Junior Research Symposia
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Item The Impact of Corporate Governance Issue on Business Failure(Department of Accountancy, Faculty of Commerce and Management Studies, University of Kelaniya, Sri Lanka, 2016) Madhubhashini, T.; Aruppala, W.D.N.Corporate governance is the process to control and direct the companies for long term results. There have been many ways to achieve this via good corporate governance but failure of some big companies raised various questions and issues. This study is motivated by the frequent reforms to strengthen the effectiveness of corporate boards and their oversight committees, in the wake of high profile corporate failures. The empirical question which is tested by this study is enhance board and their committee effectiveness and in this way, reduce the likelihood of firm‘s failure. This examines whether the lack of capability of achieving the corporate governance perspectives are related to the probability of business failure. Accordingly, the objective of this study is to find out the relationship between Corporate Governance issue and the Business Failure. As the methodology of this study, the all data will be collected through the secondary sources. The corporate governance will be measured by the terms; Accountability, Integrity, Transparency and Efficiency. The Business Failure will be measured by the Working capital to total assets ratio, Leverage of the firm, return on Total assets (ROI), Gearing Ratio, Asset turnover Ratio of the selected firms. The conclusion of this study is; there is a relationship between Corporate Governance issue and the Business Failure. The findings of this study provides a guidance to managements of these companies and existing other listed companies in the Sri Lankan context.Item The Effect of Corporate Governance on Performance of the banking Industry in Sri Lanka(Department of Accountancy, Faculty of Commerce and Management Studies, University of Kelaniya, Sri Lanka, 2016) Lekamge, A.L.I.C.; Thilakarathne, C.R.In the worst financial crisis, the banking sector faces to more difficulties. According to the studies that difficulties build on the lack of corporate governance in banks and companies. Purpose of this study was to identify the impact of Corporate Governance for the Banking Profitability in Sri Lanka. Board size, Board Ownership, Management ownership and the Board balance were used as the determinant factors and the Return on Assets was used for the performance indicator. Nine listed Commercial Banks over nine years were selected for the analysis. Descriptive analysis, Pearson Correlation and the regression analysis methods were used to find out relationship between the corporate governance and banking performance. One main model constructed under the regression analysis. Result of the analysis were found that there was significant relationship between Board size and the Board ownership. There was no significance relationship between Management Ownership and the Board Balance. According to the analysis the overall model is significant and the Corporate Governance is significantly affected to the Profitability of the banking industry in Sri Lanka.Item The Impact of Corporate Governance on Financial Performance: Evidence from Sri Lankan Banking Industry(Department of Accountancy, Faculty of Commerce and Management Studies, University of Kelaniya, Sri Lanka, 2016) Perera, W.T.N.M.; Aruppala, W.D.N.Baking industry undertakes the critical and vital roles in the financial system; the well-being of the economy and the mechanism of the banking system interconnected. The concept of Corporate Governance has become conspicuous in conjunction with banking industry. Attention to Corporate Governance has quite a long history since the seminal paper on the subject of the “Principal – Agent Problem” by Meckling which argued that the Principal – Agent problem as a consequence of the separation of ownership and control. Over the last two decades; Sri Lankan economy has encountered substantial fluctuations from countless amalgamation with the global economy ((CBSL), 2013). In 1990 Sri Lanka has utilized the capital market reforms and adopted the Anglo American Structure of Corporate Governance (Edirisinghe, 2015). The regulatory requirements which affianced with the Corporate Governance in Sri Lanka; governed by the Banking Act No. 13 of 1988, Companies Act No. 07 of 2007, Codes of Best Practices and Regulations issued by the Institute of Chartered Accountants of Sri Lanka (ICASL) and Securities and Exchange Commission (SEC) of Sri Lanka. This research empirically examines the quality of Corporate Governance practices in Sri Lankan banking industry and their impact on banks’ financial performance in the context of an emerging market such as Sri Lanka. The study concludes that there is no equivalence in the disclosure of corporate governance practices made by banks in Sri Lanka. Nevertheless they all disclose their corporate governance practices, but what is disclosed does not conform to any particular standard. Furthermore this study conclude that a positive relationship exist between financial performance, number of board meetings and education level. Besides that the study conclude that a negative relationship exist between financial performance, board size, gender, outside directors and CEO duality.Item The relationship between Corporate Governance Levels of the Board and Company’s Voluntary Disclosure Level(Department of Accountancy, Faculty of Commerce and Management Studies, University of Kelaniya, Sri Lanka, 2016) de Silva, M.P.M.U.; Sujeewa, G.M.M.The Purpose of this study is to examine the association between corporate governance levels of the board and voluntary disclosure level of Sri Lankan companies. Quantitative approach was used in positivist paradigm as the research approach. Sample of 106 quoted companies (Representing Beverage Food & Tobacco, Diversified, Hotels Travels, & Manufacturing sectors) for the analysis is based on the list of quoted companies in Colombo Stock Exchange (CSE) in Sri Lankan and the sample data has been collected from published annual reports related to 2015/16 accounting period of 106 companies selected. There is a significant relationship between the board governance level and voluntary disclosures in Sri Lankan companies. Thus, higher board governance tends to disclose more disclosures regarding corporate and strategic, financial and capital market, forward looking and corporate social responsibility disclosures. The use of a board governance index to arrive at a general board governance score can possibly cover major underlying relationships of individual board governance attributes. The use of disclosure index which is based on most recent literature with amendments may also omit certain new information items that are disclosed in annual reports. In addition, the distinctive classes of disclosures are solely adapted from foreign studies with amendments. The findings of the research will