Financial Indicators Research Articles

The Effect of Abnormal Marketing and Capital Expenditure on Firm Value

The study analyzed the effect of abnormal marketing and capital expenditure on firm value. Public firms in consumer staples sectors within the Association of Southeast Asian Nations (ASEAN)-5 countries, such as Indonesia, Malaysia, Thailand, the Philippines, and Vietnam, were chosen as the sample. Data collection yielded 432 data points from 144 firms during the period 2018–2020. The effect of abnormal marketing and capital expenditure on firm value was analyzed using cross-sectional regression analysis. The dependent variable was firm value, proxied by Tobin’s Q. The independent variables were abnormal marketing and capital expenditure. Abnormal marketing expenditure was measured using the difference between the marketing expenditure to total assets ratio for the year of interest, that is, 2018–2020, and the 5-year average of the marketing expenditure to total assets ratio for the years 2013–2017. The same methods applied to abnormal capital expenditure. The control variables were internal financial constraints, that is, Kaplan–Zingales (KZ) index; external financial constraints, that is, financial development index; and COVID-19, which is a dummy variable with a value of 1 for the pandemic period and zero otherwise. The study revealed that positive abnormal marketing and capital expenditure exhibit an adverse impact on firm value and financial constraints increase the negative effect of abnormal marketing and capital expenditure on firm value.

Turbine system vs engine generator in the production of energy by methane in the pacific of Mexico: a technical, economic, and environmental analysis.

This paper aims to analyze the potential of energy production using methane from organic waste as a sustainable alternative to mitigate the environmental impact of energy generation from fossil fuels and the generation of Municipal Solid Waste (MSW). To carry out the analysis, two technologies were evaluated from technical, economic, and environmental perspectives. The LandGEM model was used to estimate the methane generation potential. The amount of energy produced, along with the respective financial indicators, was also calculated. The results showed that for an average feed of 671,892 tons per year of waste, 6160 ft3/min of CH4 would be generated at a maximum peak in the tenth year, with an annual average of 4735 ft3/min. Additionally, 0.831 million metric tons of CO2 equivalent would be avoided. In terms of power generation, a combined cycle micro-turbine system with an installed capacity of 11.35 MW would be feasible and would yield an Internal Rate of Return (IRR) of 35% and a Net Present Value (NPV) of $11,608,006 USD. For an engine-generator system, it was not possible to verify profitability due to a significant increase in capital and O&M costs. These results are intended to provide reference information to assist in the decision-making process related to the implementation of projects aligned with the Sustainable Development Goals within the framework of the 2030 Agenda.

Does Digitization Affect Social and Financial Performance in Microfinance Institutions?

This research aims to explore the effects of the digitization of microfinance institutions (MFIs) on their social and financial performances, and on the trade-off between them given the double mission pursued by these institutions. To reach this objective, we performed ordinary least squares (OLS), logit, and two-stage least squares (2SLS) regressions on a sample of 331 microfinance institutions from the ATLAS database. Findings reveal evidence of significant mixed effects of digitization on social and financial performance indicators. They also show that there is no significant effect of digitization on trade-offs. The novel aspect of this research lies in the approach used to measure social performance which is proxied by the SPI4 -Social Performance Indicators-developed by Cerise and Social Performance Task Force (SPTF), while previous research on the topic have used social mission outcomes indicators. The SPI4 tool allows financial service providers to evaluate the implementation of Universal Standards for Social Performance Management (USSPM). This study also provides evidence on the effect that digitizing MFIs operations may have on trade-off between their social and financial performances. The findings have significant implications for institutions, especially on the way they can implement and interconnect their digitization process, USSPM and financial strategy. Firstly, the significant effect of digitization on social performance reveals synergies between the adoption and use of digital solutions and the implementation of good practices of SPM. Secondly, the mixed effects of adopting digital solutions on financial performance suggest that while this process appears to drive efficiency within institutions, it does not necessarily improve their profitability, since capital expenditure appears to increase more than profits. Finally, since digitization does not appear conducive to trade-off, MFIs should better align their financial and investment strategy with their social objectives when going digital.

