Non-financial Institutions Research Articles

ТЕОРЕТИЧНІ АСПЕКТИ ФОРМУВАННЯ ФІНАНСОВОГО РИНКУ ТА АНАЛІЗ ЙОГО ДІЯЛЬНОСТІ В УКРАЇНІ

Our article is devoted to the theoretical aspects of the formation of the financial market and analysis of its activities in Ukraine. In economic essence, the financial market is a set of economic relations associated with the distribution of financial resources, purchase and sale of temporarily free cash and securities. The purpose of the financial market is to provide enterprises with appropriate conditions for attracting the necessary funds and selling temporarily free resources. Effective development of the financial market will ensure the formation of investment processes, increase GDP in the country, as well as create opportunities for the development of various economic sectors. In view of this, the article fully reveals the essence of the concept of the financial market through the definition of domestic and foreign scientists. Theoretical bases of activity of the financial market in Ukraine, and also use of the basic functions (namely tasks) and the principles applied on it are considered. The role of objects and subjects of the financial market is defined. Among the objects are various market instruments, which reflect the temporarily free funds (financial resources) of the subjects of the financial services market, which include the state, households, financial and non-financial institutions. In particular, the activities of financial market entities that are most active in Ukraine, namely financial institutions, which include commercial banks and insurance companies, are analyzed. The dynamics of the number of changes in banking institutions and insurance companies is studied. A comparative description of the dynamics of revenues and expenditures of the banking sector for 2015-2019, as well as current information for January-September 2020. A comparison of the main indicators of insurance companies in the domestic market for the first quarter of 2019-2020, namely: the volume of gross insurance premiums, the volume of net insurance premiums, the share of net insurance premiums, as well as the number of insurance contracts. Based on the results of the study, the directions of improving the financial market in Ukraine are proposed.

Important institutions-innovators of economic transformations

The leading and modern types of innovation structures in the economy are considered in this paper. The development of integration processes between the structures contributes to the formation of full-fledged, effectively functioning national innovation model of the economy. Their selection is based on the characteristic feature of modern world economic development − the transition of leading countries to a new stage in the of innovative society formation, building the economy based primarily on the generation, dissemination and use of knowledge. Ukraine's place in the world innovation processes does not correspond to the existing business innovation and intellectual potential in the country. Therefore, it is noted that the development of relationships between the elements of the innovation system will accelerate the innovative ideas introduction into the economy and increase the innovation coverage in various sectors of the economy. It is substantiated that the basis of innovation-integrated structures functioning at the present stage of economic development is a coordinated system of production-technological, intellectual, communication and financial relations between all its participants. Based on the analysis of foreign experience in the formation of development institutions in the diverse institutional environment, and taking into account the specifics of the innovation system in Ukraine, possible successful version of interaction of its main participants: government, industry and academia, intermediate financial and nonfinancial institutions is proposed. The approaches to the organization of innovation activity with the participation of the innovation cluster and the innovation ecosystem, which are typical for the developed foreign countries in this direction, are indicated. Due to this, it is possible to obtain the following positive effects: increase of investment attractiveness; accelerated development of the innovative sector of the economy; growth of enterprises productivity; ensuring the development of business and institutional infrastructure; small and medium business development; job creation and employment growth; improvement of the population life quality and the international economy competitiveness.

Міжнародно-публічно-приватне партнерство для досягнення цілей сталого розвитку в старопромислових регіонах України

The development of public-private partnerships is identified as a key mechanism for attracting investment to achieve the Sustainable Development Goals, including Objective 9 “Sustainable Infrastructure, Promoting Comprehensive and Sustainable Industrialization and Innovation” and Objective 17 “Strengthening the Global Partnership for Sustainable Development and Enhancing It”. It is proposed to introduce into scientific circulation the concept of international-public-private partnership, taking into account the interests and funds of international organizations and international donors. The mutual coherence of the interests of the state and the private sector in the partnership is analyzed. Different variations of the interaction of institutional intermediaries through the prism of specific actors (state, business, civil society and international organization) are considered. The institutional support of international-public-private partnership to achieve the Sustainable Development Goals of the old industrial regions is analyzed. It is determined that in order to develop and support international-public-private partnership projects to achieve the Sustainable Development Goals in the old industrial regions it is necessary to create a single system for implementation and monitoring of international-public-private partnership projects taking into account all established institutions. The system of institutions for the development of international-public-private partnerships includes financial and non-financial institutions. It is proposed to establish the Center for International-Public-Private Partnership as an independent expert body, the purpose of which is to prepare, organize and support international-public-private partnership projects, as well as to provide support to public administration and business.

