Cash-based accounting is a major accounting method that recognizes revenues and expenses at the time physical cash is actually received or paid out. The technical professional issue is that the accounts receivable and accounts payable are not shown in the balance sheet and they do need a type of “audit” in order for a financial statement to be produced and errors abound in these reports. Furthermore, there is no inventory appearing on the balance sheet with cash-based accounting. This resulted in apparent potential human errors on work-in-process reports. Therefore, this study focuses on the need of change management to develop the human capital capability by looking at the perceptions, acceptance and capabilities of the clients and employees who are involved directly and indirectly with the government accounting process. The analysis showed the successful implementation of accrual-based accounting whereby greater emphasis needs to be placed by the government in ensuring the acceptance of the new system by clients and employees.

This paper aims to describe the design of an effective management accounting system based on sustainability accounting concepts for an integration of environmental and social information in sustainability disclosures. In the past few years, the launch of sustainability policy has changed to a formal move and systematic approach in order to ensure that every part of the organisation is involved. Nonetheless, Thai companies appear to be at an early stage of developing their understanding of how to identify and measure accurately environmental and social information within production processes and from external organisations. The findings are based on the fifty companies in Thailand that provided environmental and social data in the CSR disclosures and in responses to the Carbon Disclosure Project. The results are employed to support the designs of a sustainability management accounting system (SMAS). Such a conceptual model, a SMAS, combines environmental management accounting (EMA) and social management accounting (SMA) for environmental and social dimensions.  It also expands on activity-based-costing (ABC) applications for cost allocation and analysis. By having a SMAS, companies would accurately identify and measure environmental and social data to enhance internal management decisions and external reporting purposes.

Previous research supports the link between the balanced scorecard and firm performance.  Research further suggests that this link may be affected by strategy, though few studies provide empirical support for this link.  The purpose of this study is to examine and provide empirical evidence on how strategic linkage affects the relationship between BSC usage and performance.  The research also examines factors that affect the extent of BSC usage in an environment outside the United States.  Based on a sample of 259 South Korean firms, the results indicate that strategic linkage mediates the link between BSC usage and firm performance, though there was no moderating effect.  The results provide support for the significant effects of organization size, market position and market competition on BSC usage.  Marginal support is found for market uncertainty on BSC usage.  Results indicate that product life-cycle and market growth do not impact on BSC usage.

This paper constitutes an attempt to investigate the relationship between Free Cash Flow to Equity (FCFE) and the firm's market value of the pharmaceutical sector of Jordan by using a valuation technique, wherein the rift between theory and practice still need to be accommodated taking in consideration the relationship of FCFE, Net Income, Net Capital Expenditure, Working Capital and Debt Position. This paper uses panel data covering the period 2004-2010. The determination of a company's market value is a difficult decision, taking into account several antagonistic factors, such as risk of debt and capital expenditure, in times when the economic environment in which the company operates is unstable, therefore the choice among the ideal equation of FCF to Equity can affect the market value of the firm as much as profit rate can. The results show that the market values of a firm are assessed by the Free Cash Flow to Equity. Our result is in accordance with the hypothesis that FCF to Equity has significant positive effect on the stock market. Our findings add to the understanding of the determinants of the market value of firms.

This paper empirically investigates whether asymmetries exist in the New Zealand mortgage and short-term interest rate spread over the period 1988:7-2010:04. Using the threshold autoregressive (TAR) and the Momentum Threshold autoregressive (M-TAR) models, this study demonstrates that  the mortgage premium adjusts to the threshold faster when the official cash rates fall relative to the mortgage rates, widening their difference, than when the official cash rates move in the opposite direction.  First, the estimation results indicate that the mortgage premium experienced a structural break in January 1994, corresponding to the anticipation, as well as the implementation, of the 1994 Fiscal Responsibility Act. Second,   estimation results reveal that the mortgage premium adjusts to the threshold faster when the official cash rates fall relative to the mortgage rates, widening their difference, than when the official cash rates move in the opposite direction. Third, the findings also reveal the bi-directional Granger causality between the mortgage rate and the official cash rate, indicating that the mortgage rate and the official cash rate affect each other’s movement.

This paper empirically investigates organizational form of corporate ownership and capital structure of the U.S. life insurance industry and contributes to the current debate of financial policy differences between stock and mutual life insurers. The ownership factor is expected to have implications for different capital structure, underwriting, and investment policies. Other influential factors are expected to impact policies differences. Accordingly, a set of testable hypotheses is developed to examine policies differences between the two insurers. Controlling these other influential factors, the corporate ownership form is found to be significant in two policy areas: capital structure and investment. The empirical results yield support to the following conclusions. First, mutual life insurers maintain significantly higher financial leverage than stock insurers. Second, the proportion of investment in the asset categories of bonds, mortgage loans, and policy loans are higher for mutuals. No systematic differences are found in the underwriting policy.

The Nigerian Accounting Standards Board (NASB) announced its roadmap to convergence with the International Financial Reporting Standards (IFRS) in September 2010. The Nigerian listed companies and Significant Public Interest Entities (SPIE) are required to comply with IFRS effective from 1 January 2012. Following the preparation for the transition from national standards to international standards by 2012, this study investigates the association between selected corporate governance mechanisms and voluntary compliance to IFRS 8 Operating Segments among Nigerian publicly listed companies. Using a sample of 69 companies, the result indicates no relationship between audit-committee-related variables and the level of voluntary compliance. Only one corporate governance attribute, separation of board leadership, is found to be associated with voluntary disclosure of IFRS 8. The research outcome provides greater insights into the interactions between corporate governance mechanisms and IFRS 8 compliance and is useful as a starting point for further research in financial reporting particularly in emerging countries such as Nigeria.

The implications from market anomaly studies suggest that trading based on price earnings ratios, size, price book, momentum and volatility can produce excess returns.  The purpose of this study is to determine the magnitude of excess returns that these anomalies can generate, how often they work, when they work and can they be combined to enhance returns even further.  Based on the last 20 years, findings suggest excess returns are still available for some of these anomalies with the probability of success reaching up to 90% for any given 6 month period. When combining anomalies, returns are not always greater due to the necessary relaxation of the portfolio selection constraints.  PE, size and PB continue to be highly correlated with returns while beta and volatility appear to be functional risk metrics.

Private equity is an important source of financing for French companies. This paper examines the relationship between private equity and the competitiveness of buyout firms in a French context. Prior literature has assessed private equity markets and emphasized mechanisms including the replacement or reorganization of management, the reduction of agency costs, the financial pressure through leverage, the influence of shareholders and the management expertise of the fund. However, as the majority of these existing studies focus on private equity in the U.S. and U.K., little consensus has been achieved about the application of these results to France. In this paper, we discuss the mechanisms of private equity in a French context. We analyze the criteria on which buyout companies are chosen by funds, as well as the relationship between private equity and subsequent firm performance. Our findings show that French private equity funds select companies that, in comparison to their competitors, are larger in size and are better performers. Our results also show that following a buyout, companies do not experience a significant performance improvement. Based on our empirical analysis, we find no significant evidence that French private equity creates long-term value.