Development of Corporate Bond Markets in Emerging Market Countries: Empirical Evidence from Bosnia and Herzegovina

Abstract

In the countries with developed financial markets, unlike in Bosnia and Herzegovina (BiH) and other emerging market countries (EMCs) with the so called bank-centric financial systems, corporate bonds are a rather significant alternative to the usage of bank loans for financing the development needs of the real sector of the economy (corporate sector). The new architecture of world's financial stability with Basel III as its integral part additionally emphasizes this importance for both banks and companies. Besides, in the countries with developed financial markets it is probably needless to mention the need for high quality debt securities. This is especially true due to the conditions of stronger institutional investors on the market, such as pension funds that can realistically be expected to become the leading financial institutions of the 21 st century, and ever increasing need of institutional investors, funds in particular, for high quality forms of assets and portfolio diversification. In EMCs in which pension reforms have still not been completely implemented or completed, considering a drastic fall in the ratio of the insured based on contribution payment and the number of pensioners, the existing situation is almost non-sustainable. Therefore, the transformation of pension funds in accordance to the two or three pillar structure and the emergence of voluntary pension funds as financially powerful institutional investors have no alternative. Certainly, in terms of corporate bonds and their issue on the one hand, and investing in them on the other, in EMCs and thus also in BiH there are some important aspects to be observed when analyzing their influence on the decisions on financing or investing (liquidity, interest rate level, clarity and implementation of regulations, etc.).

The Role of Controlling Credit Sales and Receivables in the Wood Processing Companies of Tuzla Canton, Bosnia and Herzegovina

“…Planning and controlling, two different but closely linked functions, depend on each other. Without previous planning, control process does not have its grounding and consequently the same is true for controlling in a company [5]. The research into the extent to which the observed companies prepare multi annual and annual budgets and plans showed some interesting results.…”

“…In order to reduce and minimize credit sales risk, the sales company uses the controlling of credit sales and receivables. Controlling holds a special position in planning and supervision of credits sales but also in developing standards used in the realization of such a process [5]. Company's controlling department is responsible for the creation and revision of credit sales policy as well as credit standards that should be written in the appropriate format.…”

“…Controlling allows for more quality management of future events and provides answers to specific questionswhat are the trend values and what can be expected in the future, into which products should we invest more, which products should be canceled, which customers should be avoided, which markets should be developed and which should be abandoned, how to finance, and many other questions related to company's business operations [5].…”