Commerce and Management
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Item Board Characteristics and Intellectual Capital Disclosures: Evidence from Sri Lanka(Department of Finance, University of Kelaniya., 2021) Chandraratne, K. A. D. P. M.; Pathirawasam, C.; Mohamed, M. S.Purpose: The purpose of this study is two-fold. First, to examine the state of intellectual capital disclosures. Second, to investigate the relationship between board characteristics and intellectual capital disclosures. Design: This study selected thirty non-financial listed companies with the highest market capitalization from the Colombo Stock Exchange in Sri Lanka. An intellectual capital disclosure index comprising 61 items was developed to understand the level of intellectual capital disclosure in the selected companies. Panel data analysis techniques were applied to test the proposed hypotheses. Findings: Results indicated that role duality and proportion of female directors have a significant and positive impact on intellectual capital disclosures. Firm leverage was found to have a significant and negative effect on intellectual capital disclosures. Insufficient empirical evidence between other corporate board characteristics and intellectual capital disclosure in Sri Lanka may be attributed to a non-mandatory corporate disclosure environment. Originality: This is among the few studies to examine the link between corporate governance and intellectual capital disclosures employing panel data in Sri Lanka. However, a discourse on the role of corporate governance and corporate disclosures is warranted in a small island developing economy with a fragile financial system like Sri Lanka. Future Research Directions – The study calls for more studies to investigate the relationship between corporate governance and intellectual capital disclosures in the case of Sri Lanka by employing data from different industries for longer periods.Item The Impact of Board Characteristics on Sustainability Reporting: Empirical Evidence from Sri Lankan Firms(4th International Conference for Accounting Researchers and Educators, Department of Accountancy, Faculty of Commerce and Management Studies, University of Kelaniya, Sri Lanka, 2018) Dimuthumali, H.G.K.S.; Rajapakshe, R.M.D.A.P.At the present scenario, Sustainability Reporting plays vital role in financial reporting as it is crucially impact on the growth and continuous development of a firm in certain and equity market. There are several factors influenced on sustainability reporting. Among them board characteristics impact more as disclosure decisions are one of the primary control functions of the board. The purpose of the research is to explore the role played by the board of directors in corporate sustainability reporting among the listed companies in Sri Lanka. Research problem is based on the board characteristics and it is impact on the detailed sustainability reporting. Data collected from the sample of 60 Sri Lankan listed companies over a period of four years (2014-2017), representing practically four business sectors which represent the highest number of companies under sector classification of CSE in 2017. Board size (BS), Board independency (BIND), Dual leadership (DL), Board with female directors (BFD), Board ethnicity (BE) and Impact of ownership structure (OS) were used as the board characteristics. Binary logistic regression is the method which used to analyze the research data. The results reveals that firms which follow a detailed sustainability reporting have larger boards, more female directors and higher portion of independent directors. This study also found that dual leadership, board ethnicity and board ownership have no influenced on detailed sustainability reporting. This study contributes to provide value addition into the existing literature on this subject by providing sufficient evidences to fill up the gap in the existing literatureItem Relationship between Board Characteristics and Earnings Management Evidence from Sri Lankan Listed Companies(4th International Conference for Accounting Researchers and Educators, Department of Accountancy, Faculty of Commerce and Management Studies, University of Kelaniya, Sri Lanka, 2018) Sarathchandra, P.K.K.; Munasinghe, M.A.T.K.Many studies carried out to investigate the link between board characteristics and firm performance in developed countries. The empirical evidence on this area is very thin in Sri Lanka being a developing country. Hence this study was undertaken with the intension of fulfilling the gap. Earnings management is the usage of accounting principles to make a company's financial statements look better. Many judgments are made by management regarding accounting rules and principles. Board of director’s play an integral role in conducting earnings management practices that emerged as a result of agency issue between managers and shareholders. The research main goal is to evaluate the impact of firm characteristics on earnings management of the listed companies in Sri Lanka. To examine the effect of board on earnings management for a sample of 120 listed firms in Sri Lanka from 2015-2017. For the study, a sample of 120 companies has been selected (excluding the financial sector companies, to avoid distortion in results due to different financial fundamentals). Modified Cross Sectional (Model, 1995) has been employed for calculating discretionary accruals as proxy for earnings management. Furthermore, key board characteristics examined in the study include board independence, board size, CEO duality, gender diversity, and institutional ownership, while using firm size, leverage and profitability as control variables. The results portrayed important negative effect of board independence on earnings management, where the CEO Duality and institutional ownership had a particular positive impact on earnings managementItem The Relationship between Board Characteristics and Earnings Management: Evidence from Sri Lankan Listed Companies(University of Kelaniya, 2015) Kankanamage, C.A.This paper aims to examine the impact of board characteristics on earnings management in Sri Lanka during the period from 2012-2015. The current study uses the ordinary least squares regression (OLS) to examine the effect of board on earnings management for a sample of 160 listed firms in Sri Lanka from 2012-2015. Kothari, Lenon and Wesley (2005) performance adjusted discretionary accrual model used to measure the earnings management by using the discretionary accruals. Findings revealed that there is a significant relationship between board size, board composition, board financial expertise and board meetings and earnings management of the firms. Thus effective board of a firm is contributing to enhance the financial reporting quality and transparency. The findings of this study would provide useful information for regulators and the practioners in the country to understand the significance of board characteristics of firms to constrain the earnings management and enhance the financial reporting quality and transparency. Further results provide useful information to the investors and other stakeholders in evaluating the existence of effective board characteristics in advance to put the confidence of the financial reporting quality and make their decisions.Item The Relationship between Board Characteristics and Earnings Management: Evidence from Sri Lankan Listed Companies(Faculty of Commerce and Management Studies, University of Kelaniya, 2015) Kankanamage, C.A.Purpose: This paper aims to examine the impact of board characteristics on earnings management in Sri Lanka during the period from 2012-2015. Design/methodology/approach: This paper uses ordinary least squares regression (OLS) to examine the effect of board on earnings management for a sample of 160 listed firms in Sri Lanka from 2012-2015. Kothari, Lenon and Wesley (2005) performance adjusted discretionary accrual model used to measure the earnings management by using the discretionary accruals. Findings: This paper finds a significant relationship between board size, board composition, board financial expertise and board meetings and earnings management of the firms. Thus effective board of a firm is contributing to enhance the financial reporting quality and transparency. Practical implications: The findings based on this study provide useful information for regulators and the practitioners in the country to understand the significance of board characteristics of firms to constrain the earnings management and enhance the financial reporting quality and transparency. Further results provide useful information to the investors and other stakeholders in evaluating the existence of effective board characteristics in advance to put the confidence of the financial reporting quality and make their decisions.