ISSN: 2056-3736 (Online Version) | 2056-3728 (Print Version)
Emmanuel Gyamera and Ivy Eklemet
Correspondence: Ivy Eklemet, eklemet.ivy@upsamail.edu.gh
Department of Accounting, University of Professional Studies, Accra
pdf (443.85 Kb) | doi: https://doi.org/10.47260/bae/1122
According to numerous studies, small and medium businesses are more financially limited than large businesses due to the lack of audited financial accounts. This study investigates the effects of Audit services on SMEs' financial performance. As a result, to obtain the necessary data for the project, the study used a quantitative strategy and a survey method. The study's participants are registered SMEs from the Registrar General's Department. The sample size was determined using a list of 6,000 registered small and medium businesses. The SMEs were chosen through a systematic selection process and were given questionnaires. The PLS-SEM Software was used to analyse the data collected from the respondents. The findings indicate that the use of audit services results in the avoidance and detection of financial irregularities, resulting in an improvement in SMEs' financial performance. The study also found a positive relationship between information technology and the financial performance of SMEs.
Audit Services, Small and Medium Scale Enterprise (SME), Financial Performance, information technology.
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Mohammad Robbani
Correspondence: Mohammad Robbani, mohammad.robbani@aamu.edu
Alabama A&M University
pdf (443.85 Kb) | doi: https://doi.org/10.47260/bae/1121
Firms involved in foreign trade (exports and imports) are generally sensitive to fluctuations in the exchange rates and carefully take it into consideration while planning their future trading. In this paper, we study the inter-relationship between exchange rate volatility and economic growth in the Eurozone markets. Specifically, we study how volatility of a country’s foreign currency exchange rate affects economic development. For an economy that is heavily dependent on foreign trade, its overall economic productivity may be affected by fluctuation of its currency with the currencies of the trading partners. We investigate this relationship between the GDP growth rates of twenty Eurozone countries with the exchange rate volatility of thirteen developed countries. Our results indicate that GDP growth rates of most of the Eurozone countries are generally affected by exchange rate volatility of its trading partners. Most of these impacts are negative indicating that the GDP growth rates of the Eurozone countries decline with the volatility of the exchange rates of trading partners. The result is consistent with the findings of previous literature in this area. Our findings are important for the policymakers to consider in planning the management of their currencies to minimize the negative effect of exchange rate volatility.
Volatility, Exchange rates, GDP growth rate, Regression.
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Ivy Eklemet and Emmanuel Gyamera
Correspondence: Ivy Eklemet, eklemet.ivy@upsamail.edu.gh
Accounting Department, University of Professional Studies, Accra, Ghana
pdf (443.85 Kb) | doi: https://doi.org/10.47260/bae/1116
This paper assessed the effect of directors' remuneration and the remuneration committee on a bank's performance. The study used 200 observations from 20 licensed banks in Ghana from 2012 to 2023. The study employed dynamic System Generalized Method of Moments as the main analytical estimator using Stata 16.0 software. The study revealed that directors' remuneration, audit committee independence, and the remuneration committee are positively and significantly related to the bank's performance. Furthermore, the study revealed that banks with a remuneration committee as well as an independent audit committee tend to enhance the bank's performance because remuneration and audit committees tend to align directors' remuneration with the bank's performance. The findings highlight the importance of setting up a remuneration committee as well as strengthening its functions. The first recommendation for this study is for the board to strengthen the remuneration committee since it affects the bank's performance positively. Lastly, the study recommends that the remuneration committee should be strengthened to align directors' remuneration with the bank's performance metrics, such as revenue growth, profitability of the bank, and shareholders' returns.
Audit committee independence; Bank’s performance; Directors’ remuneration; Ghana; Optimal contracting contract.
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Hiroaki Sakurai
Correspondence: Hiroaki Sakurai, hiroaki.sakurai@gakushuin.ac.jp
Gakushuin Women’s College
pdf (443.85 Kb) | doi: https://doi.org/10.47260/bae/1115
This study examines the effects of foreign aid on poverty reduction in Thailand dividing into ways. One is the direct effect of poverty reduction and the other is the indirect effect of economic growth. Dividing the effect of foreign aid into the direct effect of poverty reduction and the indirect effect through economic growth will contribute to a more efficient way of providing foreign aid by adjusting its purpose and method of foreign aid. The estimation results are summarized as follows: First, the relationship between the infant mortality rate, as a substitute for poverty reduction, and foreign aid from 1961 to 2022 was not significantly estimated using OLS or VAR (Vector Autoregression) models. Second, the relationship between the poverty ratio and foreign aid from 1988 to 2020 for every other year was also insignificant, although economic growth was estimated to be significantly positive. Based on these results, it can be inferred that foreign aid has no direct effect on poverty reduction in Thailand; rather, the indirect effect seems more important.
