This thesis examines factors which may explain content variation in sell-side analysts’ reports. There are two main objectives: (i) to ascertain whether the extent of accounting information contained in these reports varies with firm and analysts’ characteristics; and (ii) to examine whether the tone and readability of the reports vary with analysts’ incentives to produce optimistic research. Based on a sample of 288 reports on 144 S&P 500 firms, the first objective was addressed using a manual content analysis to examine accounting themes, while the second objective was addressed using automated content analysis based on context-specific and user-defined wordlists. The empirical results indicate that the extent of use of accounting information in analysts’ reports varies across firm characteristics but such variation only partly reflects its relevance for valuation as suggested by the value relevance literature. Moreover, analysts’ incentives are influential as reports issued by analysts employed by investment banking firms or those in possession of the Chartered Financial Analysts qualification contain more references to forward-looking accounting information. Patterns of strategic reporting are also identified, as analysts employed by investment banking firms issue less readable reports compared to analysts employed by independent research firms following the same company. Further, readability is lower when the reports are less optimistic, indicating a tendency to obfuscate bad news through more complex reporting. Overall the findings are consistent with an impression management perspective as it reveals that content of analysts’ reports may not be entirely objective but influenced by analysts’ incentives to promote the companies covered. The thesis contributes to extant literatures on the relevance of accounting information, content of analysts’ reports, analysts’ bias and impression management. Moreover, the findings have policy implications as they speak to the concern about the relevance of accounting information and highlight the need to consider the subjective influences and the role of analysts’ incentives. Additionally, policy intervention on analysts’ bias should extend beyond recommendations and earnings’ forecast and consider the largely unregulated nature of the narrative content of the reports.

This research is concerned with international Integrated Marketing Communications (IMC) by global banks targeting a Jordanian audience. The main research question addressed in this work is concerned with adaptation versus standardisation of international IMC by global banks. The aim of the research is to establish whether the standardised IMC approach is sufficiently effective when targeting Jordanian customers or whether adaptation of the IMC mix is necessary. A mixed methodological approach has been used consisting of qualitative in depth interviews and a more quantitatively based sample survey. Semistructured interviews were conducted with bank managers. Likewise, a survey instrument in the form of questionnaires were sent to the clients through bank management because of the confidentiality issues. The purpose of the research is to answer the standardisation versus adaptation question with the intention of deriving specific, operationally useful suggestions for IMC improvements for global banks operating in Jordan. The problems and weaknesses identified in current IMC policies used by global banks in Jordan are identified and suggestions for future marketing communications improvements made. These weaknesses and suggestions are integrated into a conceptual model. The managerial implications of adapting the suggestions made are examined and discussed. The weaknesses identified, suggestions made to overcome them and the managerial implications of implementation make an important and original contribution to the subject area from both a practical and conceptual point of view. The findings of the research strongly indicate that significant adaptation is required in order for the IMC approach by global banks to be effective. The findings should be specifically relevant to global banks operating in Jordan but may have relevance to other international companies from different sectors operating in or wishing to operate in Jordan.

Auditing has grown considerably recently but this growth has not been impeded by steady criticism, misgivings and discussions concerning the worth of the auditing function and audit report communication. A great deal of such criticism and discussion typically emerge following major financial scandals and company collapses such as the crash of Enron, Arthur Andersen, not only in countries that suffered from such corporate collapses, but also in countries that have never experienced such crises. This criticism is attributed to the fact that this serious problem is referred to as the “Audit Expectation Gap”. Consequently, the “expectation gap”, has been investigated by various scholars in order to examine its occurrence in numerous countries such as the USA and the UK; nevertheless, the scope of such gap has not been explored in many emerging economies such as that of Libya. The main aim of carrying out this research study is to explore and examine the development and current state of auditing in Libya, and the possible existence of an expectation gap in auditing in economic transition conditions in one of the less developed countries, namely Libya. To realise the research objectives and to respond to the research questions, mixed research methods were applied. A questionnaire was conducted with the general auditing bureau, private auditors, financial statement preparers, lenders and private investors, aimed at investigating the existence of an audit expectation gap and the effectiveness of audit report communication in Libya. 270 questionnaires were gathered. The questionnaires were followed by 15 semi structured interviews to gain an understanding of the gap the reasons behind the existence of an audit expectation gap. The outcomes of this study reveal that the Libyan accounting and auditing framework is not properly developed. Furthermore, the study demonstrates that the lack of the accounting and auditing principles has resulted in flaws in the accountability and responsibility of external auditors. Moreover, the findings of both the questionnaire and the interviews evidently indicate that the audit expectation gap (which contributes to the reasonableness gap and deficient standards gap) exists in the Libyan private sector with respect to a certain number of auditing issues. These encompass auditors and the auditing process, audited financial statements, and the audited company, together with prohibitions and regulations in the audit milieu. Also, an expectation gap (a deficient standards gap) was detected especially related to the purpose of an audit, the responsibility factor, assurance of future feasibility, and the utility of decision making processes. On the other hand, it is proposed that the present audit report is not a wellunderstood document whereas it is surprising to find out that one of the unqualified audit report communication factors examined in this study – the reliability of the financial statements – appears obviously to be communicated in the audit report; both groups were unsure pertaining to this matter as – on average – their responses displayed uncertainty’ relating to the reliability issue. These findings have significant implications for the Libyan Authorities regarding the actions that should be considered to bridge the gap. Reducing the gap may need to develop the Libyan auditing profession and increase the utility of the audit report as the main source for taking investment decisions.

