International Journal of Accounting, Business and Finance
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Feedback from stakeholders on proposed audit quality standards
Full text linkThe American Institute of Certified Public Accountants (AICPA) and the Public Company Accounting Oversight Board (PCAOB) established audit quality control standards to ensure that audit engagements comply with both professional standards and the firm’s standard of quality. However, existing standards have not kept pace with auditing advancements over the years. To remedy the problem, in December 2019, the PCAOB issued a concept release proposing a potential approach to revising its quality control standards. Similarly, in February 2021, the AICPA issued an exposure draft to address the way CPA firms manage quality for their auditing and accounting engagements. This paper provides an overview of both proposals and analyzes comment letters submitted to both governing bodies on these proposals. Our results suggest that large CPA firms supported the proposals, while smaller firms and individual CPAs opposed them. The feedback from smaller firms and individual CPAs strongly suggests that the proposals are not scalable, and the proposed standards would significantly increase the cost of their audit engagements
The synergistic influence of board gender diversity and audit committee on the financial performance of Saudi Arabian banks
Full text linkThis study examines the influence of audit committee characteristics on the financial performance (F_PER) of Saudi Arabian Banks and the moderating role of board gender diversity. It analyzes data from 10 Saudi Arabian banks for a period of 10 years, specifically from 2014 to 2023. It uses two metrics to assess F_PER: ROA and ROE. Additionally, two audit committee characteristics–audit committee size and audit committee activities. The observations indicate that audit committee characteristics have varying effects on F_PER, and the results suggest that the audit committee size has a significantly adverse impact, while audit committee activities have an insignificant impact on F_PER. Gender diversity did not have a moderating effect on this linkage. This finding suggests that adding more members to the audit committee could hinder, rather than improve, its F_PER. To the best of the researcher’s knowledge, limited studies have explored the moderating role of board gender diversity in the relationship between audit committees and financial performance within the Saudi Arabian context
Modeling the efficiency of financial inclusion in Bihar: A data envelopment analysis
Full text linkThe study aims to evaluate the effectiveness of financial inclusion in Bihar from 2016-2017 to 2020-2021 and analyze the variations across different districts. The study uses secondary data from the State Level Bankers Committee Report and employs the CCR 1978 model and the Super Radial Efficiency model of DEA to measure overall technical efficiency. The analysis considers 10 indicators representing 4 dimensions of financial inclusion. The study identifies districts with improving financial inclusion levels and identifies efficient districts as benchmarks for others to emulate. Some districts show stagnation or decline, indicating the need for targeted interventions and policy measures. Policymakers can use the efficiency scores to identify districts requiring more support for enhancing financial inclusion. Financial institutions can learn from the practices of efficient districts to improve their services in less efficient areas. The focus on district-level analysis highlights the importance of decentralization in financial inclusion planning and implementation
Derivation of weight for measuring financial inclusion index using a non-parametric analysis approach: A study based on Bihar
Full text linkTo address the criticism of arbitrary weight selection in current approaches, this paper generates a composite Financial Inclusion (FI) Index to evaluate financial inclusion across 38 districts in Bihar, India, for the financial year 2020–2021. Financial inclusion is assessed through four dimensions: availability, accessibility, awareness, and usage of financial services, incorporating novel indicators such as training programs organized, persons trained, Bank Mitra engaged, and amount accumulated by Bank Mitra. A two-stage Data Envelopment Analysis (DEA) is employed to derive data-driven weights, supplemented by a comparison with the United Nations Development Programme (UNDP) approach, using data from the state-level banker’s committee report. The DEA results reveal that 27 districts are efficient (score of 1), while Sheikhpura scores the lowest (0.2727). The UNDP approach classifies 19 districts as high FI (>0.6), 16 as medium (0.4–0.6), and 3 as low (<0.4), with Patna achieving the highest score (0.940) and Arwal the lowest (0.377). By pointing out areas needing intervention, the proposed FI Index improves policy development and is simple to compute and comparable throughout regions. This study advances a strong, scientifically sound instrument for measuring financial inclusion with possible use in many spheres
A strategic approach towards sustainable development: Scaling climate finance mechanisms for climate change in India
