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Do Accounting Standards affect the Business Performance and Financial Statement Manipulation on the banks

Posted on Sunday July 29th, 2018Monday July 30th, 2018 by

Article Information

Journal:	Business and Economics Research Journal
Title of Article:	Do Accounting Standards affect the Business Performance and Financial Statement Manipulation on the banks
Author(s):	Ali Ihsan Akgun
Volume:	9
Number:	3
Year:	2018
Page:	589-603
ISSN:	2619-9491
DOI Number:	10.20409/berj.2018.125

Abstract

Financial statement manipulation has been well-rounded analyzed in both finance and accounting literature as it is important to determine whether firms could affect both performance and accounting standards. The purpose of this study is to examine cases of financial reporting manipulations which were subject to published enforcement actions by the Securities Exchange Commission (SEC), Securities Class Action Clearinghouse (SCAC), Accounting and Auditing Enforcement Releases (AAERs) and General Accounting Office (GAO) between 1996 and 2014 for reasons of alleged financial misstatements in the USA. Therefore, this study will provide to examine the relationship between bank performance and financial statement manipulations in the accounting standards. More importantly, although financial misconduct such as financial reporting manipulation is an emerging topic of great importance, a comprehensive literature review of the subject has yet to be carried out in terms of accounting standards. In this context, this study focuses on financial reporting manipulation within the context of International Financial Reporting Standards (IFRS). This study is contributed to the literature by examining the impact of financial reporting manipulation within the same or different systems of accounting standards on bank financial reporting. Findings suggest that banks that manipulate financial statements increase their operating profitability and productivity as a measure of financial performance used in the IFRS.

Keywords:

Financial Statement Manipulation, Corporate Governance, Firm Performance, International Financial Reporting Standards

JEL Classification:

G14, G30, G34, M40, M41

Full Text ( ↓ 2503)

Effect of Mandatory IFRS Adoption on Cost of Debt in Turkey

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Article Information

Journal:	Business and Economics Research Journal
Title of Article:	Effect of Mandatory IFRS Adoption on Cost of Debt in Turkey
Author(s):	Hakan Ozkaya
Volume:	9
Number:	3
Year:	2018
Page:	579-588
ISSN:	2619-9491
DOI Number:	10.20409/berj.2018.124

Abstract

The ultimate aim of financial reporting is the communication between companies and their stakeholders. To better serve this ultimate aim, International Accounting Standards Board (IASB) required all European Union listed companies to adopt International Financial Reporting Standards (IFRS) starting from January 1, 2005. Some of other emerging countries like Turkey also complied with this requirement. In this paper, whether mandatory adoption of IFRS in 2005 caused a decrease in average cost of debt of Turkish manufacturing firms or not is tested. A cross-section fixed effect panel model was employed for a data set of 138 companies and 646 firm-year observations between years 2002 and 2008. Results show that firms in the sample have a significantly lower cost of debt after adoption year. Moreover, while; firm size, current ratio, GDP growth and interest rates have a positive association with the cost of debt, tangibility and interest coverage have a negative effect on the cost of debt.

Keywords:

IFRS Adoption, Cost of Debt, Financial Reporting, Information Asymmetry, Determinants of the Cost of Debt

JEL Classification:

M41, M48

Full Text ( ↓ 2443)

Invidual Investors’ Behaviour on Stock Selection Decision: A Case of BIST

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Article Information

Journal:	Business and Economics Research Journal
Title of Article:	Invidual Investors’ Behaviour on Stock Selection Decision: A Case of BIST
Author(s):	Duygu Arslanturk Collu
Volume:	9
Number:	3
Year:	2018
Page:	559-578
ISSN:	2619-9491
DOI Number:	10.20409/berj.2018.123

Abstract

The study seeks to determine the main factors influencing stock selection decisions of individual investors in Borsa İstanbul (BİST). To achieve this objective, an integrated Decision Making Trial and Evaluation Laboratory (DEMATEL) and Analytic Network Process (ANP) method was used and a five-point Likert scale survey questionnaire was designed. The questionnaire included twenty one factors that belong to five categories, namely, accounting information; recommendations; personal financial needs, firm specific attributes and other factors. The results show that there are six most important factors affecting the stock selection decisions of individual investors at the BIST which are brokerage house recommendations, willingness of taking risk for high returns, get rich quick, opinions of the firm’s majority stockholders, suggestions from friends and family and diversification needs. On the other hand, three factors were found to be the least influencing factors on individual investors’ stock selection decisions. The least influencing factors in order of importance were sensitivity of firm performance to overall market performance, fluctuations/developments in the indices of the major markets, affordable share price.

