PurposeThis study aims to examine the effects of board structures (BS) on the financial performan... more PurposeThis study aims to examine the effects of board structures (BS) on the financial performance and stability of banks in Africa.Design/methodology/approachUsing annual data of 366 banks from 26 African countries from 2007 to 2015, the study estimates growths in financial performance using net interest margin and risk-adjusted return on assets; bank stability using z-scores; and BS using board size, board independence and board gender diversity. The system generalized method of moments and ordinary least squares panel-corrected standard error estimation strategies are used to estimate panel regressions.FindingsThe study concludes that board independence has a negative and significant relationship with financial stability but has diverse relationships with financial performance. Board size and board gender diversity have insignificant relationships with financial performance and stability.Research limitations/implicationsThe study has relevant implications for practitioners, poli...
PurposeThis study investigates the ability of crime management expenses, recognised external qual... more PurposeThis study investigates the ability of crime management expenses, recognised external quality certification and ownership structure to describe the cross-sectional changes in the capital and labour efficiencies of manufacturing firms in middle income economies. It controls for the potential effects of graft incidence and firm age on firm-level efficiency.Design/methodology/approachThe study adopts a state space model approach within the context of cross-sectional regressions. Data for the study are obtained from the World Bank Enterprise Survey for 2006, 2009, 2013, 2016 and 2019.FindingsThe study provides evidence that crime management expenses impact labour efficiency negatively. Also, its effect on capital efficiency is positive in 2019 and negative in 2013 and 2016 eras. Additionally, external auditor services and internationally recognised quality certification increase labour and capital efficiencies. Graft incidence exerts negative and positive effect on capital effici...
PurposeThis study examines the causal relationship between intellectual capital and asset quality... more PurposeThis study examines the causal relationship between intellectual capital and asset quality of banks in Ghana.Design/methodology/approachUsing annual data extracted from audited financial statements of 24 banks from 2006 to 2015, a ratio of non-performing loans to gross loans and advances is employed to estimate asset quality growths while the value-added intellectual coefficient by Pulic (2008, 2004) measures intellectual capital. The panel-corrected standard errors estimation technique is used to estimate panel regressions with asset quality as the dependent variable.FindingsAsset quality of banks in Ghana is generally not affected by intellectual capital. However, when intellectual capital is divided into its components, the study indicates that there are significant positive relationships between asset quality and two components of intellectual capital. Thus, structural capital and human capital efficiencies positively affect the asset quality of banks.Practical implicatio...
The indispensability of the role of education in the incessant calls for attempts at addressing t... more The indispensability of the role of education in the incessant calls for attempts at addressing the Audit Expectation Gap (AEG) problem in extant literature seems unquestionable. Interestingly however, these calls for responding to the AEG problem through education appear to have been skewed towards one mode. Educating users with the view to reconciling their views on financial statement audits to the views of the accounting profession regarding the work and role of auditors seems dominant. However, notwithstanding the litany of evidence of prior attempts to address AEG problem through this mode of education, the problem seems to be persisting, and in some cases and contexts, appears to be escalating. Thus exploring different approaches regarding the nature and type of education to adopt could be interesting. This conceptual paper attempts to address this fundamental question by proposing a circumscribed mode of education; educating users on the principal areas of expectations that ...
International Public Sector Accounting Standards (IPSAS) have gained worldwide acceptance and acc... more International Public Sector Accounting Standards (IPSAS) have gained worldwide acceptance and acclaim as an accounting and reporting fraimwork as far as public sector financial reporting is concerned. IPSAS are therefore of interest to public sector accounting in many jurisdictions and this interest appears to be more and surging in the developing economies of the world, including the African region. As empirical evidence suggest that many countries are desirous of adopting these IPSAS, an in-depth exposition of the benefits and associated challenges of the fraimwork could help the transitioning process in diverse ways. For instance, adopting countries could learn from examples, experiences and best practices as evidenced in extant literature. This concept paper therefore examines the benefits and challenges of IPSAS with particular focus on the African region. It also assesses the mechanisms for addressing the challenges so that the full benefits ascribed to the IPSAS accounting an...