Kinerja Keuangan BPR Syariah Ditinjau dari Aspek Pertumbuhan Ekonomi di Provinsi Lampung

This study aims to use financial indicators to determine the effect of regional gross domestic product on the performance of Sharia BPR in Lampung. This survey method uses a quantitative descriptive survey whether the performance of the Lampung BPR SYARIAH will be influenced by Lampung's economic growth between January 2020 to December 2021. The population and sample are all BPR SYARIAH registered with the Financial Services Authority (OJK), and there are 11 BPR SYARIAH in the Lampung study area. So it can be said that the influence of KAP (X1) NPF (X2) ROA (X3) BOPO (X4) FDR (X5) CASH RATIO (X6) triggers the GRDP (Y). %, the remaining 1% is caused by other unavailable factors. The result of the f-test is known as the probability statistic F (0.017600). Because (0.05), it can be said that KAP, PAP, NPF, ROA, BOPO, FDR, and CASHRATIO together have a major influence on GRDP. And the partial significance test shows the value of Prob. KAP Ha1 was rejected because 0.05 < 0.0731, indicates a negative relationship, Prob value. NPF Ha2 is accepted because 0.0191 < 0.05 indicates a positive relationship, Prob value. ROA Ha3 is accepted because 0.0681 < 0.05 indicates a positive relationship, Prob value. BOPO Ha4 is rejected because 0.1055 < 0.05 indicates a negative relationship, Prob value. FDR Ha5 is accepted because 0.0398 < 0.05 indicates a positive relationship, Prob value. CASHRASIO Ha6 is accepted because 0.0235 < 0.05 indicates a positive relationship.

УПРАВЛІННЯ РИЗИКАМИ ЯК ДІЄВИЙ ІНСТРУМЕНТ ЗРОСТАННЯ КОНКУРЕНТОСПРОМОЖНОСТІ СУБ’ЄКТА ГОСПОДАРЮВАННЯ

The article deals with issues related to the analysis of financial and economic activities of an enterprise. The methods for its realization are also investigated. Modern risks faced by business structures encourage the formation of effective management. Risk-oriented management should be viewed as a monolithic approach to understanding and predicting the likelihood of risks. Risk management is an effective tool for improving the competitiveness of a business entity. However, in order to detect certain changes in financial and economic results, effective control over the company's key financial indicators must be exercised. This results in the company's ability to implement measures aimed at protecting and enhancing the competitiveness of the business entity, its profitability, economic growth, efficiency of financial resources, solvency, use of labor and material resources, as well as the efficiency of the company as a whole. For a modern society, it is extremely important to form a clear vision of modern risks and their connection with the competitiveness of a business entity. This implies understanding the circumstances of the risk of minimizing it and identifying the consequences. Russia's armed aggression has created new threats and problems for the development of our country in general and its economy in particular. Without an efficiently functioning economy, it is impossible to win a war, so it is increasingly important to identify credible threats. Before establishing the probability of risks for a particular business entity, it is necessary to analyze the main financial indicators of its work. Based on the results obtained, the presence of dangers to the business environment of this entity is determined. The most effective methods for determining the financial condition are the analysis of relative indicators and the DuPont method. Together, they provide a complete assessment of the enterprise's performance. Recommendations for analyzing the financial condition based on an integrated approach are substantiated. Their expediency was confirmed in the calculations on the example of PJSC "Motor Sich".

Digital finance infrastructure and growth of commercial banking firms in Nigeria

This study delves into the intricate relationship between digital finance infrastructure and the growth of commercial banking firms in Nigeria. Through a comprehensive analysis of various financial indicators and statistical tests, we offer critical insights into the dynamics of the Nigerian banking sector. The findings reveal a resilient and steadily growing banking industry, even in the face of economic challenges and the global COVID-19 pandemic. Key highlights include the exponential rise in digital infrastructure, exemplified by the proliferation of Automated Teller Machines (ATMs), Point of Sale (POS) machines, and web banking accounts. These digital channels have significantly influenced the accessibility and convenience of banking services in Nigeria. Our analysis employs correlation, regression, and Granger causality tests to explore the intricate relationships between bank total assets and digital infrastructure components. While positive correlations between bank total assets and digital infrastructure components suggest a strong link between technological expansion and banking growth, the analysis reveals nuanced relationships. Furthermore, while web banking accounts have grown significantly, their influence on bank total assets remains limited. Our findings emphasize the paramount importance of continued investments in digital finance infrastructure for the Nigerian banking sector's growth. However, they also underscore the need for a more profound understanding of the underlying drivers of these trends. This study offers valuable insights for policymakers, financial institutions, and researchers interested in fostering financial inclusion and optimizing digital banking services in Nigeria's ever-evolving financial landscape. In conclusion, this study highlights the critical role of digital finance infrastructure in driving the growth of commercial banking firms in Nigeria, while also calling for more targeted strategies to maximize the benefits of technological advancements in the banking sector.

