Board independence and accounting conservatism in Malaysian companies

This paper examines the relationship between board independence and accounting conservatism among Malaysian companies in year 2000 until 2012.What triggers the researchers to carry out this study is that studies found that the implementation of Malaysian Code of Corporate Governance to Malaysian companies has created a higher confidence level to investors and enhances the company's image.Further, one of the elements of good corporate governance is the board independence.However, few studies discuss on accounting conservatism. It is argued that accounting conservatism is an effective mechanism to address the agency problem.Based on the findings, interestingly, this study found that higher board independence does not align with higher conservatism.Instead, the independent non-executive directors do not actually have the power of ‘independence’, monitoring and advising the board of directors

Board Governance Mechanisms and Sustainability Disclosure: A Moderating Role of Intellectual Capital

The purpose of this paper is to investigate the extent and determinants of sustainability disclosure practice in Nigeria.The second objective is to examine if the effectiveness of intellectual capital moderates the relationship between board governance mechanisms and sustainability disclosure.In the course of carrying out this research, content analysis was conducted to extract sustainability disclosure information from annual reports of 80 companies listed on Nigerian Stock Exchange. The study spanned from 2010-2015. Board size, board independence, board diversity and board meetings were considered as determinants of sustainability disclosure.The sustainability disclosure index and board governance measures were computed for estimation of the regression analysis.The percentages were used to describe the nature and extent of sustainability disclosure among the sampled companies. A multiple regression analysis was used to test the relationships specified in the study.The result of the descriptive analysis evidence a low-level disclosure of sustainability information in annual reports of companies.From the regression analysis, board size, board independence and board diversity were found to enhance the disclosure of sustainability information.However, board meeting was found to be insignificantly related to sustainability disclosure.The results also reveal that intellectual capital has a significant positive effect on the relationship between board size, board independence, board diversity and sustainability disclosure. However, intellectual capital does not seem to moderate the relationship between board meetings and sustainability disclosure.The findings from this study have both theoretical and practical implications

Board size and accounting conservatism of Malaysian listed firms

Board of directors is entrusted with responsibilities to monitor operations of firms. Therefore, the board should have effective characteristics to ensure the interest of shareholders is protected.In view of that, Code of Corporate Governance was issued in Malaysia in 2000 to strengthen the board.Objective: This paper examines board size, one of the board’s characteristics, to assess whether it is big or small board that produces high quality financial reporting.In particular, it examines the effect of board size on the level of accounting conservatism for Malaysian firms listed on Bursa Malaysia. Accounting conservatism is an important element in good quality financial reporting Sample of this study consists of 3,852 firm-year observations of non-financial firms over the period 2001-2012. Results: From the analysis, results reveal that the level of accounting conservatism is higher for firms with small board size.Conclusion: With respect to financial reporting quality, board of directors is more effective when the number of board members is smal

Women director characteristics: Do they add value to firm performance?

Participation of women as a part of firm management becomes one of the nation agenda as the Malaysian government introduced a policy to increase women involvement at least 30% in corporate sectors in June 2011.The aim of this paper is to examine whether the characteristics of women as decision maker influence firm performance.Based on 2384 firm observations from year 2001 to 2012, this study finds that women education level, age and ownership have a relationship with firm performance.These findings indicate that women directors who are older in age and have a degree qualification help to improve firm performance.In contrast, women ownership has a negative association with firm performance which indicate that women involvement in a company as shareholders do no contribute to the incremental of firm performance.Large firms enjoy high performance whilst capital intensive firms struggling in their performance

Firm characteristics and financial reporting quality: the moderating role of Malaysian corporate governance index

The principle role of financial reporting is to provide investors with useful information for investment decision makings. In this study, we examine whether corporate governance moderates the relationship between firm characteristics and financial reporting quality. We use earnings management as measure for financial reporting quality. This study uses secondary data obtained from Thompson Database. The sample of this study is firms listed on the Main Market of Bursa Malaysia from 2012 to 2015. The results of our study reveal that there is a positive value of abnormal cash flow which indicates that companies do practice earnings management through manipulation of cash flow from operations. Large firms are practicing earnings management. Factors such as many business segments and business complexity have encouraged large firms to manage their earnings by manipulating their cash flow from operation. In contrast, firms with high leverage and firms audited by Big 4 are less likely to involve with earnings management. Interestingly, when corporate governance index is used as moderating variable, our result shows that only firms audited by Big 4 are related to earnings management. In terms of the contribution of the study, this study is important for the development of Malaysian capital market and it help investors to better understand how the impact of corporate governance mechanisms on financial reporting quality varies across firms