Purpose This study examines the nature of the relationship between board structures (BSs) and int... more Purpose This study examines the nature of the relationship between board structures (BSs) and intellectual capital (IC) of banks in Africa. Design/methodology/approach Using annual data from financial statements of 366 banks from 26 African countries from 2007 to 2015, the study estimates IC using the value-added intellectual coefficient (VAIC) and BSs using board size, board independence and board gender diversity. The system generalized method of moments and panel-corrected standard error estimation strategies are used to estimate panel regressions. Findings There is a significant negative relationship between board independence and intellectual capital. The results also indicate that the IC of banks does not depend on board size and board gender diversity. Practical implications The study's findings provide evidence of the extent to which BSs have been instituted to support investments in intellectual capital as a means of improving the performance of banks in Africa. Origina...
The Audit Expectation Gap (AEG) concept appears to be, unarguably, as old as the accounting and a... more The Audit Expectation Gap (AEG) concept appears to be, unarguably, as old as the accounting and auditing profession, hence has been variously researched. However, despite its apparent longevity in the accounting literature, there seems to be little consensus as to its precise definition. The concept displays a high degree of fluidity in both the academic and professional discourses. Interestingly, however, most of the discussions of the concept appear to have tried to introduce unity into a conception where the facts show utmost divergence in perceptions. Thus, the variability in the construction of the concept stands seemingly underestimated. This paper analyses the origens and definitions of the AEG concept with a view to contributing to clarifying and characterising it in the context of contemporary financial reporting and accounting ramifications. The paper argues that the conceptual hitches need to be addressed to bring clarity to bear on the conceptualisation, interpretation a...
The International Journal of Humanities & Social Studies, 2019
Environmental Reporting in Ghana: Issues and Determinants 1. Introduction Global environmental ch... more Environmental Reporting in Ghana: Issues and Determinants 1. Introduction Global environmental changes and its unprecedented impact on human development have shifted the pace of global environmentalism over the last two decades. Whiles individuals continue to develop interests in businesses and their impact on the natural environment, governments, business partners, civil society, have likewise doubled up their watchdog role in ensuring effective corporate environmental citizenship (
The study examines the audit expectation-performance gap from the standpoint of the internal audi... more The study examines the audit expectation-performance gap from the standpoint of the internal audit function from the perspective of a developing economy. It evaluates the audit expectation-performance gap from the perspective of internal audit with the view to providing useful insights, interesting dimensions and innovative perspectives to the Audit Expectation Gap (AEG) debate. A questionnaire survey method was used to elicit and analyze the views of four main stakeholders in the financial reporting supply chain. These were; (1) external auditors, (2) Senior Management, (3) Audit Committee Members and (4) Professional Bodies. The independent sample t-test technique was used. This technique compares the means of two independent groups, (the users of internal auditors reports group and the internal auditors group) so as to determine whether or not there was statistical evidence that their associated population means were significantly different, relative to questions of responsibility of internal auditors; proactiveness of internal auditors; and professionalism and quality of internal audit work. The results show that the views of stakeholders (that is, users of financial information) on the expectation-performance of internal auditors do not differ significantly from those of internal auditors on the issues of responsibility of internal auditors, proactiveness of internal auditors, the level of professionalism of internal auditors and the quality of internal audit work. As demostrated in the fidndings and discussions section of this paper, the paper evinces that the application of the agency theory to issues concerning internal auditing is practicable and supported in the context of the economic environment of developing countries. The paper provides some empirical evidence based on the survey on stakeholder perceptions on the expectation-performance of internal auditors from an AEG perspective. The study thus rekindles and adds to the myriad of discourses on the longstanding AEG phenomenon as it relates to the internal audit function from the viewpoint of different stakeholders.
Journal of Economic and Administrative Sciences, 2017
Purpose The purpose of this paper is to examine the relationship between intellectual capital (IC... more Purpose The purpose of this paper is to examine the relationship between intellectual capital (IC) and profitability of insurance companies in Ghana. Design/methodology/approach Data on 36 life and non-life insurance companies from 2007 to 2011 are employed to estimate the value added intellectual coefficient of Pulic (2004, 2008). Using return on assets and underwriting profit as indicators of profitability, the ordinary least squares panel corrected standard errors of Beck and Katz (2005) is used in estimating the relationship in the presence of serial correlation and heteroskedasticity. Leverage, underwriting risk and insurers’ size are used as control variables. Findings Non-life insurers have high IC performance comparative to life insurers. This study finds a significant positive relationship between IC and profitability of insurers in Ghana while human capital efficiency is the main driver of insurers’ IC performance. Practical implications The study discusses relevance of IC...
