Kesan pertukaran pengurusan tertinggi ke atas harga saham Syarikat Berkaitan dan Bukan Berkaitan Kerajaan

Kajian ini dijalankan untuk melihat kesan pertukaran pengurusan tertinggi (PT) di Syarikat Berkaitan (SBK) dan Bukan Berkaitan Kerajaan (SBBK) ke atas harga saham. Ini disebabkan sebarang pertukaran yang berlaku bagi jawatan ini akan memberi impak kepada hala tuju syarikat kerana pengganti biasanya akan mengubah strategi syarikat. Perubahan ini seterusnya boleh mempengaruhi harga saham yang juga boleh dipengaruhi oleh asal usul pengganti. Amnya SBK di Malaysia, berbanding SBBK, dikawal secara langsung atau tidak langsung oleh kerajaan yang berupaya melantik ahli lembaga pengarah dan PT serta membuat keputusan utama berkaitan dengan SBK. Oleh itu, kesan pertukaran PT bagi kedua-dua bentuk syarikat ke atas harga saham mungkin berbeza. Berdasarkan Teori Kecekapan Pasaran Separa Kuat dan kaedah kajian peristiwa,data sekunder yang terdiri dari harga saham dan maklumat pertukaran telah diperolehi. Hasil kajian mendapati pasaran modal bertindak positif yang signifikan sebelum, semasa dan selepas pengumuman pertukaran. Namun begitu, perbandingan antara syarikat menunjukkan harga saham bagi SBK menunjukkan tindak balas positif sebelum pengumuman pertukaran dibuat, berbanding tindak balas positif untuk ketiga-tiga tempoh dalam kes SBBK. Penemuan ini menunjukkan pelabur SBK telah menerima maklumat terlebih dahulu sebelum pengumuman dan bertindak balas terhadap harga saham. Oleh itu pada tarikh pengumuman maklumat pertukaran sudah tidak mengejutkan lagi. Kajian juga mendapati asal usul pengganti berhubungan positif dengan harga saham. Namun ianya tidak memberi perbezaan ketara antara SBK dan SBBK. Kajian menyumbang kepada literatur dalam memahami reaksi pasaran modal terhadap perubahan PT terutamanya di SBK yang menguasai pasaran modal Malaysia

Chief Executive Officer/ Managing Director succession and value relevance of accounting numbers

Apart from Board of Director, top management, including Chief Executive Officer or Managing Director is also considered as an important governance mechanism of the firm. CEO plays a major role in managing and controlling business operations, thus his/her succession may significantly affect firm performance. This study aims to examine the effect of top management succession on share price. Past studies, which used the event-study methodology to evaluate immediate investors’ reactions towards top management succession had their observations done over limited time frame (window periods). Succession may impact the share price beyond the window period because the investors may use information obtained from financial statements to evaluate new top management capabilities. This study contributes to the literature by examining the effects of top management succession on share price at the end of financial years. Book value of equity per share (BE) and earnings per share (EPS) on share price is regressed at three different points of time; year of top management change (TMC), a year after top management change (TMC_1) and post occurrence years of top management change (TMC_C). Findings indicate that BE and EPS are value relevant. Findings also indicate that top management succession is not significantly related to changes in share price over a short period of time (transition year and a post transition year). However, over the longer period of time (TMC_C), our study indicates the top management succession is value relevant. Findings indicate that investors take a longer time to appreciate the new top management on their decision makings. Further analysis indicates that BE is regarded as value relevant by the investors after incorporating firm with outside successor; while EPS is value relevant for the firm with inside successor. This study supports the limited studies in Malaysia which indicate succession events have an implication on share price. Findings in this study may contribute towards strategic decision making in corporate management of public listed companies in Malaysia, specifically when board of directors are considering the top management replacement

Kerelevanan nilai pelaporan segmen di Malaysia

Kajian lepas mendapati pelaporan segmen adalah relevan untuk menilai risiko dan pulangan bagi firma yang mempunyai kepelbagaian aktiviti dan beroperasi di pelbagai lokasi. oleh itu, beberapa penambahbaikan telah dilakukan untuk memastikan firma lebih telus dalam menyediakan laporan segmen. Di Malaysia, sejajar dengan perkembangan di peringkat antarabangsa, Lembaga Piawaian Perakaunan Malaysia (MASB) telah menerbitkan MASB 22 Segment Reporting pada tahun 2002 bagi menggantikan IAS 14 Segment Reporting, yang dikatakan banyak kelemahan. Kajian ini bertujuan untuk menguji sama ada maklumat segmen yang dilaporkan menurut MASB 22 adalah relevan dan berguna (kerelevanan nilai) dalam pembuatan keputusan. Secara spesifiknya, kajian ini menguji kerelevanan nilai perolehan segmen dan juga nilai buku bersih segmen. Hasil kajian mendapati bahawa perolehan segmen dan nilai huku hersih segmen mempunyai kerelevanan nilai. Walau bagaimanapun. kerelevanan nilai bagi nilai buku bersih segmen terhad dalam situasi tertentu. Ujian kesensitifan yang dijalankan juga menyokong penemuan ini. Konsisten dengan kajian terdahulu, kajian ini juga mendapati perolehan dan nilai buku bersih segmen tidak mempunyai kuasa penjelasan tambahan. Ini menunjukkan bahawa walaupun maklumat segmen mempunyai kerelevanan nilai, pelabur masih mementingkan maklumat buku bersih dan perolehan firma dalam penentuan nilai firma