help policy makers and practitioners in formulating corporate governance policies. However, this research is limited because it focuses on only companies listed on the CSE. The results may therefore not be representative of all companies operating in Sri Lanka. This study produces confirmation of the changing scene of management voluntary disclosure practices embedded in the corporate governance framework in a developing nation with a rising capital market.Item Corporate Governance and Profitability Evidence from Sri Lankan Banking Industry(Department of Finance, Faculty of Commerce and Management Studies, University of Kelaniya, 2015) Herath, H.M.S.L.The objective of this research is to examine the impact of corporate governance mechanisms on firm performance of 13 banks in Sri Lankan banking industry over the period of 2005-2014. This is an exploratory study which addresses the research problem of does corporate governance affect the bank performance in Sri Lanka. Return on Equity (ROE) is used as dependent variable and, Firm Size, Firm Leverage, Audit committee composition, Board Independence, Board Size and CEO Duality used as independent variables. This research has used only secondary data and main source of data includes the annual report of the selected companies. Empirical research was conducted based on the 130 observations and findings are based on regression analysis. Researcher employed panel data methodology as a method of estimation. Descriptive statistics, ANOVA and t-test applied on data by using SPSS. Correlation techniques method has been used to test the hypotheses, to solve the research problem, and to achieve goals and objectives of the study. Accordingly, there is a significant impact of corporate governance on Performance of the banking industry in Sri Lanka. Moreover, there is a positive relationship between bank performance and board independence and firm size.Item Impact of Board of Directors (BOD) and Chief Executive Officer (CEO) duality on financial performance of plantations sector in Sri Lanka(Department of Accountancy, University of Kelaniya, 2015) Grero, R.K.Corporate governance can be defined as a set of relationships between a company’s management, its board, its shareholders and other stakeholders. Corporate governance also provides the structure through which the objectives of the company are set, and the means of attaining those objectives and monitoring performance are determined.” (OECD principles of corporate governance, 2nd edition, 2004). Corporate governance is a widely spreader concept and the BOD and the CEO duality are a part of corporate governance. The purpose of this study is to examine the relationship of board size and the CEO duality on the financial performance of plantations sector in Sri Lanka, identify how the board size and the CEO duality will impact on performance of the company. The data will be measured by using return on equity (ROE) and return on capital employed (ROCE). The population of this study will include twenty listed companies in Colombo Stock Exchange (CSE). The research samples consist with plantation industry firms listed on CSE in Sri Lanka. This study will be considered for a period of 3 years (From 2012-2014). In this study the evidence will be collected from secondary sources such as data collected from company annual reports, CD issued by CSE and CSE web site. This study analyses the annual reports of selected companies in the plantations sector of last three years.Item The effects of corporate governance on financial performance(Department of Accountancy, University of Kelaniya, 2015) Perera, N.Attention to corporate governance has quite a long history since the seminal paper on the subject of the “principal – agent problem” by Meckling (1976). They argued that the existence of the principal – agent problem as a consequence of the separation of ownership and control raises a conflict of interest between the interests of managers and shareholders. The financial crisis in 2008 and high sketch financial dishonours tends to have concentration of academic researches, policy makers, regulatory institutions and investors to study the level of corporate governance practices and its effect on firm’s financial performance. Mostly, the quality of corporate governance can be assessed on the basis of the principals of disclosures and transparency, relationship with stakeholders including shareholders, policies and compliance, structure and the characteristics of board of directors and the ownership and control structure. According to Black (2006) worthy corporate governance practices strengthen the firm financial performance. This research empirically examines the quality of corporate governance (CG) practices in Sri Lankan listed private banks and their impact on firm’s financial performance in the context of an emerging market such as Sri Lanka. To evaluate the level of corporate governance practices at an identified firm, this study construct a corporate governance index (CGI) which involves four scopes: disclosure and transparency, composition of the board of directors, shareholders’ rights and investor relations, ownership and control structure. Based on a sample of 10 private banks listed on the Colombo Stock Exchange (CSE) in Sri Lanka, the effects of corporate governance on financial performance are assessed. Tobin’s Q is used to evaluate the firm’s financial performance.Item Corporate governance issue to the business failure(Department of Accountancy, University of Kelaniya, 2015) Madhubhashini, H.M.T.S.Corporate governance is the process to control and direct the companies for long term results. There has been many ways to achieve this via good corporate governance but failure of some big companies raised various questions and issues. This study is motivated by the numerous reforms to strengthen the efficacy of corporate boards and their oversight committees, in the wake of high profile corporate failures. The empirical question, however, is whether recent proposals would enhance board and their committee effectiveness and in this way, reduce the likelihood of firm‘s failure. This study examines whether the composition, structure and functions of corporate boards and their interactions are related to the probability of corporate failure. The objective of this study is to find out the relationship between Corporate Governance issue and the Business Failure. As the methodology of this study, the all data will be collected through the secondary sources. The corporate governance will be measured by the terms; Accountability, Integrity, Transparency and Efficiency. The Business Failure will be measured by the Liquidity ratio, Defaulting long term loans, Continues losses, resigning top management people without refilling and over trading of the selected firms. The conclusion of this study is; there is a relationship between Corporate Governance and the Business Failure. Also there is a significant impact on Business Failure from the Corporate governance issue.