The thesis extends the research in the area of momentum strategies by investigating the short-term continuation for stocks listed in the United Arab Emirates (U.A.E.) Stock Market over the period from January 2001 to June 2006. The evidence shows that winner portfolios tend to outperform loser portfolios of stocks over pre- and post-formation periods of three months to twelve months. The most successful zero-cost trading strategy selects stocks based on their returns over the previous six months and then holds the portfolio for eight months. This strategy yields abnormal returns of 1.10 percent per month, which is very close to the profits reported by Jegadeesh and Titman (1993) in the US market. The thesis continues by looking at possible explanations of momentum profits by investigating whether they can be explained by the firm size effect or book-to-market effect. The empirical results provide evidence that small-stocks exhibit a greater return than big-stocks over various holding periods, but that the difference between high B/M-stocks and low B/M-stocks is not as effective in producing abnormal returns. In order to achieve a deeper understanding of the linkages between these variables and momentum profits, I propose a multiple model of risk valuation that extends both the CAPM and the Fama and French (1992, 1993) models, by introducing a new model that assumes that momentum is explained by the sensitivity of stock returns to four-factors; market beta, firm size and book-to-market, and in addition to the oil price factor. The evidence suggests that the relationship between momentum return and the market risk and book-to-market factors is insignificant, which means that these factors are unable to explain the performance of the momentum returns, while it is positively correlated with the firm size factor and the changes in the oil price factor. These findings motivate taking a closer look at the causes behind the momentum returns. A survey questionnaire is carried out to acquire more knowledge of the momentum effect, and to identify further possible explanations of momentum in stock returns. The results from the survey questionnaire reveal that investors’ decision-making appears to be influenced by a number of factors other than fundamental factors, such as recent price movements in a stock, market rumors and friends/family opinions. The questionnaire results lead to additional insights into the causes of the momentum phenomenon.

The Saudi financial reporting environment witnessed significant development in the past two decades, which is evidenced by the incorporation of the Saudi accounting standard setter (Saudi Organization for Certified Public Accountants (SOCPA)) and its subsequent development of the accounting profession. The main objective of this study is to investigate whether developments in financial reporting following SOCPA’s inception resulted in financial statement information being more value relevant over time. This study focuses solely on quantitative methods and employs secondary data in addressing the research questions. This study uses adjusted R² as a primary metric for measuring value relevance. Value relevance of accounting information has been investigated through its association with contemporaneous market values and future cash flow-predictive ability studies. The theoretical frameworks of Ohlson (1995)and Easton and Harris (1991) have been used to specify the relationship between accounting information and market values. To link accrual-based earnings and accrual components with future cash flows, the theoretical frameworks of Dechow, Kothari and Watts (1998) and Barth, Cram and Nelson (2001) have been used. A sample of firms listed in the Saudi Stock Market during the 1993–2009 time period has been used. The total number of observations included in the sample is 997 from 97 firms, which excludes firms in the banking and insurance sectors. The main findings of the value relevance of accounting information in equity valuation are: First, earning (book value) coefficients were found to be significant in (nine) all years in the price regressions. Second, earning levels and changes have not been found significantly related to stock returns in all years. Third, hedge portfolio strategies based on pre-knowledge of accounting information yielded non-zero returns. Fourth, the explanatory power of the price model increased from the 1993–1997 to the 1998–2003 time period and declined in the following time period. Fifth, the explanatory power of the return model shows no significant change over time. Sixth, earnings are not value-relevant in equity valuation for loss-making firms, while book value is value-relevant for the 1993–1997 and 1998–2004 time periods. Earnings are only asymmetrically timely in reflecting good and bad news in the 1998–2003 and 2004–2009 time periods. Findings from the predictive ability of future cash flows show that earnings provide incremental explanatory power beyond that provided by current cash flows in all three pooled cross sections. Earnings’ accrual components have also been found been found to significantly provide incremental explanatory power beyond that provided by current cash flows in predicting future cash flows. These two measures did not witness any significant change over time. Earnings as a summary measure have not been found to outperform current cash flows in their predictive ability except for three years. This study concludes that accounting information has been value relevant during the entire period of this study and that an increase in value relevance might only be present in the early period of this sample.

