design/methodology/approach The period for the study is from 2010–2018. The data has been extracted from the BSE website, annual reports of the sample companies and the Prowess IQ database. Panel data methodology has been used to analyse the impact of the corporate governance variables on accounting conservatism. Accounting conservatism is the dependent variable, which has been measured by using the CONACCR (negative accruals) measure and the independent variables include the characteristics of the board of directors and the audit committee. Findings Overall, the relationship between accounting conservatism and corporate governance indicates a significant impact of corporate governance variables, namely, characteristics of the board of directors and the audit committee, on the accounting conservatism policy of the firm. Originality/value This research explores the benefits of conservatism in resolving agency conflict. Very few studies have captured the relationship of individual components of corporate governance with accounting conservatism. Moreover, this study contributes to the literature regarding the influence of corporate governance variables on the extent of conservatism used in accounting records.

Role of Corporate Governance in Shareholders Value Creation

2018 ◽  
pp. 344-358
Author(s):  
Muhammad Atif Khan ◽  
Muhammad Asif Khan ◽  
Idrees Liaqat
Keyword(s):  
Corporate Governance ◽  
Financial Performance ◽  
Value Creation ◽  
Performance Optimization ◽  
Audit Committee ◽  
Positive Impact ◽  
Firm Financial Performance ◽  
Long Run ◽  
The Impact

The mechanism of governing corporate affairs in line with strategic goal of shareholders' value creation (SVC) has been pivotal debate among academic and institutional scholars over last few decades. Most of the studies in developing countries including Pakistan, have considered more conventional measures, like firm financial performance to examine the impact of corporate governance (CG). Theoretically, firm financial performance optimization has little role in maximizing SVC, that rarely streams to shareholders' exchequer. Therefore, the study is unique in its nature that identifies market capitalization, the most appropriate measure of value creation for shareholders over long run. The authors gathered panel and longitudinal data pertaining to PSX-100 listed firm over the period of 10 years ranging from 2006-15, which is analyzed using multivariate regression. Hausman and Likelihood tests guide the process of appropriate econometrics model selection. Empirical findings reveal that CG dimensions such as audit committee independence (ACI), managerial ownership (MO) and ownership concentration (OC) have positive impact on SVC, except board size (BS) and board independence (BI). The study offers valuable policy recommendations to make CG practices more effective, however, application of the model proposition at macro and micro level can be a substantial extension to literature incorporating some controlling dimensions.

Impact of Corporate Governance on the Cash Holding of the Firms: An Empirical Study of Indian Manufacturing Sector

GIS Business ◽  
2017 ◽  
Vol 12 (4) ◽  
pp. 47-52
Author(s):  
Karam Pal Narwal ◽  
Sonia Jindal
Keyword(s):  
Corporate Governance ◽  
Audit Committee ◽  
Manufacturing Sector ◽  
Control Variable ◽  
Cash Holding ◽  
Executive Directors ◽  
Control Effect ◽  
Board Size ◽  
Indian Manufacturing Sector ◽  
The Impact

The paper empirically examines the impact of corporate governance on the cash holding of the firms. The components of corporate governance are measured by board size, board meeting, audit committee members, directors remuneration and non executive directors and the cash holding is measured with the log of average cash and size is taken as control variable for the control effect on the dependent variables. Moreover, correlation and panel regression model were employed to examine the relationship between the corporate governance and cash holding. Empirical data was collected from 96 firms over the period of 2004-05 to 2013-14. The results show that directors remuneration and the number of audit committee members positively influence the cash holding and the board size also positively influences the cash holding whereas, the non executive directors and the board meetings do not play any role in enhancing the cash holding.

Conditional Conservatism and Audit Fees

2014 ◽  
Vol 29 (1) ◽  
pp. 83-113 ◽  
Author(s):  
Hye Seung (Grace) Lee ◽  
Xu Li ◽  
Heibatollah Sami
Keyword(s):  
Corporate Governance ◽  
Potential Benefit ◽  
Audit Fees ◽  
Accounting Conservatism ◽  
Audit Risk ◽  
Debt Contracting ◽  
Conditional Conservatism ◽  
Governance Quality ◽  
Corporate Governance Quality ◽  
The Impact

SYNOPSIS In this study, we examine the impact of conditional conservatism on audit fees and, more importantly, the influence of corporate governance on this relationship. Prior literature presents evidence regarding explanations for the existence and pervasiveness of accounting conservatism such as compensation and debt contracting, shareholder litigation, taxation, and accounting regulation. However, there is very limited evidence or discussion of the potential benefit of accounting conservatism on audit risk and thus audit fees, and how the potential benefit can be attenuated by corporate governance quality. Using a sample of firm-year observations over the period of 2004–2009, we provide evidence consistent with conditional conservatism and firms' commitment to such conservatism reducing their audit fees. However, our evidence shows that this reduction in audit fees is moderated by higher corporate governance quality. These results have implications for auditors, regulators, standard setters, and firms' managers. In addition, our study extends the literature on the determinants of audit fees. JEL Classifications: M41; M42; D81; D22.

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