Relationship between unionized companies, government ownership and reporting human capital information in corporate annual reports

Investors, employees, and societies are interested in human capital information. This information will assist investors to assess the effectiveness of human capital management to deliberate their investment capital allocation. The employees will also know the extent of their development and value in organizations. Despite the significant role of human capital in the success and survival of an organization, human capital information disclosure is still limited in annual reports. Thus, investors or other stakeholders have scarce information to distinguish between organizations that develop human capital and those that constrain human capital. The factors that explain the disclosure is still unknown. In light of stakeholder’s theory, this study investigated the relationship between highly unionized companies and government-owned companies, which are factors that can pressure companies to disclose human capital information in annual reports. Companies from the banking and financial institution industries were selected as highly unionized companies, whereas companies from the real property industry were selected as poorly unionized companies based on the Malaysian Trade Union Congress (MTUC) dataset. Government ownership was also identified in these sample companies. A total of 192 annual reports gathered from 48 companies for the financial year from 2010 to 2014 were analyzed in terms of content. Control variables, such as age, size, profit, and leverage, were also associated in the relationship. This study determined that highly unionized companies (banks) and government ownership demonstrate significantly positive relationship with human capital information reporting in annual reports. For control variables, only the size of companies shows positive relationship with the disclosure. Therefore, the presence of stakeholders in companies (i.e., union membership and government) is considered a good predictor for reporting human capital information in annual reports

Underinvestment and value relevance of earnings management

The aim of this study is to examine whether earnings management among underinvestment firms is positively related to share price. Firms are said to have high growth opportunity but is unable to fund investment projects due to liquidity constraints because of the information asymmetry between the firm and the investors. As a result, firms have to provide high quality accounting information (i.e. value relevant information) to reduce information asymmetry and hence be free from liquidity constraints. One type of accounting information that can be provided is discretionary accrual (proxy for earnings management). The sample of this study is firms listed on the Main Board of Bursa Malaysia from year 2001 to 2007. We use Ohlson’s model to examine the value relevance of earnings management. We separate earnings into managed and unmanaged earnings. Panel data regression analyses were performed to examine the role of underinvestment on the relationship between earnings management and share price. We also examine the value relevance of earnings management using the return model. The results from the panel data regression analysis indicate that earnings management increases the value relevance of accounting information. Further, underinvestment moderates the relationship between earnings management and share price. Nevertheless, the results suggest that earnings management among firms can decrease the value relevance of accounting information. In general, it is concluded that underinvestment weakens the relationship between earnings management and share price/return, hence it motivates managers to convey opportunistic earnings management

Measuring Internet Financial Reporing (IFR) disclosure strategy

There is a significant development in the accounting practices and communication due to the rapid growth of internet technology. Nonetheless, until today, financial reporting through the internet still has no legally structured standard compared to the formal international financial reporting standard (IFRS) that firms need to adhere. Yet, firms must still consider stakeholders’ decision making based on internet accounting disclosures. Since the 1990s studies on Internet Financial Reporting (IFR) apply various indexes to measure disclosure practices. However existing indexes mainly focus only on the level and quality of IFR disclosure. Our study develops a new checklist – IFR disclosure strategy checklist – to measure IFR disclosure strategy based on a taxonomy proposed by Williams (2008) which has not yet been empirically tested until today. However, the taxonomy only outlines the characteristics of each proposed strategy. Our study takes the challenge to interpret the taxonomy by developing a checklist for each characteristic that were describe in the taxonomy. Utilizing content analysis, detailed consideration was made about items in the checklist based on prior studies, available regulations in several countries as well as current practices by reporting entities. Results from reliability test indicate that our checklist is a valid and reliable instrument with regards to our sample of study. It is expected that our checklist will be referred to by reporting entities in order to assist stakeholders’ decision making. Eventually we hope that with the knowledge about the disclosure strategy, stakeholders might reduce their time and effort in searching for the best business entities when deciding upon their investment portfolio