The increasing complexity of financial reporting requirements, especially accounting standards, leads many countries to consider moving to simpler reporting requirements for small and medium enterprises (SMEs) in order to reduce reporting burdens. In response to such concern, the International Accounting Standards Board (IASB) also released the IFRS for SMEs, an international accounting standard intended for SMEs worldwide. In Thailand, SMEs are required by law to prepare and publish general purpose financial statements for statutory reporting, but the Thai financial reporting framework is complex. Thus, it would be beneficial for Thai SMEs if their reporting burdens were reduced. The IFRS for SMEs might be considered as an alternative set of accounting standards in Thailand, so its suitability to Thai SMEs is worth evaluating. This present study examines SME reporting in Thailand to ascertain its features and to evaluate its costs and benefits to SME stakeholders. Both qualitative and quantitative approaches are adopted in the study. Semi-structured interviews of SMEs, users and other stakeholders are conducted and the data are analysed using Strauss and Corbin’s grounded theory approach. A questionnaire survey of directors or managers of SMEs and a review of SME financial statements are also undertaken. Univariate and multivariate data analysis is carried out with these two data sets. Overall, the interview and survey research concludes that SMEs in Thailand prepare and publish their financial reporting largely in order to meet legal requirements. They rely on their accountants in fulfilling these reporting obligations. For SME directors, costs of reporting are not considered to be an undue burden. Tax authorities, entities’ managements and lenders, in order, are perceived to be the most important users. However, it appears that the financial information in SME financial is unable to meet the needs of these main users. Preparation of financial statements with tax motivation, limited disclosures and out-of-date information are identified as the main weaknesses in SME financial statements. The analysis of SME financial statements shows that: the majority of SMEs engage in simple business transactions and non-compliance with mandatory accounting standards exists among many SMEs. SME stakeholders generally support using simpler accounting standards for SMEs. The IFRS for SMEs seems to be too complicated for many Thai SMEs and inconsistency with tax rules is an issue. The findings of this study are of interest to standard setters and other SME stakeholders in Thailand and other countries. The study also provides implications for SMEs, their accountants and their stakeholders.

The main objective of this study was to develop an algorithmic financial model to determine and examine the characteristics of key value drivers, earnings, net income, EBITDA, sales, and book value, that formulate the value aspects of a company to compute raw value multiples using multi-linear regression analyses of scaled value driver, Price-to-Earnings (PE), Price-to-Net_Income (PX_Earn_Com), Price-to-EBITDA (PEBITDA), Price-to-Sales (PS), and Price-to-Book (PB), against a comprehensive list of independent proxy variables. The resulting spectrum of raw value multiples is utilised in further computation that encompass the triangulation of the spectrum raw value multiples in a weighted process based on the adjusted coefficient of determination measurement, which would synthesise a raw market share price of the company (Adj. Vs_PX) comparable to Bloomberg-based share prices (PX). Effectively, the multi-linear regressive algorithmic financial model would be used for assessing market value signalling a buy or sell based on the position of synthesised market share price relative to current market share prices. The amalgamated data sample for this study comprises of the market indices representing the Anglo-Saxon and European markets, namely the FTSE-All-Share (ASX) of UK, S&P 500 (SPX) of the USA and STOXX Europe 600 (SXXP) of Europe with a data availability ranging from 2001 to 2011 obtained from Bloomberg. The main objective was successfully completed by the analysis of 170 regression models based on 5 scaled dependent variables regressed against 56 independent proxy variables for 8,851 company-years out of 14,340 company-years representing the 3 market indices, ASX, SPX, and SXXP. The descriptive statistics measures of the computed raw value multiples and share prices relative to the Bloomberg-based values have overall generated robust and significant results. Generally reflecting a low standard error, consistent standard deviation and yielding sample means that are very similar. Relating the computed raw value multiples of PE, PX_Earn_Com, PEBITDA, PS, and PB, against the respective Bloomberg-based multiples has mostly shown similar company values for ASX and SPX, signifying that the listed companies are efficiently valued. Whereas for the companies listed on the SXXP index, the results highlighted that there were differences in values observed between the synthesised raw multiples and the Bloomberg-based multiples, implying that companies are either over-valued or under-valued. Overall the corresponding PS and PB multiples displayed the most consistent and explanatorily significant results compared to the three earnings multiples. However, the observed discrepancies in the synthesised values relative to the Bloomberg-based values would mostly be offset collectively between PE, PX_Earn_Com, and PEBITDA, thus presenting consistent and significant results. This study concludes that the cross-sectional relative valuation analysis of any fully-listed company in the Anglo-Saxon and European markets in an identical process to be achievable. Hence, the process of valuation analysis using independent proxy variables can be standardised for the Anglo-Saxon and European markets and the triangulation of value multiples to synthesise comparable market share prices. The various aspects of the methodologies applied are founded on multi-linear regression analysis and relative valuation using a standardised database for all the data obtained from the three market indices: ASX, SPX, and SXXP. Thus, the multi-linear regressive algorithmic financial model is capable of computing cross-sectional valuation, as well as cross-market valuation for any fully-listed company, to compute value multiples that can be triangulated to synthesise respective share prices premised on standardised proxy variables.

