Since the late 1970s, observers of accounting and finance research have noted a growing gap between extant academic research and the needs of practitioners. In accounting, for…
Abstract
Since the late 1970s, observers of accounting and finance research have noted a growing gap between extant academic research and the needs of practitioners. In accounting, for example, both industry leaders and academic leaders have voiced their concern over this increasing gap between research and practice (see Baxter, 1988; ICAS, 1988). A major view suggests that the methodological precepts of most extant accounting/finance research are constructed in abstruse mathematics based on hypotheses far removed from reality; in consequence, many practitioners have remained sceptical, unable to express an opinion and have withdrawn from the decision making process (Allen, 1992). Over a decade earlier, Carleton (1978) in his Presidential address to the Financial Management Association (FMA) made an indicting observation that ômost contemporary theory and research in corporate finance do not even deal with what in the abstract are the central problems in corporate financeö. The gap between research and practice and the need to dovetail research to issues which are close to the needs of financial practitioners have been echoed by other academics (see Herbert and Wallace, 1996).
E. Dockey, W.E. Herbert and K. Taylor
Discusses the agency issues underlying corporate governance, refering to research on managerial attitudes/incentives for maximizing shareholder value and pressures to align the…
Abstract
Discusses the agency issues underlying corporate governance, refering to research on managerial attitudes/incentives for maximizing shareholder value and pressures to align the interests of directors and shareholders. Reports a survey of finance executives in 175 large firms in 7 EU countries to analyse their strategies and the influence of pressure groups on strategy choice. Shows that market leadership and increased operating margins are the most successful operating strategies; changing productive capacity, generating new/better products and buying business with complementary products are the best investment strategies; and a leveraged buyout is the most effective capital strategy to maximize shareholder returns. Adds that UK managers (like US managers) have a shorter term focus than other European managers, perhaps because their relationships with institutional investors are less close.
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Emerging markets present differences in structural characteristics, yet exhibit commonalities of melancholy evidence of varying degrees of economic and political…
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Emerging markets present differences in structural characteristics, yet exhibit commonalities of melancholy evidence of varying degrees of economic and political under‐development. There is a greater consensus in the finance literature on what the characteristics of emerging markets are than there is on their meaning. Some perceive the financial markets in terms of the mix of financial institutions and the level of development of the national economy. In this respect, popular reference relates to the dichotomy between developed and developing countries. This view of the emerging markets is flawed on the grounds that some countries within the developed countries' group are regarded as emerging markets (e.g. Portugal, Greece and former USSR) (see for example, Todaro, 1989, p.16). Narrow conceptions then focus on the level of development (and efficiency) of the national stock market and financial system, hence the appellation ‘emerging stock markets of developing countries’. These markets are thought to suffer from the small numbers market condition (Williamson, 1975), allocative efficiency distortion, and a range of market imperfections and externalities, including transaction costs. Yet others cast these markets in terms of their high levels of political risk, involving essentially military interregnums or what the international investor regards as unwarranted government intervention in exchange transactions.
Suggests that the corporate governance (CG) systems of transition economies in Eastern Europe may differ from those of industrialized countries and describes the governance system…
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Suggests that the corporate governance (CG) systems of transition economies in Eastern Europe may differ from those of industrialized countries and describes the governance system in Poland, which uses National Investment Funds (NIFs) under supervisory boards and the Treasury to deal with the restructuring of enterprises to be privatized. Outlines the financial market environment in Poland and the NIFs’ role within it; and discusses the CG issues arising from the relationships between the NIFs and the supervisory boards. Recognizes the problems involved but doubts whether the use of UK/US or german CG systems would solve them. Hopes that the paper will provide a basis for further research.
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The pace of economic reforms in the emerging markets of Central and Eastern Europe through such measures as macro stabilisation policies, price liberalisation and currency…
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The pace of economic reforms in the emerging markets of Central and Eastern Europe through such measures as macro stabilisation policies, price liberalisation and currency convertibility has helped to demonstrate that economic transition can be achieved fairly rapidly. Certainly, the challenge for these economies has been to construct, through the new freedom afforded economic agents, (households and firms), an economy that can: (a) facilitate non‐inflationary economic growth, and (b) usher in improvements in social and economic welfare. It is the interconnection between the macroeconomic stabilisation measures (e.g. tight fiscal and monetary policies) and the desire to alter decades of economic decline which has prompted the commitment of these governments to fostering a greater reliance on market forces to improve the overall efficiency of resource utilisation (See Lipton and Sachs, 1990). The global impression is that the competitiveness and industrial restructuring efforts are beginning to alter the economic structure of these countries, which are being met with varying success; (see, for example, Hare and Hughes, 1991).