Unveiling the Concealed Risks: The Influence of Digital Finance on Cyber Financial Crime in China

Digital finance has emerged as a pivotal catalyst for economic growth in China, profoundly altering social structures and behaviors. Despite its benefits, it has also engendered financial risks, thereby complicating social governance. This study utilizes a panel dataset from China’s provinces spanning 2011 to 2021 to analyze the influence of digital finance development on cyber financial crime rates. The results reveal a positive correlation: an increment of one unit in the digital finance index is associated with a 0.058 unit increase in cyber financial crime rates. These findings are robustly supported by tests for endogeneity and robustness. Variations in impact are observed across urbanization levels and average wage brackets. And the study identifies income distribution and traditional financial demand as the mechanisms of the effect. Furthermore, this study presents strategic recommendations to enhance financial inclusion, facilitate income redistribution, strengthen cyber crime governance, and integrate digital and traditional finance for the advancement of financial modernization.

The impact of minimum wage on automotive companies' performance

This paper aims to verify the relationship between minimum wage growth and the financial indicators of automotive companies. As a hi-tech sector, the automotive industry is usually not expected to be affected by minimum wage policies. The introduction of the minimum wage in Germany and the dynamic development of the minimum wage in Eastern European countries make it possible to assess this relationship. German, Czech, Polish, and Slovak automotive company data was obtained from the Orbis database. Panel regression models were applied to test for dependencies. The paper detects the association between the growth of the minimum wage and the increase in personnel cost, which is next to the associations with several financial indicators at the company level. The identified impact is specific to small and medium-sized companies.

The current state of Kazakhstan financial system: theoretical and practical aspects

Against the backdrop of the global challenges of the current economic situation, the financial system of the Republic of Kazakhstan is becoming an important tool for ensuring the sustainable development of the national economy, acting as a factor in stimulating its growth. This study was undertaken to analyze the state of the national financial system based on theoretical principles that determine its structure and significance in financial development. The financial system of Kazakhstan mainly solves the problem of providing the national economy with financial resources and promoting economic growth. At the same time, an analysis of the state of the financial system, based on theoretical principles regarding its significance and indicators of the country’s financial development, allows us to identify key problems and directions for its further development. In the context of ensuring economic growth, the role of the financial system is considered from the point of view of indicators characterizing the degree of its development. The study identifies structural components of the financial system that correlate with the Financial Development Index provided by the International Monetary Fund (IMF). This approach allows us to assess the current state of Kazakhstan's financial system, identify problems, and identify areas for further improvement. The study's results highlight the need to improve the efficiency of financial institutions, emphasizing the role of market mechanisms in the formation and distribution of the country's financial resources. Kazakhstan's financial system needs further reforms to achieve sustainable economic development.

Contribution of controlling to the business success of a company in the example of Pevex

Controlling, as an advisory function of management, reflects on the quality of company management at the strategic, tactical and operational levels. To a large extent, it contributes to the timely and quick reaction of the management to changes inside and outside the organization and thus minimizes risks and optimizes operations. At the same time, the application of appropriate controlling instruments affects the efficiency and effectiveness of business operations. The purpose of the research was to determine the role and contribution of controlling in the stabilization of Pevex’s operations after restructuring, as well as management’s perception and the role of controlling instruments in operations. In order to examine the established relationships, research was conducted using the semi-interview method with company management and analysis of f inancial statements and selected business financial indicators, as well as SWOT and TOWS analysis. The results of the research showed that there is a significant role and contribution of controlling in the stabilization of business after the restructuring of Pevex. Controlling greatly contributed to the adjustment of the business strategy, which affected business indicators measured by liquidity, profitability, economy, profitability and indebtedness. Management’s perception is that the use of controlling instruments contributes to the organization’s management processes and the achievement of the organization’s set goals. Based on information from the company itself, the controlling system at Pevex is presented, its contribution to management in making business decisions, and recommendations for further development are given. Primary data sources from the company itself and secondary data sources (annual financial reports) were used for the analysis.