Keywords:

Stock Selection Decision, Invidual Investor, DEMATEL, ANP, BIST

JEL Classification:

G11, G41, C39

Full Text ( ↓ 2355)

Adjustment to Target Capital Structure and Global Financial Crisis: Evidence from Turkey

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Article Information

Journal:	Business and Economics Research Journal
Title of Article:	Adjustment to Target Capital Structure and Global Financial Crisis: Evidence from Turkey
Author(s):	Yilmaz Yildiz
Volume:	9
Number:	3
Year:	2018
Page:	543-557
ISSN:	2619-9491
DOI Number:	10.20409/berj.2018.122

Abstract

The aim of this study is to investigate the adjustment speed towards target capital structures of the publicly-traded firms in Turkey for the period 2003-2016. To observe the impact of the 2007-2009 global financial crisis on the adjustment speed, additional estimations for the sub-periods are also employed. Consistent with the dynamic trade-off theory, Turkish firms adjust their capital structures to reach the target but the adjustment speed is relatively slow. The findings reveal that firms tend to close the gap between their current and target level of leverage by approximately 12% – 14%, each year. However, the adjustment speed is significantly lower for the post-crisis period (9% – 10%) than the crisis and pre-crisis periods (14%-16%). Additional findings also show that over-levered firms tend to adjust their capital structures more quickly than the under-levered firms. The findings are robust to different methods of estimations and also different considerations of the time periods.

Keywords:

Speed of Adjustment; Dynamic Capital Structure; Trade-off Theory; Financial Crisis; Turkey

JEL Classification:

C23, G3, G32

Full Text ( ↓ 2443)

Forecasting Sales Revenues of Turkish Manufacturing Industry by Grey Forecasting and Markov Model

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Article Information

Journal:	Business and Economics Research Journal
Title of Article:	Forecasting Sales Revenues of Turkish Manufacturing Industry by Grey Forecasting and Markov Model
Author(s):	Selahattin Kaynak, Mirac Eren
Volume:	9
Number:	3
Year:	2018
Page:	531-542
ISSN:	2619-9491
DOI Number:	10.20409/berj.2018.121

Abstract

Turkish manufacturing industry has been increasingly important with the adoption of free market economy. It has become the driving force of the Turkish economy in terms of employment, production and exports. In terms of capital ownership, in Turkish manufacturing industry; public, private and foreign capital type companies operate in different status. The aim of this study is to predict the sales income trends of the public, private and foreign capital types operating in different positions in terms of capital ownership in the Turkish manufacturing industry through the Grey and Markov model. The grey model for estimating the total sales revenue of the firms, and the new Markov approach based on the quadratic programming model for their trends have been proposed. These models were used to forecast the total sales of firms for the period 2004-2014 and to estimate the trends of 2017-2022 period. In the scope of the research, the sales revenues of Turkey’s largest 500 industrial firms, operating in the manufacturing industry were analyzed. The analyzed dataset covers the period 1993-2014. As a result of the analyzes, it has been found that in the Turkish manufacturing industry, the weight of public capital is gradually decreasing and that the private capital has a high level of penetration.

Keywords:

Manufacturing Industry, Markov Model, Quadratic Programming, Grey Model

JEL Classification:

D29, D41, E23

Full Text ( ↓ 2236)

Institutional Change and Economic Policy Coordination for Turkey

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Article Information

Journal:	Business and Economics Research Journal
Title of Article:	Institutional Change and Economic Policy Coordination for Turkey
Author(s):	Pinar Ozdemir Cukadar, Nese Algan
Volume:	9
Number:	3
Year:	2018
Page:	513-529
ISSN:	2619-9491
DOI Number:	10.20409/berj.2018.120

Abstract

Aim of this study is to investigate instiutional change of economic policies and to examine whether policies are well coordinated or not for the 1980-2016 period of Turkey. The coordination between economic policies may succeed in through trust, coordination and complementarity between institutions. Turkish economy transformed planned economy to free market system and institutional structure has changed dramatically in that period. Moreover in that period Turkey had exposed to several structural changes and economic crises too. The analysis can be significant when the suitable methods are used for these datas. This is the main reason why non linearity is tested by Harvey, Leybourne and Xiao (2008) and results supports that series are nonlinear. Fourier ADF unit root test is used nonlinear variables and Kapetanios, Shin and Snell (2003) cointegration test is applied for to analyze long run relations between variables. The empirical findings support that there is no relationship between monetary and fiscal policy variables. Secondly, Arby and Hanif (2010) methodology is used for calculating a coordination coefficient for Turkey. The low coordination coefficient supports that coordination institutions has not worked efficiently.

Keywords:

Institutional Change, Nonlinear Time Series, Coordination, Turkish Economy

JEL Classification:

C32, E61, E02

Full Text ( ↓ 2443)

Effects of Sectoral Energy Consumption on Economic Growth: The Case of Turkey (1972-2015)

Posted on Saturday July 28th, 2018Monday July 30th, 2018 by

Article Information

Journal:	Business and Economics Research Journal
Title of Article:	Tuba Hanifi, Aysun Eser Ozen
Author(s):	Effects of Sectoral Energy Consumption on Economic Growth: The Case of Turkey (1972-2015)
Volume:	9
Number:	3
Year:	2018
Page:	499-512
ISSN:	2619-9491
DOI Number:	10.20409/berj.2018.119

Abstract

The aim of this study is to analyse the impact of energy consumption on economic growth in the basis of main sectors, between the years 1972-2015 in Turkey. The dependency between variables was tested by the method of Horizontal Cross Section (CD test), then the causality between energy consumption and Gross Domestic Product was analysed by using the heterogeneous panel test developed by Dumitrescu and Hurlin. Unidirectional causality from growth to energy consumption was found for Turkey. In terms of the main sectors, unidirectional causality from growth to energy consumption in the agricultural sector and bi-directional causality between growth and energy consumption in the services sector was found. In terms of the industrial sector, no causality was found.

