scholarly journals Corporate Governance and Firm Free Cash Flows: Evidence from Malaysia

2013 ◽  
Vol 5 (11) ◽  
pp. 531-537
Author(s):  
Razieh Adinehzadeh
Keyword(s):  
Corporate Governance ◽  
Cash Flow ◽  
Audit Committee ◽  
Cash Flows ◽  
Free Cash Flow ◽  
Governance Mechanism ◽  
Data Set ◽  
Corporate Governance Mechanism ◽  
Free Cash Flows ◽  
The Relationship

This study provides view of free cash flow and corporate governance (CG) by addressing the relationship between audit committee characteristics with free cash flow. Specifically, this study explores whether audit committee characteristics are substitutes to control agency problem regarding to free cash flow within Malaysian firms. The data set comprise of 200 firm observations Malaysian companies for four consecutive years, which comprise of 2005 to 2008. The results show that size of audit committee, frequency of audit committee meeting, proportion of audit committee independence is positively associated with level of free cash flow (FCF). The results of study highlight the importance of corporate governance mechanism, in the form of audit committee characteristics, in the management of cash flow.

scholarly journals DETERMINAN MANAJEMEN LABA AKRUAL PADA INDEKS LQ45 DAN JII PERIODE 2010-2015

2018 ◽  
Vol 3 (2) ◽  
pp. 141-151
Author(s):  
Rina Trisnawati ◽  
Mardayaningrum Mardayaningrum ◽  
Laillatul Khotimah
Keyword(s):  
Corporate Governance ◽  
Earnings Management ◽  
Cash Flow ◽  
Audit Committee ◽  
Sampling Method ◽  
Free Cash Flow ◽  
Earning Management ◽  
Managerial Ownership ◽  
Governance Mechanism ◽  
Corporate Governance Mechanism

The purpose of this study is to examine and analyze the mechanisms of corporate governance, leverage and the free cash flow against the accrual earning  management on LQ45 and JII Indexes during the 2010-2015 period. The number of samples in the study is 144 companies in JII index and 121 companies  in JII indexs. Sampling techniques using purposive sampling method. Methods of data analysis using multiple linear regression to test and prove the hypothesis of the study. Research results showed the proxy of corporate governance mechanism with institutional ownership, managerial ownership, the proportion of Board of Commissioners and the audit committee no effect  to accrual earnings management.(prob value >0.05). The free cash flow and leverage have an effect significantly to accrual earning management (prob value <0.05). Meanwhile in JII index, they have the same results. Corporate governance also no effect to accrual earning  management, but the free cash flow and leverage have an effect significantly to accrual earning management. Keywords: corporate governance, leverage, free cash flow, accrual earnings management

scholarly journals Pengaruh Intellectual Capital dan Corporate Governance Terhadap Kinerja Bank di Indonesia

2019 ◽  
Vol 2 (1) ◽  
pp. 57
Author(s):  
Jadzil Baihaqi
Keyword(s):  
Corporate Governance ◽  
Intellectual Capital ◽  
Boards Of Directors ◽  
Audit Committee ◽  
Stock Exchange ◽  
Governance Mechanism ◽  
Moderation Effect ◽  
Corporate Governance Mechanism ◽  
The Impact ◽  
The Relationship

This study examines the impact of intellectual capital and corporate governance mechanism on banks’ performance both directly and also moderated effect. We used banks that were listed in the Indonesia Stock Exchange. The bank’s performance was measured by risk-based bank rating while intellectual capital was measured by the coefficient of VAICTM (Pulic, 1998). The corporate governance mechanism was measured based on the size of boards of directors, the composition of independent director, CEO remuneration, managerial ownership, the effectiveness of audit committee and ownership concentration. The result of the study shows that banks’ performance was positively influenced by intellectual capital. However, corporate governance mechanism did not influence the banks’ performance, while the moderation effect of corporate governance mechanism on the relationship between intellectual capital and banks’ performance was not confirmed.

scholarly journals Interactions between free cash flow, debt policy and structure of governance: Three stage least square simultaneous model approach: evidence from the Tunisian stock exchange

2012 ◽  
Vol 9 (2) ◽  
pp. 21-40 ◽  
Author(s):  
Ben Moussa Fatma ◽  
Jameleddine Chichti
Keyword(s):  
Cash Flow ◽  
Stock Exchange ◽  
Cash Flows ◽  
Free Cash Flow ◽  
Least Square ◽  
Agency Conflicts ◽  
Governance Mechanism ◽  
Free Cash Flows ◽  
Debt Policy ◽  
Simultaneous Model

This research tests the efficiency of the ownership structure and the debt policy as mechanism of resolution of agency conflicts between shareholders and managers due to the problem of overinvestment, in the limitation of the problem of the free cash flow, by estimating three stage least square simultaneous model and on the basis of a sample of 35 non-financial Tunisian listed companies selected for the period 1999–2008. Our results are in favour of the theory of free cash flows of Jensen (1986) that stipulates that the debt policy represents the principal governance mechanism that can limit the risk of free cash flow. However, the ownership concentration and managerial ownership increase the risk of the free cash flow.