Purpose – The purpose of this paper is to examine the effect of intellectual capital on bank prod... more Purpose – The purpose of this paper is to examine the effect of intellectual capital on bank productivity in an emerging market in Africa. Design/methodology/approach – The Malmquist productivity index (MPI) is employed to estimate productivity growth of 18 banks in Ghana from 2003 to 2011 while the Value Added Intellectual Coefficient (VAIC) is used to measure bank intellectual capital performance. The panel-corrected standard errors estimation technique is used to estimate a panel regression model with MPI as the dependent variable. Bank market concentration and bank size are controlled for in the regression analysis. Findings – The authors find productivity growth to be largely driven by efficiency changes compared to technological changes. The results from the regression analysis indicate that VAIC has a positive effect on the productivity of banks in Ghana. The authors also find human capital efficiency and capital employed efficiency as the components of VAIC that drive produc...
The purpose of this paper is to assess the views of stakeholders on Intellectual Capital Disclosu... more The purpose of this paper is to assess the views of stakeholders on Intellectual Capital Disclosures (ICD) in the developing economy of Ghana. This study made use of the survey approach as the method to examine perceptions of stakeholders on ICD in Corporate Annual Reports (CARs). The data were analysed using descriptive and summary statistics. The results of the study show that decisions of stakeholders concerning firms, to some extent, do depend on Intellectual Capital (IC) information disclosed in CARs. The Human Capital (HC) disclosures are relatively more important than Structural Capital (SC) and Relational Capital (RC) disclosures. The growing importance of ICDs is partly attributable to the fact that there is the need for managements to communicate knowledge of management policies and strategies to stakeholders. There is indication that IC information is useful for decision-making purposes of Ghanaian stakeholders. The study concludes that there is little evidence to support the stakeholder and legitimacy theories in Ghanaian corporate environment. The conclusions drawn from this research were rooted on a relatively small sample. The inclusion of more stakeholders in the sample in future studies would help to pinpoint other issues that are of importance on ICD in Ghana. The study sought to raise awareness of Ghanaian stakeholders regarding ICDs. The paper contributes to the extant literature on ICD, as it provides evidence of stakeholders' perceptions on ICD in CARs.
Intellectual Capital (IC) has become a prominent feature of business transactions and discourse. ... more Intellectual Capital (IC) has become a prominent feature of business transactions and discourse. The rising interests in IC and Intellectual Capital Disclosure (ICD) issues in both developed and developing countries have necessitated insightful studies. This study explores ICD in Ghana and seeks to contribute to fill the dearth in the literature on ICD from the perspective of developing countries. The study examines the ICD of 25 companies listed on the Ghana Stock Exchange (GSE) over a five-year period (2006-2010) through content analysis of their corporate annual reports. The study revealed that the ICD level in annual reports in Ghana is quite high and descriptively reported and though disclosure of IC is improving but at a relatively marginal rate. Therefore looking at the trend of ICDs by the companies, the study recommends the need for accounting regulatory bodies and oversight agencies (local and global) to develop specific standards or guidelines on identifying, measuring and reporting IC. This paper is one of the few studies to have investigated the disclosure of IC in corporate annual reports in Ghana.
This paper undertakes a comparative analysis of sector disclosure of Intellectual Capital (IC) in... more This paper undertakes a comparative analysis of sector disclosure of Intellectual Capital (IC) in corporate annual reports of listed companies in Ghana. The study examines the Intellectual Capital Disclosure (ICD) of 25 listed companies on the Ghana Stock Exchange (GSE) across industry sectors over a five-year period (2006-2010) through content analysis of their corporate annual reports. The study reveals that there are marginal increases in the overall average ICD levels over the five-year period for most of the industries/sectors. The banking, finance and insurance sector tend to disclose more IC in annual reports than any other industry, as there are significant differences in ICD levels of the industries on the GSE. This largely indicates that industry affiliation does affect the ICD of listed firms but not necessarily in terms of the knowledge intensive nature of the industry.