The thesis investigates two major mechanisms of corporate governance in terms of their impact on corporate performance. These mechanisms are the composition of board of directors, and the ownership structure. The thesis focuses on the UK FTSE All Shares non-financial firms. The reason for excluding financial firms was the different regulations that monitor the financial sector, and by excluding this sector from the study, findings more comparable with prior research can be obtained. The sample size arrived at 363 companies that had survived at least four years in the FTSE All shares between the year 2005 and 2010. The main hypotheses tested were whether board composition and ownership structure have an impact on firm performance, using Tobin’s Q (TQ) as a market based performance measure, and Return on Assets (ROA), Return on Equity (ROE), Return on Capital Employed (ROCE), and growth in total sales (SGRTH), as accounting-based performance measures. Correlation and multi-regression analysis (univariate and multivariate regression) were carried out to test these hypotheses. The results suggested a high positive association between board size and TQ, and insignificant association between board size and accounting-based performance measures (ROA and ROE), while some evidence was found of an impact of an independent board on firm performance. The results also found a negative association between blockholdings and performance during the financial crisis in 2008, whilst an insignificant relationship was observed before 2008.

This study seeks to examine the applicability of performance management systems (hereafter, PMSs) framework in public sector. Using a teaching hospital as a case study, this thesis provides empirical evidence on how PMSs are functioning from the context of Nigeria. It demonstrates the extent to which performance management can be understood/explained using a framework developed in the western context. To maintain anonymity the hospital is termed the Nigerian State Hospital (NSH). The study draws on the contingency theory of management accounting to identify and explain contextual factors which could influence the design and operation of PMSs in the NSH. Data were collected using a triangulated approach. Interviews were the main sources of evidence and were conducted with various members of staff of the NSH. The interview evidence was supplemented with observation and document analysis. Various documents on health policies, newspaper articles were analysed. Furthermore, a number of observations were made and documented. The case findings were analysed using Ferreira and Otley’s (2009) PMSs framework and interpreted using the lenses of contingency theory. The study revealed the implication of contextual factors on the operation and structure of PMSs from an emerging economy context. It showed that the application of PMSs framework cannot be generalised but needs to be contextually understood and adapted to local structural conditions. Based on the findings, the study proposes an extension to Ferreira and Otley’s (2009) PMSs framework to incorporate contingencies which are likely to implicate its application in healthcare settings in EEs. Overall, the study contributes to PMSs literature in emerging economies by providing empirical evidence on how PMSs are functioning from the context of Nigeria. The findings have implications for the design and use of PMSs in public sector in Nigeria and emerging economies.