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Ivan D. Trofimov
Correspondence: Ivan D. Trofimov, ivan.trofimov1@gmail.com
Victoria University of Wellington, New Zealand
pdf (443.85 Kb) | doi: https://doi.org/10.47260/bae/1114
The effects of real exchange rate changes on the sectoral trade balance have received limited consideration in the empirical literature. We examine services trade and the dynamics of Canada’s bilateral trade balance in services with its 53 major trading partners during 1990-2018. We demonstrate a short-run deterioration and a long-term improvement of the services trade balance following depreciation in an aggregate panel as well as sub-panels, hence supporting the J-curve effect hypothesis and satisfying the Marshall-Lerner condition. At the level of individual cross-sections, the evidence was mixed: a number of economies experienced long-term improvement of the trade balance, albeit without short-term deterioration.
J-curve, Panel data, Trade balance, Exchange rate, Services.
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Hiroaki Sakurai
Correspondence: Hiroaki Sakurai, hiroaki.sakurai@gakushuin.ac.jp
Faculty of Intercultural Studies, Gakushuin Women’s College
pdf (443.85 Kb) | doi: https://doi.org/10.47260/bae/1113
This study examines the relationship between foreign aid and sectoral growth in Thailand from 1960 to 2021 using ordinary least squares. While it is important to see how foreign aid impacts the recipient country, few studies provide analyses in this field. The estimation results show a linear relationship not only between foreign aid and secondary industry growth, but also between foreign aid and tertiary industry growth, whereas a relationship between foreign aid and primary industry growth is not necessarily seen. The results are consistent with previous studies.
Foreign Aid, Sectoral Growth, Thailand.
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Javkhlan Ganbayar
Correspondence: Javkhlan Ganbayar, ganbayar.javkhlan@gmail.com
Graduate School of Humanities and Social Sciences, Saitama University, Saitama, Japan.
pdf (443.85 Kb) | doi: https://doi.org/10.47260/bae/1112
This study contributes to the ongoing debate on the consequences of expansionary fiscal policy by evaluating the macroeconomic effects of various fiscal policy options in a small open economy using a dynamic stochastic general equilibrium (DSGE) model. In addition, the study emphasizes the importance of studying Mongolia, which has unique characteristics and exhibits significant research gaps regarding its fiscal policy. The general architecture of the selected DSGE model includes different types of firms and households, commodity sectors, natural resource funds, and abundant fiscal tools regarding both expenditure and revenue. Employing numerous types of fiscal policy shocks, this study reveals that an exogenous increase in government investment yields the most significant long-term economic benefits, boosting potential output by 0.3%. Among the policy options, government transfers are the least effective in promoting economic output, and existing transfer policies in Mongolia appear to exert only a modest impact on growth, instead primarily contributing to the redistribution of resources. Finally, the estimated output multipliers (except transfers) are greater than one, implying that fiscal policy instruments may be an effective tool for managing the economy in Mongolia.
Fiscal policy, Fiscal policy multiplier, Small open economy, Dynamic Stochastic General Equilibrium model, Natural Resource Sector.
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Chris Magnis and Skilodimou Louiza
Correspondence: Chris Magnis, magnis@uth.gr
Department of Economics, University of Thessaly, Volos, Greece
pdf (443.85 Kb) | doi: https://doi.org/10.47260/bae/1111
This study aims to analyze the impact of corporate governance practices on the earnings quality of 228 firms located in the United Kingdom throughout the period from 2019 to 2022. Our fundamental concept states that there is a negative relationship between the efficiency of corporate governance practices within the organization and the probability of participating in earnings manipulation. The findings of our empirical study offer substantiation for our claims, as they demonstrate that companies with boards of directors marked by notable autonomy and financial capabilities, along with the presence of effective audit and compensation committees, experience an improvement in the quality of their earnings.
Corporate Governance, Earnings Quality, Board of Directors, Audit Committee, Compensation Committee.
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