Full text linkClimate change poses a significant threat to the global community, particularly impacting vulnerable populations in developing countries. This paper provides an in-depth examination of climate finance, illustrating its definition, sources, instruments, and implications for developing countries. The paper also highlights key climate finance funds that serve as vital mechanisms for channeling financial resources to projects aimed at reducing emissions, enhancing resilience, and promoting sustainable development in developing countries. The study emphasizes the importance of a strategic approach to secure the necessary funding for India\u27s ambitious transition outlined in its Long-Term Low Emission Development Strategy submitted at COP27. It suggests four pillars of India\u27s climate finance strategy: private sector engagement, international partnerships, diverse financial instruments, and innovation finance. By outlining these pillars, the paper aims to assist Indian policymakers and stakeholders develop a strong and efficient climate finance strategy to achieve their climate objectives while promoting sustainable development
Bridging theory and practice: Contemporary perspectives in accounting and finance
Full text linkWith the dedicated support of our editorial board members, authors, peer reviewers, section editors, and production team, we are pleased to present the June 2024 issue of the International Journal of Accounting, Business and Finance (IJABF), now published under the auspices of the Indian Accounting Association Patna Branch. This volume (3:2) features five research articles addressing critical contemporary issues in accounting and finance, from audit quality standards to financial inclusion measurement and climate finance strategies. Each contribution not only provides valuable empirical insights but also identifies important avenues for future research. We extend our sincere gratitude to all contributors whose scholarly work and rigorous peer review have made this issue possible. These collective efforts continue to advance IJABF\u27s mission of bridging academic research with professional practice in the field of accounting and finance
Crisis Accounting and Financial Irregularities: Do Ethical Considerations Play a Role?
Full text linkIn periods of crisis, organizations and nations experience heightened demands to achieve financial targets, which result in unethical conduct such as the manipulation of financial data and the misrepresentation of financial information or funds. The study aimed at assessing the relationships between Crisis Accounting, Ethical Considerations and Financial Irregularities and establish the moderating role of Ethical Consideration in the relationship that exists between Crisis Accounting and Financial Irregularities. Data from 309 accountants were used to establish the relation between the variables using Partial Least Square - Structural Equation Modeling (PLS-SEM) analysed in SmartPLS 3. The results revealed a positive relationship between Crisis Accounting and Financial Irregularities and also significant impact in the relationship between Ethical Consideration and Financial Irregularities. The results also revealed a strong moderating role of ethical consideration on the relation between Crisis Accounting and Financial Irregularities. The study, therefore, recommends that ethical standards and considerations should be enhanced in accounting practice to limit or deter financial irregularities in crisis situations
Assessing the Impact of the Turkey-Syria Earthquake on Global Stock Markets
Full text linkUsing the event study and cross-sectional analysis, we show that the impact of the Turkey-Syria earthquake on the leading stock market indices of 53 nations was not uniform. While the global, European, and developed markets exhibit negative returns on t+1 and t+4, positive returns were observed on t+2 and t+3, indicating that market participants later adjusted their perceptions and expectations of the event. The country-wise analysis suggests that investors\u27 optimistic view leads to positive returns. We show that trade dependence and proximity to the event zone negatively impact returns, while past returns just before the event can predict returns during the event windows.
An event study analysis of the impact of bonus share announcements on Nifty 100 and Nifty Midcap 100 companies
Full text linkThis study examines how the large-cap and mid-cap firms listed on the National Stock Exchange responded to bonus share announcements between January 1, 2006, to September 30, 2022. The conventional event study approach has been utilized, along with the commonly used market model assessment of predicted returns to analyze 45 pure events during this period consisting of 20 events of large-cap and 25 events of midcap stocks. According to the analysis, stock values significantly changed around the time of occurrence. Announcements of stock dividends typically increase stock prices. The mean of average abnormal return around the event for Nifty Midcap 100 indexed companies (0.2087) is higher than that for Nifty 100 indexed companies (0.1446), although the difference is insignificant. The study also shows that the cumulative average abnormal return for Nifty Midcap 100 indexed companies (6.472) is higher than that for Nifty 100 indexed companies (4.483) during the event period
Global Financial Dynamics: Crisis, Ethics, and Market Impacts: Insights from the June 2023 Issue
Full text linkWe are launching the June 2023 issue of the International Journal of Accounting, Business and Finance (IJABF). During the process we received extensive support from the editorial board members, section editors, technical editors, production editors and authors. Volume 2, Issue 2 of IJABF features five articles addressing contemporary issues. The authors explore meaningful research questions through empirical results, providing insights and directions for future studies. We extend our gratitude to all contributors to this issue