Financial crisis shows the ambiguous role of the corporate governance system. Hence, the main purpose of this paper is to assess the impact of corporate governance on Non-performing loans of the banking industry of Pakistan. The time period selected from 2006 to 2016 and source of data is annual reports of respective banks and the World Bank. In order to explain the relationship between the governance system and non-performing loans used descriptive, correlational and panel data analyses. The results revealed a negative and significant effect of corporate governance on nonperforming loans of sample firms of the study. Therefore, suggested for the banking industry of Pakistan to implement and make sure their reports according to corporate governance code compliance to control non-performing loans.
The main objective of the firm is to maximize the shareholder’s wealth; to achieve this objective the management indulge the earnings information by manipulation practices such practices reduce investors’ confidence. Furthermore, a hypothetical dispute recommends that a better quality of financial reporting reduce the information asymmetry, by refining the corporate governance compliance, result in reducing earnings management practices. Thus the main aim of this study is to explore the impact of corporate governance on earnings management by using panel data sample of 257 non-financial firms listed in Pakistan stock exchange for the period of 2012 to 2019 through Fixed effect model along with control variables. The results disclose that the CG system of Pakistan negatively and significantly impacts the EM activities of the companies registered in Pakistan stock exchange. Hence, concludes that the CG system is more effective to prevent the EM process. The entire results are seamless with prior research work that the effective CG scheme of the firms controls the EM and collapse of businesses. Keywords: Earnings Management, Corporate Governance, Corporate Governance Index.
Besides, the corporate level governance factors and country level governance factors there is another crucial factor that affect the earnings manipulation practices, is country level Financial Development. Financial development would likely act to discipline managers, thereby minimizing their engagement in EM, therefore an effective financial development system helps to reduce the EM practices. Hence the main purpose of this research work is to investigate the impact of Financial development on accruals based earnings management by using panel data analysis taking sample of 257 non-financial firms listed in Pakistan stock exchange for the period of 2012 to 2019 through Fixed effect model.The results disclose that the financial development system of Pakistan negatively and significantly influence the EM activities of registered firm’s in Pakistan stock exchange. Hence, conclude that the strong financial system is effectively restrain the EM activities.The overall results are consistent with earlier literature that the advance FD enhance the controlling and analyzing of accounting informationby reducing the interference of management in the procedure of accounting accruals. Keywords: Earnings Management, Financial Development, Financial Development Index.
Management either for their informative or opportunistic purposes mask the true financial information of firms which is known as earnings manipulation practices. However, in turn such practices lead to a higher cost of capital. Therefore, in this study examined the effect of earnings manipulation on cost of capital in 144 listed sample firms of Pakistan Stock Exchange for the period of 2006-2016. Used panel data approaches for analysis and the diagnostic tests procedures of panel models selection suggests that fixed effect model is the suitable model. The result reports that firms that indulge in the activities of earnings manipulation their cost of capital are high because the manipulated information reduces the confidence of investors on fundamentals information of firms and ultimately they demand high rate of return. Moreover, control variables such as size, capital structure, firm performance, market risk and capital expenditure significantly affect the cost of capital and the results are consistent with the theoretical and empirical justifications. Hence, the study recommended for the policymakers to develop regulated policies to control the earnings manipulation.
ACR system is being used as a performance management and evaluation tool in AWKUM for the last five years since its inception as a Public sector university in KPK, Pakistan. The main purpose of this study is to find out that whether ACR system do fulfill the requirement of an effective and efficient Performance evaluation and management tool. What employees think of this system? As any excellent performance management system plays a very vital role in the success of any organization.
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