Malik Abu Afifa, Isam Saleh and Rahaf Abu Al-Nadi
The purpose of this research is to investigate the link between external audit quality and integrated reporting (IR) quality in the Jordanian market, a developing market…
Abstract
Purpose
The purpose of this research is to investigate the link between external audit quality and integrated reporting (IR) quality in the Jordanian market, a developing market. Furthermore, the research model considers the mediating effect of earnings management practices and the moderating effect of board gender diversity. As a result, it intends to provide further empirical evidence in this area.
Design/methodology/approach
This research investigates its model using data from Jordanian services companies listed on the Amman Stock Exchange (ASE) during the period 2013–2022. With 430 company-year observations, the current research’s sample includes all companies in the research population for which complete data were available during the period under investigation. Data relevant to the research setting were obtained from annual disclosures and the ASE's database.
Findings
The findings of this research show that audit firm size and audit firm specialty have a positive influence on IR quality, but audit firm tenure does not. External audit quality (as proxied by the size, specialty and turnover of the audit firm) had a negative impact on earnings management practices, while earnings management practices had a negative impact on IR quality. Additionally, the findings reveal that earnings management practices completely mediate the relationship between two external audit quality proxies (audit firm size and audit firm specialty) and IR quality. Furthermore, in terms of the moderating impact of board gender diversity, it is obvious that board gender diversity favorably moderates the relationships between all external audit quality proxies and IR quality.
Originality/value
Using agency theory and stakeholder theory, this investigation fills a gap in previous literature by adding scientific explanations and empirical evidence from the Jordanian market, a developing market, in the context of the impact of audit quality on IR quality, mediated by earnings management and moderated by board gender diversity.
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Malik Muneer Abu Afifa, Isam Hamad Saleh and Fadi Fouad Haniah
The purpose of this study is to look at the direct relationship between audit quality, earnings management (EM) practices and company performance, as well as the indirect…
Abstract
Purpose
The purpose of this study is to look at the direct relationship between audit quality, earnings management (EM) practices and company performance, as well as the indirect influence (mediation) of EM practices in the relationship between audit quality and company performance. It offers empirical evidence from the Jordanian market, which is considered an emerging market.
Design/methodology/approach
The population of this study is represented in Jordanian service companies listed on the Amman Stock Exchange (ASE), with a total of 344 company-year observations. Furthermore, panel data analysis was used in this study, and data for the study were acquired from yearly reports as well as the ASE’s database.
Findings
Based on generalized method of moments model, the present findings demonstrate that the size of the audit firm and the tenure of the audit firm have a positive and negative influence on EM practices, respectively, but that industry-specialist audit firm has a negative and insignificant effect. EM practices have a negative impact on two company performance proxies (ROA and ROE), but have no effect on earnings per share (EPS). Furthermore, the size of the audit firm has a positive and significant influence on the performance proxies of the company [i.e. return on assets (ROA) and return on equity (ROE)]. The presence of an industry-specialist audit firm has a positive and significant influence on two proxies of company performance (ROE and EPS), but a negative and significant impact on ROA. An audit firm’s tenure has a negative and significant impact on two performance proxies (ROA and EPS), but a positive and significant impact on ROE. Then, EM practices either fully or partially mediate the relationship between audit quality proxies and company performance as assessed by ROA, ROE and EPS.
Research limitations/implications
The current study’s limitation is that it only searched in Jordanian service companies listed on ASE from 2012 to 2019 to meet the study’s objectives; thus, the authors recommend that future work investigate the study model for other sectors, whether in Jordan or other emerging markets such as the Middle East and North Africa. Another limitation of this study is that the study models lack important variables, which may affect EM and company performance, such as corporate governance and ownership structure characteristics; as a result, the authors recommend that future work includes such variables in future research models to have more explanations in this context.
Practical implications
Analysts, investors and other strategic decision makers may use the findings of this study to improve the efficiency and efficacy of Jordan’s financial market. These findings will enhance policymakers’ willingness to establish appropriate regulations, which might improve Jordan’s financial market performance and efficacy. These findings may help investors make better judgments by using audit quality proxies and EM indicators, which can forecast business success.
