Capital Budgeting as a Tool of Management Decision Making: A Case Study of National Investment Bank Limited

Sound financial management and decision-making on capital investments are critical to company survival and long-term success. With this truth affirmed by the global financial crisis, this study sets out to examine the capital budgeting tools at National Investment Bank Limited (NIB) in Ghana, adapted for management decision making. It establishes the various capital budgeting techniques used by NIB in undertaking investment projects and how these decisions affects the firm’s value, profit and growth rate. As methodology, the study adopts both primary and secondary sources which are further analyzed with the use of correlation analysis. The findings reveal that there is a positive relationship between the variables and their effects are significant. The study concludes that, the firm used capital budgeting techniques such as Net Present Value, Internal Rate of Return, Profitability Index, Discounted Payback Period, Payback Period and Accounting Rate of Return in order to maximize the firm’s value which is usually affected by the profit and the growth rate. Given the conclusion herein, the study recommends among others that NIB should educate and train their staff on the various capital budgeting tools and the formation of knowledgeable team that will evaluate projects using the capital budgeting tools due to its irreversibility nature, huge investment outlay and its long term effect. Keywords: Capital budgeting, Techniques, Cash Flow, Investments, Decision making, Ghana DOI: 10.7176/RJFA/11-4-04 Publication date: February 29th 202

Natural Resources and the Economic Growth of West Africa Economies

In this study, we employed the pooled mean group (PMG) regression to examine the effect of natural resources economic rent (coal rent, gas rent, oil rent, forest rent, minerals rent) and foreign direct investment (FDI) on economic growth in West Africa for the period 1996 to 2017. We found strong evidence of a positive relationship between FDI, total natural resources (TNR), total natural gas (TNG), and economic growth in the long-run. However, the study recorded a negative relationship between mineral resources rent, oil rent and gas rent, and economic growth in the long run. The rent from coal also exhibited neutrality on economic growth. While all the short-run coefficients are not statistically significant, the error correction term (ECT) is significant and a negative value of -0.889, signifying cointegration at a 1% significance level. This also implies that the short-run estimates converge towards the long-run estimates to achieve equilibrium at the speed of 89% per annum. Our findings highlight the significance of FDI and total rent from natural resources in stimulating West African economies' growth in the industrialization drive and general welfare. In contrast, this study also highlights the need for policy direction to redesign and realign ownership in the oil and gas sector from multinational co-operations (MNCs) to the locals and the domestic economy to benefit directly from the prevailing environment

Association between transcription factor 7-like-2 polymorphisms and type 2 diabetes mellitus in a Ghanaian population

Type 2 diabetes mellitus (T2DM) has been strongly associated with single nucleotide polymorphisms (SNPs) in the TCF7L2 gene. This study investigated the association between rs12255372, rs7903146 in the TCF7L2 gene and T2DM in a Ghanaian population. A case-control study design was used for this study. A total of 106 T2DM patients and 110 control participants were selected. Basic data collected included body mass index, blood pressure and socio-demographics. Fasting blood samples were collected and processed for: serum lipid analysis, plasma glucose estimation and plasma HbA1c estimation. Parts of the whole blood samples were used for DNA extraction using a modified salting-out method. Common and allele-specific primers were designed for genotyping using the Modified Tetra-Primer Amplification assay. Associations were evaluated using logistic regression models. The rs7903146 risk variant was significantly associated with 2.16 vs. 4.06 increased odds for T2DM in patients \u3c60 years vs. ≥60 years. Both rs7903146 and rs12255372 were significantly associated with increased odds of T2DM in women, overweight/obese, T2DM negative family history (T2DM-NFH) and low-HDL-C. In a multivariate model, rs7903146 but not rs12255372 was significantly associated with 2.18, 5.01 and 2.25 increased odds of T2DM, under the codominant, recessive and additive model, respectively (p \u3c 0.05). The association between rs7903146 and rs12255372 with T2DM is more highly associated in a subgroup—women and those with T2DM-NFH, yet who have cardiometabolic risk

Efficiency in Banking: Analysis of Factors Affecting the Internal Audit Effectiveness in Ghana

