This thesis examines the use and nature of chartism in the foreign exchange market, bringing together an analysis of chartist methods and the views/empirical work of economics. A survey of general chartist methods demonstrates the origins of the modern techniques, the construction of the various indicators, the use of pattern recognition and the variety of calculated indices. Despite these methods being widely used in the market, there seems to be very little bridging between practical chartism and the many fundamental-based academic studies of exchange rate determination/forecasting. Key points of the academic literature which have features pertinent to non-fundamental chart analysis are therefore discussed, and what little explicit analysis of chartism has been done is highlighted. It is clear that analysis of the subject is a growing area of the literature. It transpires, however, that there is minimal actual evidence available about the use of chartism in practice. To provide information on this, a questionnaire survey was conducted to examine the extent to, and manner by which, chartism is used in the (London) foreign exchange market and how it is perceived by the market participants themselves. This gives clear information on the extent of chartist advice in the market and the wide variety of techniques used, along with insights into the differing views held by market participants on the subject. While something of a broad consensus emerges regarding the possible methods and the weights given to charts at differing time horizons, there is sufficient heterogeneity in general to suggest that differences of views will be transmitted in actual chartists advice. To test this directly, a database of chartists' forecasts was constructed by a telephone survey of a panel of chartists, to compile their one and four week ahead predictions for the three major bilateral rates. This gives a unique data set, from which it is possible to analyse the forecasts of individuals as well as the median forecast. The data is subjected to a battery of tests and comparisons, a recurring result of which is indeed the apparent difference in accuracy between individual chartists. For example comparisons with a range of other forecasting techniques (economic and statistical), show some chartists under-perform these consistently while the best are even able to outperform a random walk. Tests of the implied expectations mechanism reveal that the hypothesis of rationality of chartism cannot be entirely rejected over the short horizon, but that there is stronger evidence of irrationality over the four week period, a result which becomes more pronounced as the information set is expanded, which provides evidence against the chartist tenet that 'the price discounts everything'. Testing for different methods of expectation formation reveals that in general the hypothesis of static expectations cannot be rejected against the variety of afternatives considered. Overall, the crucial result in this area was that of an inelasticity of expectations: chartists' advice does not appear to exert a destabilising on the foreign exchange market by overreacting systematically to changes in the current rate. In sum, this thesis forms a bridge between chartism and economics, by examining the methods and results of the former and analysing them with the tools of the latter.

This thesis is concerned with banking market imperfections, most especially real resources costs and imperfect competition. A special focus is made on the empirical estimation of the importance of such imperfections in the Portuguese market. The thesis is organised in three different essays, being the first focused on real resources costs, the second on market power and price and non-price competition and the third chapter discusses the impact of such imperfections on the measurement of interest rate risk. The first chapter is an empirical study on real resources operating costs in Portuguese banking. The approach followed is the stochastic cost frontier, because this methodology allows the simultaneous estimation of measures of economies of scale and scope as well as production efficiency and input substitutability estimates. The theoretical framework developed differs from existing literature on the explicit inclusion of the balance sheet constraint on the cost minimisation problem, being concluded that deposits should be handled as an output. Results show a clear evidence for the existence of economies of scale for the smaller banks and some costs advantages for the larger ones associated with high productivity of their branching networks. Economies of scope between deposits and loans were found for all but the larger banks. Portuguese banks were found to be particularly cost inefficient. The second chapter studies the evolution of market power on the Portuguese deposits market under the current deregulation process. Using panel data, three equations were estimated representing optimality conditions for deposit rates, advertising expenditures and branches. An important conclusion is that interest rate and entry deregulation were associated with an increase in both price and non-price competition. The small banks were found to have virtually no market power on deposits, being the situation especially unpleasant for the foreign institutions following growth strategies. On the other hand, significant market power was detected for banks with market shares for above 5%. However, above that level, we didn't detect a positive relationship between the two variables. Thus, mergers between large banks will not directly increase market power for the participating firms, although will create a favourable situation for the overall industry, trough the price-concentration relationship. The third chapter analyses the problem of measurement of interest rate risk exposure of a financial intermediary operating under imperfect competition. A solution proposed by Dermine (1985) is criticised since it doesn't take in consideration the optimising behaviour of such an intermediary. It is also shown that unlike in Dermine's article, imperfect competition also affects exposure through durations of assets and liabilities, and not only through goodwill. Another consequence of this modelling approach is that other imperfections like required cash reserves and operating costs (responsible for an operating leverage effect) seem to influence exposure. An important conclusion is that duration gap analysis is biased and inappropriate to measure exposure, being concluded that net worth immunization requires that assets have different duration than liabilities, rather than equal.