Originality/value
First, this study distinguishes itself from prior studies through establishing a new research model, by investigating the mediating effect of EM in the relationship between audit quality and company performance. It provides empirical evidence from the Jordanian market; hence, it increases the body of the knowledge in this context. Second, to the best of the authors’ knowledge, this is the first study to look into the link between audit quality, EM and company performance together; hence, the model of this study is developed using agency theory and information asymmetry theory. Third, the current study adds new evidence to the role of audit quality and EM in companies, as well as how audit quality and EM practices affect company performance in emerging markets such as Jordan.
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Malik Abu Afifa, Isam Saleh, Aseel Al-shoura and Hien Vo Van
The direct nexus between board characteristics, earnings management (EM) practices and dividend payout is examined in this study, followed by an examination of the indirect…
Abstract
Purpose
The direct nexus between board characteristics, earnings management (EM) practices and dividend payout is examined in this study, followed by an examination of the indirect mediation impact of EM practices in the nexus between board characteristics and dividend payout. It aims to provide new empirical evidence from the Jordanian market, which is an emerging market.
Design/methodology/approach
The study population consists of all service firms that were listed on the Amman Stock Exchange (ASE) between 2012 and 2019. Due to the lack of availability of their complete data during the period, four service firms were omitted from the population; hence, a sample of 43 service firms was acquired over the time frame (2012–2019), yielding a total of 344 firm-year observations. Moreover, panel data analysis was employed in this study, and data for the study were acquired from yearly reports as well as the ASE's database.
Findings
Based on the GMM estimator findings, board size and independence have a negative and significant influence on the EM, but CEO/chairman duality has a positive and significant impact. Simultaneously, the impacts of female representation on the board of directors and the number of board meetings were both positive but insignificant. The findings also found that four board characteristics, including board size, female representation on the board of directors, CEO/chairman duality and the number of board meetings, had a significant negative or positive effect on dividend payout, while board independence did not. Additional findings show that EM practices have a direct negative insignificant effect on dividend payout, whereas EM practices partially mediate the relationship between board characteristics and dividend payout.
Research limitations/implications
The current study's limitation is that it only searched in Jordanian service firms listed on ASE from 2012 to 2019 to fulfill the study's objectives; thus, we urge that future work explores the study models for other sectors, whether in Jordan or other growing markets such as the Middle East and North Africa.
Practical implications
The findings of this study may be utilized by analysts, investors and other strategic decision-makers to enhance Jordan's financial market's efficiency and efficacy. These findings will improve policymakers' willingness to impose appropriate constraints, perhaps boosting Jordan's financial market performance and efficacy. These findings may also help investors make more enlightened judgments by utilizing board characteristics and EM factors that predict firm dividend policy.
Originality/value
Contradictions in the results of earlier investigations inspired the current study, with the findings filling a gap in the existing literature. This study differs from previous studies by constructing a novel research model and analyzing the mediating influence of EM in the nexus between board characteristics and dividend payout.
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Malik Muneer Abu Afifa, Isam Saleh and Fatima Taqatqah
This paper aims to recognize the direct influence of audit quality (AQ) on earnings management practices (EMP) and company value (CV), as well as the mediating role of EMP in the…
Abstract
Purpose
This paper aims to recognize the direct influence of audit quality (AQ) on earnings management practices (EMP) and company value (CV), as well as the mediating role of EMP in the link between AQ and CV. It presents new factual proof from the Jordanian market, which is still in its early stages.
Design/methodology/approach
A pattern of 43 service firms listed on the Amman Stock Exchange (ASE) was collected for the timeframe (2012–2019), giving an amount of 344 firm-year observances. The data was collected from the annual reports extracted from the ASE’s database and tested with panel data analysis.
Findings
The results show that audit firm industry specialization positively affects EMP while its size and tenure do not, which implies that its industry specialization does not restrict earnings management but rather leads to an increase in opportunistic behaviors. Audit firm size and audit firm industry specialization positively affect CV, whilst audit firm tenure does not. Additionally, the findings indicate that EMP negatively affect CV, and EMP act as a mediator for the AQ–CV nexus.