Although organizational internal control is for the purpose of ensuring effectiveness and efficiency of operational activities, trustworthiness of financial data amidst compliance with auditing standards which have been instituted into the mundane activities of banks in Ghana, many banks still have difficulties in recovering facilities which are granted to customers after expiry. This study assesses the effectiveness of internal auditing in rural banks in the Central Region of Ghana. Adding to the body of knowledge, the paper argues that in spite of the instituting of internal audit units in various rural banks, the issue of default of bank facilities is gradually destroying most gains and also crippling business opportunities. Methodologically, the paper adopts a descriptive survey where primary and secondary data are effectively utilized. The findings of the study revealed that the default in rural banks facility recoveries are accorded to the fact that most recommendations cited by internal auditors are not applied. The study findings also showed that most internal auditors lack the necessary in training to be updated on the job in order to make them function at their full human resource capacity while other bank operating units rip the internal auditor of privacy and independence. The study recommends among others that prior to the findings of the study, internal audit findings should be used as a gauge to facilitate banking operations while implementing suggested recommendations so as to achieve set targets of rural banks. Furthermore, the banks should endeavor to periodically offer training programs for internal audit staff to enlighten and update them on the ethics of the auditing profession. Keywords: Internal Audit Effectiveness, Rural Banks, Ghana DOI: 10.7176/RJFA/10-4-0

Audit pricing puzzle: Do audit firm industry specialization and audit report lag matter?

AbstractThis study examines whether audit firm industry specialization and audit report time lag (ARL) matter in the audit fees puzzle. Specifically, we examine the moderating effect of audit time lag on the audit firm industry specialization and audit fees nexus. We use dataset from 100 quoted and unquoted Ghanaian firms from 2008 to 2018. We find that audit firm industry specialization exhibits a significant positive impact on audit fees and a significant negative effect on ARL. The results of the interaction between audit firm industry specialization and ARL also display a negative association with audit fee, signifying that specialization significantly reduces audit fee premium paid provided these experts produce the financial report in a short time. Further analysis on large and small companies, state-owned and private companies, weak and strong internal controls also indicate the significance of audit firm industry specialization and reporting time lag in explaining audit pricing puzzle. The novelty aspect of this study is the analysis of the moderation effect of audit timeliness on the audit firm industry specialization and audit fees nexus in the context of a lax enforcement of Generally Accepted Accounting Principles environment

Effect of audit firm industry specialization on cost of debt financing: Evidence from Ghana

AbstractThis study examines whether audit firm industry specialization affects the cost of debt finance of business. We hypothesize that audit firm industry specialization reduces client cost of debt since auditors with industry specialization are more likely to deter and detect questionable accounting practices and report material errors and irregularities. Thus, utilizing data from Ghanaian listed and unlisted firms, the study finds that audit firm industry specialization reduces the cost of debt. The finding is consistent with a robustness test in which an alternative measure of the audit firm’s industry expertise was utilised. The study further submits that the influence of audit industry specialization on the cost of debt is more pronounced in the low-earning companies than high-earning companies, while no significant difference in impact exists between private companies and state-owned companies

Association between Transcription Factor 7-like-2 Polymorphisms and Type 2 Diabetes Mellitus in a Ghanaian Population

Type 2 diabetes mellitus (T2DM) has been strongly associated with single nucleotide polymorphisms (SNPs) in the TCF7L2 gene. This study investigated the association between rs12255372, rs7903146 in the TCF7L2 gene and T2DM in a Ghanaian population. A case-control study design was used for this study. A total of 106 T2DM patients and 110 control participants were selected. Basic data collected included body mass index, blood pressure and socio-demographics. Fasting blood samples were collected and processed for: serum lipid analysis, plasma glucose estimation and plasma HbA1c estimation. Parts of the whole blood samples were used for DNA extraction using a modified salting-out method. Common and allele-specific primers were designed for genotyping using the Modified Tetra-Primer Amplification assay. Associations were evaluated using logistic regression models. The rs7903146 risk variant was significantly associated with 2.16 vs. 4.06 increased odds for T2DM in patients <60 years vs. ≥60 years. Both rs7903146 and rs12255372 were significantly associated with increased odds of T2DM in women, overweight/obese, T2DM negative family history (T2DM-NFH) and low-HDL-C. In a multivariate model, rs7903146 but not rs12255372 was significantly associated with 2.18, 5.01 and 2.25 increased odds of T2DM, under the codominant, recessive and additive model, respectively (p < 0.05). The association between rs7903146 and rs12255372 with T2DM is more highly associated in a subgroup—women and those with T2DM-NFH, yet who have cardiometabolic risk

Comparative efficacy of low-dose versus standard-dose azithromycin for patients with yaws: a randomised non-inferiority trial in Ghana and Papua New Guinea