This thesis contains four essays that examine the relationships among risk disclosures, multi-level governance, credit ratings, and bank value in the Middle East and North Africa (MENA) banks. These essays concentrate on four closely linked risk disclosures, and governance topics that quantitatively investigate the antecedents and informativeness of risk disclosures by banks from 14 countries in MENA region over the 2006–2013 inclusive period. The first essay aims at investigating the impact of multi-layer governance mechanisms on the level of risk disclosures by banks. The essay result suggests a variation between MENA banks in the level of risk disclosures with a significant improvement from 2006 to 2013. Specifically, the findings are three-fold. First, the results suggest that Sharia Supervisory Board (SSB) is positively associated with the level of risk disclosures by banks. Second and at the bank-level, the essay finds that ownership (governmental ownership and family ownership) and board (board size and non-executive directors) structures have a positive effect on the level of risk disclosures by banks, whilst CEO duality is negative, but insignificantly related to bank risk disclosures. At the country-level, the evidence suggests that control of corruption has a positive effect on the level of bank risk disclosures, whilst political stability and absence of violence have a negative, but insignificant association with the level of bank risk disclosures. In the second essay, the thesis investigates the relationships among national governance quality (NGQM), Islamic governance quality (ISGQ), including other bank-level governance mechanisms, and risk management and disclosure practices (RMDPs); and consequently ascertains whether NGQM has a moderating influence on the ISGQ -RMDPs nexus. The findings are four-fold. Firstly, this study finds that RMDPs are higher in banks from countries with higher NGQM. Secondly, this essay shows that RMDPs are higher in banks with better Islamic governance. Thirdly, the study finds that board size and non-executive directors have a positive effect on the level of RMDPs. Finally, this study finds evidence that suggests that NGQM has a moderating effect on the Islamic governance quality-RMDPs nexus. The third essay explores whether RMDPs have a predictive effect (informativeness) on banks’ credit ratings (BCRs); and consequently ascertains whether governance structures can moderate such an association. The findings suggest that RMDPs have a predictive effect on BCRs. The study finds that the quality of the BCR is higher in banks that have higher risk disclosures, board size, government ownership, board independence, women directors and established SSB. On the other hand, the results indicate that the BCR quality is lower in banks that have higher foreign ownership, and CEO role duality. Furthermore, the findings suggest that governance structures moderate the relation between RMDPs and BCRs. The final essay examines the extent to which RMDPs and multi-level governance can explain observable changes in bank value in a number of ways. First, this essay seeks to examine whether RMDPs can influence the value of banks. The second objective is to examine how NGQM may affect the bank value. Finally, this essay explores the relationship between operating in better- or poorly-governed countries and the market value of banks. The results confirm the substantial role of risk disclosures and multi-level governance in improving bank valuation in MENA. More specifically, the results indicate that market valuation is higher in banks with bigger foreign ownership, board size, board independence, Islamic governance, and NGQM. The results also show a significant negative relationship between CEO power and bank value. The research’s empirical findings are largely in line with the predictions of the multi-theoretical framework that incorporates insights from agency, signalling, legitimacy, institutional, and resource dependence theories. The study findings are robust to alternative firm- and country-level controls, alternative multi-level governance mechanisms, risk disclosure proxies, alternative estimation techniques, and endogeneity problems. In doing so, this study extends, as well as contributes to the banking and governance literature in a number of ways. First, to the best of the researcher’s knowledge, this thesis provides a first-time cross-country evidence on the level of risk disclosures in MENA countries, especially following the 2007/08 financial crisis in the banking industry. Second, this thesis offers first-time evidence on the informativeness of Islamic governance quality and risk disclosures from equity and debt markets. Third, this thesis offers evidence and extends prior research on the influence of multi-level governance on bank value, and credit ratings, using a multi-theoretical framework. Fourth, the study offers first-time evidence on the effect of national governance quality on banks’ risk disclosures, credit ratings, and bank value.