The success or failure of a derivatives (futures or forward) contract is determined by its ability to perform its economic functions efficiently, and therefore, to provide benefits to economic agents, over and above the benefits they derive from the spot market. These economic functions are price discovery and risk management through hedging. A considerable amount of empirical research has been directed towards examining these functions in different financial and commodity derivatives markets. The evidence however, on the over-the-counter FFA market is very limited. This thesis therefore, by investigating these issues provides new evidence in the literature for a forward market with some unique characteristics such as the trading of a service. Our empirical results can be summarised as follows. First, the FFA contracts perform their price discovery function efficiently since forward prices contribute to the discovery of new information regarding both current and expected spot prices. Furthermore, most FFA contracts contribute in the volatility of the relevant spot rate, and therefore, further support the notion of price discovery. Second, the introduction of FFA contracts has not had a detrimental effect on the volatility of the underlying spot market. On the contrary, it appears that there has been an improvement in the way that news is transmitted into prices following the onset of FFA trading. Third, FFA prices fail to reduce market risk to the extent evidenced in other markets in the literature and, hence, the FFA market does not perform its risk management function satisfactorily; this is thought to be the result of the lack of the cost-of-carry arbitrage relationship of storable assets that keeps spot and derivatives prices close together. Fourth, there seems to be a positive relationship between bid-ask spreads and expected price volatility in most FFA trading routes. Finally, in the routes where the cointegrating vector is restricted to be the lagged basis, the VECM generates more accurate forecasts than the VAR model and in the routes where the cointegrating vector is not restricted to be the lagged basis the VAR generates more accurate forecasts than the VECM model.

Since the mid 1980s the world oil price discovery process has been dominated by two crude oil futures markets: the New York Mercantile Exchange (NYMEX) and London's International Petroleum Exchange (IPE). To date considerable work has been done to scrutinize the degree to which these two markets price efficiently, but little with regard to the way the two markets interact. It is the first attempt, to our knowledge, to investigate the interaction of the two markets. Given that participants in these markets move with relative ease from one market to the other and usually take positions in both of them, prices of these two leading crudes are kept closely related to each other. It is of interest, therefore, to investigate the speed of information. transmission between IPE and NYMEX and, perhaps, identify which market is the true price leader. To carry out this empirical investigation, simultaneous and non-simultaneous trading sessions of IPE and NYMEX are examined separately. Interesting findingsare disclosed. Firstly, non-simultaneous trading sessions of IPE (IPE morning session) and NYMEX are analyzed with univariate and multivariate time series analysis respectively. In univariate analysis, spillover effects in mean returns are found in the IPE morning session from previous day NYMEX trading information, while no information transmission is found from IPE morning session to NYMEX same-day trading. In multivariate time series analysis with a larger data set, estimation using all data available suggests different results from that used in univariate analysis. However, closer analysis on sub-period estimation reveals consistent findings: the results from the first sub-period, which has the same observation data as in the univariate analysis, mirror those from univariate analysis; results from the second sub-period with extended data have a largely different behaviour from the first sub-period. It thus can be implied that the estimated results using all available information are averages of the behaviour of the two sub-periods. This changing behaviour from one sub-period to the next points to a possible structural break between the two sub-periods. Given that there are no significant political forces, such as "oil shocks", taking place during the period under investigation, the changing forces must be coming from the markets themselves. Secondly, the simultaneous trading session of IPE and NYMEX is examined to detect the temporal lead-lag relationship between the two futures markets using 5minute intervals. Results indicate a bi-directional relationship between the two, however the lead ofNYMEX futures is dominant within 5-minute intervals. Further analyses under major news effects both on the supply side and demand side reveal: (1) the two markets move closer when there are major US news events taking place, and IPE is more efficient in information incorporation when there are major news events both on the supply and the demand sides; (2) the lead ofNYMEX is stronger when there are major US events and that of IPE is stronger when there are major supply side events. Finally, intra-day trading activities of IPE are examined using the tick-by-tick transaction data. Empirical evidence from diurnal factor (intra-day seasonality), and from ACD model suggests that the patterns of IPE morning and afternoon durations are distinctively different from each other. These findings suggest that NYMEX has a large impact on IPE trading. Empirical findings in this thesis imply that NYMEX is a leader in the information incorporation process, but the extent of this leadership changes dynamically; under different news effects as well as different time periods. These results would impose significant challenges to regulators, in today's global market, to keep their market competitive as well as prudent. They should also benefit hedgers, who after taking into account their hedging implementation criteria such as liquidity, may be able to benefit from the faster information transmission ability of the leading market by directly taking hedging positions using the leading market contracts. The users most likely to benefit from the above findings are traders, who may be able to take arbitrage profits after taking into account trading costs, borrowing costs, etc.

