Corporate Finance

A well-regulated economic system requires incentives that reward productive and withhold rewards from unproductive activity. Such incentives are put in place by means of legislation and enforced with the help of regulatory agencies. A well-managed system will allocate resources more efficiently than a system in which income may be gained without active participation in economic activity, by lending at interest in particular, which invariably increases the prices of finished goods without, however, adding any value. Interest-based lending produces a range of important, though rarely highlighted, side effects. They include inefficiency, indebtedness, instability, inflation, unemployment, slow or declining economic growth, and an uneven distribution of wealth. (224 pages)

The Influence Of Dividend Yield, Dividend Payout Ratio, Firm Size, Long Term Debt, Earnings Volatility, Growth Asset, Trading Volume, And Managerial Ownership To Stock Price Volatility On Basic And Chemical Industry Listed In Indonesia Stock Exchange During Period 2010-2013
(Pengaruh Dividend Yield, Dividend Payout Ratio, Ukuran Perusahaan, Hutang Jangka Panjang, Earnings Volatility, Pertumbuhan Aktiva, Trading Volume, Dan Kepemilikan Manajerial Terhadap Volatilitas Harga Saham Pada Perusahaan Sektor Industri Dasar Dan Kimia Periode 2010-2013)

Corporate finance and project finance are both used by corporations for the financing of projects. They both draws on debt and equity as source of finance. While corporate finance favors higher percentage of equity project finance favors higher percentage of debt. Corporate finance which requires lower capital cost is usually used for interrelated projects of different degrees as such the performance of the corporation as  well as overall balance sheet is the basis for credit evaluation. Project finance on the other hand is focused on a single particular project that is to be constructed or in few instances the expansion of an existing project, the financing is based on the projected future revenue of the project, cost of capital is higher and the  outlay is usually very high. While risk is less in project finance as it's diversified, risk is higher in corporate finance as it's not diversified.

The telecom regulator in Guyana, with the backing of the Government, introduced competition in the mobile market sector in the year 2006. However, the fixed-line market and the international telecom sector in Guyana has been dominated by a 40-year (monopoly) license that holds exclusivity over landline voice, data connectivity (internet) and international voice and data access.
The telephone company, GT&T has, over its life, made contributions to the national economy while creating the opportunity for its own expansion and growth as well as the international expansion of its parent company.
This quantitative correlational study analyzed the results of a web based and face-to-face survey to quantify the value of the telecoms monopoly (i.e. fixed-line market and international telecom sector) to Guyana, a developing country.
This research found that there is no significant relationship between telecom monopoly in the country and Guyana’s economy. The study has shown that the impact of liberalization will neither negatively impact the economic well-being of the national economy of Guyana nor that of the incumbent, GT&T.
This study also supported the hypothesis that there is significant impact of telecoms market liberalization on the satisfaction of the telecoms subscribers in Guyana. The study further concluded that there is significant difference in the satisfaction experienced from telecom services between the male population and the female population of Guyana.
This study also concludes that customers’ acceptance of and satisfaction with liberalization is directly correlated to their satisfaction with the company’s products, its customer care and quality of service – which are usually the factors that influence customers’ willingness to pay higher prices with the converse being true for lower prices.

This case examines the rise and fall of WeWork—a company that experienced one of the most dramatic changes of fortune in technology company history. For several years, WeWork was a Silicon Valley darling, growing at breakneck speed with visionary Adam Neumann at the helm. By some estimates, Neumann’s company was worth USD 47 billion in January of 2019. But when the company filed paperwork in preparation for going public later that year, investors balked at the details revealed in the documents: billions of dollars in losses and lots of questionable behavior on the part of Neumann (including numerous conflicts of interest involving his personal business dealings). The initial public offering was postponed and later withdrawn; Neumann was forced to step down as CEO; and by May of 2020 the company’s valuation had dropped to USD 3 billion. Exploring this recent history will provide an opportunity to ask what lessons can be drawn from the rise and fall of WeWork, and from the economic and social context that enabled its growth.

The objective of the paper is to study the impact of choice
factors affecting students’ selection of higher education
institutions. The paper identifies the contribution of various
factors in selection of higher education institution. The
survey method has been employed in order to collect data
from the respondents. It has been found that quality of
teaching; academic reputation and flexible mode of teaching
are the most important factors to be considered by the
students’ while selecting the education institution.