With the existence of loopholes in the accounting rules, firms have been able to keep many assets and their corresponding debt off the balance sheets, thus, hiding the true value of debt and firm financial risk (Ketz (2003), Franzen et al. (2009) and Koller et al. (2010)). Graham and Leary (2011) point out that one of the noticeable gaps in the capital structure research area is the mis measurement of leverage when off-balance sheet financing is excluded. Therefore, this thesis bridges the mis-measurement gap by adjusting leverage for three important off-balance sheet debt equivalents and two on-balance sheet ones. Moreover, this study investigates the relationships between asset redeployability, top-management compensation and both adjusted and non-adjusted leverage as well as examines whether these on and off-balance sheet debt equivalents are reflecte in credit risk measurements. Focusing on large US firms from 1996 to 2010, my results show that the off-balance sheet debt equivalents account for significantamounts over total reported debt. Also,there is a considerable gap between reported debt and adjusted debt for debt equivalents, and this gap seems to increase sharply over time. I suggest that these debt equivalents should be considered carefully; otherwise, firms' financial health can be misinterpreted. In addition, I document different results for adjusted and non-adjusted leverage which indicates that existing theories related to the conventional capital structure might not be able to give the same explanations to the adjusted one. Moreover, credit risk measurements do not incorporate all of these debt equivalents in their credit risk assessments; which implies that the market may not be fully aware of the importance of these debt equivalents.

Agency theory predicts that ownership structure monitoring mechanisms can effectively align the interests of managers with those of the shareholders. In additions, it views external audit as a function that lends credibility to the information disclosed in financial reports. Prior research sustains these predictions in developed markets such as in the US. However, institutional settings such as ownership structure and regulatory oversight bodies differ around the world and accordingly, the sustainability of agency theory predictions might also differ. Further, little research differentiates between accruals and real activities earnings management in contexts such as the Jordanian where ownership is concentrated, investors’ protection is weak and capital market is still evolving. Therefore, this study addresses these issues and investigates the validity of agency theory predictions concerning the effectiveness of ownership structure and external audit monitoring mechanisms in mitigating both accruals and real activities earnings management in Jordan. In this study, four measures of earnings management are estimated through the models of Kothari et al. (2005) and Roychowdhury (2006). Magnitudes of abnormal accruals are obtained from the former model and magnitudes of abnormal cash flow from operating activities, abnormal production costs and abnormal discretionary expenses are obtained from the latter model. As a result, four empirical models are constructed in which the estimated earnings management measures represent the dependent variables. Independent variables in each empirical model are the same and are classified into three categories: first, ownership structure variables include ownership concentration, controlling shareholders, institutional ownership and foreign ownership. The second category includes external audit quality measured by auditor size. Third, a set of control variables include board size, leverage, growth and firm size. These models are tested using the population of all manufacturing firms listed on Amman Stock Exchange over the period 2005 – 2008. The results reveal that controlling shareholders appear effective in constraining accruals manipulations, sales manipulations and production costs manipulations. As for manipulations in discretionary expenses, the results show that only high levels of institutional ownership can effectively deter abnormal discretionary expenses. Moreover, contrary to the popular convention, the results suggest that non-big 5 auditors in Jordan who in fact mitigate abnormal accruals not big 5 auditors. Finally, no evidence is found supportive of the substitutive effect. That is, firms that are prevented from managing their earnings through accruals due to the enhanced scrutiny of non-big 5 auditors, do not resort to sales manipulations, production costs manipulations or discretionary expenses manipulations as substitutes to achieve desired levels of reported earnings. Given these findings, the present study provides understanding and extension for agency theory literature that focuses on earnings management in general and in emerging markets in particular. It highlights challenges to applicability of agency theory in emerging markets where corporate governance mechanisms are supposed to mitigate the practice of earnings management. As such, these findings could be helpful to investors and other stakeholders in making rational contractual decisions, especially when such decisions involve non-owner-controlled firms. Finally, Amman Stock Exchange could impose the corporate governance codes that actively promote internal corporate governance mechanisms to restrain accruals and real activities earnings management.

