ORCID Profile
0000-0003-4984-8021
Current Organisations
National Graduate Institute for Policy Studies
,
Monash University
,
Deakin University
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Publisher: Emerald
Date: 03-10-2016
DOI: 10.1108/IJAIM-05-2016-0061
Abstract: The effect of political connections of agency costs has attracted considerable research attention due to the increasing recognition of the fact that political connection influences corporate decisions and outcomes. This paper aims to explore the association between corporate political connections and agency cost and examine whether audit quality moderates this association. A data set of Bangladeshi listed non-financial companies is used. A usable s le of 968 firm-year observations was drawn for the period from 2005 to 2013. Asset utilisation ratio, the interaction of Tobin’s Q and free cash flow and expense ratio are used as alternative proxies for agency costs membership to Big 4 audit firms or local associates of Big 4 firms is used as a proxy for audit quality. Results show that politically connected firms exhibit higher agency costs than their unconnected counterparts, and audit quality moderates the relationship between political connection and agency costs. The results of this paper suggest the importance of audit quality to mitigate agency problem in an emerging economic setting. The findings of this paper could be of interest to regulators wishing to focus regulatory effort on significant issues influencing stock market efficiency. The findings could also inform auditors in directing audit effort through a more complete assessment of risk and determining reasonable levels of audit fees. Finally, results could inform financial statement users to direct investments to firms with lower agency costs. To the knowledge of the authors, this study is one of the first to explore the relationship between political connection and agency costs, and the moderating effect of audit quality of this relationship.
Publisher: Emerald
Date: 03-08-2015
Abstract: – This study aims to purport to investigate the relationship between firm size, profitability, board ersity (namely, director gender and nationality) and the extent of corporate social responsibility (CSR) disclosures within a developing nation context. – The dataset comprises 116 listed Bangladeshi non-financial companies for the period of 2005-2009. A CSR disclosure checklist was used to measure the extent of CSR disclosures in the annual reports and a multiple regression analysis to examine its association with firm characteristics and two board ersity features – female and foreign directorship. – Results indicate that large and more profitable firms provide more CSR disclosures. It was also found that female directorship has a negative association with CSR disclosures, while foreign directorship has a positive impact on such disclosures. This paper documents that CSR disclosures decrease further when family ownership is higher and there are more female directors on the board. – This study extends empirical evidence on the association between firm characteristics, board ersity and CSR disclosure practices from a developing nation context. Furthermore, this study also reveals that female directors’ impact on firm disclosures may differ between developing and developed nations, and somewhat impeded in the latter. This paper also provides empirical evidence on the importance of appointment of foreign nationals on the boards of developing countries to influence CSR practices.
Publisher: Elsevier BV
Date: 09-2019
Publisher: Emerald
Date: 02-03-2015
Abstract: – This paper aims to explore the relationship between corporate social responsibility (CSR) disclosures and earnings quality proxied by earnings accruals. Specifically, we examine whether CSR disclosures are context-specific, that is, whether companies dominated by powerful stakeholders are obliged to behave in a responsible manner to constrain earnings management, thereby reporting higher-quality earnings to investors. – This paper explores the relationship between CSR disclosures and earnings quality proxied by earnings accruals. Specifically, we examine whether CSR disclosures are context-specific, that is, whether companies dominated by powerful stakeholders are obliged to behave in a responsible manner to constrain earnings management, thereby reporting higher-quality earnings to investors. – Results show that managers in an emerging economy manage earnings when they provide more CSR disclosures. Such earnings management is achieved through income increasing discretionary accruals. Furthermore, companies from export-oriented industries dominated by powerful stakeholders (international buyers) disclosing more CSR activities, provide transparent financial reports through constraining earnings management. – The findings of this study are significant for both investors and policymakers. Investors should not take for granted that firms engage in CSR activities, behave ethically and provide transparent financial reports. As we document that firms might manipulate earnings through discretionary accruals and provide less transparent financial reports to shareholders, the credibility of firms’ CSR policies should be assessed with caution. Policies directing at promoting socially responsible practices instead of motivating the desired behaviour, may provide managers with additional incentives to utilise CSR for opportunistic behaviour. Thus, policymakers need to be cautious about this opportunistic behaviour and enhance monitoring to enforce social compliance. Possibly, some guidelines can be introduced to confirm that CSR disclosures are based on actual practice and not just a “green wash” statement to deceive stakeholders.