Research limitations/implications
Stakeholders can use the findings to enhance the capacity and effectiveness of Jordan’s fiscal market. For example, our results will boost policymakers’ eagerness to institute suitable statutes improving Jordan’s fiscal market performance. Besides, the results can assist existing and potential investors make sound adjudication by using AQ proxies and earnings management as signals to predict future company’s value.
Originality/value
The paper differentiates itself from previous papers through initiating a new proposed model by exploring the role of earnings management as a mediator in the nexus between AQ and CV by presenting new factual proof from the Jordanian market.
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Malik Muneer Abu Afifa, Isam Saleh, Maen Al-Zaghilat, Nawaf Thuneibat and Nha Minh Nguyen
This study aims to investigate the direct nexus between board characteristics, corporate social responsibility (CSR) disclosure and the cost of equity capital (CEQ). This is done…
Abstract
Purpose
This study aims to investigate the direct nexus between board characteristics, corporate social responsibility (CSR) disclosure and the cost of equity capital (CEQ). This is done by using agency theory, stakeholder theory and signalling theory, followed by an investigation into the indirect mediation impact of CSR disclosure in the board characteristics-CEQ nexus. It intends to present new experimental evidence from Jordan’s developing economy.
Design/methodology/approach
The study’s target population was services companies registered on the Amman Stock Exchange (ASE) between 2012 and 2020. As a result, the population and sampling of this study are represented by all services companies for whom complete data are available over the period, with a total of 43 services companies yielding 387 company-year observations. Data for our study were obtained from their annual disclosures and the ASE’s database.
Findings
The main findings demonstrated that board size, board gender variety and the number of board sessions positively affect CSR disclosure significantly. In addition, three board characteristics (i.e. board size, board independence and board gender variety) significantly negatively affect CEQ. Besides, CSR disclosure significantly negatively affects CEQ and it fully mediates the relationship between two board characteristics (i.e. board size and board gender variety) and CEQ, whereas it partially mediates the nexus between board independence, CEO/Chairman duality and the number of board sessions of board characteristics and CEQ.
Originality/value
This study varies from earlier studies, in that it builds a new research model by looking at the mediating role of CSR disclosure in the nexus among board characteristics and the CEQ.
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Malik Abu Afifa, Nha Minh Nguyen and Duong Van Bui
This study aims to investigate the nexus among environmental, social and governance disclosure quality (ESGDQ), corporate governance (COG) and corporate social responsibility…
Abstract
Purpose
This study aims to investigate the nexus among environmental, social and governance disclosure quality (ESGDQ), corporate governance (COG) and corporate social responsibility strategy (CSRS) in the context of ASEAN, a developing market. Furthermore, carbon emission (CAE) has been considered as a moderation component for the CSRS–ESGDQ link.
Design/methodology/approach
With strict selection criteria, five countries in the ASEAN region (ASEAN-5) were selected as the research sample frame, including Vietnam, Thailand, Malaysia, Indonesia and the Philippines. Using the Thomson Reuters Eikon database, the initial sample included 4,735 listed companies in ASEAN-5. After a rigorous screening process, there were a total of 683 companies in the final sample with the 2018–2022 intervals.
Findings
By using maximum likelihood structural equation modeling, the finding indicates that COG and CSRS have a favorable effect on ESGDQ in the ASEAN-5 context. Furthermore, CAE plays an outstanding moderation role in the CSRS–ESGDQ link. The fundamental accounting standards are also identified as having an impact on ESGDQ.
Practical implications
The research points up the dominant role of internal components (i.e. COG, CSRS and CAE) and government factor (i.e. fundamental accounting standards) for the sustainable value (i.e. ESGDQ) of firms in ASEAN-5, a developing market. Thus, firm headers should inspect the performance of these internal components at a crucial interval to enhance their environmental, social and governance (ESG) behaviors and make them more sustainable. Furthermore, governments in ASEAN-5 should pay attention to developing areas that have low CAE and have a favorable influence on national sustainable development goals.
Social implications
The findings of the research provide some social implications by pointing up important factors influencing sustainability practices, and understanding how ESG practices can be improved in developing countries.