scholarly journals A test of audit committee characteristics and free cash flows

2013 ◽  
Vol 10 (2) ◽  
pp. 611-626 ◽  
Author(s):  
Samuel Jebaraj Benjamin ◽  
Kiarash Ehtiat Karrahemi
Keyword(s):  
Agency Theory ◽  
Cash Flow ◽  
Audit Committee ◽  
Positive Relationship ◽  
Cash Flows ◽  
Free Cash Flow ◽  
Transaction Cost Theory ◽  
Pecking Order ◽  
Free Cash Flows ◽  
The Impact

The study concentrates on audit committee characteristics and their influences on free cash flow. A panel of 120 firms from the trading and services industry from the year 2005 to 2008 is examined. The results show a significant and positive relationship between Audit Committee characteristics (size, independence, frequency of meetings) and free cash flows. These findings suggest that effective audit committee governance leads to availability of higher free cash flows. Our study draws upon the lack of understanding on the impact of audit committee characteristics on free cash flow along the two views; agency theory and pecking order/transaction cost theory and finds support for the later.

The Relationship between Corporate Governance Mechanism and the Firm Value: The Case of Islamic Banks in Malaysia and Indonesia

2021 ◽  
Vol 12 (3) ◽  
pp. 1337-1349
Author(s):  
Nooraisah Katmon Et.al
Keyword(s):  
Corporate Governance ◽  
Firm Value ◽  
Audit Committee ◽  
Institutional Ownership ◽  
Governance Mechanism ◽  
Financial Industry ◽  
Significant Positive Association ◽  
Female Directors ◽  
Corporate Governance Mechanism ◽  
The Relationship

Our study empirically examines the relationship between corporate governance mechanism and their interactions on the firm value. We concentrated on the banking industry in Indonesia and Malaysia given that majority of the literature are primarily focused on the non-financial industry due to stringent regulation on disclosure in the financial banking counterparts. We measure firm’s value using Tobin’s q, while corporate governance mechanisms comprised of independent directors, the presence of audit committee, the institutional ownership as well as the percentage of female directors on the board. Using 48 observations during the year 2016-2018, our result exhibit that there is a significant positive association between audit committee independence and firm value. Moreover, we also reported a negative link between board independent and the presence of female directors on the firm value. In respect to our interaction effects, we found that there is a complementary relationship between (i) audit committee independent and board independent and (ii) female directors and audit committee independent and firm value. Moreover, our regression also reported a significant substitutive relationship between (i) female directors and institutional ownership (ii) female directors and board independent as well as (iii) audit committee independent and institutional ownership and firm value. In contrary to the findings from the western counterpart, our result shows that the presence of female directors reduce firm value, thus suggesting that the role of female directors have been impaired due to the cultural aspect of the society.  

scholarly journals AUDIT COMMITTEE PRACTICE IN THE POLISH LISTED STOCK COMPANIES. PRESENT SITUATION AND DEVELOPMENT PERSPECTIVES

2012 ◽  
Vol 10 (1) ◽  
pp. 50-65 ◽  
Author(s):  
Piotr Szczepankowski
Keyword(s):  
Corporate Governance ◽  
Audit Committee ◽  
Stock Exchange ◽  
Listed Companies ◽  
Governance Mechanism ◽  
Corporate Managers ◽  
Warsaw Stock Exchange ◽  
Problematic Issue ◽  
Corporate Governance Mechanism ◽  
The Relationship

The audit committee is one of the parts of corporate governance mechanism, which is understood as the relationship between corporate managers, directors and the providers of equity, people and institutions who save and invest their capital to earn the return. This study presents survey research results of audit committee activity in Polish public stock companies quoted on the Warsaw Stock Exchange (WSE). The purpose of this paper is to present the audit committee practice in Poland after 2009. The paper shows that the audit committee practice is still the most problematic issue of transitional Polish corporate governance rules. The survey has shown that the corporate needs and its implementation, and communication with listed companies leave a lot of room for improvement. The paper is based on the documents prepared in 2010 by PricewaterhouseCoopers, the Polish Association of Listed Companies and the Polish Institute of Directors.

scholarly journals Corporate Governance and Firm Performance: A Study of High Agency Costs of Free Cash Flow Firms

2018 ◽  
Vol 12 (2) ◽  
pp. 2724-2731
Author(s):  
Dan Lin ◽  
Lu Lin
Keyword(s):  
Corporate Governance ◽  
Firm Performance ◽  
Cash Flow ◽  
Agency Costs ◽  
Composite Index ◽  
Cash Flows ◽  
Free Cash Flow ◽  
Return On Equity ◽  
Free Cash Flow Hypothesis ◽  
Free Cash Flows