The origin of modern accounting is an unsettled phenomenon. Several scholars have traced that origin to the ancient Greece, to India, to Mesopotamia, and Egypt. There is no systematic study of the role which each ancient community has played in the development of modern accounting. Received knowledge from accounting history, to date, is that modern accounting has its roots in Europe, especially ancient Greece and Italy. The purpose of this thesis is to attempt to modify this accepted truth and to suggest that some aspects of the roots of modern accounting can be traced to Iraq and the ancient Mesopotamia. Accounting is a progressive science which develops as it is passed from one generation to the next. Knowledge of our past helps us to understand our present and predict the future. Modern accounting may be said to have become possible with the introduction and gradual adoption of rational procedures in arithmetic and bookkeeping. Therefore, it is important to know how our forebears practised their accounting in the cradle of civilisation, i.e. Assyria and babylonia, where mankind is said to have built its first civilisation, and to have invented a unique writing system. Unfortunately, Iraq lacks sufficient literature dealing with the origins and the history of accounting. One reason for the paucity of information on accounting in the Mesopotamia is that much of the archival information that would have led to the discovery of accounting history of the region are in ancient Mesopotamian languages and in clay tablets which have not been studied by archaeologists interested in accounting. Another reason is the lack of interest in the history of the Iraqi people brought about by the long period of wars with its neighbours and the lack of interest in Iraq by people outside its borders. Yet another reason and perhaps the most important is the scarcity of Iraqi scholars interested in accounting history of Iraq. This lack of literature on Iraqi accounting history motivates the attempt to fill this important gap in historical literature. The study covers the period between 3600 BC and the advent of the Islamic religion (that is, until the beginning of the 12th century AD). With the help of archaeological discovery of the tools of writing, numbering systems and accounts of the ancient Mesopotamia, the analysis of socio-economic institutions such as palaces, temples, Islamic religion, capitalism and markets and their relation to accounting, I reconstructed the role of the ancient Mesopotamia in the discovery of modern accounting. To discipline the synthesis and analysis, Littleton' s (1966) framework for discovering the historical roots of bookkeeping (and indeed, accounting) was adopted. This required finding out how a society recorded their events and transactions (the art of writing); made computations (arithmetic and mathematics); dealt with property rights; exchanged goods either through the medium of money, credit or by barter, and the nature of their commerce and how they accumulated wealth and accounted for it. The presence of these prerequisites for the development of bookkeeping in Iraq 4000 or more years ago would lead to the suggestion that the inhabitants of ancient Iraq had a culture of accounting. The thesis concludes that these prerequisites existed in the ancient Iraq and that, in several respects, the ancient Iraq had an accounting culture that predated many of these antecedents as a part of the protoliterage age.

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This thesis contributes to the managerial accounting research literature. The methodology used is basically analytical modelling. Part I focuses on voluntary financial accounting disclosure. Following a detailed survey of the existing literature, an analytical model of an entry game with continua of types is provided to advance the results of prior research. By explicitly considering both a potential entrant and potential investors, this model incorporates two opposing forces that may influence an incumbent's decision to disclose or withhold private information. Various equilibria are characterized and discussed. Part II of the thesis focuses on firms' contractual relationships. The analyses extend traditional agency theory analysis to situations in which complete contracting is costly. Two models related to incomplete contracting are offered. One model analyzes the influence of contracting costs on a firm's contracting strategy in the context of the firm's internal transfer of goods and services. The results of this analysis provide insights and a new basis for the research of the transfer pricing issue. The second model deals with the incentive issues within organizations. The analysis focuses on the situations in which verifiable performance measures are unavailable. In the model, two kinds of incentives, namely, high-powered and low-powered incentives, are analyzed. We find that contract renewal based on observable (but non-verifiable information) can provide useful low-powered incentives in an hierarchical organization in which employees build up human capital. This may provide useful insights into managerial accounting system design. / Business, Sauder School of / Graduate