Originality/value
The research enlarges ESG documentation by specifying the influences of internal components and government factor, as well as providing actual proof from developing regions. In addition, this study identifies the effectiveness of CAE as well as its moderating role in this context.
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Pilar Gardiazabal, Constanza Bianchi and M. Abu Saleh
The purpose of this paper is to investigate if retail services have a transformative potential to improve the well-being of customers in a Latin American market. Transformative…
Abstract
Purpose
The purpose of this paper is to investigate if retail services have a transformative potential to improve the well-being of customers in a Latin American market. Transformative studies have been conducted mostly in developed countries, and consumer well-being in a Latin American supermarket context has not been addressed previously. Specifically, this study aims to understand if customer satisfaction with a supermarket experience in Chile leads to positive customer well-being. Additionally, it is examined if customer well-being influences firm outcomes, such as customer loyalty, word-of-mouth (WOM) communication or retailer equity.
Design/methodology/approach
A conceptual model was developed, and data was collected through an online survey from 866 customers of a large supermarket chain in Chile. Hypotheses were tested with structural equation modeling.
Findings
The findings of this study support all the hypotheses of the model and confirm that customer satisfaction has direct and indirect effects on customer loyalty and other firm outcomes through customer well-being.
Research limitations/implications
This research is among the few studies in the academic literature that considers retail experience and well-being outcomes for supermarket customers in a Latin American context. Limitations derive from the cross-sectional nature of this study.
Practical implications
There are implications from this study contributing to the literature on customer retail experience, in terms of the potential to transform supermarket shopping in a Latin American country. This is particularly relevant in Latin America as the extent to which for-profit organizations acknowledge their relevancy of the individuals’ well-being is still at its infancy.
Social implications
This research provides empirical support to the importance of not only looking at traditional measures such as WOM, equity and loyalty but looking into the impact services have for customers’ life and well-being.
Originality/value
This study contributes to the services literature and addresses a gap in it by exploring the transformative potential of supermarket shopping on customer well-being and in turn the role of customer well-being in retail firm outcomes. The findings also contribute in considering Chile, a Latin American context that has been overlooked in the transformative services studies. This provides managerial implications for domestic and global companies that offer grocery retailing for consumers in this region.
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Bing Peng-Loong Wong, M. Abu Saleh, Raechel Johns and Ravi Chinta
Despite the important role that exploitation plays in innovation and new product development (NPD), research on the relative impact of internal organisational stocks of existing…
Abstract
Purpose
Despite the important role that exploitation plays in innovation and new product development (NPD), research on the relative impact of internal organisational stocks of existing knowledge on subsequent exploitation is largely absent. In particular, there is lack of clarity within the extant literature regarding the associations between organisational exploitation and, respectively, the distal-proximal technological experience and radical-incremental innovative experience generated by multiproduct firms. Thus, this study seeks to further enhance researchers’ theoretical understanding on the relationship between organisational exploitation and internal knowledge stocks categorised along two dimensions of organisational experience accumulated by multiproduct firms that have not previously been considered jointly.
Design/methodology/approach
This paper pursues a focussed literature review approach and applies the underlying theory of exploitation to develop a theory explaining the possible relationships between organisational exploitation and internal knowledge stocks.
Findings
Based on the theory of exploitation, this paper proposes a new direction in studying the various internal knowledge stocks and their respective impact on subsequent organisational exploitation.
Practical implications
The proposed research direction suggests an emerging framework of possible relationships between exploitative new radical products development in firms, and respectively, proximal and distal technological experience, and radical and incremental innovative experience, accumulated in multiproduct firms. This novel framework can guide further research on this topic.
Originality/value
To fill a research gap regarding the possible relationships between subsequent exploitative endeavours and two dimensions of organisational experience that have been traditionally associated with the exploration-exploitation construct, this paper proposes and develops a novel typology of knowledge stocks categorised along two dimensions of organisational experience accumulated by multiproduct firms that have not previously been considered jointly in the literature.