Keywords:

Energy Consumption, Economic Growth, Sectors, Causality, Turkey

JEL Classification:

C33, Q43, E23, O49

Full Text ( ↓ 2399)

The Relationship between Economic Growth, CO2 Emissions and Health Expenditures in Turkey under Structural Breaks

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Article Information

Journal:	Business and Economics Research Journal
Title of Article:	The Relationship between Economic Growth, CO2 Emissions and Health Expenditures in Turkey under Structural Breaks
Author(s):	Melike Atay Polat, Suzan Ergun
Volume:	9
Number:	3
Year:	2018
Page:	481-497
ISSN:	2619-9491
DOI Number:	10.20409/berj.2018.118

Abstract

One of the many factors that affect human health is the destructions in the quality of the environment. Especially, the destructions in the environmental quality caused by increasing economic activities poses serious threats in terms of health. Health problems caused by environmental destruction leads to rapid increase in health expenditures. In this study, the effects of environmental destruction and economic growth on health expenditures of Turkey in the 1980-2016 years have been analyzed using single structural break Zivot-Andrews test and Gregory-Hansen cointegration test. While analyzing causal relation among variables, Toda Yamamoto method has been used. At this study CO2 emission per capita is used as indicator of environmental disruption and real GDP per capita has been used as indicator of economic growth, and health expenditure has been measured as per capita. The result of the analysis have shown that there is not a long term relation among health expenditures, economic growth and CO2 emission. In addition, one way causality relationship has been determined from health expenditure towards economic growth and CO2 emissions and from economic growth towards CO2 emissions.

Keywords:

Environmental Quality, Environmental Degradation, Health Expenditure, Economic Growth, Cointegration Test, Toda Yamamoto Causality Test

JEL Classification:

C32, I19, K32

Full Text ( ↓ 2451)

Foreign Technology Absorption in Sub-Saharan Africa: A Long-Term Analysis of the Nature and Stability of Relationships

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Article Information

Journal:	Business and Economics Research Journal
Title of Article:	Foreign Technology Absorption in Sub-Saharan Africa: A Long-Term Analysis of the Nature and Stability of Relationships
Author(s):	Katarzyna Świerczyńska, Agata Kliber
Volume:	9
Number:	3
Year:	2018
Page:	463-479
ISSN:	2619-9491
DOI Number:	10.20409/berj.2018.117

Abstract

The goal of this paper is to investigate the relationships between the process of technology absorption, official development aid (ODA), foreign direct investment (FDI), and import in Sub-Saharan Africa. We investigate long-run relationships between the process of technology absorption in the region. The investigation is based on such variables as ODA, FDI as well as import from developing and developed economies to estimate co-integration relationships and error-correction models. The results obtained indicate that aid and import from the South are more likely to cause the absorption of technology than other directions of flow.

Keywords:

Sub-Saharan Africa, Foreign Technology Absorption, Official Development Aid, Foreign Direct Investment

JEL Classification:

O11, O55, F35

Full Text ( ↓ 2369)

Market Structure of the Turkish Pharmaceutical Industry

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Article Information

Journal:	Business and Economics Research Journal
Title of Article:	Market Structure of the Turkish Pharmaceutical Industry
Author(s):	Egemen Ipek, Ozlem Ipek
Volume:	9
Number:	3
Year:	2018
Page:	449-462
ISSN:	2619-9491
DOI Number:	10.20409/berj.2018.116

Abstract

The market structure of the Pharmaceutical Industry, which has an extremely important both socially and economically position, is carefully monitored by regulatory authorities. The consantration of pharmaceutical companies tends to adversely affect consumer welfare as well as resource distribution in the economy. The competitive structure of the markets is determined by the concentration indices. For these reasons, in this study the market concentration ratios of the pharmaceutical sector in Turkey are calculated by using concentration measures such as Concentration Ratio; Herfindahl-Hirschman; Hall-Tideman; Rosenbluth; Comprehensive Industrial Concentration; Hannah-Kay; Hause and the Entropy measure with the annual sales revenue data of the companies in the sector for the 2009-2016 period.According to the results, pharmaceutical sector in Turkey has a low concentrated market structure. In addition, the Rosenbluth index presents the most consistent results for the Turkish pharmaceutical sector, which consists of hundreds of small companies having markets shares of 7% at the highest.

Keywords:

Market Structure, Pharmaceutical Industry, Concentration Measures, Trend Analysis

JEL Classification:

D40, L10, L22

Full Text ( ↓ 2965)