This thesis comprises four published papers (the Papers) - three on accounting-based loan covenants and one on the going concern qualification (GCQ) - plus a linking essay. The essay focuses on the Papers' common subject matter of corporate control and on their common research methodology, positive accounting theory. The essay shows how the agency literature is closely bound up with problems of corporate control. It goes on to argue that certain features of positive accounting theory - its recognition of conflict and of institutional influences, and its focus on economic incentives - render it a particularly useful framework for research into loan covenants and the GCQ. The loan covenant papers address both the structuring of loan agreements ('ex ante' issues) and the subsequent functioning of such agreements, in particular breaches of covenant ('ex post' issues). Their chief contribution to the 'ex ante' literature is the first evidence they provide on the extent and incidence of covenants in the UK; their UK/US comparison, drawing on institutional differences to explain why accounting-based covenants in the UK, unlike the US, have a positive association with term but no association with gearing; and their analysis of the incidence of accounting-based covenants in convertible and secured debt agreements. The Papers' findings on 'ex post' matters contain early evidence on the costliness of covenant breaches, on the effectiveness of managerial opportunism in avoiding covenant violations and on the costliness of mandatory accounting changes. In the context of loan covenants the essay also provides a methodological critique of positive accounting theory, which it sees as a developing research programme. This is reflected both in the ambiguous relation between accounting-based covenants and the investment opportunity set (which is resolved in this research for a UK setting), and in the 'ad hoc' nature of many arguments put forward by the theory's proponents to explain existing practice. Finally, the essay argues that the positive accounting theory and the decision-usefulness views of accounting have more in common than is sometimes supposed. The going concern paper addresses important issues of independence and disclosure. The essay discusses several possible explanations for the low GCQ rate among failed companies, adducing evidence from more recent research. The GCQ paper itself shows that, although the self-fulfilling prophecy argument and differential audit firm size do not appear to prejudice independence, auditor switching may pose such a threat. The essay concludes by pointing at directions for future research, in particular in areas with public policy implications, and by suggesting that greater use of a case study methodology could deepen our understanding of these issues.