Publisher: Elsevier BV
Date: 09-2015
Publisher: Emerald
Date: 04-04-2017
Abstract: This study aims to investigate the moderating role of audit quality on the association between business group affiliation of firms and earnings management in the South Asian emerging economy of Bangladesh. A usable s le of 917 firm-year observations was drawn from companies listed on the Dhaka Stock Exchange from 2005 to 2013. Data were collected from the annual reports of s le companies. Earnings management was measured using the absolute value of discretionary accruals, and two proxies were used to measure audit quality: auditor size and industry specialisation. Results showed that the level of discretionary accruals is positively associated with business group affiliation status, and higher audit quality reduces this association. This suggests that in environments without strong investor protection, complex ownership structures create opportunities for controlling shareholders to expropriate minority shareholders. The controlling shareholders could then mask this practice through earnings management. The findings also show that in environments lacking strong investor protection, audit quality can help improve earnings quality for group-affiliated firms. The results suggest that financial statement users need to consider audit quality for a reasonable evaluation of the earnings quality of business groups. The study also informs regulators by illuminating audit quality as a key area of focus in any effort directed at enhancing stock market efficiency through improved earnings quality in environments where business group affiliation is prevalent. This study documents empirical evidence on the moderating effect of audit quality on the positive association between business group affiliation and earnings management.
Publisher: Elsevier BV
Date: 06-2014
Publisher: Wiley
Date: 22-02-2016
DOI: 10.1111/IJAU.12061
Publisher: Emerald
Date: 07-05-2019
DOI: 10.1108/IJAIM-10-2017-0120
Abstract: The purpose of this study is to empirically examine the association between corporate governance and the extent of corporate social responsibility (CSR) disclosures in insurance companies, using archival data. The data set comprises 277 listed insurance company-years in Bangladesh for the period of 2008 to 2014. The authors have used a checklist to measure the extent of CSR disclosures. The checklist was developed based on the previous CSR literature. The study uses a multiple regression analysis technique to investigate the association between different governance variables, particularly managerial ownership, institutional ownership, board independence and the proportion of female directors, and the extent of CSR disclosures in Bangladeshi insurance companies. The authors find that board independence and the proportion of female directors have positive associations with the extent of CSR disclosures. However, the results indicate that managerial ownership is negatively associated with the extent of CSR disclosures. Unlike most of the prior research that explored CSR disclosures in non-financial companies, the authors focus on financial companies, namely, insurance businesses. The authors provide empirical evidence using archival data that suggests that some governance mechanisms are important determinants of CSR disclosures in the insurance industry.
Publisher: Wiley
Date: 07-03-2021
DOI: 10.1111/IJAU.12223
Abstract: We examine whether a firm's voluntary purchase of sustainability assurance is associated with reduced capital constraint and lower cost of debt. We also explore the effect of assurance provider (accountant/non‐accountant) and a country's level of investor protection/creditor rights, on this association. Using a panel dataset drawn from an international s le, we find that voluntary purchase of sustainability assurance is negatively associated with both capital constraint and cost of debt. The associations are stronger for accounting firm providers than non‐accounting assurers. Further, the effect is stronger for firms operating in low investor protection (creditor rights) settings suggesting that voluntary sustainability assurance is valued in a context generally characterized by greater information asymmetry. Findings provide evidence that firms derive a financing benefit from voluntary sustainability assurance, and the benefit is sensitive to the profile of the sustainability assurance provider and the institutional environment in which the firm operates.