The purpose of this study is to examine how corporate performance influences Chief Executive Officer (CEO) pay in UK public listed companies. Specifically it is to identify evidence of relative performance evaluation in CEO pay, following the recommendation in the Combined Code (2003) to link long-term incentive compensation to relative firm performance. The major and a novel contribution of this study is the focus on the payments received by CEOs from performance-based long-term incentive schemes. The pay-for-performance relationship is investigated in a longitudinal setting using random and fixed-effect panel data estimation methods. An unbalanced panel of CEOs is drawn from 204 of the largest, nonfinancial UK companies, between 2003 and 2007. From a principal-agent theory perspective it is hypothesised that firm performance is positively associated with chief executive pay and from a relative performance evaluation theory perspective it is hypothesised that, whilst controlling for actual firm performance, peer group performance is negatively associated with chief executive pay. The CEO compensation data are hand collected exclusively for this study and provides a level of detail not previously found in the literature. The findings demonstrate that it is crucial to distinguish between the different elements of pay and the different performance conditions that attach to those elements in order to establish a comprehensive understanding of the pay-for-performance relationship. New and convincing evidence shows that actual bonus pay is determined relative to annual FTSE-350 market performance and actual long-term pay is determined relative to three-year FTSE-350 sector performance. These findings provide robust evidence that is consistent with the principal-agent framework of executive pay and corporate performance. This study may alleviate the concerns held by some stakeholder groups that pay is not clearly linked to corporate performance. These findings will be of particula r practical importance to investors who expect the interests of executives to be aligned with those of the company shareholders, via an incentive contract that rewards executives for enhanced corporate performance and consequently shareholder wealth maximisation. The findings also confirm that changes introduced to improve corporate governance practice in the field of executive pay are working to the benefit of shareholders.

This thesis investigates the effects of micro-saving on the performance of microfinance institutions (MFIs) using unbalanced panels that straddle the period 2000-2012. This issue is also examined in a country-specific case study of Vietnam. There are four important findings. First, we found that serving more voluntary savers is costly and curtails depth of microfinance outreach. Second, micro-savings, in terms of the total deposits and the number of deposit accounts per staff member have a positive and significant impact on financial sustainability, cost-efficiency and breadth of outreach of MFIs. Third, a trade-off between financial sustainability and depth of outreach was found for deposit-taking MFIs, compared with MFIs that do not offer micro-savings financial products. Fourth, the findings from the cross-country studies are consistent with the findings from Vietnam. Overall, these findings have important implications for policy makers, microfinance practitioners and researchers.

<p> Due to the increase in corporate bankruptcy, financial distress studies have flourished since 1968. Firms do find themselves in financially distressful situations because of several factors including changing economic environment such as a decrease in aggregate demand, an increase in the cost of borrowed funds, and changes in government regulation. In addition to the Altman's z-score model, the sustainable growth rate (SGR) is another tool that is used primarily for financial planning. The problem with Altman's z-score model is that it does not consider whether a firm can be financially distressed or not if the sustainable growth rate of the firm is in fact higher than the growth rate of the firm's reported revenues. The purpose of this quantitative study was to investigate the efficacy of using ltman's z-score in forecasting financial distress of a firm when the sustainable growth rate was higher than the growth rate of the reported revenues. The sample for this study was drawn from all non-financial firms traded on the NYSE. The research question was investigated using two group design in two phases. Phase 1 involved the calculation of the sustainable growth rate (SGR), the growth rate of reported revenues, and the calculation of Altman's z-score. The Altman's z-score of the two groups were compared using Mann-Whitney <i>U</i> test to determine whether a statistically significant difference exists in the z-score. Phase 2 involved the correlation between the values of SGR and the values of Altman's z-score to determine if there was a statistically significant relationship between the two scores. The result of this research indicates that the Alman's z-score and the sustainable growth rate are conceptually independent and both can be used to ascertain whether a firm is financially distressed or not. In addition, result of this study provide practical application that could help management of firms reach important financial and managerial decisions. While the result of this study provided useful information and added to existing knowledge on financial distress, additional research using more than one year of financial data is recommended in order to confirm the results of this study.</p>

This thesis examines the role of internal auditors in three key areas: strategy, control models and control self assessment. Research findings are based on the results of a survey of a specialist group of professionals with an interest in Control Self Assessment. This group comprises both internal auditors and non-internal auditors. Membership is multinational and a full range of industries is represented. The actual and potential contribution that internal auditors can make to strategy is assessed and evaluated, with particular reference to the Balanced Scorecard. Control models were examined to identify use and effectiveness and the potential link with successful implementation of Control Self Assessment. Control Self Assessment was also examined as a specific activity. This part of the research addressed how it was perceived by the respondents and their organisations, and also to examine the importance of facilitation skills and IT support. The results show that internal auditors already play a significant role in strategic issues, and that there is a significant awareness of the potential benefits of the Balanced Scorecard to internal audit practice. Control models are seen as highly important to the effective implementation of Control Self Assessment, which can be seen to have developed into a mature and established audit tool.