Business Commons^™

An Examination Of The Effect Of The Coronavirus Pandemic On Firm Value In Egypt: A Panel Pmg/Ardl Approach, Wafaa Salah, Lela Pumphrey

Business Administration

This study investigates the short-and long-term consequences of coronavirus-induced declines in firm activity on firm value. This association was explored explicitly at both the market and industry levels. The panel data covers the period from March 19,2020,to June 25,2020,for 136 publicly traded non-financial companies. The panel pooling mean group/Autoregressive Distributed Lag estimate method is utilized to investigate the Coronavirus's short-and long-term effects on firm value. The primary findings indicate that the pandemic negatively impactedthe daily stock returns of all industries besides healthcare. This outcome could be ascribed to a 24,3 percent increasein Egyptian healthcare spending in 2019/20 to assure the …

The Determinants Of Unconditional Conservatisms: A Cross-Country Study, Wafaa Salah, Noura Anwar Abdel-Fatah, Farouk Tamam Shoaeb

Business Administration

Accounting conservatism is a fundamental qualitative characteristic of financial statements. For centuries, it has had a significant impact on accounting practices. The goal of this study is to investigate the attributes of firms and countries, as well as their relative importance in influencing the level of unconditional conservatism. The data for Hierarchical Linear Modeling was collected from a sample of 5470 publicly traded firms from 55 countries between 2017 and 2019. The results reveal that country differences explain approximately 31 percent of the variance in the level of unconditional conservatism. Thus, firm attributes are superior in explaining cross-country variance in …

Earnings Mangement Determinants: A Study Of Egyptian Listed Firm Characteristics Post The Egyptian Revolution, Engy Elhawary ,The British University In Egypt, Dina Hassouna , The British University In Egypt

Business Administration

This research aims to look at how firm characteristics and audit quality can affect the earning management practices in the Egyptian context, within the period of 2011–2019. This period was after the Egyptian revolution and has not been well investigated in Egypt, especially after the new release of corporate governance rules for listing firms. A sample of 157 non-financial listed companies in the Egyptian stock exchange is selected for achieving the research objective through analysing their financial reports. The panel least squares, using the fixed-effect model, is used to test the hypotheses and investigate the relationship between discretional accruals and …

Audit Committee Effectiveness And Company Performance: Evidence From Egypt, Engy Elhawary

Business Administration

The purpose of this paper is to investigate the impact of audit committee characteristics (size, independence, experience, gender diversity, and frequency of meetings) on the company‘s financial performance (ROA and ROE) in Egypt. In 2016, the Egyptian Stock Exchange announced a new listing requirement for the audit committee members‘ characteristics to enhance its effectiveness. Data are gathered from the board of directors (BOD) and annual reports of the EGX 30 index non-financial listed companies in Egypt for the period of 2016–2018. Data is analyzed by using panel data cross-section data analysis and correlation analysis. The findings reveal that the audit …

Corporate Social Responsibility And Firm Risk: Egypt’S Case, Dina Hassouna, Rania Abdelfattah

Business Administration

Studies amongst developed countries have extensively investigated the link between corporate social responsibility (CSR) and financial performance. However, due to lack of research in the Middle East, especially in Egypt, the association between CSR and firm risk remains much less understood (Nguyen & Nguyen, 2015). Therefore, this paper is one of the very few studies that investigate the impact of CSR on firm risk amongst developing countries. A sample of 31 Egyptian listed companies was examined over four years, from 2011 to 2015. We test the impact of CSR on firm risk using fixed and random effects estimation models. We …

The International Financial Reporting Standards And Firm Performance: A Systematic Review, Wafaa Salah

Business Administration

This study reviews the accounting literature which investigates the effects of International Financial Reporting Standards (IFRS) on firms’ financial performance to answer a debating question of how effective are the accounting standards in affecting financial performance and to provide guidance for future studies. The focus of the review is three primary streams, first, reasons and evidence of differences between countries in accounting practices; second, theories justifying the transition from local Generally Accepted Accounting Principles (GAAP) to IFRS; Third, the effect of accounting standards on firms’ financial performance regarding three broad groups: (1) Common law countries (2) Civil law countries, and …

The Effects Of International Financial Reporting Standards On Financial Reporting Quality, Wafaa Salah, Abdallah Ahmed Abdelsalam

Business Administration

The purpose of this study is to investigate whether the financial reporting under International Financial Reporting Standards (IFRS) has more quality than local GAAP for firms listed on Taiwan stock exchange. Financial Reporting Quality is measured in this study by three attributes of earnings introduced in previous literature, namely: 1) earnings management expressed as managing towards positive earnings and earnings smoothing and, 2) timely loss recognition expressed as the asymmetric incorporation of economic gains and losses and large negative net income, and 3) value relevance. Ordinary Least Square (OLS) Regression analysis, Z-test, and Binary Logistic Regression are employed to investigate …

Does Deferred Tax Mediate The Relationship Between Tax Planning And Earnings Management?, Wafaa Salah

Business Administration

The objective of this study is to investigate the effect of deferred tax disclosed under the Egyptian Accounting Standard No. 24, income taxes, and tax planning on earnings management. In addition, to investigate the role of net deferred tax liabilities as a mediator between tax planning and earnings management. This study employs a sample of 127 firms listed on the Egyptian stock exchange covering the period 2011 to 2017 ending up with 889 observations. A stratified simple random sampling technique was used to select the sample. Path analysis is employed to examine the framework of the study and analyses the …

Earnings Relevance Changes Post The Egyptian Revolution Crisis, Sara Abdallah

Business Administration

Purpose – This paper aims to investigate whether the value relevance of accounting information has been affected by the occurrence of the Egyptian revolution financial crisis. More specifically, this paper examines the value relevance changes of three key accounting constructs: operating cash flow, normal nondiscretionary accruals and discretionary accruals before and after the Egyptian revolution crisis.