Publisher: Elsevier BV
Date: 09-2018
Publisher: Emerald
Date: 27-09-2019
Abstract: The emerging practice of integrated reporting (IR) has raised curiosity regarding how it impacts on firms and their stakeholders. The purpose of this paper is to examine whether a firm’s decision to provide integrated reports is associated with its financing decisions and whether financial reporting quality mediates the relationship. A usable s le of 832 firm-year observations was employed based on a dataset drawn from companies listed on the Johannesburg Securities Exchange (JSE) for the period between 2009 and 2015. The findings show that firms that provide integrated reports tend to have lower levels of leverage, and this effect is partially mediated through financial reporting quality. We further document that the partial effect of financial reporting quality on leverage is stronger for firms that provide integrated reports than is the case for other firms. The findings suggest that IR enables firms to employ equity financing, which is a more informationally-sensitive source of capital than debt financing. This study is the first to document evidence suggesting that management can draw on IR in devising optimal financing strategy.
Publisher: Wiley
Date: 14-05-2013
DOI: 10.1111/CORG.12027
Publisher: Emerald
Date: 12-07-2013
Abstract: The purpose of this paper is to investigate the relation between the value of executive director share ownership and discretionary accruals. This study uses a dataset of 1,173 firm‐year observations drawn from 188 Australian listed companies for the period 2000‐2006. The analysis is based on multivariate regression analysis and ordinary least square models were used to investigate the relation between the value of managerial ownership and discretionary accruals. The issue of potential endogeneity is addressed by using a simultaneous equation system. A negative relation is found between value of managerial share ownership and discretionary accruals at lower levels of value of ownership, which is consistent with the theorised incentive alignment that as the managers commit more resources to their firms, stakeholders impose less contractual constraints specified in terms of accounting numbers and managers make lower accrual adjustments. After a certain level of value of ownership is attained, a positive relations seen, consistent with increased discretionary accrual adjustments associated with stakeholders anticipating managerial entrenchment. Also, it is found that these results are driven by firms with income increasing, as opposed to income decreasing, discretionary accruals. Shares and options are forming an increasing proportion of executive remuneration that continues to be the subject of much debate amongst regulators and in the media. Showing that the value of share ownership may be an effective internal governance mechanism to help align incentives adds to the debate and has policy implications. The paper's primary contribution is finding that the value (as opposed to proportion) of share ownership, typically representing a sizeable proportion of managers' un ersified wealth, is a potentially direct driver of theorised incentive alignment and entrenchment effects associated with share ownership.
Publisher: Springer Science and Business Media LLC
Date: 14-03-2018
Publisher: Elsevier BV
Date: 12-2015
Publisher: Elsevier BV
Date: 02-2019
Publisher: Elsevier BV
Date: 12-2013
Publisher: Elsevier BV
Date: 12-2015
Publisher: Emerald
Date: 05-05-2022
DOI: 10.1108/IJMF-11-2021-0554
Abstract: The study examines the association between firm-level political risk and corporate innovation and also this study explores how financial constraint and growth level of a firm influence this association. A s le of 14,140 firm-year observations of the US firms from 2003 to 2020 is used. Unlike prior studies, this study uses a firm-level measure of political risk recently developed by Hassan et al. (2019) and measure innovation by patent and patent citation data and a text-based measure. A regression technique is used for empirical testing. This study finds that firm-level political risk is negatively associated with innovation and also document that firm-level political risk has a negative impact on innovation for financially constrained and high growth firms. The overall results are robust after addressing the issue of potential endogeneity using entropy balancing and two-stage least squares regression techniques. This study also documents qualitatively consistent results after using alternative measures of innovation as well as firm-level political uncertainty. The findings of this study could help the managers to make better investment decision and improve economic efficiency through understanding the effect of firm-level political risk on innovation activities. The study concentrates on firm-level political risk and innovation and presents new insights that political risk at the microlevel is an important determinant for investment in innovative activities.