Excessive free cash flows can lead to high agency problems as retaining free cash flow reduces the ability of capital market to monitor managers. Managers are also likely to waste the free cash flow on value-decreasing investments. Based on the free cash flow hypothesis, this study examines the relationship between corporate governance and firm performance of a sample of high agency costs of free cash flow firms, which is defined as firms that have high free cash flow and low investment opportunities. The sample firms are extracted from firms listed on the S&P/TSX composite index between 2009 and 2012. Using corporate governance scores provided by The Globe and Mail, this study finds that better corporate governance is associated with better firm performance, measured by return on equity. The results highlight the importance of corporate governance in protecting shareholders’ interests.

scholarly journals Impact of corporate governance index on firm performance: evidence from Pakistani manufacturing sector

2015 ◽  
Vol 4 (3) ◽  
pp. 163-174 ◽  
Author(s):  
Faisal Javaid
Keyword(s):  
Corporate Governance ◽  
Firm Performance ◽  
Capital Investment ◽  
Random Effect ◽  
Annual Reports ◽  
Governance Mechanism ◽  
Inconsistent Result ◽  
Governance Index ◽  
Corporate Governance Mechanism ◽  
The Relationship

Corporate governance is considered to have significant impact on the growth and development perspective of an economy. Sound corporate governance practices leads the economy towards the achievement of higher performance, provide sources for capital investment by increasing the creditability of shareholders. The purpose of this study is to empirically investigate the relationship of corporate governance and firm performance in terms of accounting as well as market performance i.e.to be measured by Return on asset, Return on equity and Tobin’s Q. The theoretical base to conduct the study is the demand of separation of ownership and control characterize as agency theory. The previous studies have yielded inconsistent result. To achieve the purpose 58 textile sector companies were selected listed in the Karachi stock exchange and data was taken from annual reports of the companies for the period of 2009 to 2013. Descriptive statistics, correlation analysis and regression estimation using pooled, fixed effect, random effect and Hausman specification test were carried out after developing a composite index based on 21 proxies. The result entails that corporate governance index (CGI) and firm performance has positive and significant association but the relationship for each specific index is dependent upon the measure of firm performance. The result also shows that companies having strong corporate governance mechanism has greater chances to acquire finance. The implication of study demands that the reform effort should be directed towards the improvement in internal corporate governance mechanism and regulatory framework for the governance system.

scholarly journals Impact of Corporate Governance index on Firm Performance: evidence from Pakistani manufacturing sector

2015 ◽  
Vol 5 (2) ◽  
pp. 1 ◽  
Author(s):  
Faisal Javaid ◽  
Abdul Saboor
Keyword(s):  
Corporate Governance ◽  
Firm Performance ◽  
Capital Investment ◽  
Manufacturing Sector ◽  
Random Effect ◽  
Governance Mechanism ◽  
Inconsistent Result ◽  
Governance Index ◽  
Corporate Governance Mechanism ◽  
The Relationship

Corporate governance is considered to have significant impact on the growth and development perspective of an economy. Sound corporate governance practices leads the economy towards the achievement of higher performance, provide sources for capital investment by increasing the creditability of shareholders. The purpose of this study is to empirically investigate the relationship of corporate governance and firm performance in terms of accounting as well as market performance i.e.to be measured by Return on asset, Return on equity and Tobin’s Q. The theoretical base to conduct the study is the demand of separation of ownership and control characterize as agency theory. The previous studies have yielded inconsistent result. To achieve the purpose 58 manufacturing sector companies were selected listed in the Karachi stock exchange and data was taken from annual reports of the companies for the period of 2009 to 2013. Descriptive statistics, correlation analysis and regression estimation using pooled, fixed effect, random effect and Hausman specification test were carried out after developing a composite index based on 21 proxies. The result entails that corporate governance index (CGI) and firm performance has positive and significant association but the relationship for each specific index is dependent upon the measure of firm performance. The result also shows that companies having strong corporate governance mechanism has greater chances to acquire finance. The implication of study demands that the reform effort should be directed towards the improvement in internal corporate governance mechanism and regulatory framework for the governance system.

scholarly journals Pengaruh Mekanisme Corporate Governance Terhadap Ketepatan Waktu Pelaporan Keuangan (Studi Empiris Pada Perusahaan Perbankan Milik Pemerintah Pusat)

2018 ◽  
Vol 19 (1) ◽  
pp. 1
Author(s):  
Muhammad Rivandi ◽  
Maria Magdalena Gea
Keyword(s):  
Corporate Governance ◽  
Financial Reporting ◽  
Audit Committee ◽  
Sampling Method ◽  
Stock Exchange ◽  
Central Banking ◽  
Managerial Ownership ◽  
Governance Mechanism ◽  
Multiple Regression Models ◽  
Corporate Governance Mechanism

This study aims to examine the effect of corporate governance mechanism on the timeliness of financial reporting. The sample of this study are four central banking companies listed in Indonesia Stock Exchange (IDX) selected based on purposive sampling method. The method of data analysis used in this study is multiple regression models. Based on the hypotheses testing result, that the managerial ownership and audit committee have a positive and significant effect on the timeliness of financial reporting, while independent commissioner has no effect on the timeliness of financial reporting

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