El caso de LACC número 712-S11 es la versión en español del caso de HBS número 709-462.

En noviembre de 2005, Robert Iger, el recién nombrado consejero delegado de Walt Disney Company, esperaba ansiosamente los resultados de la recaudación de Chicken Little, el segundo largometraje de dibujos animados generado por ordenador (CG) de la compañía. Sabía que, para que para que Disney como un todo tuviera éxito como empresa, debía enderezar el negocio de la animación, especialmente perfeccionando la nueva tecnología CG, que estaba sustituyendo muy rápidamente la animación dibujada a mano. Sin embargo, la compañía había dependido de un contrato con los estudios de animación Pixar, que había producido éxitos como Toy Story y Buscando a Nemo, para la mayoría de sus ingresos recientes por películas de animación. Y el acuerdo de coproducción, negociado durante el mandato de su predecesor Michael Eisner, expirabaen 2006, después del estreno de Cars, la quinta película del acuerdo para cinco películas. Desgraciadamente, las negociaciones para la renovación del contrato entre Steve Jobs, consejero delegado de Pixar, y Eisner habían fracasado en 2004 debido a conflictos de carácter personal. Cuando asumió su nuevo rol, Iger reabrió las líneas de comunicación entre ambas empresas. De hecho, acababa de llegar a un acuerdo con Jobs para vender algunos espectáculos televisivos propiedad de Disney y producidos por los estudios ABC-como Mujeres desesperadas-a través del iTunes Music Store de Apple. Iger sabía que podía llegar a un acuerdo con Pixar; la cuestión estribaba en qué términos debía hacerlo. ¿Tenía sentido para Disney sencillamente comprar Pixar?

The paper clarifies the effect of internal factors to stock market price (MP) of joint stock companies listed on the Vietnam‘s Stock Market. Data was collected from 808 joint stock companies listed on the Vietnam‘s Stock Market in 2016. The findings show that MP is significantly affected by dividend per share (DPS), type form of dividend paid (TYPE), earnings per share (EPS), Return on assets (ROA) and size of company (SIZE) while return on equity (ROE) has insignificant effect on MP. Further, the research revealed that EPS and TYPE have the most significant effect on MP

The real success of Indian democracy is being attributed to its social responsiveness towards all of its citizens. Nevertheless, in the endeavour of sustaining a true and vibrant democracy, the country strives very hard to extent the facilities and benefits to all strata of the society due to its constrained resources. Therefore, the Government of India needs a helping hand from corporate sector to ensure better standard of living of its people. In this regard, the corporate India is expected to play a constructive role by undertaking activities which may ultimately lead to social rejuvenation, development and empowerment of unprivileged people. If this happens, India is very proud to be one of the countries in the world to attain real inclusive growth. Hence, it is felt that Corporate Social Responsibility (CSR) activities of companies are really a key to unlock both economic and social disparities, which in turn, benefits the person in the last mile. Moreover, the Companies Act, 2013 has directed corporate India to work towards a growth based socio-economic-environment development model.

            The present book is an attempt to provide the emerging trends and best practices in CSR implementation, models of partnership, managerial and organizational challenges and issues in monitoring and evaluation of projects related to CSR in the public and private sector.

            I thank all paper contributors for their continued support, encouragement, inspiration to complete this task. Without their help it will be difficult task for me to complete this volume.

  Dr. M. Vasan

This Paper explores and summarises the Director's Duties of the UK Companies Act 2006 with emphasis on "the duty to promote the success of the company.

Tags:
Companies Act 2006 model articles, Companies Act 2006 summary
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Companies Act 2006 UK
UK Companies Act 2006

A contract is legally enforceable because it meets the requirements and approval of the law. An agreement typically involves the exchange of goods, services, money, or promises of any of those. In the event of breach of contract, the law awards the injured party access to legal remedies such as damages and cancellation.

Ce mémoire a été rédigé en vu de l'obtention de mon master 2 en Science de Gestion option: Finance et Comptabilité.
Je vous le conseille vraiment car il vous édifiera pour comprendre l'incidence que peut avoir le financement bancaire sur la compétitivité d'une TPE, PME/PMI et GE.