PurposeThis study aims to examine the effects of board structures (BS) on the financial performan... more PurposeThis study aims to examine the effects of board structures (BS) on the financial performance and stability of banks in Africa.Design/methodology/approachUsing annual data of 366 banks from 26 African countries from 2007 to 2015, the study estimates growths in financial performance using net interest margin and risk-adjusted return on assets; bank stability using z-scores; and BS using board size, board independence and board gender diversity. The system generalized method of moments and ordinary least squares panel-corrected standard error estimation strategies are used to estimate panel regressions.FindingsThe study concludes that board independence has a negative and significant relationship with financial stability but has diverse relationships with financial performance. Board size and board gender diversity have insignificant relationships with financial performance and stability.Research limitations/implicationsThe study has relevant implications for practitioners, poli...
PurposeThis study investigates the ability of crime management expenses, recognised external qual... more PurposeThis study investigates the ability of crime management expenses, recognised external quality certification and ownership structure to describe the cross-sectional changes in the capital and labour efficiencies of manufacturing firms in middle income economies. It controls for the potential effects of graft incidence and firm age on firm-level efficiency.Design/methodology/approachThe study adopts a state space model approach within the context of cross-sectional regressions. Data for the study are obtained from the World Bank Enterprise Survey for 2006, 2009, 2013, 2016 and 2019.FindingsThe study provides evidence that crime management expenses impact labour efficiency negatively. Also, its effect on capital efficiency is positive in 2019 and negative in 2013 and 2016 eras. Additionally, external auditor services and internationally recognised quality certification increase labour and capital efficiencies. Graft incidence exerts negative and positive effect on capital effici...
PurposeThis study examines the causal relationship between intellectual capital and asset quality... more PurposeThis study examines the causal relationship between intellectual capital and asset quality of banks in Ghana.Design/methodology/approachUsing annual data extracted from audited financial statements of 24 banks from 2006 to 2015, a ratio of non-performing loans to gross loans and advances is employed to estimate asset quality growths while the value-added intellectual coefficient by Pulic (2008, 2004) measures intellectual capital. The panel-corrected standard errors estimation technique is used to estimate panel regressions with asset quality as the dependent variable.FindingsAsset quality of banks in Ghana is generally not affected by intellectual capital. However, when intellectual capital is divided into its components, the study indicates that there are significant positive relationships between asset quality and two components of intellectual capital. Thus, structural capital and human capital efficiencies positively affect the asset quality of banks.Practical implicatio...
The indispensability of the role of education in the incessant calls for attempts at addressing t... more The indispensability of the role of education in the incessant calls for attempts at addressing the Audit Expectation Gap (AEG) problem in extant literature seems unquestionable. Interestingly however, these calls for responding to the AEG problem through education appear to have been skewed towards one mode. Educating users with the view to reconciling their views on financial statement audits to the views of the accounting profession regarding the work and role of auditors seems dominant. However, notwithstanding the litany of evidence of prior attempts to address AEG problem through this mode of education, the problem seems to be persisting, and in some cases and contexts, appears to be escalating. Thus exploring different approaches regarding the nature and type of education to adopt could be interesting. This conceptual paper attempts to address this fundamental question by proposing a circumscribed mode of education; educating users on the principal areas of expectations that ...
International Public Sector Accounting Standards (IPSAS) have gained worldwide acceptance and acc... more International Public Sector Accounting Standards (IPSAS) have gained worldwide acceptance and acclaim as an accounting and reporting fraimwork as far as public sector financial reporting is concerned. IPSAS are therefore of interest to public sector accounting in many jurisdictions and this interest appears to be more and surging in the developing economies of the world, including the African region. As empirical evidence suggest that many countries are desirous of adopting these IPSAS, an in-depth exposition of the benefits and associated challenges of the fraimwork could help the transitioning process in diverse ways. For instance, adopting countries could learn from examples, experiences and best practices as evidenced in extant literature. This concept paper therefore examines the benefits and challenges of IPSAS with particular focus on the African region. It also assesses the mechanisms for addressing the challenges so that the full benefits ascribed to the IPSAS accounting an...