Internet Financial Reporting (IFR) disclosure position and firm value

Nowadays, Internet Financial Reporting (IFR) disclosure is the global way to display firm performance to investors and stakeholders. Hence, it is imperative that firms properly manage their IFR disclosure to ensure their existence is conspicuous to the world in order to foster their firm value. We believe that in order to manage IFR disclosure, firms would probably behave either ritualistically or opportunistically in terms of their IFR disclosure position. In this study, we propose a quantitative measurement for the IFR disclosure position, i.e. utilizing IFR presentation score, taking into consideration latest IFR rules and regulations worldwide as well as relevant extant empirical studies. Based on a sample of 320 Malaysian listed firms in year 2012, our regression analysis shows that our quantitative measurement for the IFR disclosure position variable has a positive association with firm value. We found that 87 firms, categorized as poor performing seems to manage their IFR disclosure position ritualistically. While 233 firms, categorized as well performing manage their IFR disclosure position opportunistically. Hence, our study provide circumstantial evidence that firms’ financial performance has a relationship with IFR disclosure position. In further analysis, our findings show that stakeholders seem to perceive ritualistic IFR disclosure’s position is empirically valid to value poor performing firms. However, stakeholders seem to negate the opportunistic IFR disclosure position in valuing well performing firms even though theoretically the opportunistic IFR disclosure position should be able to offer vast benefits that could enhance firms’ value. Our findings should be useful to firms and stakeholders likewise in making firms’ valuation taking into consideration the existence of firms’ financial performance and IFR disclosure position

Pertukaran Ketua Pegawai Eksekutif/Pengarah Urusan dan pengurusan perolehan

Pengurusan atasan (Ketua Pegawai Eksekutif/Pengarah Urusan) merupakan antara individu paling berpengaruh dalam menentukan prestasi dan kelangsungan operasi syarikat. Oleh itu, pertukaran KPE/PU merupakan peristiwa penting yang memberi kesan kepada syarikat. Kajian lalu mengkaji hubungan antara pertukaran KPE/PU dengan (i) harga saham; (ii) prestasi kewangan syarikat; dan (iii) pengurusan perolehan. Namun kajian di Malaysia hanya melihat perkaitannya dengan prestasi kewangan syarikat dan harga saham. Sehubungan itu, kajian ini memenuhi jurang yang wujud dengan melihat perkaitan antara pertukaran KPE/PU dan pengurusan perolehan. Sampel kajian terdiri daripada 98 syarikat senaraian awam yang melakukan pertukaran KPE/PU antara tahun 2009 hingga 2014. Hasil kajian mendapati KPE/ PU yang mengambil alih jawatan mempunyai kecenderungan mengurus perolehan secara negatif bagi menurunkan perolehan pada tahun pertukaran. Seterusnya mereka mengurus perolehan secara positif bagi meningkatkan perolehan pada tahun fiskal pertama selepas pertukaran. Dapatan ini selari dengan dapatan kajian lepas. Namun begitu dapatan juga menunjukkan pengganti KPE/PU dari dalam syarikat lebih berkecenderungan melakukan pengurusan perolehan secara positif berbanding pengganti dari luar organisasi. Dapatan ini membantu pembuatan keputusan strategik yang melibatkan pengurusan korporat syarikat senaraian awam, khususnya yang melibatkan pertukaran KPE/PU. Ianya juga berguna kepada pelabur dan bakal pelabur dalam membuat keputusan pelaburan dalam syarikat yang telah atau akan mengalami pertukaran KPE/PU

Institutional investors, risk management and audit committees influence on non-financial risk disclosure

This study examines the complementary or substitution role of audit committee independence (ACInd), risk management committee (RMC) and institutional investors on non-financial risk disclosure (NFRD). While the existing literature provides inconclusive evidence on the individual influences of various monitoring mechanisms on NFRD, it is necessary to examine whether their combined monitoring roles are present as many monitoring mechanisms coexist within an organisation. This study examined a sample of 864 Bursa Malaysia companies from 2016 to 2018. The Delphi technique is used to finalise NFRD items. This study performed regression and simple slope tests to examine the complementary and substitutive role of ACInd, RMC and institutional investors. The findings show that RMC is substitutive to AcInd towards NFRD. This demonstrates that RMC has the expertise and potential to lessen any information asymmetry, making it the most reliable monitoring mechanism. These findings indicate the significance of establishing a standalone RMC among Malaysian companies to supervise the NFRD reporting

Non-financial human capital disclosure and share price

The aim of this study is to examine the relationship between disclosure of non-financial human capital information (HCD) and share price of the top 100 companies listed on Bursa Malaysia from financial years 2010 to 2013. Human capital (HC) is considered a valuable asset in a knowledge-based economy. The knowledge and skills possessed by individuals are regarded as a key source of competitive advantage and value creator to companies. Prior research acknowledges the importance of HC information to investors, who may have to rely on disclosures in annual reports when evaluating a company’s future direction, potential, value and prospects. However, companies only disclose limited information on this ‘asset’. In this study, HCD is viewed from the perspective of signalling and efficient capital market theories. Following previous studies, we incorporate HC information and its two components, namely, HC information related to directors and employees, into the Ohlson model. Our study reveals an increasing trend of HCD, and the disclosure is value relevant. Further analysis of the HC information component reveals that both HC information (HC related to directors and employees) are value relevant. These findings are in line with the argument that Malaysian financial analysts and fund managers regard information related to the company’s management and key corporate decision makers as important in investment decision making. The findings of this study are relevant to accounting standard setters in determining the types of HC that should be disclosed in the annual reports because this information can create value for companies. Managers should also pay attention to HC information because such information is value relevant to stakeholders