Given the important part that the Coca-Cola Company has in the non-alcoholic beverages industry, this paper has been conducted to examine the performance of this company at the financial level between 2017 and 2020. This study has been carried through using the Financial Ratios Analysis method including Liquidity Ratios, Profitability Ratios and Solvency Ratios. This paper has also examined the limitations of the ratios analysis conducted. This research is based on quantifiable and non-quantifiable information published on different sources.

This paper explores the effects of deregulation and globalization on the dominant mode of corporate governance in Swedish public firms. The effects are multidimensional-the direction of change in corporate governance cannot be determined by simply examining whether a convergence towards the Anglo-American model is occurring. Dispersed ownership with management control has not proven to be a viable model of corporate governance for Swedish listed companies. Instead, the control models with the most rapid growth in the most recent decades are found outside the stock market, notably private equity and foreign ownership. After a major revival of the Swedish stock market its importance for the Swedish economy is again in decline. Instead of adjustments in pertinent institutions and practices to ensure effectiveness of the corporate governance of Swedish public firms under these new conditions, a great deal of endogenous adjustment of the ownership structure has taken place. A major lesson from this study is that unless institutional reform renders management entrenchment and/or board independence possible, convergence to the Anglo-American model cannot take place.

The revised Principles maintain many of the recommendations from earlier versions as continuing essential components of an effective corporate governance framework. They also introduce some new issues and bring greater emphasis or additional clarity to others. While some of the Principles may be more appropriate for larger than for smaller companies, it is suggested that policymakers may wish to raise awareness of good corporate governance for all companies, including smaller and unlisted companies.
The Principles provide guidance through recommendations and annotations across six chapters:
I)  Ensuring the basis for an effective corporate governance framework; The chapter emphasizes the role of corporate governance framework in promoting transparent and fair markets, and the efficient allocation of resources. It focuses on the quality and consistency the different elements of regulations that influence corporate governance practices and the division of responsibilities between authorities. In particular, new emphasis is placed on the quality of supervision and enforcement. The chapter also includes a new principle on the role of stock markets in supporting good corporate governance.
II)  The rights and equitable treatment of shareholders and key ownership functions; The chapter identifies basic shareholder rights, including the right to information and participation through the shareholder meeting in key company decisions. The chapter also deals with disclosure of control structures, such as different voting rights. New issues in this chapter include the use of information technology at shareholder meetings, the procedures for approval of related party transactions and shareholder participation in decisions on executive remuneration.
III)  Institutional investors, stock markets and other intermediaries; This is a new chapter which  addresses the need for sound economic incentives throughout the investment chain, with a particular focus on institutional investors acting in a fiduciary capacity. It also highlights the need to disclose and minimize conflicts of interest that may compromise the integrity of proxy advisors, analysts, brokers, rating agencies and others that provide analysis and advice that is relevant to investors. It also contains new principles with respect to cross border listings and the importance of fair and effective price discovery in stock markets.
IV)  The role of stakeholders in corporate governance; The Principles encourage active co-operation between corporations and stakeholders and underline the importance of recognising the rights of stakeholders established by law or through mutual agreements. The chapter also supports stakeholders’ access to information on a timely and regular basis and their rights to obtain redress for violations of their rights.
V)  Disclosure and transparency; The chapter identifies key areas of disclosure, such as the financial and operating results, company objectives, major share ownership, remuneration, related party transactions, risk factors, board members, etc.  New issues in this
chapter include the recognition of recent trends with respect to items of non-financial information that companies on a voluntary basis may include, for example in their management reports.
VI)  The responsibilities of the board; The chapter provides guidance with respect to key functions of the board of directors, including the review of corporate strategy, selecting and compensating management, overseeing major corporate acquisitions and divestitures, and ensuring the integrity of the corporation’s accounting and financial reporting systems. New issues in this chapter include the role of the board of directors in risk management, tax planning and internal audit. There is also a new principle recommending board training and evaluation and a recommendation on considering the establishment of specialized board committees in areas such as remuneration, audit and risk management.