Renewable energy technology diffusion model: Evaluation of financial incentives in the electricity market of ecuador

This paper develops a simulation model using the System Dynamics paradigm to evaluate the effect of applying financial incentives on the diffusion of non-conventional renewable energy technologies in the Ecuadorian electricity market. The barriers to the diffusion of renewable energies are studied, the diffusion models are characterised, and the model is built with market variables and financial indicators integrated into its base structure. The Ecuadorian electricity market is described as a case study focusing on the incentive scheme. Based on investment, generation, and indirect incentives, this scheme plays a crucial role in promoting renewable energy technologies. Different long-term diffusion scenarios are simulated and compared with each other and with the baseline scenario to obtain diffusion rates and financial information for five renewable generation technologies: non-conventional hydro, wind, solar photovoltaic, biomass, and geothermal. The results of the simulations show that the combination of incentives leads to high diffusion rates, reassuring the audience about the potential impact of the proposed model. However, the feed-in tariff and tradable green certificate incentives are the most effective in promoting the use of renewable energy. For the Ecuadorian electricity market, the results show that wind and biomass technologies would be the most profitable, as opposed to geothermal energy, whose diffusion will not be feasible within the simulated period.

Penerapan Manajemen Balance Scorecard (BSC): Studi Kasus di MIS Miftahul Ulum Kec. Serpong Utara Kota Tangerang Selatan

The implementation of Balanced Scorecard (BSC) management at MIS Miftahul Ulum, Serpong Utara District, South Tangerang City is still facing some obstacles. The lack of understanding and accurate data, structured systems, resources, and accountability culture are the main barriers. This has resulted in the suboptimal achievement of strategic goals, such as learning, internal process, customer, and financial indicators that are not yet maximized. The purpose of this study is to determine the extent to which the implementation of Balanced Scorecard (BSC) management at MIS Miftahul Ulum, reviewed from four perspectives, namely: financial, customer, internal process, and learning and growth. This research is qualitative, with data collection methods including interviews, observations, and documentation. Data validity is ensured through triangulation, and data analysis techniques include data collection, data reduction, data presentation, and conclusion drawing. The research shows that the quality of education at MIS Miftahul Ulum, Serpong Utara District, South Tangerang City has improved compared to previously. However, some adjustments need to be made in the implementation of Balanced Scorecard (BSC). Conclusion: MIS Miftahul Ulum focuses on diversifying funding sources, increasing the efficiency of fund management, and increasing income from voluntary donations. Customer satisfaction and making MIS Miftahul Ulum the main school of choice for students and parents. Progress in its internal processes by implementing a quality curriculum, an effective teaching and learning process, and timely completion of teaching and learning tasks, and a quality curriculum provides a strong foundation for students to learn and grow. Effectiveness of the teaching and learning process: An effective teaching and learning process allows students to reach their full learning potential. Timely completion of teaching and learning tasks: Timely completion of teaching and learning tasks ensures that students have enough time to learn and understand the subject matter.

Financial Development and Foreign Direct Investment Impact on Economic Growth: Evidence from Nepal

The interplay among financial development, foreign direct investment (FDI), and economic growth has been a subject of keen interest among scholars, both from a theoretical standpoint and through empirical research. Focusing on Nepal, this study examines the distinctive connections among economic expansion, the influx of foreign capital, and the evolution of the financial sector. Given the lack of a definitive metric for financial development, this research adopts the financial development index, along with the financial institution index and financial market index, as alternative indicators. It also considers additional variables that could influence economic growth beyond financial development and FDI. Utilizing the Autoregressive Distributed Lag (ARDL) bounds testing method and the Error Correction Model (ECM), the analysis uncovers a robust positive link between financial development and FDI in enhancing Nepal's economic output. Furthermore, both the short-term and long-term analyses prove to be reliable, devoid of issues like heteroscedasticity, autocorrelation, and multicollinearity. Importantly, the findings indicate that in the face of short-term disruptions, the dynamics between these variables adjust back to a long-term equilibrium state.