Female representation on the boards of directors of non-financial companies

This study offers new insights to help improve our understanding of the impact of female representation on firm performance, as measured by return on assets (ROA) and return on equity (ROE) and using non-financial institution data from Jordan. The study utilizes a lagged dependent variable in the regression models by employing the generalized method of moments (GMM) for dynamic panel analysis of the panel data of 77 companies over the period 2008-2018. The results of the regression analysis reveal that leverage, board size, and firm size were positive and statistically significant, while the age of the firm was statistically significant but had a negative effect, which indicates the existence of a relationship between these variables and the performance of Jordanian companies. However, the results fail to show any effect of the impact of female representation on firm performance as measured by return on assets and return on equity. This finding might be attributed to the low representation of females on non financial institution boards, which was only 3.63%, a very low figure compared to that of males on Jordanian boards. Therefore, our results are valid only for Jordanian firms and cannot be generalized to ones in other countries, which might have different cultural and legal perspectives.

Asymmetry in Earnings Management Surrounding Targeted Ratings

This study examines earnings management among financial institutions attempting to achieve a target financial strength rating. We find empirical evidence that firms with an actual rating below their target rating use income-increasing earnings management, however we find no evidence that firms above their target rating manage earnings. Our result is consistent with financial institutions facing less pressure from unions and suppliers, but more pressure from regulators, relative to non-financial institutions. Our findings are robust to a variety of alternative definitions of target rating. Notably, we examine a subset of firms with an exogenously determined target rating and find consistent results. We also find evidence that firms can influence ratings agencies, as firms that underestimate their initial claims are more likely to receive a rating upgrade.

Management Share Proprietory and Firm Value: Are There Peculiar Determinants?

The study examined the specific factors that influence management share holdings and how this impact on the value of the firm in Ghana. The study specifically sought to find the relationship existing between managerial ownership and firm worth, non-linear relationship between managerial ownership and firm value, how managerial ownership and firm value are affected by size of firm and firm growth opportunities. Using secondary data from Ghana Stock Exchange from the period of 2015 to 2019, ten financial institutions (Banks) and ten non-financial institutions (non-bank) were purposively selected for the study, considering data availability and accessibility. Inferential statistics was adopted in analysing the data collected. The study found a weak positive linear relationship between firm worth and management’s share holdings in the organization. The findings from the second research question revealed that the nature of the bond between management share holdings and firm value was the fact that it was nonlinear, however with no visible description of shape but rather fluctuating in nature. The study further found that there is a moderately weak positive association between firm worth and management share of holdings of the organization in the presence of firm size. The findings from the final research questions also revealed that connection between firm value and management holding of share is influenced by firm growth opportunities. The study recommends the development of a more robust and parsimonious model in the examination of the association between management ownership share and firm size to help improve on the strength and nature of the relationship as was revealed by weak correlation and coefficient of determination values.

Pemberdayaan Pelaku Usaha Gabah Kopi di Gabah Kopi Atep Desa Warnasari Kecamatan Pangalengan Kabupaten Bandung


 
 
 Pangalengan a district in Bandung Regency, West Java Province. Pangalengan is located in the south of Bandung City and is famous for various tourist objects such as Situ Cileunca, tea plantations and Cibolang hot springs. Pangalengan is also known as an area of agriculture, livestock and plantations. There are several tea plantations managed by PTPN. Pangalengan is also an area for producing cow's milk, livestock and milk processing in the Pangalengan area. Another potential that is currently growing rapidly is coffee plantations. Citiis Village, which is located in Warnasari Village, Pangalengan District, is one of the villages that produces Arabica coffee. Most of the farmers in Citiis village grow coffee, because the price of coffee cherries or what is called logs is higher than vegetables and tea. Common problems faced by partners are marketing management, production management and financial management. The priority problem of partners is the Production Aspect where the Milling Machine (pulper) is damaged so that it cannot grind coffee to separate the beans and skins and the partner cannot produce more coffee grain. As well as the capital aspect, currently partners do not get capital assistance from any banking or non-financial institution due to limited knowledge about recording or bookkeeping as a condition for borrowing capital. The solution offered is to repair the damaged coffee milling machine (pulper) so that it can function again, as well as provide training in making simple financial reports so that partners can lend to banks or other non-financial institutions to increase capital in developing their business.
 