Design/methodology/approach – Ordinary Least Squares (OLS) regression is used to examine the changes in earnings value relevance across before and after the Egyptian revolution crisis. The performance matched Jones model (Kothari et al., 2005) is used to estimate the discretionary accruals.

Findings – After …

The Impact Of Country-Level And Firm-Level On Financial Performance: A Multilevel Approach, Wafaa Salah

Business Administration

The objective of this study is to demonstrate the relative importance of both firm-level and country-level on financial performance. In addition, to explore the influence of firm-level variables (Accounting standards, firm age, firm size, liquidity) together with country-level variables (GDP per capita, inflation rate, development status, human development index, country openness to trade) on financial performance. Financial performance is measured in this study by Return on Assets. Hierarchical Linear Modeling is employed to identify the components of firm performance variability. This study employs a sample of 4095 publicly listed industrial firms from 54 countries listed on stock exchange covering the …

External Auditor Type, Discretionary Accruals And Investors' Reactions, Sara Abdallah

Business Administration

Purpose – The purpose of this paper is to investigate, in an Egyptian context, the external auditor type (Big 4 vs local) implications on reporting quality proxied by discretionary accruals (DA) and also examine whether auditor type impacts the market’s pricing of DA, where pricing is considered a proxy for the perceived DA quality.

Design/methodology/approach – The sample period is 2012–2015, that is meant to be post the Egyptian revolution financial crisis; all Egyptian stock exchange (EGX) listed firms (except banks and financial institutions) are considered. DA are estimated using modified Dichev and Dechow’s (2002) model (McNicholas, 2002). Ordinary least …

Book-Tax Income Conformity And Earnings Quality: Egx-Based Evidence, Sara Abdallah

Business Administration

This article aims to investigate the incremental value of book-tax differences (BTD) for the future earnings post the Egyptian revolution crisis and also examine the changes in BTD information under earnings discretionary overestimation versus underestimation by Egyptian stock exchange (EGX) listed firms. The findings show a negative incremental BTD value for the one-year ahead earnings performance. This finding is more pronounced for large BTD regardless of its sign (positive/ negative). However, large BTD negative implications are more evident in firms managing earning upward. The findings advocate that BTD are more likely to be driven by earnings manipulation incentives than tax …

Adoption, Importance And Barriers To The Implementation Of Contemporary Management Accounting Practices: Evidence From Egypt, Amani Hussein

Business Administration

In present times, complexity in the business environment, and advanced technology has intensified the challenges for more management accounting information to meet global competition. Therefore, contemporary management

accounting practices (CMAPs), which focus on financial and non-financial information, have emerged to support

managers’ decision-making processes. This research is aimed at examining the adoption, importance and barriers to

the implementation of contemporary management accounting practices. To achieve its objectives, the research

conducted a survey and collected data on forty MAPs. The methodology of the study relied on factor analysis to

identify and group different variables into the main factors that contribute to …

The Effect Of Firm Characteristics On Earnings Quality: The Moderating Role Of Firm Size, Wafaa Salah

Business Administration

This study sought to examine the effect of firm characteristics on earnings quality. Specifically, the objectives of the study were two-fold: first, to investigate the relationship between firm characteristics and earnings quality using a sample of 45 industrial firms listed on the Egyptian stock exchange for the period 2014 to 2017; and secondly, empirically investigate the moderating role of firm size in the relationship between firm characteristics and earnings quality. The discretionary accrual is used as a proxy for earnings quality. The study employs Ordinary least squares regression analysis. The results indicate that profitability and financial leverage have a significant …

Features Affecting The Quality Of Sustainability Reporting: An Empirical Study And Evaluation, Noha Abdelrahman

Business Administration

Despite of the increasing importance of the sustainability reporting, as a measure of the sustainability performance, nowadays, there is a consensus on the poor quality of sustainability reporting among academics and practitioners. This research aims at testing the impact of some factors that could be the reason behind that poor quality of sustainability reporting. Based on the relevant literature, the research applied multiple regression analysis to test the impact of the corporate adherence to regulations (mainly Global Reporting Initiatives “GRI”) and the type of information in the report (mainly the quantitative information) on the quality of sustainability reporting. This relationship …

Determinants Of Internet Financial Reporting By Egyptian Companies, Laila Aboutera, Amani Hussein