ECONOMIC FEASIBILITY STUDY FOR THE IMPLEMENTATION OF A MICRO-INDUSTRY PRODUCING KOMBUCHA FLAVORED WITH PASSION FRUIT FROM THE CAATINGA.

Kombucha is a fermented beverage of Chinese origin produced from the infusion of black or green tea from the Camelia sinensis plant, sugar and a symbiotic culture known as SCOBY. After fermentation, the drink becomes rich in natural nutrients with functions that are beneficial to health such as organic acids, amino acids, vitamin C, polyphenols and antibiotic substances. The present work aims at carrying out a study of the economic feasibility of opening a micro-industry for the production of a black tea kombucha flavored with passion fruit from the caatinga. The caatinga passion fruit is a species native to the dry areas of northeastern Brazil. This fruit is rich in flavonoids, vitamin C and carotenoids, which have antimicrobial and antioxidant properties. For the development of the study, specifications of processes, equipment and analysis of financial and economic indicators were carried out. The evaluation of the investments was carried out using the internal rate of return (IRR), minimum attractiveness rate (TAM), net present value (NPV), simple payback and discounted payback methods. The initial investment for the production of 2,000 L of kombucha flavored with passion fruit from the caatinga was R$ 187,199.78. The economic indicators obtained resulted in NPV of R$ 253,154.68, IRR of 22%, TAM of 13.34% p.a. and simple payback of 3.9 years considering a useful life of 10 years. The positive IRR reflects that the enterprise is economically viable and profitable, making it possible to invest and generate income for cooperatives and family farmers.

Dynamic spillovers of various uncertainties to Russian financial stress: Evidence from quantile dependency and frequency connectedness approaches

Being geopolitically exposed, the Russian financial sector is vulnerable to various ­uncertainties. The aim of the article is to examine the quantile movements and dynamic connectedness of uncertainty indices with the financial stress index of Russia employing the cross-quantilogram (CQ), recursive cross-quantilogram (R-CQ) and TVP‑VAR dynamic connectedness using monthly data from July 2011 to August 2023. It is found that for Tweeter-based Economic Uncertainty (TEU) and Global Economic Policy Uncertainty (GEPU), there is strong positive dependence on the Russian Financial Stress Index (RFSI) in the bearish states of market in the initial memory, and the strength of this positive spillover effect gradually wilts towards longer memory structures. Unlike the GEPU, Russian Economic Policy Uncertainty (REPU) has long-lasting heterogeneous spillover effects on RFSI. Though there are significant positive, as well as negative, spillover ­effects of Global Geopolitical Risk (GGPR) on RFSI in the initial memory, across the longer­ memory structures these entire heterogeneous effects wash out. However, Russian Geopolitical Risk (RGPR) have long-lasting heterogeneous spillover effects on RFSI, unlike GGPR. GEPU, GGPR and RGPR were the net transmitters while RFSI, TEU and REPU were net receivers of volatility shocks. Since RFSI shows resilience over the long-term horizon to global geopolitics and economic uncertainty, investors are advised to keep patience and hold their capital/investment up to a minimum of 1 year in Russian financial system in order to be rewarded with positive returns.

A Comprehensive Study of Techno Economic Viability (TEV) Report of Various Projects

This paper provides a comprehensive analysis of the TEV process, focusing on its application to both greenfield and brownfield projects across various sectors, including manufacturing, infrastructure, energy, and services. The study aims to guide decision-makers by bridging technical assessments with financial analysis to establish project profitability and sustainability. A Techno-Economic Viability (TEV) Study serves as a crucial tool in the decision- making process for both lenders and investors. It offers a detailed assessment of a project's technical feasibility, economic viability, and overall sustainability. It delves into the dual aspects of technical feasibility and economic viability, emphasizing their roles in influencing investment decisions across a wide spectrum of industries, including manufacturing, infrastructure, energy, and services. The findings from this research also illustrate real-world applications, highlighting two case studies with an emphasis on key financial indicators such as the Debt Service Coverage Ratio (DSCR) and Internal Rate of Return (IRR), which are used to measure a project’s ability to meet debt obligations and generate profits. Keywords: Techno Economic Study, Financial Viability, Technical Feasibility, Financial Modelling, Risk Analysis, Investment Decision