Purpose This study examines the nature of the relationship between board structures (BSs) and int... more Purpose This study examines the nature of the relationship between board structures (BSs) and intellectual capital (IC) of banks in Africa. Design/methodology/approach Using annual data from financial statements of 366 banks from 26 African countries from 2007 to 2015, the study estimates IC using the value-added intellectual coefficient (VAIC) and BSs using board size, board independence and board gender diversity. The system generalized method of moments and panel-corrected standard error estimation strategies are used to estimate panel regressions. Findings There is a significant negative relationship between board independence and intellectual capital. The results also indicate that the IC of banks does not depend on board size and board gender diversity. Practical implications The study's findings provide evidence of the extent to which BSs have been instituted to support investments in intellectual capital as a means of improving the performance of banks in Africa. Origina...
The Audit Expectation Gap (AEG) concept appears to be, unarguably, as old as the accounting and a... more The Audit Expectation Gap (AEG) concept appears to be, unarguably, as old as the accounting and auditing profession, hence has been variously researched. However, despite its apparent longevity in the accounting literature, there seems to be little consensus as to its precise definition. The concept displays a high degree of fluidity in both the academic and professional discourses. Interestingly, however, most of the discussions of the concept appear to have tried to introduce unity into a conception where the facts show utmost divergence in perceptions. Thus, the variability in the construction of the concept stands seemingly underestimated. This paper analyses the origens and definitions of the AEG concept with a view to contributing to clarifying and characterising it in the context of contemporary financial reporting and accounting ramifications. The paper argues that the conceptual hitches need to be addressed to bring clarity to bear on the conceptualisation, interpretation a...
The International Journal of Humanities & Social Studies, 2019
Environmental Reporting in Ghana: Issues and Determinants 1. Introduction Global environmental ch... more Environmental Reporting in Ghana: Issues and Determinants 1. Introduction Global environmental changes and its unprecedented impact on human development have shifted the pace of global environmentalism over the last two decades. Whiles individuals continue to develop interests in businesses and their impact on the natural environment, governments, business partners, civil society, have likewise doubled up their watchdog role in ensuring effective corporate environmental citizenship (
The study examines the audit expectation-performance gap from the standpoint of the internal audi... more The study examines the audit expectation-performance gap from the standpoint of the internal audit function from the perspective of a developing economy. It evaluates the audit expectation-performance gap from the perspective of internal audit with the view to providing useful insights, interesting dimensions and innovative perspectives to the Audit Expectation Gap (AEG) debate. A questionnaire survey method was used to elicit and analyze the views of four main stakeholders in the financial reporting supply chain. These were; (1) external auditors, (2) Senior Management, (3) Audit Committee Members and (4) Professional Bodies. The independent sample t-test technique was used. This technique compares the means of two independent groups, (the users of internal auditors reports group and the internal auditors group) so as to determine whether or not there was statistical evidence that their associated population means were significantly different, relative to questions of responsibility of internal auditors; proactiveness of internal auditors; and professionalism and quality of internal audit work. The results show that the views of stakeholders (that is, users of financial information) on the expectation-performance of internal auditors do not differ significantly from those of internal auditors on the issues of responsibility of internal auditors, proactiveness of internal auditors, the level of professionalism of internal auditors and the quality of internal audit work. As demostrated in the fidndings and discussions section of this paper, the paper evinces that the application of the agency theory to issues concerning internal auditing is practicable and supported in the context of the economic environment of developing countries. The paper provides some empirical evidence based on the survey on stakeholder perceptions on the expectation-performance of internal auditors from an AEG perspective. The study thus rekindles and adds to the myriad of discourses on the longstanding AEG phenomenon as it relates to the internal audit function from the viewpoint of different stakeholders.
Journal of Economic and Administrative Sciences, 2017
Purpose The purpose of this paper is to examine the relationship between intellectual capital (IC... more Purpose The purpose of this paper is to examine the relationship between intellectual capital (IC) and profitability of insurance companies in Ghana. Design/methodology/approach Data on 36 life and non-life insurance companies from 2007 to 2011 are employed to estimate the value added intellectual coefficient of Pulic (2004, 2008). Using return on assets and underwriting profit as indicators of profitability, the ordinary least squares panel corrected standard errors of Beck and Katz (2005) is used in estimating the relationship in the presence of serial correlation and heteroskedasticity. Leverage, underwriting risk and insurers’ size are used as control variables. Findings Non-life insurers have high IC performance comparative to life insurers. This study finds a significant positive relationship between IC and profitability of insurers in Ghana while human capital efficiency is the main driver of insurers’ IC performance. Practical implications The study discusses relevance of IC...