Business Administration

This research aims at examining the determinants of internet financial reporting by Egyptian companies through

measuring the extent of internet financial reporting (IFR) practices in Egypt and the association between IFR and

the Egyptian listed companies’ characteristics. The research sample consists of 133 Egyptian companies listed on

the Egyptian stock exchange as well as Nile stock exchange. The sample includes only those companies that

disclose financial information on the internet. This research considers; company’s size, profitability, liquidity,

leverage, company’s age, auditor type and ownership structure as the independent variables that might impact

the company’s’ corporate IFR practices. Moreover, a disclosure …

Perceived Risk And Behavioral Determinants Of Using Internet Banking In Egypt, Amani Hussein, Mohamed Saad

Business Administration

Internet banking (IB), refers to the use of bank’s web site through which users access their banking accounts and conduct financial transactions. The success of IB is determined not only by banks or government support but also by users’ acceptance of it. Therefore, this research aims at examining perceived risk and behavioral determinants of using internet banking in Egypt. The research design a model based on using the original postulates of Technology Acceptance Model (TAM) perceived usefulness and perceived ease of use and introducing new factors (such as: security risk, financial risk, privacy risk, awareness, computer self-efficacy (CSE) and resistance …

The Effect Of Firm’S Size And Leverage On Profitability: A Panel Data Approach, Wafaa Salah

Business Administration

The purpose of this study is to investigate the effect of firm’s size and leverage on the profitability of publicly listed firms adopting IFRS. A Panel data fixed-effects regression model is employed to estimate the relationship between firm size and leverage on profitability, while controlling also for the effects of other variables as asset turnover and liquidity. The study is based on a sample of 94 firms from Malaysia over the period from 2012 to 2016. The study is applied to the industrial sector. The study concluded that firm size is positively and significantly related to profitability. However, leverage is …

Features Affecting The Quality Of Sustainability Reporting Within An Egyptian Context: An Empirical Study And Evaluation, Noha Abdelrahman

Business Administration

Despite of the general agreement among academics and practitioners on the massive importance of sustainability reporting, the quality level of sustainability reporting is unsustainable. There is an obvious increase in the number of sustainability reports that is not associated with a parallel or even acceptable increase in their quality. This research aims at contributing knowledge within sustainability reporting in the context of Egypt. This aim will be achieved by providing insights in the knowledge and reporting of sustainability through testing certain features for their impact on the quality of sustainability reporting. Data will be collected for the Global 100 companies, …

A Quantitative Analysis For The Correlation Between Corporate Financial And Social Performance, Wafaa Salah, Mostafa Salama

Business Administration

Recently, corporate social performance (CSP) is not less important than corporate financial performance (CFP). Debate still exists about the nature of the relationship between the CSP and CFP, whether it is a positive, negative, or a neutral correlation. The objective of this study is to explore the relationship between corporate social responsibility (CSR) reports and CFP. The study uses the accounting-based and market-based quantitative measures to quantify the financial performance of seven organizations listed on the Egyptian Stock Exchange in 2007-2014. Then uses the information retrieval technologies to quantify the contribution of each of the three dimensions of the corporate …

Investigating Corporate Social Responsibility Disclosure By Banks From Institutional Theory Perspective, Wafaa Salah, Iman Mohamed Arafa

Business Administration

Previous research on Corporate Social Responsibility (CSR) has mainly focused on the companies operating in different industry 􀏐ields. Yet, a limited number of research has investigated the CSR practices at the banking sector. Accordingly, this study attempts to add further knowledge to this domain by measuring and comparing the extent and quality of CSR practices and its components which are: Employees, Community, Environment and Corporate governance at a larger geographical scale. Moreover, the relationship between institutional environment and the CSR and its components will be empirically examined. Secondary data provided by CSRHUB database is used for a sample of 231 …

The Impact Of Corporate Governance On Stock Price And Trade Volume, Wafaa Salah, May Elewa

Business Administration

The purpose of this paper is to investigate whether corporate governance is associated with stock prices and trade volume for 62 publicly traded firms on the Egyptian Stock Exchange during 2007-2014. The authors hypothesize that firms with strong corporate governance have a significant impact on stock prices and trade volume. To examine the associations, a multiple regression analysis is used. Consistent with the first hypothesis, this study finds firms with strong corporate governance have a significant impact on stock prices while has no significant impact on trade volume. Findings indicate that the quality of corporate governance can affect firms' stock …

Propensity And Comprehensiveness Of Corporate Internet Reporting In Egypt :Do Board Composition And Ownership Structure Matter?, Sara Abdallah, Khaled Samaha, Khaled Dahawy, Ahmed Abdel-Meguid

Business Administration

Purpose – The purpose of this study is to examine the impact of corporate governance attributes of listed Egyptian companies on the propensity (adoption) and comprehensiveness (quality) of corporate internet reporting (CIR) practices.

Design/methodology/approach – This study uses archival data from the largest (top) 100 listed companies on the Egyptian Stock Exchange (EGX 100). Corporate governance attributes are captured by ownership structure (free float, managerial ownership, government ownership) and board of directors’ structure (board size, board independence, CEO-chair duality). Empirical models are used to estimate the effects of these attributes on the propensity, content, presentation, and overall comprehensiveness of CIR. …