Decoding the ‘Social’ in ESG

Traditionally, a company’s financial performance indicators, such as revenue generating capacity, profit margins, and inventory turnover were the driving force behind a company’s attractiveness as an investment opportunity. The rising popularity of environmental, social and governance (‘ESG’) norms in the last decade however has seen a shift in investors’ risk appetite – investors are moving away from archaic definitions of performance indicators and assessing an investee’s impact in terms of ESG metrics.While there is clarity on what factors constitute ‘environment’ and ‘governance’ principles, the ‘social’ metric continues to remain shrouded in mystery. In this article, we discuss the factors which form the building blocks of the ‘social’ metric as well as review the yardsticks available to measure this metric, particularly from an Indian standpoint.

Financial development and tax evasion: International evidence from OECD and non-OECD countries

This study investigates the nexus between financial development and tax evasion across 156 countries from 2000 to 2017. In contrast to previous research focusing solely on banks or financial markets’ development, we employ a more comprehensive financial development index introduced by the International Monetary Fund (IMF) in 2016. This index gauges the progress of financial institutions (FI) and financial markets (FM) in terms of depth, access, and efficiency. Our findings underscore a negative correlation between financial development and tax evasion. Enhanced depth, access, and efficiency in both FI and FM correspond to reduced levels of tax evasion. Nevertheless, disparities emerge between the Organization of Economic Cooperation and Development (OECD) and non-OECD countries. While non-OECD countries exhibit negative associations between FI and FM development and tax evasion, in OECD countries, the role of FI assumes greater significance in curtailing tax evasion. Notably, within OECD countries, the depth of FI and FM emerges as the sole influential factor. This contrasts starkly with non-OECD counterparts, where all dimensions − depth, access, and efficiency − negatively influence tax evasion. Our research has noteworthy implications for policymakers in both categories of countries.

Exploring the Nexus of Oil Price Shocks: Impacts on Financial Dynamics and Carbon Emissions in the Crude Oil Industry

This empirical research study delves into the intricate interplay between oil price shocks (OPS) and their dual impact on both carbon emissions and the financial performance of the crude oil industry. Utilizing a sophisticated econometric approach, the study employs a Nonlinear ARDL model to meticulously scrutinize the enduring and immediate associations between oil prices and key financial indicators such as stock prices, dividends, and profit ratios of oil exploration industries. Given the significant fiscal and ecological transformations in China during this period, the chosen factors provide a robust framework for measuring changes at both microeconomic and macroeconomic levels, contributing valuable insights to sustainable economic development strategies. Our findings elucidate a statistically significant influence of OPS on the financial performance of the oil industry, particularly in the short term. The increase in the volatility level of OPS manifests a discernible decline in stock prices and profit ratios. Intriguingly, the study further uncovers a nuanced facet of OPS, revealing a prolonged and beneficial impact on carbon emissions in the long term. More importantly, heightened oil prices serve as a catalyst, motivating oil exploration companies to intensify production and exploration activities, thereby increasing carbon emissions in a direct relationship. The implications of these findings are pivotal for policy making, underscoring the imperative for decision-makers and industry stakeholders to pivot towards cleaner, more sustainable energy sources. The research augments the ongoing discourse surrounding the intricate nexus between energy costs and carbon emissions, furnishing invaluable insights that could steer the development of policies geared towards fostering sustainability and mitigating the adverse effects of climate change.

Assessment of regional financial risk based on an integrated approach

Subject. The article considers a comprehensive model to assess the financial risk of the region. Objectives. The aim is to develop a financial risk prevention model that integrates economic, social, political, environmental, and financial indicators, having a significant impact on the economy. Methods. The study rests on methods of synthesis, analysis, comparison, and economic and mathematical calculations, i.e. weighted summation with preliminary normalization of each estimated indicator. The process of data collection, normalization, selection of indicator weights, and calculation of integral indicator of financial risk was implemented for 2022. Results. We established the presence of financial risks in the region. Both the results and the model itself can be useful for further research. The advantage of the model is the relative small number of applied indicators. This facilitates the collection of information, its processing and evaluation. The evaluation of the above calculations reflects the conditionality of ranking. The results that reflect dynamics are more indicative. Conclusions. The formed model, when assessing regional financial risk, enables to take into account the multidimensionality of modern regional economies.