It is over five years since the countries of Central and Eastern Europe (CEE) initiated a rapid programme of economic reforms. Although substantial progress has been achieved…
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It is over five years since the countries of Central and Eastern Europe (CEE) initiated a rapid programme of economic reforms. Although substantial progress has been achieved within this short period, especially with regard to price and monetary reforms, trade liberalisation and privatisation of large state‐owned enterprises, the majority of these countries have yet to develop a properly functioning financial market to accommodate the financing needs of the growing population of privatised firms. While considerable progress has been made in reforming and modernising the banking and financial sectors, the undercapitalisation of banks and the limited capacity of financial institutions to fill the capital gap (Dockery, 1995) have tended to cause slowness in restructuring the enterprises and general economic progress. The continuing demands for investment capital by the newly privatised firms (and those in the process) require active support of financial institutions to provide the much needed capital in the emerging market economy.
Tyrone De Alwis, Narayanage Jayantha Dewasiri and Kiran Sood
The goal of this study is to look into the connection between Sri Lanka’s fiscal deficit and inflation. Sri Lanka is currently experiencing one of its worst inflation crises in…
Abstract
The goal of this study is to look into the connection between Sri Lanka’s fiscal deficit and inflation. Sri Lanka is currently experiencing one of its worst inflation crises in its history, necessitating an investigation into how fiscal deficit affects inflation, as it has been experiencing an ever-increasing fiscal deficit for the last four decades. The quantitative methodology is employed in this study using annual data from 1977 to 2019 following the ARDL technique in the analysis. The findings showed that both in the long run and the near term, Sri Lanka’s fiscal deficit had a positive and significant link with inflation. The policymakers should increase the revenue through the taxes in order to bridge the fiscal deficit. As a developing country, it cannot afford to continue with the ever-increasing fiscal deficit which has become a burden to country. Also, it is the responsibility of each government to think carefully to reduce its massive expenditure which has become a common feature in the country for the last four decades. Cutting down government expenditure can improve the economic growth and well-being of the citizens too. The government should therefore concentrate on short-term investment programmes that will benefit the country while doing the same in the long run.
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Collins Sankay Oboh, Solabomi Omobola Ajibolade and Olatunde Julius Otusanya
The purpose of this study is to examine the influence of ethical ideological orientation (moral idealism and moral relativism), work sector and types of professional membership on…
Abstract
Purpose
The purpose of this study is to examine the influence of ethical ideological orientation (moral idealism and moral relativism), work sector and types of professional membership on the ethical decision-making (EDM) process of professional accountants in Nigeria.
Design/methodology/approach
The study obtained primary data from 329 professional accountants with the aid of a structured questionnaire containing four scenarios of ethical dilemmas. The data were analysed using descriptive statistical analysis, independent sample t-test, Pearson correlation analysis and multiple regression techniques.
Findings
The results revealed both idealistic and relativistic moral orientation among the accountants surveyed with a higher mean score (>4.0) recorded for moral idealism. Moral idealism was found to have a positive influence, while moral relativism a negative influence on the three stages (ethical recognition, ethical judgement and ethical intention) of EDM examined. Professional accountants with idealistic orientation showed a higher disposition towards making ethical decisions in situations involving ethical dilemmas than those tending towards relativistic orientation. The results also revealed that work sector (private or public) and types of professional membership play significant roles in predicting the EDM process of professional accountants in Nigeria.
Practical implications
The study provides empirical evidence that could be used to support educational and legislative efforts in enhancing the moral ideological orientation of professional accountants, which will, in turn, enhance their EDM processes. The findings could be used to enhance ethics instructions and training of current and prospective professional accountants in educational settings, especially in countries such as Nigeria where there is yet to be a discrete ethics course in the curriculum for accounting undergraduate degree programmes. Professional accounting bodies in Nigeria and other developing countries could use the evidence in this study to strengthen the ethics code for professional accountants.
Originality/value
The study is unique in focussing on professional accountants in developing countries using Nigeria to represent developing countries with high corruption profile and weak institutions and governments and, as such, it contributes to the scarce research output on accounting ethics in developing countries.
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The purpose of this paper is to examine the influence of personal and moral intensity variables on specific processes, namely, ethical recognition, ethical judgment and ethical…
Abstract
Purpose
The purpose of this paper is to examine the influence of personal and moral intensity variables on specific processes, namely, ethical recognition, ethical judgment and ethical intention, involved in the ethical decision making (EDM) of accounting professionals.
Design/methodology/approach
A structured questionnaire containing four vignettes of ethical dilemmas is used in the paper to obtain data from 329 accounting professionals. The data are analyzed using Pearson correlation matrix, independent sample t-test, one-way analyses of variance and multiple regression estimation techniques.
Findings
The findings of the paper suggest that age, economic status, upbringing, moral idealism and relativism, magnitude of consequence and social consensus are significant determinants of the EDM process of accounting professionals.
Practical implications
The paper provides evidence to guide accounting regulatory bodies on ways to strengthen extant measures that ensure strict compliance with ethics codes among accounting professionals in Nigeria.
Originality/value
The paper provides support for Kohlberg’s cognitive reasoning and moral development theory and Rest’s EDM theoretical model, which will aid the development of a structured curriculum for accounting ethics instruction in Nigeria, as hitherto, there is yet to be a provision for a stand-alone ethics course in the undergraduate accounting programs in Nigeria.