Article published by Tax Justice Network Blog april 10th 2017 in: https://www.taxjustice.net/2017/04/10/tax-haven-blacklisting-13-latin-american-countries/

As governments (slowly) get to grips with the fact that tax havens are inflicting great harm on economies and democracies across the globe, facilitating mega amounts of tax dodging, and vast movements of criminal money by way of the secrecy services some of them offer, the question of our times is how we deal with them. Attempts to create tax haven blacklists (in order to potentially implement sanctions for non-cooperative jurisdictions) have so far been farcical as we’ve noted many times, most recently commenting on the European Union’s current work compiling its own blacklist system, here and here. So far the criteria for inclusion in tax haven blacklists has been weak, such lists have been ineffective and it’s been far too easy for some of the world’s worst offenders to wriggle their way out of them, or simply be big and bad enough not to worry about being included in the first place – for example – Tax Haven USA. If the EU, or anyone else really wanted to do this properly, the work’s already been done for them – with the best objective ranking available – the Tax Justice Network’s Financial Secrecy Index.

Anyway, we were very interested to see that Brazil attempted to tackle Irish tax havenry in September 2016 by putting Ireland on its tax haven blacklist, effective more or less immediately.

Today we’re happy to share an article by Macroeconomics Professor Juan Valerdi[1] (of La Plata National University and El Salvador University) based on the conclusions of his research looking at the approaches of 13 Latin American governments to tackling tax havens. The full document is available here and was part of the campaign “Que las trasnacionales paguen lo justo”. The Spanish version of this article was published by ALAI Magazine earlier this month and is available here. (You can read the Professor’s blog here).
While this article looks at what’s happening in Latin America, the conclusions and recommendations represent an approach to solve what he refers to as the ‘Tax Haven Networks’ problem at a global level. His research focused on 13 Latin American countries: Argentina, Bolivia, Brazil, Colombia, Costa Rica, Ecuador, El Salvador, Guatemala, Honduras, México, Nicaragua, Paraguay and Peru.

The analysis was based on traditional indicators, and completed with a national parallel (a sample 1,925 companies across the country). Were probed five specific aspects: profitability, development path, asset strength, financial rationality, responsiveness and resistance to sudden changes in demand. The analysis then concludes with some insights on corporate liquidity. Regarding profitability, the return on equity is distributed as "leopard spot", ranging from -5% to 15%. There are few local industries that earn more than the national average (steel, plant construction, precision machinery construction, construction vehicles). Also the return on investment is discontinuous between sectors. Critical is the non-operating impact: the erosion produced by fiscal management and the financial one is on average higher than the national average. The development path is instead fast, certainly more pronounced than the national one. The growth, however, is potentially fragile; there is a risk of overcapacity: the capital expenditures are growing faster than the turnover. The datas on asset strength are negative. The leverage is high: the value is ranging from 5 of the industrial sectors to 7 of the commercial sectors; the national figures are better. The solvency appears formally correct, in the sense that fixed investments are not financed by short term sources. A problem arises with the financing of stocks. In the balance sheets they are reported as current assets, and they are consequently financed by short term sources, but their true nature is that of fixed investment. Relating to responsiveness and resistance, defined as the ability to respond to sudden changes in demand, the value of production can be reduced without compromising the economic balance of only 3% in the trade and 6.4% in industrial activities. Local firms are elastic, as the variable costs significantly outweigh the fixed ones, but they are surprisingly below the national average. The ability to turn the turnover in cash flow is low. Also in this case, on average, this capacity is less than that at national level.

This paper examines the asymmetrical relationship between exchange rate and consumer prices in 40 Sub-Saharan African (SSA) countries from 1990q1 to 2017q4. The exchange rate pass-through (ERPT) to consumer prices is estimated for each country by using the nonlinear autoregressive distributed lags (NARDL) framework and dynamic panel estimators robust to cross-sectionally correlated errors. Firstly, our findings suggest an asymmetrical ERPT in the SSA region during the short-term, whereas there are mixed results across sub-regions in the long-term. Next, we find incomplete and significant ERPT to consumer prices in the entire SSA region which is higher during the depreciation of the local currency than after appreciations. Third, we find nonlinear ERPT with respect to the size of the exchange rate. The pass-through is higher during large exchange rate changes than after small changes.  Finally, we find that the pass-through is greater in the countries with fixed exchange rate re...

