Earnings Manipulation and the Cost of Capital: Empirical Investigation of Non-Financial Listed Firms of Pakistan

Ilyas, Muhammad; Khan, Ihtesham; Urooge, Saima

doi:10.20547/jms.2014.1906107

Cited by 2 publications

(2 citation statements)

References 21 publications

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“…There is a conflict in current CG implementation on whether it is an effective mechanism to prevent organizations from FDIS (Alabede, 2016). According to Bilal et al (2013), the probabilistic perspective defines FDIS. The possibility of FDIS is evaluated due to the inadequate liquidity of assets and the higher level of debt of a firm.…”

Section: Introductionmentioning

confidence: 99%

Corporate Governance Practices and Financial Distress: Empirical Evidence from Listed Companies in Sri Lanka

Balagobei¹,

Keerthana

2023

Kelaniya J Manage

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The study aims to investigate the impact of corporate governance on financial distress of listed companies in Sri Lanka. Board size, board composition, CEO duality, board meeting, director ownership, and audit committee size are proxies for corporate governance while financial distress is measured by the Altman Z-score. Altman Z-score measures financial distress inversely and bigger the Z-score indicates the smaller the risk of financial distress. Using hundred and eight individual observations of firms listed in Sri Lanka for the period of 2019 to 2021 and employing fixed effects model, the effect of corporate governance practices on financial distress is evaluated. The results from panel data regression analysis reveal that firms having large number of directors on the board have a low likelihood of financial distress of listed companies in Sri Lanka. Furthermore, when a chief executive officer serves as the chairman of the board at a company, the more likely it is that the company will experience financial distress. But, board composition, audit committee size, board meeting and director ownership have not shown any significant impact on financial distress. The current study also provides evidence that firm-specific characteristics such as firm size, leverage and profitability, could be useful as to determining the likelihood of financial distress. The findings may be of prominence to the academic researchers, practitioners, and regulators who are interested in discovering the quality of corporate governance practices in a developing market and its impact on financial distress.

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Section: Introductionmentioning

confidence: 99%

Corporate Governance Practices and Financial Distress: Empirical Evidence from Listed Companies in Sri Lanka

Balagobei¹,

Keerthana

2023

Kelaniya J Manage

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“…Since the incorporation and promulgation of the CCG in 2002 in Pakistan, a new trend of research started in Pakistan and many researchers in Pakistan researched the topic of CG-related variables with firm financial performance [14,20,38,47,71,78,82,94,121,124,147,148,153], firm value [49,90,92,104,112,135,138,150,155], cost of capital [54,61,62,64,102,122,137], investment efficiency [129], cash holding [25,77,116,146], related party transactions [34],56, 57, 141-145, accounting conservatism [111], disclosure and audit quality [102,105,111,140], earnings quality [90,92,119], dividend policy [20,23,30,…”

Section: Introductionmentioning

confidence: 99%

Corporate governance looking back to look forward in Pakistan: a review, synthesis and future research agenda

et al. 2022

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The basic aim of this paper is to systematically review the corporate governance research trends in Pakistan and to give directions for future researchers in this field. The methodology adopted in this paper is “Systematic Literature Review,” 108 papers have been used from the period 2002–2020 along with 17 research theses in this study. The findings of this study show two trends in corporate governance research first one form 2008 to 2016 and the second one is from 2017 to 2020. The first trend shows that corporate governance (variables) is linked with traditional topics such as firm performance, dividend policy, capital structure, cost of capital and earnings management. The theory which is mostly used in the first corporate governance trend is the agency theory. In the second trend, corporate governance (variables) are linked with multiple issues while taking various theoretical perspectives such as risk taking, tunneling, CSR, investment portfolios, board-related issues, financial distress and much more. This paper has identified and filled the research gap by writing a comprehensive review paper of the prevailing corporate governance literature and has given directions for future researchers to consider it. To the best of researchers’ knowledge, this is the first study that has systematically reviewed and synthesized the corporate governance literature by adopting the systematic literature review methodology in Pakistan an emerging economy. It is an extensive effort for the purpose to encourage the interested researchers/scholars to add and expand their contributions to the corporate governance literature in Pakistan on the potentially identified areas of corporate governance.

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Earnings Manipulation and the Cost of Capital: Empirical Investigation of Non-Financial Listed Firms of Pakistan

Cited by 2 publications

References 21 publications

Corporate Governance Practices and Financial Distress: Empirical Evidence from Listed Companies in Sri Lanka

Corporate Governance Practices and Financial Distress: Empirical Evidence from Listed Companies in Sri Lanka

Corporate governance looking back to look forward in Pakistan: a review, synthesis and future research agenda

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