scholarly journals Hedge Accounting and Market Value of Quoted Manufacturing Firms in Nigeria: Panel Data Evidence

2018 ◽  
Vol 2 (1) ◽  
pp. 21-38
Author(s):  
Alasin Captain Briggs
Keyword(s):  
Panel Data ◽  
Cash Flow ◽  
Significant Relationship ◽  
Oil And Gas ◽  
Market Value ◽  
Fair Value ◽  
Business Environment ◽  
Cross Sectional ◽  
Hedge Accounting ◽  
Oil And Gas Firms

In a developing economy such as Nigeria, the business environment is characterized with risk that affects the operational efficiency and the performance of quoted firms. There is needed to make policies that will hedge against risk in the operating environment. This study examined the effect of hedge accounting on the market value of quoted oil and gas firms. A sample of 10 oil and gas firms was selected based on data quality and availability to address the requirements of the variables in the regression model. The study modeled market value as linear function of cash flow hedging, investment hedging and fair value hedging. Cross sectional data was sources from financial statement of the selected firms from 2011 to 2016. From the panel data result, (Fixed Effect Model) the study found that cash flow hedging have positive and significant relationship with market value while fair value hedging and investment hedging have positive but not significant relationship with market value of the quoted oil and gas firms.   We therefore recommend that hedge accounting policies should be properly integrated to the operational objectives of the firms.

Barriers to growth of SMEs in Western Balkan countries

2019 ◽  
Vol 38 (1) ◽  
pp. 2-24 ◽  
Author(s):  
Naqeeb Ur Rehman ◽  
Arjona Çela ◽  
Fatbardha Morina ◽  
Kriselda Sulçaj Gura
Keyword(s):  
Factor Analysis ◽  
Panel Data ◽  
New Technologies ◽  
Business Environment ◽  
Least Square ◽  
Policy Implications ◽  
Entrepreneurial Activity ◽  
Western Balkans ◽  
Cross Sectional ◽  
Content Type

PurposeWestern Balkans countries (WBCs) have a great potential for growth and among the main focuses of entrepreneurial activity is small- and medium-sized enterprises (SME) sector. Moreover, SMEs are believed to contribute in the economy by stimulating employment, increasing production, transferring new technologies and so forth. Due to this crucial importance the purpose of this paper is to analyze the barriers that hinder labor productivity (LP) of SMEs in WBCs.Design/methodology/approachThe research method employed to discover solution to this research problem is quantitative analysis by using survey data of World Bank. Research methodology applied in this paper found it correctly to use cross-sectional data and conducts a factor analysis and ordinary least square (OLS) regression as the best procedure for this type of data.FindingsThe results show variability for different countries access to finance, tax rates, tax administration, corruption, inadequately educated labor force, competition in informal sector and political instability appear to be some of the main obstacles that are negatively affecting LP of SMEs in WBC.Research limitations/implicationsAlthough this study is the first to analyze all the possible obstacles for the six WBCs using factor analysis better results could be obtained with larger samples and panel data.Practical implicationsThe policy implications of this study suggest that in order to boost productivity of these firms there must be a reduction of the barriers and improvement of business environment. Although, this study is the first to analyze all the possible obstacles for the six WBCs using factor analysis and contributes as insight to policy makers, better results could be obtained with larger samples using panel data.Originality/valueDifferently from previous studies this work uses explanatory factor analysis and method OLS to estimate regressions for all barriers in each country of Western Balkan region.

scholarly journals The Effects of Oil and Gas Risk Factors on Malaysian Oil and Gas Stock Returns: Do They Vary?

Energies ◽  
2020 ◽  
Vol 13 (15) ◽  
pp. 3901 ◽  
Author(s):  
Mohammad Enamul Hoque ◽  
Soo-Wah Low ◽  
Mohd Azlan Shah Zaidi
Keyword(s):  
Risk Factors ◽  
Stock Returns ◽  
Oil And Gas ◽  
Market Value ◽  
Negative Effects ◽  
Firm Level ◽  
Stock Size ◽  
Positive Effects ◽  
Oil And Gas Firms ◽  
Gas Price

This study explores Malaysian oil and gas stocks’ exposure to oil and gas risk factors, paying special attention to subindustry classification, stock size, book-to-market value, and volatility state. The study employs firm-level weekly frequency data of oil and gas firms and several multi-asset pricing models within a GARCH (1,1)-X and Markov-switching framework. The empirical findings reveal that oil price, gas price, and exchange rate exhibit positive effects on the stock returns of all oil and gas sub-industries, but they exhibit negative effects on gas utilities sub-industry stock returns. The empirical findings also reveal that the extent of this effect varies across sub-industry, stock size, book-to-market value, and volatility states. Thus, the findings suggest the existence of asymmetric, heterogeneous, and non-linear exposures.