The period when corporate social responsibility (CSR) only referred to corporate philanthropic donations has passed. Present day CSR is intimately intertwined with sustainable development, and its growth in the last several decades has been evident in Canada. The recent appearance of “hybrid” corporate legal structures on the international stage marks a growing trend toward enabling the dual pursuit of economic and social mandates for businesses. It suggests that the next significant stage in the CSR movement will be in the reformation and creation of corporate legal models that not only enable, but require, CSR concepts to be embodied within corporate governance practices.

While the US shareholder primacy model is often presumed to be the model that is dominant in modern Canadian corporations, this presumption is flawed. This article identifies some of the fundamental legal features that set Canada apart from US shareholder primacy, and attempts to demarcate a path for Canada to attain transformational corporate governance through its laws. The term “transformational” is borrowed from the business sector to help identify a tangible goal for corporate governance reform in Canada. Highlights include having a sustainable purpose, long term vision, and multi-stakeholder collaboration. Canada is poised to become a leader in corporate governance reform on two fronts: through the reformation of its existing laws regulating mainstream corporate governance practices, and in the creation of hybrid laws that can meet growing demands to legally house and govern social purpose businesses and enterprises.

There has been much fanfare surrounding the possible implementation of a hybrid similar to the US “benefit corporation” in Canada in order to address growing for-profit sector needs to pursue social value in addition to profit-making. However, some of the fundamental legal characteristics within the benefit corporation actually parallel existing common laws in Canada regarding mainstream corporate governance practices. Canada does not need to adopt American solutions to American problems. During these formative years of Canada’s corporate legal development, it is critical that the nation’s progressive legal stance is properly understood and taken into account when establishing hybrid laws so as not to confuse and/or jeopardize that stance. An ongoing stream of thoughtful and intelligent commentary is needed to address and advance Canadian corporate legal needs for social progress, as well as the establishment of innovative new hybrid laws that can bridge the gap between for-profit and non-profit sectors.

Various taxing power-related challenges have negatively affected the governance of state and federal governments of Nigeria since1999 to date. For instance, the poor drafting of the Nigerian constitution of 1999 and the failure on the part of the policy makers to adequately distinguish and delineate the taxing powers of the state and federal governments has given rise to sharp divisions and jurisdictional conflict-related litigation. Accordingly, the article examines these and other related flaws in the Nigerian and Ethiopian tax laws. Moreover, the relevant constitutional provisions in these countries are comparatively discussed to, inter alia, recommend possible measures that could be employed to remedy such flaws in Nigeria and Ethiopia. In this regard, it is submitted that the Nigerian tax laws and the Nigerian constitution of 1999 should be amended to provide a clear position on the taxing powers for both state and federal governments. Lastly, the authors submit that the Nigerian policy makers should consider adopting the Ethiopian model for the allocation of taxing powers.

1. a 2. b 3. d 4. The number of share available on a fully diluted basis after series a = ((total equity + Series A funding) – ((total equity+ Series A funding) * 10%)) = 4,000,000 – (10% of 4,000,000) = 3,600,000 5. The option pool = (total equity+ Series A funding) * 10% = (1,000,000 + 3,000,000) * 10% = (4,000,000 *(10/100)) = $400,000 6. The total amount of shares after Series B = (share available on a fully diluted basis after series A + total amount of shares contributed in series B) = (3,600,000 + 3,000,000) = 6,600,000 shares 7. Amount raised after series B = $9 million-$6 million = $3 million The share price after series B = (Amount raised after series B/original share price) = (3,000,000/1,000,000) = $3.00 8. The option pool = 10% of the company value Thus, the option pool = (9,000,000 * 10%) = 900,000 9. 1 st year = (200*100,000) = $20,000,000 2 nd Year = (200*200,000) = $40,000,000 3 rd year = (200 *200,000) = $40,000,000 4 th year = (200*200,000) = $40,000,000 5 th year = (200*200,000) = $40,000,000

We document a significant increase in U.S. corporations' use of off-balance-sheet (OBS) lease financing over the past 27 years. This trend has significant implications for capital structure and a host of risk and performance metrics commonly employed in securities analysis and empirical research. The distortion affects relative risk (rank ordering of firms) as well as average levels: conventional leverage, Z-Score, and return on capital underestimate risk and overstate performance of firms relying heavily on OBS leasing. Firms utilizing the greatest excess OBS lease financing exhibit significant excess equity returns which suggests that excess leasing is related to priced risk indicators. The increase in OBS leasing cannot be explained by theoretical determinants, but it is diminished by scrutiny of equity analysts, credit ratings, and institutional ownership. Moreover, firms investigated by the SEC or DOJ exhibit high levels of excessive leasing. Overall, our results are consistent with regulators' contention that some corporations take advantage of the OBS accounting treatment in order to intentionally distort their balance sheets.