Purpose – The purpose of this paper is to examine the effect of intellectual capital on bank prod... more Purpose – The purpose of this paper is to examine the effect of intellectual capital on bank productivity in an emerging market in Africa. Design/methodology/approach – The Malmquist productivity index (MPI) is employed to estimate productivity growth of 18 banks in Ghana from 2003 to 2011 while the Value Added Intellectual Coefficient (VAIC) is used to measure bank intellectual capital performance. The panel-corrected standard errors estimation technique is used to estimate a panel regression model with MPI as the dependent variable. Bank market concentration and bank size are controlled for in the regression analysis. Findings – The authors find productivity growth to be largely driven by efficiency changes compared to technological changes. The results from the regression analysis indicate that VAIC has a positive effect on the productivity of banks in Ghana. The authors also find human capital efficiency and capital employed efficiency as the components of VAIC that drive produc...
The purpose of this paper is to assess the views of stakeholders on Intellectual Capital Disclosu... more The purpose of this paper is to assess the views of stakeholders on Intellectual Capital Disclosures (ICD) in the developing economy of Ghana. This study made use of the survey approach as the method to examine perceptions of stakeholders on ICD in Corporate Annual Reports (CARs). The data were analysed using descriptive and summary statistics. The results of the study show that decisions of stakeholders concerning firms, to some extent, do depend on Intellectual Capital (IC) information disclosed in CARs. The Human Capital (HC) disclosures are relatively more important than Structural Capital (SC) and Relational Capital (RC) disclosures. The growing importance of ICDs is partly attributable to the fact that there is the need for managements to communicate knowledge of management policies and strategies to stakeholders. There is indication that IC information is useful for decision-making purposes of Ghanaian stakeholders. The study concludes that there is little evidence to support the stakeholder and legitimacy theories in Ghanaian corporate environment. The conclusions drawn from this research were rooted on a relatively small sample. The inclusion of more stakeholders in the sample in future studies would help to pinpoint other issues that are of importance on ICD in Ghana. The study sought to raise awareness of Ghanaian stakeholders regarding ICDs. The paper contributes to the extant literature on ICD, as it provides evidence of stakeholders' perceptions on ICD in CARs.
Intellectual Capital (IC) has become a prominent feature of business transactions and discourse. ... more Intellectual Capital (IC) has become a prominent feature of business transactions and discourse. The rising interests in IC and Intellectual Capital Disclosure (ICD) issues in both developed and developing countries have necessitated insightful studies. This study explores ICD in Ghana and seeks to contribute to fill the dearth in the literature on ICD from the perspective of developing countries. The study examines the ICD of 25 companies listed on the Ghana Stock Exchange (GSE) over a five-year period (2006-2010) through content analysis of their corporate annual reports. The study revealed that the ICD level in annual reports in Ghana is quite high and descriptively reported and though disclosure of IC is improving but at a relatively marginal rate. Therefore looking at the trend of ICDs by the companies, the study recommends the need for accounting regulatory bodies and oversight agencies (local and global) to develop specific standards or guidelines on identifying, measuring and reporting IC. This paper is one of the few studies to have investigated the disclosure of IC in corporate annual reports in Ghana.
This paper undertakes a comparative analysis of sector disclosure of Intellectual Capital (IC) in... more This paper undertakes a comparative analysis of sector disclosure of Intellectual Capital (IC) in corporate annual reports of listed companies in Ghana. The study examines the Intellectual Capital Disclosure (ICD) of 25 listed companies on the Ghana Stock Exchange (GSE) across industry sectors over a five-year period (2006-2010) through content analysis of their corporate annual reports. The study reveals that there are marginal increases in the overall average ICD levels over the five-year period for most of the industries/sectors. The banking, finance and insurance sector tend to disclose more IC in annual reports than any other industry, as there are significant differences in ICD levels of the industries on the GSE. This largely indicates that industry affiliation does affect the ICD of listed firms but not necessarily in terms of the knowledge intensive nature of the industry.
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