 

Electronic Banking and Customer Satisfaction in Imo State (A Study of Selected Commercial Banks in Imo State)

This study was carried out to examine the impact of electronic banking on customer satisfaction in commercial banks in Imo State. The aim is to determine the relationship between electronic banking and customer satisfaction in some commercial banks in Imo State. The study used primary data; the instrument used in gathering the primary data was questionnaire. The statistical tool of analysis is the Pearson Product Moment Correlation Techniques. The result revealed that there is positive relationship between electronic banking and customer satisfaction in United Bank for Africa Plc, Access Bank Ltd and Keystone Bank Ltd. It also revealed that there is positive relationship between Automated Teller Machine and Mobile Banking and customer satisfaction in United Bank for Africa Plc, Access Bank Ltd and Keystone Bank Ltd. More so, the study shows that there is a negative relationship between point of sale and customer satisfaction in the three (3) banks. This implies that increase in charge levied on those electronic banking systems will have a corresponding decrease in customer satisfaction and vice-versa. The study therefore recommends the following; that banks should improve continuously in the advance of Automated Teller Machine for speedy transaction when using by customers; financial institutions (banks) and non-financial institutions should endeavor to make available POS machine at a minimal cost to some small business outlets in order to help in the achievement of cashless economy; the banks should ensure that there is creation of more internet security in internet and mobile banking so as to avoid loss of cash by customers as a result of fraudulent activities and finally, continuous advancement and reengineering information communication technology should play a vital role in the overall synergy of financial institution operations (banking). It becomes more important for bank leadership to deepen investment in ICT products to increase speedy, user friendly and perfect services. These will make Nigerian banks to stand firm in terms of efficiency, profitability, reliability, and competitiveness among its global competitors and to withstand challenges and changes that may occur in ICT controlled globalized economy.

Analysis of the Effect of Good Corporate Governance and Audit Committee Size on Thin Capitalization of Companies Owning Foreign Capital

This study aims to analyze the thin capitalization implemented in companies that have foreign capital. Thin capitalization is a financing structure from internal and external companies. This study uses the independent variable Good Corporate Governance and Committee Size. The population of this study consists of all non-financial companies listed on the Indonesia Stock Exchange from 2017-2019. This study took samples from companies that own foreign capital which are non-financial institutions. This study uses multiple linear regression analysis as a statistical method. The results of this study indicate that the size of the Audit Committee has a significant effect on thin capitalization

INFLUENCE OF MANAGERIAL ABILITY ON FINANCIAL REPORTING QUALITY: EVIDENCE FROM NIGERIAN LISTED NON-FINANCIAL FIRMS

Users of accounting information crave of quality financial reporting, by emphasising on the quality of the auditors neglecting the attribute of the managers. This study investigates the influence of managerial abilities on financial reporting in Nigerian listed non-financial sectors. The time series research design was employed by selecting 40 non-financial institutions as sample size between 2010 and 2017. Secondary data obtained from the financial report were analysed using correlation and logistic regression. It was found that managerial ability has an inverse relationship on financial reporting quality, which is consistent with the agency theory. The finding implied that managers employ their ability to income smoothing for the benefit of the organisation rather than the interest of the shareholders.

Factors affecting Corporate Cash Holdings: A study of Non-financial Institutions Listed on the Ghana Stock Exchange.

This article intended to investigate the determinates of cash holding of registered non-financial institutions (NFIs) on the Ghana Stock Exchange (GSE). The research used panel data obtained from the twenty-five enterprises, for the period 2012-2018. The article adopted the robust fixed effect regression technique to empirically find the determinates of cash holdings. The research findings indicated an adverse nexus between cash holdings and capital structure. The profitability of the enterprise shown a positive and significant affiliation with industry cash holdings. Similarly, the size of the firms exhibited statistically a significant connection with enterprise cash holdings. The interest rate and inflation rate both indicated a positive and negative link. The article results are of significant source for enterprises registered on the GSE market to make the proper decision on the volume of cash to hold Keywords : Cash holdings, robust fixed effects, leverage, Non-financial institutions, profitability. DOI: 10.7176/RJFA/11-18-18 Publication date: September 30 th 2020