This paper examines share price behaviour surrounding announcements of CEO departures from UK firms listed on the All Share Index between 1990 and 1995. We find that many firms choose not to announce CEO departures, and that these firms have poorer performance records, and higher chances of future failure, than those firms who officially announce CEO turnover to the London Stock Exchange. The market reacts negatively to announcements of top executive departures, especially when the CEO is dismissed or leaves to take up another job. Share price reactions to the disclosure of top executive departure are significantly affected by the financial risk of the firm and whether the board announces a replacement CEO. D

Voordeel vir skuldeisers in verpligte sekwestrasieverrigtinge

Die konsep van voordeel aan krediteure is uiters belangrik in die Suid-Afrikaanse insolven-siereg. Byvoorbeeld, enige voorlopige of finale sekwestrasiebevel word slegs deur die howe toegestaan indien die sekwestrasie van die skuldenaar of die insolvent se boedel voordelig by die algemene liggaam van krediteure sal wees (sien aa 10 (c) en 12 (1) (c) lees Met artikel 3 (1) en 6 (1) van die Insolvensiewet 24 van 1936 (Insolvensiewet). Die konsep van voordeel aan krediteure word egter nie uitdruklik in die Insolvensiewet gedefinieer nie. Die artikel bespreek dus die onlangse besluit in die liggaam. Korporatiewe van Empire Gardens v Sithole 2017 4 SA 161 (SCA) ("Sithole") wat verskeie interpretasie- en verwante uitdag-ings blootstel wat steeds deur die howe en geaffekteerde partye voorkom wanneer hulle met die konsep van voordeel aan krediteure in die Suid-Afrikaanse insolvensiereg handel.

This study considers that in Sri Lanka share market, the accounting variables would significantly explain the contemporaneous price, provided that Ohlson (1995) model implicate market efficiency. The study also attempts to explore the benchmarking role of net assets in assessing the value relevance of earnings and dividends. The results indicate positive significant relevance of net assets, earnings and dividends for explaining the price, independently. Pooled and fixed-year effect results of the model imply incremental relevance of accounting variables. However, this is not consistent with year-wise analysis, thus implying that Sri Lankan share market might be of weak-form efficiency. The findings are repeatedly confirmed with the fixed-sector results, which are almost similar to fixed-year effect results. The benchmarking role of net assets in exploring the incremental relevance of earnings becomes meaningful only with the pooled analysis. Differently, the relevance of dividends is explored with the proxy role for future earnings, beyond current earnings.ABSTRACT

Debt financing involves borrowing money that would be refunded over a period normally with interest. Secured borrowings involves the borrower allowing the lender an interest in specific assets (fixed charge) or all assets (floating charge) which are not specified. The aim of this paper is to briefly examine the evolution and development of floating charges in the UK and its advancement with the use of Case-Law

This paper tests traditional capital structure models against the alternative of a pecking order model of corporate financing. The basic pecking order model, which predicts external debt financing driven by the internal financial deficit, has much greater timeseries explanatory power than a static tradeoff model, which predicts that each firm adjusts gradually toward an optimal debt ratio. We show that our tests have the power to reject the pecking order against alternative tradeoff hypotheses. The statistical power of some usual tests of the tradeoff model is virtually nil.