Summary: Background: A dose of 30 mg/kg of azithromycin is recommended for treatment of yaws, a disease targeted for global eradication. Treatment with 20 mg/kg of azithromycin is recommended for the elimination of trachoma as a public health problem. In some settings, these diseases are co-endemic. We aimed to determine the efficacy of 20 mg/kg of azithromycin compared with 30 mg/kg azithromycin for the treatment of active and latent yaws. Methods: We did a non-inferiority, open-label, randomised controlled trial in children aged 6–15 years who were recruited from schools in Ghana and schools and the community in Papua New Guinea. Participants were enrolled based on the presence of a clinical lesion that was consistent with infectious primary or secondary yaws and a positive rapid diagnostic test for treponemal and non-treponemal antibodies. Participants were randomly assigned (1:1) to receive either standard-dose (30 mg/kg) or low-dose (20 mg/kg) azithromycin by a computer-generated random number sequence. Health-care workers assessing clinical outcomes in the field were not blinded to the patient's treatment, but investigators involved in statistical or laboratory analyses and the participants were blinded to treatment group. We followed up participants at 4 weeks and 6 months. The primary outcome was cure at 6 months, defined as lesion healing at 4 weeks in patients with active yaws and at least a four-fold decrease in rapid plasma reagin titre from baseline to 6 months in patients with active and latent yaws. Active yaws was defined as a skin lesion that was positive for Treponema pallidum ssp pertenue in PCR testing. We used a non-inferiority margin of 10%. This trial was registered with ClinicalTrials.gov, number NCT02344628. Findings: Between June 12, 2015, and July 2, 2016, 583 (65·1%) of 895 children screened were enrolled; 292 patients were assigned a low dose of azithromycin and 291 patients were assigned a standard dose of azithromycin. 191 participants had active yaws and 392 had presumed latent yaws. Complete follow-up to 6 months was available for 157 (82·2%) of 191 patients with active yaws. In cases of active yaws, cure was achieved in 61 (80·3%) of 76 patients in the low-dose group and in 68 (84·0%) of 81 patients in the standard-dose group (difference 3·7%; 95% CI −8·4 to 15·7%; this result did not meet the non-inferiority criterion). There were no serious adverse events reported in response to treatment in either group. The most commonly reported adverse event at 4 weeks was gastrointestinal upset, with eight (2·7%) participants in each group reporting this symptom. Interpretation: In this study, low-dose azithromycin did not meet the prespecified non-inferiority margin compared with standard-dose azithromycin in achieving clinical and serological cure in PCR-confirmed active yaws. Only a single participant (with presumed latent yaws) had definitive serological failure. This work suggests that 20 mg/kg of azithromycin is probably effective against yaws, but further data are needed. Funding: Coalition for Operational Research on Neglected Tropical Diseases

Adaptation of the Wound Healing Questionnaire universal-reporter outcome measure for use in global surgery trials (TALON-1 study): mixed-methods study and Rasch analysis

BackgroundThe Bluebelle Wound Healing Questionnaire (WHQ) is a universal-reporter outcome measure developed in the UK for remote detection of surgical-site infection after abdominal surgery. This study aimed to explore cross-cultural equivalence, acceptability, and content validity of the WHQ for use across low- and middle-income countries, and to make recommendations for its adaptation.MethodsThis was a mixed-methods study within a trial (SWAT) embedded in an international randomized trial, conducted according to best practice guidelines, and co-produced with community and patient partners (TALON-1). Structured interviews and focus groups were used to gather data regarding cross-cultural, cross-contextual equivalence of the individual items and scale, and conduct a translatability assessment. Translation was completed into five languages in accordance with Mapi recommendations. Next, data from a prospective cohort (SWAT) were interpreted using Rasch analysis to explore scaling and measurement properties of the WHQ. Finally, qualitative and quantitative data were triangulated using a modified, exploratory, instrumental design model.ResultsIn the qualitative phase, 10 structured interviews and six focus groups took place with a total of 47 investigators across six countries. Themes related to comprehension, response mapping, retrieval, and judgement were identified with rich cross-cultural insights. In the quantitative phase, an exploratory Rasch model was fitted to data from 537 patients (369 excluding extremes). Owing to the number of extreme (floor) values, the overall level of power was low. The single WHQ scale satisfied tests of unidimensionality, indicating validity of the ordinal total WHQ score. There was significant overall model misfit of five items (5, 9, 14, 15, 16) and local dependency in 11 item pairs. The person separation index was estimated as 0.48 suggesting weak discrimination between classes, whereas Cronbach's α was high at 0.86. Triangulation of qualitative data with the Rasch analysis supported recommendations for cross-cultural adaptation of the WHQ items 1 (redness), 3 (clear fluid), 7 (deep wound opening), 10 (pain), 11 (fever), 15 (antibiotics), 16 (debridement), 18 (drainage), and 19 (reoperation). Changes to three item response categories (1, not at all; 2, a little; 3, a lot) were adopted for symptom items 1 to 10, and two categories (0, no; 1, yes) for item 11 (fever).ConclusionThis study made recommendations for cross-cultural adaptation of the WHQ for use in global surgical research and practice, using co-produced mixed-methods data from three continents. Translations are now available for implementation into remote wound assessment pathways