Proactive monitoring and compliance with International Financial Reporting Standard in Nigeria

The study examines how proactive monitoring by regulatory authorities and external auditors affect compliance with International Financial Reporting Standard (IFRS) in Nigeria.Data is hand collected from 154 companies that mandatorily adopted IFRS in the year 2012.The study uses the unweighted index in determining the extent of compliance with the disclosure requirements of 10 standards and uses multiple regressions in examining how proactive monitoring affects compliance with IFRS.The results show that the overall level of compliance is 61% and the regulatory bodies under insurance companies and firms audited by Big-4 auditors significantly and positively affect the level of compliance with IFRS disclosures.The study recommends an increase in vigilant in monitoring compliance with IFRS by the regulatory bodies supervising non-financial firms and by local audit firms to improve compliance

Investigating board of directors’ perceptions on corporate governance practice in cooperatives

This study investigated 56 Board of Directors of the Malaysian budget hotel and accommodation cooperatives perceptions on corporate governance practice.They were asked to provide their perceptions regarding nine aspects of cooperatives governance – principles and values, responsibilities and accountability, appointment, management, communication, assessment, information, remuneration and also auditing and control.They were approached through questionnaire survey and were asked to return the questionnaire within three weeks using a stamped - envelope provided. The findings indicated that majority of the Board have positive perceptions regarding the corporate governance practice.This eventually contributes to the management of cooperatives to sustain the economy and community wealth particularly within the tourism and hospitality industry in Malaysia

The importance of non-technical skills in accounting graduates

The purpose of this study is to look at the quality issue from the perspective of one of the most important customers of higher education institutions-employers that hire the accounting graduates.Specifically, this study determines how well skill requirements match skill preparedness of accounting graduates.Results re­vealed that. five most important non-technical skills required by employers were the ability to perform assigned tasks, having initiative, teamwork, computer literacy, and problem solving.Employers, however; perceived that higher education institutions do not seem to prepare accounting graduates with all the skills required.The majority of employers agree that quality differences exists between accounting graduates ,from public and pri­vate institutions, and accounting graduates with and without professional qualifications.Finally, the study highlights suggestions to improve the quality of accounting graduates, and also recommendations for future research

Employers' perception of the quality of accounting graduates in Malaysia

The purpose of this study is to look at the quality issue from the perspective of one of the most important customers of higher education institutions, employers that hire the accounting graduates.Specifically, this study determines how well skill requirements match skill preparedness of accounting graduates.Results revealed that five most important non-technical skills required by employers were the ability to perform assigned tasks, initiative, teamwork, computer literacy, and problem solving. Employers, however,perceived that higher education institutions had failed to prepare accounting graduates with all the skills required. Majority of employers agree that quality differences exists between accounting graduates from public and private institutions, and accounting graduates with and without professional qualifications. Finally, the study highlights suggestion to improve the quality of accounting graduates, and also recommendations for future research

Border tourism: Factors affecting self-efficacy of entrepreneurs in Northern Malaysia and Southern Thailand

Background: Strategies to attract higher-yielding tourists will be complemented by measures to ensure that local communities benefit from increasing tourist spending.Therefore, it is important to understand factors that drive local entrepreneurs to become successful in their business.Self-efficacy is a concept used in the literature to measure one's belief in his ability to successfully venture into a business. Objective: This paper examines the relationship between entrepreneur demographic factors, environmental forces and entrepreneurial self-efficacy of small business operators at the border towns of Malaysia and Thailand.The research is a cross-sectional study and a survey method is used. Results: Our result reveals that nationality has a significant relationship with entrepreneurial self-efficacy. With regard to the environmental forces, there is also a positive relationship between intensity of competition and entrepreneurial self-efficacy.Conclusion: Our result on environmental forces is not consistent with those studies conducted in western countries. It seems that the small business operators at border town of Malaysia and Thailand have the same belief which is different from those in western countries