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Malik Muneer Abu Afifa and Isam Saleh
This study aims to investigate the relationship between management accounting systems effectiveness (MASE) and company performance and then it examines the role of perceived…
Abstract
Purpose
This study aims to investigate the relationship between management accounting systems effectiveness (MASE) and company performance and then it examines the role of perceived environmental uncertainty as a moderator on this relationship. It provides empirical evidence from a developing market, especially from the Jordanian market.
Design/methodology/approach
This study is based on collecting its data using a quantitative method to assist in explaining and interpreting the results, whereby the study data were collected through a survey design approach using a questionnaire method to achieve the objectives of the study. The population of this study included all Jordanian companies listed on the Amman Stock Exchange (ASE) at the end of 2019, a total of 187 companies. Therefore, the study sample consists of all these companies (a completely sensuous population) which are listed on ASE at the end of 2019.
Findings
The findings of this study offered that two informational characteristics of MASE, namely, timeliness and integration, have a significant impact on the financial performance and other characteristics have no impact on the financial (FP) and nonfinancial (NFP) performance. The informational characteristics of management accounting systems complement each other to ensure the MASE in the company, where the relationship between MASE proxied by four informational characteristics together and FP as well as NFP, were highly significant. Additionally, the findings documented that perceived environmental uncertainty, namely, customer uncertainty, competitor uncertainty and technology uncertainty separately do not moderate the relationship between MASE and company performance (both FP and NFP).
Research limitations/implications
The findings of this study shape the way for more thorough studies into monitoring MASE. Nevertheless, to start efficient decisions, managers need to comprehend the interaction of the MASE with other factors. All these considerations need to be comprehended both for and against the performance. Finally, this study addressed important issues that have practical management value. However, it is limited to a sample from one country. Future research would be interesting to study different businesses and cultural settings to enhance the theoretical and practical contributions of the study’s findings and conclusions. To be more specific, further study should have a wider view of the determinants of performance by containing economic factors in different areas such as the MENA region.
Originality/value
To the best of the knowledge, this is the first study of Jordan to examine the relationship between MASE and company performance from two sides (namely, financial and non-financial performance), moderated by perceived environmental uncertainty. As such, the study raises significant findings drawing attention to management accounting systems and the role of management accounting systems in Jordan.
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Dao Truc Thi Vo, Malik Abu Afifa, Duong Van Bui, Hien Vo Van and Nha Nguyen
This paper aims to examine the nexus among cloud-based accounting (CBA), employee job performance (EJP) and operational performance (OPP) in the circumstances of Vietnam, an…
Abstract
Purpose
This paper aims to examine the nexus among cloud-based accounting (CBA), employee job performance (EJP) and operational performance (OPP) in the circumstances of Vietnam, an emerging nation. In which the authors examine EJP as a mediator variable inside the research model. Furthermore, the employee digital skills (EDS) factor is examined as a moderating variable for the CBA-EJP nexus and the CBA-OPP nexus, respectively.
Design/methodology/approach
The study’s sample was acquired through extensive screening methods. This study used email surveys to acquire data. The survey was sent to 1,200 chief financial officers of Vietnamese firms. For analysis, the ending pattern of 401 e-surveys was used.
Findings
By using partial least squares structural equation modeling, the results imply that the CBA has a favorable effect on EJP and OPP. Furthermore, EJP favorably mediates the linkage between CBA and OPP, whereas EDS play a significant moderator role in the CBA-EJP nexus and CBA-OPP nexus, respectively.
Practical implications
This study highlights the crucial role of human factors (i.e. EDS and EJP) for the internal modern applying behaviors (i.e. CBA) and firm value (i.e. OPP) of firms in emerging markets. Therefore, managers should scrutinize the performance of human factors in an essential interval to improve modern applied behaviors and make them more powerful, thus improving the OPP of their firms. Substantially, firm managers should focus on employing the EDS, which enhances the CBA-EJP nexus and the CBA-OPP nexus, respectively.
Originality/value
This study enlarges the OPP documentation by detailing the beneficial effects of human factors as well as the CBA. Furthermore, the study recognizes the effectiveness of EDS as a moderator variable in the context of developing economies. Finally, this work has been regarded as earlier empirical research that integrates all of the aforementioned components into a single model in emerging economies, particularly Vietnam.