Perspektif Multinasionality dan Kepemilikan Institusional Terhadap Thin Capitalization Perusahaan Asing

This study aims to analyze the thin capitalization that is applied in multinational companies for the effectiveness and efficiency of corporate financing. This study uses independent variables namely multinational and managerial ownership. The study population consisted of all non-financial companies listed on the Indonesia Stock Exchange from 2017-2019. This study takes a sample from multinational companies that are non-financial institutions. This study uses multiple linear regression analysis as a statistical method. The independent variables used in this study are multinational and managerial ownership, then the dependent variable is thin capitalization.

Industry 4.0 in Finance: The Impact of Artificial Intelligence (AI) on Digital Financial Inclusion

This study sought to investigate the impact of AI on digital financial inclusion. Digital financial inclusion is becoming central in the debate on how to ensure that people who are at the lower levels of the pyramid become financially active. Fintech companies are using AI and its various applications to ensure that the goal of digital financial inclusion is realized that is to ensure that low-income earners, the poor, women, youths, small businesses participate in the mainstream financial market. This study used conceptual and documentary analysis of peer-reviewed journals, reports and other authoritative documents on AI and digital financial inclusion to assess the impact of AI on digital financial inclusion. The present study discovered that AI has a strong influence on digital financial inclusion in areas related to risk detection, measurement and management, addressing the problem of information asymmetry, availing customer support and helpdesk through chatbots and fraud detection and cybersecurity. Therefore, it is recommended that financial institutions and non-financial institutions and governments across the world adopt and scale up the use of AI tools and applications as they present benefits in the quest to ensure that the vulnerable groups of people who are not financially active do participate in the formal financial market with minimum challenges and maximum benefits.

THE EFFECT OF CONCENTRATED OWNERSHIP ON BANK PROFITABILITY IN INDONESIA

This paper examines the association between concentrated ownership and the profitability of banks in Indonesia during the period from 2012 to 2018 with a total sample of 93 banks or 651 observations. This study applies the Random Effect regression method, and reveals a non-significant association between concentrated ownership and bank profitability as measured by ROA and ROE. It indicates that a majority of shareholders tend to use their power to exploit minority shareholders, which can also strengthen the monitoring effect. However, the regression also indicates that there is a significant non-linear relationship between concentrated ownership and profitability when measured by ROE. There is a mixed-effect between concentrated ownership and profitability in the case of Indonesian banks. Moreover, a regression is also utilized with dummy variables of concentrated ownership (FIN and IND) to assess the difference between non-financial institution ownership and financial institution ownership. The results show no significant difference in cases. This can be caused by institutional ownership (financial institutions), which only acts as a short-term trader that emphasizes short-term profits. Therefore, its existence as a shareholder is not any different to the presence of non-financial institution ownership. The findings of this study show that the application of POJK No. 56/POJK.03/2016 regarding Share Ownership of Commercial Banks which regulates the maximum limit of concentrated ownership in banks may not work effectively in strengthening bank performance.

Accounting and Financial Reporting during a Pandemic

In this paper, I discuss how a pandemic affects the nature of financial reporting especially for financial and non-financial institutions that were deeply affected by the 2020 coronavirus (COVID-19) pandemic. I show that accounting practices or techniques such as fair value accounting, big bath earnings management, loss avoidance and income smoothing techniques can help to dampen the effect of a pandemic on firm performance. Some implications about the merits and risks of accounting during a pandemic are highlighted and discussed.

PERFORMANCE EVALUATION MODEL OF ROMANIAN MANUFACTURING LISTED COMPANIES BY FUZZY AHP AND TOPSIS

We are interested in the hierarchy of the main Romanian companies in the manufacturing industry by considering eight financial and seven non-financial indicators. Thirty three listed companies, that are non-financial institutions, were selected for the study and in order to control the reliability of the data we used the Bucharest Stock Exchange database, official data published by the Romanian Ministry of Public Finance, and the annual reports released by the companies on their websites, collecting information for the years 2011–2015. Because the human thinking is subjective and ambiguous we prefer linguistic variables, converted afterwards in triangular fuzzy numbers, to represent the importance of indicators. Our method involves the calculation of the weights of individual or categories of indicators based on Fuzzy Analytic Hierarchy Process. Then, the level of performance for each company, separately for financial, non-financial and all indicators is obtained by TOPSIS method. We deduce an objective hierarchy of the companies on a rigorous basis, which is however dependent from the choice of indicators and the conversion scale of linguistic variables into triangular fuzzy numbers. Also, following the obtained results we concluded that the overall performance of companies for the analyzed period is significantly influenced by non-financial indicators.