1. This study examines the value to financial analysts and investors generally in the UK of firms' accounting disclosures and other information contained in the annual report and accounts for share valuation purposes. 2. Using daily share price data and a large sample of actively traded UK firms the relative information content of four major information releases, the preliminary announcement, annual report and accounts, annual general meeting and the interim report, are examined. Three different models are employed, two of which involved the calculation of the market risk measure; the firm's beta. To increase comparability with previous studies, some of the tests were replicated using weekly data. 3. Previous studies have shown a bias when calculating abnormal returns due to the size composition of the sample. Re-estimating the parameters using Ordinary Least Squares but including a size variable, showed virtually no effect on the magnitude of the estimated parameters. Neither the constant `alpha' nor the coefficient 11 of the size variable were statistically significant. The former is consistent with prior research. 4. Infrequency of trading is largely associated with small companies and gives rise to a downward bias when estimating betas. Although the sample comprised actively traded mainly large companies, the betas were re-estimated using a method which takes into account thin trading. The results indicated that parameter estimates have to take into consideration thin trading even when using predominantly large actively traded stocks. The degree of stability in the betas over successive periods was low though the difference in the average betas of the two periods was negligible. The pooled betas were therefore used. 5. The initial test was to ascertain the extent of the information content of the four events. The three different model formulations employed produced almost identical results suggesting a naive model with beta=1 may well be adequate in many such event study situations. Therefore, all further tests were conducted using only the market model with adjusted betas. Of the four events, the preliminary announcement and interim report, largely representing earnings and dividends announcements, had the highest information content, whilst little information in aggregate is conveyed to the market by the annual general meeting and the annual report and accounts. Similar results were produced using a different information measure and weekly data. No unusual share price activity was observed prior to 111 the event day or after event day plus one, which is consistent with the semi-strong form of the Efficient Market Hypothesis.6. Evidence was found in tests of the market's reaction to `good' and `bad' news that, on average, they are given equal value except for the interim report where there is a sharper reaction to `bad' news. 7. This study supports previous research showing an inverse relationship between company size and the abnormal return on an event day. When variance of returns is included in the regression, the size coefficient albeit statistically significant becomes negligible in magnitude which suggests, like prior work, that size is probable a surrogate for absent firm specific variables. 8. Using a control group of companies with low annual report and accounts abnormal returns but otherwise matching a sample of outlier companies with high annual report and accounts residuals, an analysis was made of both groups. Little difference was noted in the amount of statutory or voluntary information disclosed in the preliminary announcements of the groups. There was, however, significant evidence of greater price-sensitive information being provided in the annual reports and accounts of the outlier group. 9. There was little evidence to suggest that one group was more closely followed by analysts than the other. Capital gearing and income cover were, on average, little different. Apparently what was driving the returns of the outlier sample was company specific information. The information seemed to be largely contained in two sections of the annual report , the balance sheet and the chairman's statement, which previous studies have shown to be valued by users. 10. Tests of association between information content of the events produced conflicting results but analysis of the press comments seemed to furnish some evidence of an informational relationship between the preliminary announcement and the annual report and accounts of the outlier group not observed in the control group. Press comments on the annual reports of the outlier group bear some relationship to the press comments on their preliminary announcements. 11. No previous study has directly examined the informational value of the annual report and accounts for individual firms and used analysis of press comments to identify those parts of the annual report which seem to have information content. The value of this study lies in the new evidence that it provides suggesting the annual report and accounts does have some information value for the stockmarket for particular firms and in identifying those parts of the annual report found useful by investors. 12. The implications of this study are that whilst, in aggregate, there seems to be an apparent lack of incremental information in the annual report and accounts ,this is not a true reflection of its value to all market participants. Unless the stockmarket has access to this financial statement potential adverse valuation consequences may be missed. This study suggests summary accounts are unsuitable for active stockmarket participants.

The thesis comprises an analysis of the regulation of the charity sector and its managerial implications, focusing on internal control. The thesis begins with an introduction which outlines the aim of the thesis, research design and method, and is divided into four further interlinking but self contained chapters with appendices. The second chapter reviews the definition problem of charity; the debates on politics, convergence and religious influences; a critical evaluation of the Salamon and Anheier hypothesis; the problem for statistical analysis and new developments. The third chapter places charity into an historical, political and economic context; the 'spirit' of charity is reviewed; the emergence and dismantling of the statutory welfare state is discussed and the policy implications for the future direction of charity. The fourth chapter looks at the history of charity regulation and the events which led to the establishment of the permanent Charity Commission. The 1987 criticisms are considered from the perspective of how much was the Commission itself to blame. The new system of regulation and the charity accounting standard are described and appraised against theoretical perspectives. International comparisons are made and the British system evaluated. The fifth chapter looks at the regulatory focus, the charity trustee. The role of the trustee is considered against the new legislation and managerial perspectives of the ideal trustee are considered. Liability and risk considerations, we argue, inevitably focus on an evaluation of control systems. The absence of information on control functions in charities is considered and why a survey was deemed necessary. A synopsis of the findings in 1991 and their relevance in 1995 is discussed, which offers comfort and concerns about internal control in the larger charities. In the appendix are the full results of the 1991 Internal Audit Survey and the European Survey of Audit, Accounting and Supervision Practices. The Conclusion provides a combination of practical suggestions for improvements of internal control in charities and suggestions for the Charity Commission as it embarks upon a more pro-active role. Future directions for research in this field are recommended.