If joint stock companies and agency problem are twins then board of directors will be their after-birth. As opine by Jesen and
Meckling (1976) since the separation of ownership from management through joint stock companies, agency problem has never been
eliminated. Various approaches such as laws, trustee, auditing, have been used to arrest the agency problem and protect the benefit of
shareholders. But board of directors has emerged as an efficient approach to protect shareholders benefit. This paper has revealed the
impact of board size, number of promoter directors and independency of the board on the total benefits a shareholder gets for investing.
An unbalance panel data was collected from annual reports of 25 companies through purposive sampling for the accounting years 2009
to 2013.The Hussmann’s test was used to check the appropriate regression method to statistically test the impact of board structures on
total shareholder’s return. It was found that, the average board size in companies was 12 members out of which half were independent, 3
are promoters/founders and remaining are other executives. Shareholders also get more than 90% of their returns from changes in
share prices. The random effect regression method reports that, all the board variables have a positive relationship with shareholders
return with the exception of board size but only board independence is significant @ 5%. Promoter directors have an inverse relationship
with capital gain whiles board size and independent directors have positive correlation.

In order to test the moderating role of corporate strategy and industry environment in the effect of liquidity on investment for Portuguese manufacturing firms, we developed a multiple linear regression model for panel data. It is a static model with three types of variables: financial; strategic/environmental; and interactive. The estimated model was validated through the Breusch-Pagan/Cook-Weisberg and Wald Modified tests (heteroscedasticity tests), Lagrange Multiplier (industry random effects test, using the two-digit National Classification of Economic Activities), Hausman robust test (fixed effects model vs. random effects model test) and likelihood-ratio test (joint effect of industry and time test). The statistical processing of the data revealed that a company’s strategy (diversification and innovation) and the industry environment (growth) moderate the effect of liquidity on investment, which can be explained by the effect of these factors on the cost of asymmetric informat...

Aida Maria Ismail, Wee Xian Xing, Raziah Bi Mohamed Sadique, Nor Balkish Zakaria, Faculty of Accountancy, Universiti Teknologi MARA, Puncak Alam Campus, Selangor, Malaysia, Roche Services (Asia Pacific) Sdn Bhd, Selangor, Malaysia, Faculty of Accountancy, Universiti Teknologi MARA, Seremban Campus, Negeri Sembilan, Accounting Research Institute and Faculty of Accountancy, Universiti Teknologi MARA, Segamat Campus, Johor, Malaysia, Email: [email protected]

This paper corrects some of the equations of Farber, Gillet and Szafarz (2006). The WACC is a discount rate widely used in corporate finance. However, correctly calculating the WACC involves properly calculating the value of tax shields, and the value of tax shields depends on the company's debt policy. Many authors (e.g. Inselbag and Kaufold (1997), Booth (2002), Cooper and Nyborg (2006), Farber, Gillet and Szafarz (2006)) have stated that debt policy can only be implemented by maintaining a fixed market-value debt ratio (Miles-Ezzell's assumption) or a fixed dollar amount of debt (Modigliani-Miller's assumption).

This study presents an empirical analysis of capital structure of Land and Property sector of Sri Lankan firms in order to understand the behavior of corporate leverage and its dynamics in the said sector. The dynamic adjustment model and panel methodology are applied on a sample of 14 Sri Lankan listed real estate companies, over a nine year period from 1996 to 2004. The study finds that the firms with relatively higher total assets and younger firms in the sector target more debt to their capital structures. The results further reveal that more liquid firms adjust readily towards the target capital structure. The findings also reveal interesting interrelations between the adjustment speed macro economic variables among Land and Property sector firm in Sri Lanka. For example, the speed of adjustment is higher when the inflation rate is lower.

This paper explores the recent changes to the corporate IP tax rules following the Autumn Statement of 2015. Previously it was possible to bring IP within the corporate rules by transferring into a partnership vehicle. This is no longer possible as the paper explains.

In their study "The cost of capital, corporation finance and the theory of investment" (1958) laureates of Nobel Price Nobel Franco Modigliani and Merton Miller represent what could possibly be the most important theory for the structure of capital, through which they explain the effect of the capital structure for the value of companies. Despite the hard work by Modigliani and Miller and the entire time spent by numerous scholars in developing concepts regarding this theory, we can say that it still remains unclear and faces many objections. This paper attempts to assess and make a critical review of Modigliani and Miller's Theory and the dominating literature that is pro and against this theory, aiming to identify the theory's importance and contribute to the field modern finances. To this end, the paper assessed and analyses Modigliani and Miller's theorem by considering the original work of authors Modigliani and Miller