Identifying and Coping with Balance Sheet Differences: A Comparative Analysis of U.S., Chinese, and French Oil and Gas Firms Using the “Statement of Financial Structure”

2007 ◽  
Vol 22 (4) ◽  
pp. 591-606
Author(s):  
Yuan Ding ◽  
Gary M. Entwistle ◽  
Hervé Stolowy
Keyword(s):  
Oil And Gas ◽  
Financial Analysis ◽  
Balance Sheet ◽  
Financial Structure ◽  
The United States ◽  
Business Environment ◽  
Business World ◽  
National Boundaries ◽  
Local Business Environment ◽  
Oil And Gas Firms

In a globalized business world it is often necessary to compare companies across national boundaries. This comparison often includes an examination of financial statements. While the harmonization of accounting standards continues to progress, there still remain differences in how accounting information is reported between companies located in different countries, especially with regard to the format used to present the balance sheet. It is consequently important that students be able to both identify these differences, and have a method for coping with them. Using three oil and gas firms from three different countries (Exxon in the United States, Sinopec in China, and Total in France), this paper provides a setting for students to identify differences in balance sheet formats across countries. The paper then introduces a standardizing model—the Statement of Financial Structure—that enables students to cope with these differences. In working with this Statement, students develop their financial analysis skills. In particular, the concept of working capital is reinforced, as is the importance of understanding the local business environment in order to interpret the numbers and ratios within the proper context.

Accounting for Derivatives and Hedging Activities: Comparison of Cash Flow versus Fair Value Hedge Accounting

2008 ◽  
Vol 23 (1) ◽  
pp. 103-117
Author(s):  
Pamela A. Smith ◽  
Mark J. Kohlbeck
Keyword(s):  
Board Of Directors ◽  
Cash Flow ◽  
Fair Value ◽  
Hedge Accounting ◽  
Limited Experience

Warfield Company is considering hedging the risk associated with (1) an available-for-sale (AFS) security portfolio and (2) an anticipated purchase of oil. Warfield's Board of Directors has limited experience in this area and has requested that you summarize the accounting and reporting implications if these items are hedged. The hedged risk in these two transactions can be either the risk associated with the cash flow or the risk associated with changes in the fair value. The two risks are discussed in separate parts of the case.

scholarly journals Financial Statement Outcomes When Alternative Derivative Hedging Designations Exist

2011 ◽  
Vol 19 (3) ◽  
Author(s):  
Arlette C. Wilson ◽  
Ronald L. Clark ◽  
William Pugh
Keyword(s):  
Cash Flow ◽  
Fair Value ◽  
Financial Statement ◽  
Font Size ◽  
Hedge Accounting

<p class="MsoBlockText" style="margin: 0in 0.5in 0pt;"><span style="font-style: normal;"><span style="font-size: x-small;"><span style="font-family: Times New Roman;">When alternate reporting methods exist, financial statement preparers tend to select methods that provide more favorable results.<span style="mso-spacerun: yes;">&nbsp; </span>Certain hedging transactions may be designated as either a fair value hedge or a cash flow hedge.<span style="mso-spacerun: yes;">&nbsp; </span>Both designations achieve the objective of matching the gain &lt;loss&gt; on the derivative with the loss &lt;gain&gt; on the hedged item in the same reporting period.<span style="mso-spacerun: yes;">&nbsp; </span>However, the cash flow hedge accounting tends to create a greater appearance of equity volatility.<span style="mso-spacerun: yes;">&nbsp; </span></span></span></span></p>

scholarly journals Trade-Off Variables and Market Value: An Estimated Panel Data Study of Quoted Small and Medium Scale Enterprises from Nigeria

2021 ◽  
Vol 04 (08) ◽  
Author(s):  
Anyamaobi Chukwuemeka ◽  
Keyword(s):  
Panel Data ◽  
Random Effects ◽  
Significant Relationship ◽  
Firm Value ◽  
Fixed Effects ◽  
Market Value ◽  
Equity Capital ◽  
Trade Off ◽  
Medium Scale