Real Earnings Management and Dividend Payout among Non-financial Institutions in Nigeria

Aims: This study seeks to evaluate the consequences of real earnings management and dividend payout among non-financial institutions in Nigeria.
 Study Design: The study adopted Descriptive and ex-post facto research design.
 Place and Duration of Study: Department of Banking and Finance, Niger Delta University, Wilberforce Island, Bayelsa State, Nigeria. The study was carried out between October 2019 and January 2020.
 Methodology: To this end, we made use of Descriptive and ex-post research design, secondary data set, collected from thirty five quoted non-financial institutions for the period 2015 and 2018 financial period. The data were analyzed using Descriptive Statistics, Correlation Matrix.
 Results: Our findings align with the agency theory which suggests that despite the fact that corporate contracting is primarily designed to align incentives between principals and agents, agency concerns are still created as a result of incompleteness and rigidities in binding of contracts, which lead to manipulation of the reporting process consequently altering shareholders returns in form of dividend payout.
 Conclusion: Specifically, we find that real earnings management is been modulated through expenses. The variables of abnormal production and cash flow from operations show no significant effect on dividend payout with respect to the institutions and period under review.

AUDIT REPORT DELAY AND AUDIT FIRM ROTATION IN TURKEY

Lengthy delays in the publication of financial reports may adversely affect the efficiency of capital markets. The current study investigates the effect of auditing firm rotation on financial report disclosure dates. Accordingly, 1.200 company-year observations obtained from annual reports of non-financial institutions traded on the Borsa Istanbul for the years 2010-2017 are analyzed. The results of the current study indicate that there is a statistically significant positive relationship between financial report disclosure dates and audit firm rotation. In other words, financial report delay is longer following audit firm rotation. The results of the study are expected to provide benefits to regulatory authorities in the publication of timely financial reports necessary for the effective functioning of the capital market.

O sentido social da ação em política monetária no Banco Central do Brasil (BCB) entre 1995 e 2017

O artigo busca demonstrar os sentidos sociais da ação na tomada de decisão da taxa básica de juros (SELIC) pelo Banco Central do Brasil (BCB).Com base na sociologia da capacidade crítica de Luc Boltanski e Laurent Thévenot, através da análise de disputas situacionais nas inflexões dos juros entre 1995 e 2017, foi possível demonstrar a influência das trajetórias sociais, das narrativas e de seu vínculo com os demonstrativos financeiros. Ficou demonstrado, também, que em conjunturas rotineiras macroeconômicas, há maiores graus de liberdade para ação com convergência de posição e tomadas de posição (no sentido de Pierre Bourdieu) em juros. Em momentos de disputas situacionais, crises políticas e desequilíbrios macroeconômicos, observou-se um aumento da influência de agentes de instituições financeiras e não financeiras (que estão do lado da inércia cognitiva econômica e moral) valendo-se de pressões performativas com base em dogmas macroeconômicos e justificações morais.

Non-performing loans and bank corporate governance: conceptual framework and literature review

This paper aims to accurately distinguish non-performing loans (NPLs) notion from some related concepts and provides the theoretical background and empirical literature review of these loans. This displays bank efficiency studies which consider bad loans and reports previous researches on NPLs determinants. Banks' efficiency studies have empirically proven the direct effect of bad loans on banks' production process. Researches on NPLs factors have shown that these loans are affected by both macroeconomic and bank-specific determinants. Moreover, loan quality can be influenced by bank corporate governance (CG). But, this remains implicitly studied though the apparent failures and weaknesses in CG. Thus, we cite the few studies which examine the influence of CG on bank loan quality. To do so, we state the CG theories and discuss the special features distinguishing banks from non-financial institutions. This review represents an historical record for researchers who aim to examine NPLs topic in the future.