Audit committee effectiveness, internal audit function and sustainability reporting practices

PurposeThe purpose of this study is to examine the association between audit committee effectiveness (ACE), internal audit function (IAF) and sustainability reporting practices.Design/methodology/approachUsing a cross-sectional and correlational design, useable questionnaires were received from 48 financial services firms in Uganda. The data were analyzed using Statistical Package for Social Sciences.Findingsresults indicate that ACE and IAF are positively and significantly associated with sustainability reporting practices. ACE and IAF are more significantly associated with economic and social indicators than environmental sustainability indicators.Research limitations/implicationsIn terms of practice, it is no longer a matter of having internal auditors and audit committees in place but rather those who are mindful of the welfare of society and the natural environment. The effectiveness of the board audit committee and a functioning internal audit can be assessed in terms of their recommendations and decisions regarding improvements in the welfare of society and the natural environment in addition to the traditionally known performance benchmarks.Practical implicationsThe study focuses on only financial services firms in Uganda, and this is a small sample. Future studies may focus on larger samples to enable comparison of the results.Originality/valueThis study provides insights on the initial understanding of the association between ACE, IAF and sustainability reporting practices using evidence from a developing African country – Uganda.

Progress on EU-Swiss deal remains a distance away

Significance Political divisions in Switzerland have put the deal on hold. By threatening some of Switzerland's existing privileges, the Commission is seeking to increase the pressure for the signature and ratification of a deal agreed in late 2018. Impacts The experience of negotiating Brexit will make the EU less willing to give concessions to third countries over single market access. Switzerland’s export industries and financial services firms would be worst affected if the IFA collapses. The Swiss economy would be one of the worst-affected in Europe from global reforms to corporate tax structures.

A theory of financial services competition, compliance and regulation

Purpose This paper aims to derive the conditions under which a financial services firm will want to hire a compliance services company and show how much money they should spend. Design/methodology/approach This paper uses a mathematical model to show the intuition behind many of the compliance decisions that cost financial services firms billions every year. Findings This paper finds that hiring compliance firms may save banks and brokerages money. However, their advice may lead to an embarrass de riches – whereby the lower compliance costs and higher profit advantages they confer may lead to more regulation. Regulators may furthermore tighten regulation – with the expectation that financial service firms will adapt somehow. This paper presents a fresh perspective on the Menon hypothesis, deriving conditions under which financial regulations help the competitiveness of an international financial centre. Research limitations/implications The paper represents one of the first and only models of compliance spending by financial services firms. Practical implications This paper provides five potential policy responses for dealing with ever ratcheting financial regulations. Originality/value The paper hopefully launches literature on the compliance service industry – and the buy-or-do decision to engage in financial services compliance. This paper finds that efficient compliance can hurt firms, by encouraging regulation. This paper shows how firms can forestall the extra regulation that comes with easier internet and computerised monitoring.

2020 will be important for Swiss-EU relations

Significance There are concerns in Switzerland that the IFA would undermine its sovereignty, reduce wages and subject Swiss businesses to greater competition. A referendum on ending Switzerland’s freedom of movement regime with the EU on September 27 will have a crucial bearing on the future of the IFA. Impacts The EU could soften its tough approach to Switzerland once the EU-UK future trade relationship is resolved. The restoration of Swiss contributions to the EU’s regional development funds would help generate goodwill between Brussels and Bern. Switzerland’s export industries and financial services firms would be worst affected if the IFA collapses.

The Dali Model in Risk-Management Practice: The Case of Financial Services Firms

Originality/value—this model contributed to the vast literature on models of change and risk management within organisations, but was not validated empirically for reliability of the factors, and on financial services providers within small jurisdictions. Therefore, the significance and importance of such a study lies firstly on the premise that testing on small countries can be deemed as small laboratories for more complex politics, regulations and policies of larger countries and secondly, the importance of financial services as essential for prosperity in a country’s economy. This model will provide an empirically tested proactive model in a specific environment for managing organisational risks to arrive at their objectives with minimal setbacks.

Intellectual capital, isomorphic forces and internet financial reporting

Purpose The purpose of this paper is to report on the results of study carried out to examine the contribution of intellectual capital (IC) and isomorphic forces (IF) to internet financial reporting (IFR) among financial services firms in an emerging economy like Uganda. Design/methodology/approach This study is cross sectional and correlational. Data were collected through a questionnaire survey of 40 financial services firms. Data were analyzed through correlation coefficients and linear regression using Statistical Package for Social Sciences. Findings Results suggest that both IC and IF are significant predictors of IFR among financial services firms in Uganda. However, IF significantly contribute to IFR when IC is not present. Originality/value This study provides an initial empirical evidence on the contribution of IC and IF to IFR using evidence from Uganda’s financial service firms.