This study was undertaken to examine the relationship between trade off variables and market value of quoted small and medium scale enterprises in Nigeria. Secondary data obtained from financial statement of 10 quoted small and medium scale enterprises from 2009 – 2018. Market value was modeled as the function of, non-tax shield, business risk and tangibility. Panel data methods were employed while the fixed and random effects models were used as estimation technique at 5% level of significance. Fixed effects, random effects and pooled estimates were tested while the Hausman test was used to determine the best fit. Panel unit roots and panel cointegration analysis were conducted on the study. The study found that trade off variables has significant relationship with market value of the small and medium scale enterprises. From the regression summary, we conclude that, trade off variables have significant relationship with market value of the small and medium scale enterprises. We recommend that financial managers should institute sound, efficient and coherent capital structure management policies such that will enable them determine the right mix or combination of debt, equity or both that will enhance firms’ value in Nigeria. Firm should expand to a level it does not result to diseconomies of scale and the eventual fall in the value of the small and medium scale enterprises. Government and policy makers should provide an enabling market environment capable of enhancing easy source of capital to enhance firm value in Nigeria. Management of the small and medium scale enterprises should employ more of long-term debt than equity capital in financing their operations, because it results in higher small and medium scale enterprises value. Corporate financial decision makers should employ more of long-term-debt than equity in their financial option. This is in line with the pecking order theory. Management of the small and medium scale enterprises should compare the marginal benefit of using long-term-debt to the marginal costs of long-term-debt before concluding on using it in financing their operations. This is because as shown by this work, long-term-debt impact positively on firm’s value unlike equity capital.

scholarly journals The Effect of Firm Specific Variables on Stock Returns of Nepalese Banks

2020 ◽  
Vol 9 (1) ◽  
pp. 1-12
Author(s):  
Jeetendra Dangol ◽  
Bidhan Acharya
Keyword(s):  
Panel Data ◽  
Stock Returns ◽  
Cash Flow ◽  
Firm Size ◽  
Total Yield ◽  
Negative Relationship ◽  
Cross Sectional ◽  
Relationship Of ◽  
The Relationship

This study focuses to examine the firm specific fundamental variables impact on the stock returns in the context of Nepali banks. The study uses cross sectional panel data of 12 banks for the duration of ten years. The study finds the existence a negative relationship between stock returns (total yield) and firm size. Likewise, the study shows that the book to market equity has negative relationship with stock returns. However, the study reveals that the relationship of earnings yield and cash flow yield with the stock returns is contradicted in comparison to previous studies.

Intellectual capital in tangible intensive firms: the case of Brazilian real estate companies

2014 ◽  
Vol 15 (2) ◽  
pp. 333-348 ◽  
Author(s):  
Daniel Pitelli Britto ◽  
Eliane Monetti ◽  
Joao da Rocha Lima Jr
Keyword(s):  
Real Estate ◽  
Intellectual Capital ◽  
Value Creation ◽  
Market Value ◽  
Fair Value ◽  
Market Risk ◽  
Cross Sectional ◽  
Content Type ◽  
Physical Assets ◽  
Using Data

Purpose – The purpose of this paper is to clarify whether value created by real estate (RE) companies (tangible intensive firms) can be evaluated better using intellectual capital (IC) elements (human, structural and physical assets) or traditional accounting measures of efficiency (ROIC and profit margins). Design/methodology/approach – Correlations and cross-sectional OLS regressions with robust standard errors were used to find relationships between variables explaining value creation. Data were collected from 2007 to 2011 for Brazilian RE firms. To measure market risk, the authors used a new approach to deal with low liquidity. VAIC and I j ratios were used as IC proxies even though both have limitations. Findings – IC has a significant inverse relationship with market value. The more valuable companies showed lower levels of IC except for CEE which explains value as much as ROIC. Also, IC does not influence market risk caused by size and leverage and does not explain ROIC. Research limitations/implications – The limitations of this study result from time and proxy variables. IC was measured by a VAIC model using data from a period of intense volatility. To increase the robustness of the conclusions, other variables should be used as proxies for IC and the results compared. The VAIC model has certain deficiencies in measuring IC. Practical implications – Managers and investors in the RE sector need to change the way they create value and measure value creation. The low level of HC explaining either ROIC or market value is a signal of low innovation which, combined with high CEE, induces a short-term outlook. Originality/value – This study opens discussion of IC in the Brazilian RE sector. A new methodology for identifying value creation is necessary for better evaluation and determining the fair value of firms.

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