Publisher: Emerald
Date: 26-02-2020
DOI: 10.1108/IJAIM-10-2019-0124
Abstract: Although proponents of integrated reporting (IR) advocate that this emerging practice has the potential to transform corporate reporting, the eventuation of this expectation would depend on the incentive IR provides to firms. This study aims to examine whether IR is associated with cost of debt and whether IR moderates the relationship between financial reporting quality and cost of debt. Based on insights drawn from information asymmetry and agency theories, the authors develop models that link IR and financial reporting quality with a firm’s cost of debt. The authors analyze 847 firm-year observations drawn from non-financial firms traded on the Johannesburg Stock Exchange, for the period between 2009 and 2015. The authors find that firms that provide integrated reports tend to have a lower cost of debt than those do not provide IR. The authors also find an inverse association between financial reporting quality and cost of debt, and that integrated reports accentuate this association. The findings suggest that the debt market perceives value in the information presented in integrated reports beyond what is furnished in financial reports. To the best of the authors’ knowledge, this study is the first to document evidence suggesting that the debt market perceives value in the information presented in integrated reports, beyond what is furnished in financial reports.
Publisher: Emerald
Date: 19-02-2018
DOI: 10.1108/AAAJ-06-2015-2078
Abstract: The purpose of this paper is to examine the association of corporate political connection with the level of voluntary corporate social responsibility (CSR) disclosures to determine how the relationships between the state and the corporate sector influence CSR engagement. Based on a neo-pluralist view of legitimacy theory, which conceptualizes the state as a concentration of power amenable to exploitation by the corporate sector, the study develops and empirically tests a hypothesis that CSR disclosures are inversely associated with political connection. A s le of 936 firm-year observations is used with data collected from annual reports of companies listed on the Dhaka Stock Exchange in Bangladesh from 2005 to 2013. Results indicate that corporate political connection is associated with reduced CSR disclosures. This finding suggests that the perceived need for CSR disclosures as a legitimation strategy diminishes for politically connected firms. The finding supports a neo-pluralist argument that political connection could enable firms to eschew stakeholder pressure associated with potential legitimacy threats originating from poor CSR performance. This conclusion challenges the pluralist view of legitimacy theory that considers the state as a neutral arbiter resolving conflict among stakeholder groups in society. The study makes a significant contribution to the literature by developing a neo-pluralist theorization of voluntary CSR disclosures within legitimacy theory and empirically testing it. Because prior empirical CSR disclosure research is largely underpinned by the pluralistic conception of society, examining this phenomenon from a neo-pluralist perspective enables a more complete understanding of CSR disclosure behaviors of firms.
Publisher: Springer Science and Business Media LLC
Date: 19-05-2012
Publisher: Wiley
Date: 25-03-2018
DOI: 10.1111/ACFI.12357
Publisher: Wiley
Date: 29-09-2023
DOI: 10.1111/IJAU.12334
Publisher: Elsevier BV
Date: 12-2019
Publisher: Elsevier BV
Date: 06-2011
Publisher: Virtus Interpress
Date: 2011
DOI: 10.22495/COCV9I1ART8
Abstract: We examine the relation between managerial share ownership (MSO) and discretionary accruals in Australia. We find a positive relation between MSO and discretionary accruals up to a certain level of MSO followed by a negative relation (inverse U-shaped). We suggest that these unique results are a result of certain Australian institutional features that are markedly different to those in the US and the UK and imply that the ownership-discretionary accruals relation is context specific with the wider corporate governance systems influencing the theorised incentive effects. We also posit that executive directors and independent directors have different ownership-discretionary accruals incentives and report results consistent with this proposition.
Publisher: SAGE Publications
Date: 20-12-2014
Abstract: We investigate the relationship between managerial share ownership (MSO) and earnings as a measure of operating performance in Australia. To mitigate potential earnings management, we also use discretionary accrual adjusted earnings as an alternative measure of performance. We document a negative relation between MSO and performance followed by a positive relation. We suggest that these unique results are an artefact of certain Australian institutional features and imply that the ownership–performance relation is context-specific, with the wider corporate governance systems influencing the theorised incentive effects. We also posit that executive directors and independent directors have different ownership–performance incentives. Our results are consistent with this proposition and suggest that independent directors may be immune to the theorised incentive alignment or entrenchment effects associated with share ownership.
Location: No location found
No related grants have been discovered for Arifur Khan.