The nineties were a hectic period for many policy makers around the world in respect-of payment systems reforms. The increased attention to payment system issues was brought about by the following trends: (i) increased cross-border competition, innovations, and new communication and information technologies; (ii) the financial and political integration and changing processes in European Union and Countries in Transition. The purpose of this thesis is threefold. Firstly, it seeks to define and critically assess the major payment system developments and problems around the world with a view of advancing the understanding of the payment system matters. Secondly, it presents empirical evidence on payment systems similarities, and differences, across countries. This serves as a basis for recommendations about payment system reforms in Countries in Transition. Thirdly, it emphasises and investigates the institutional aspects of payment systems in different groups of countries. The research finds that payment systems around the world are different, but there are some universal themes and values that can serve as a basis for countries that are reforming their payment systems. The particular recommendations for public policy relate to need for greater: (i) payment system providers and instruments competition; (ii) payment system and monetary policy co-ordination; (iii) emphasis on financial stability.

This thesis presents an aggregated econometric model of the world shipping markets. The model distinguishes between dry cargo and tankers and also between the a) freight market, b) second hand market for ships, C) shipbuilding market, d) scrap market. Chapters 1,2 of the thesis examine the history of shipping in the last 100 years or so, analyse the cyclical behaviour of the industry, and consider past theoretical attempts at modelling the shipping markets. It is argued that the structure of existing models of the shipping industry is theoretically flawed In its treatment of the demand for new and second hand ships as well as in the treatment of expectations. Chapter 3 presents a 'new' theoretical model of the behaviour of shipping markets that attempts to remedy these defects. Novel features of this theory are the assumption of 'rational expectations' in shipping markets as well as the treatment of new and second-hand ships as assets, the portfolio demand for which varies with the own expected return relative to the return on other assets. Econometric versions of the theoretical model are estimated from post World War II annual data, separately for the dry cargo and tanker sectors In chapters 4, S. The two models are linked In chapter 6 and the models are used In order to simulate the dynamic response of the shipping markets to anticipated and unanticipated external shocks. A crucial role in the adjustment process is played by the forward looking speculative positions of investors in the second hand and newbuilding markets. Chapter 7 tests the assumption of the rational expectations hypothesis in the shipping markets by examining the evidence from the freight futures, time charter and new building markets. The stochastic behaviour of these variables is examined and statistical tests are performed in order to Investigate the extent to which this Is considered to be consistent -with the efficient markets / rational expectations hypothesis. The results are somewhat mixed. Chapter 8 illustrates how the model can be used for real world forecasting purposes and scenario planning.

The professional independence of external auditors is fundamental to the auditing profession. Thus, it is important that auditors are not only independent in fact, but that they are also seen to be independent - i. e. independent in aPRearance. In that light, it is clear that external auditor independence (EAI) is a perceptual issue. Yet there is a marked lack of empirical research done with a view to determine how users of audited accounts perceive EAI, or to contrast such views with comparable ones held by external auditors themselves. Thus, the major objective of the research is to empirically examine how relevant groups see EAI within specified audit situations. The research examines how three groups of users of audited statements (bankers, credit managers and internal auditors - the user groups) and sets of external auditors (who issue audit reports - the issuer groups), see EAI in circumstances described in specific audit situations. This is the primary context of the empirical research. An appropriate questionnaire was developed and used as the research instrument because of its natural accord with the Brunswick Lens Model approach to perceptual examinations. The facts specified in each of the twenty situations were cues upon which judgement of EAI, was made by judges (the questionnaire respondents). Thus, the empirical chapters consider: 1. Areas of concern with EAI 2. Significant perceptual differences: a) between each user group and the issuer group b) within two sub-groups of the issuer group 3. Possible explanations for differences by examining: a) the dimensions underlying group views of EAI b) the importance attached by groups to EAI cues c) the pattern between bio-data and views on EAI main findings indicate, within an EAI context: 1. Significant differences of perception between the issuer group and each of the three user groups. 2. Generally non-significant differences of perception within the external auditor group. 3. Each group having its own unique set of underlying (factor or dimensional) constructs. 4. The cues (facts) contained in audit environments are of consequence in explaining such group differences. 5. Personal group characteristics (attributes) do not appear to be very helpful in explaining group views.