• The Journal of Asian Finance, Economics and Business
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• 제8권4호
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• pp.769-776
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• 2021

The focus of this study is to investigate the effect of earnings management and audit quality on the cost of equity capital and also examines whether audit quality acts as a moderating variable for the effect of earnings management on the cost of equity capital. The population in this study are companies from the consumer goods industry sector listed on the Indonesia Stock Exchange (IDX) during the 2016-2018 period. This sector was chosen because it is a sector that is able to survive in conditions of economic decline, so it becomes a good investment opportunity in the future. The sample selection was carried out using purposive sampling technique. By using the Moderated Regression Analysis (MRA) technique, the results show that earnings management has a positive effect on the cost of equity capital. Conversely, companies with good audit quality will bear lower cost of equity capital. The moderating hypothesis test results show that audit quality moderates the effect of earnings management on the cost of equity capital. This means that, even though the company carries out earnings management, investors have more confidence in the results of audits conducted by qualified auditors so that the cost of equity capital is low.

• The Journal of Asian Finance, Economics and Business
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• 제4권3호
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• pp.5-17
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• 2017

This study extends research into whether disclosure of corporate and financial information is associated with firms' costs of equity capital. This study sets out to examine empirically the determinants of corporate disclosure in the annual reports of 37 largest and most liquid firms listed on Kazakhstan Stock Exchange (KASE) in Kazakhstan. It also reports the results of the association between company-specific characteristics and disclosure of the sample companies. Based on the analysis of existing empirical research, the disclosure index has been constructed and regression analysis of the influence of the disclosure index on the cost of equity capital has been conducted. The obtained results show that the received findings correlate with foreign empirical studies, and the disclosure index in this sample has a negative impact on the cost of equity capital. Using cost of equity capital estimates derived from capital asset pricing model, we find that firms with higher levels of financial transparency are associated with significantly lower costs of equity capital. Economic theory assumes that by increasing the level of corporate reporting, firms not only increase their stock market liquidity, but also decrease the investors' estimation risk, arising from uncertainty about future returns and payout distributions. The results show that firms on the Kazakhstan market can reduce their cost of equity capital by increasing the level of their voluntary corporate disclosures.

• Asia pacific journal of information systems
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• 제29권2호
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• pp.283-307
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• 2019

Although crowdfunding has emerged as a promising route to fundraising success, little is known about the specifics of equity-based crowdfunding. Using a data set of 1,111 start-ups with investment funding totaling over $4.67 billion, we analyzed the association between a start-up's underlying characteristics and its funding outcome. We found that a start-up's funding outcome is positively associated with its human capital, but negatively associated with earlier investors' business experience. Furthermore, our analyses revealed that investors have higher levels of social capital are a noise signal to later investors. These findings shed light on the critical role of human capital, investors' experience, and social capital as credible signals for start-up investment in equity crowdfunding.

• 아태비즈니스연구
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• 제14권1호
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• pp.327-340
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• 2023

Purpose - The purpose of this study is to examine the information effect of securities firm's net operating capital, securities firm's regulatory purposes capital, by analyzing the value relevance of net operating capital. Design/methodology/approach - This study was empirically analyzed using samples of domestic listed securities firms in the past 12 years, and multiple regression analysis and Vuong (1989) test were used together as specific research methods. Findings - First, it was found that the net operating capital of securities firms has an incremental value relevance that is added to basic accounting information (equity book value, profit or loss information). Second, after classifying equity capital on the books into net operating capital and the rest of equity capital, the value relevance of net operating capital was significantly higher than that of other equity capital. Research implications or Originality - The results of this study indicate that the level of regulatory capital in the securities industry can be used in the process of evaluating firm value in the capital market, and it is significant in that capital market evaluation can be stratified according to regulatory purposes.

• 산경연구논집
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• 제12권11호
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• pp.9-16
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• 2021

Purpose: Carbon emissions have now become a major concern around the world, especially for the government and private sector. Unfortunately, in Indonesia, disclosure related to company carbon emissions is still done voluntarily. This research aims to provide empirical evidence on the effect of environmental performance, carbon emission disclosure, and carbon emission intensity on the cost of equity capital. Research design, data, and methodology: This research uses secondary data with a sample consisting of Indonesia companies that are sensitive to the environment and listed on the Indonesia Stock Exchange in 2017-2019. The analytical tool used in this research was multiple regression models. Result: The study found a carbon emission disclosure had a significant positive effect on the cost of equity capital. Carbon emission intensity and company size had a significant negative effect on the cost of equity capital. Meanwhile, environmental performance did not have a significant effect on the cost of equity capital. Conclusion: Therefore, the results of this research are expected to provide feedback to the company's stakeholders that environmental performance and carbon emissions are some of the points seen by investors in making investment decisions.

• KDI Journal of Economic Policy
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• 제38권2호
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• pp.21-44
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• 2016

There has been a surge of interest in private equity as an alternative corporate restructuring scheme to complement the current institutional forms such as workouts and court receivership. By empirically examining whether private equity in Korea can improve investee companies, we find that while private equity in Korea did not sacrifice the long-term growth potential of investee firms, it did not improve their profitability (e.g. ROA, ROE, and ROS) or growth (e.g. sales growth) either. Both the negative correlation between business performance and firm age and our empirical results showing that young firms were favored by private equity for investment imply that Korean private equity may perform as growth capital, similar to venture capital rather than as buyouts for corporate restructuring.

• 재무관리연구
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• 제22권2호
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• pp.1-41
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• 2005

선행연구에서 기업의 어느 특정한 재무의사결정의 영향을 분석할 경우, 다른 재무정책이 일정하다고 가정한 후 그 특정한 재무정책의 영향을 분석하는 것이 일반적이다. 그러나 Jensen, Solberg and Zorn(1992)은 투자, 배당, 자본구조, 내부자지분은 상호간에 직. 간접적으로 영향을 받는다는 연구결과를 제시하였다. 본 연구에서는 자본구조, 투자, 배당과 내부자지분사이의 상호관계를 모형화한 통합적인 분석방법을 통하여 각 재무정책 상호간의 관계를 분석하였다. 또한 본 연구에서는 분석모형에 전기의 시차항을 포함하여 재무정책과 내부자지분에 상호관계를 파악하였다. 거래소 상장기업 361개 기업을 대상으로 자본구조, 투자, 배당, 내부자지분분석모형을 3SLS 방법에 의한 실증분석을 통해 밝혀진 결과를 요약하면 다음과 같다. 자본구조는 투자와 상호관계를 보이는 한편, 투자는 배당과 상호관계를 보인다. 그리고 배당은 내부자지분과 상호관계를 보이면서 자본구조에 영향을 미치고 있다. 내부자지분과 자본구조 사이에 직접적인 상호관계가 존재한다는 증거는 찾을 수 없었다. 그러나 내부자지분과 자본구조 사이에 간접적인 영향으로 재무정책과 내부자지분은 서로 영향을 미치고 있음을 알 수 있다.

• 한국벤처창업학회:학술대회논문집
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• 한국벤처창업학회 2023년도 추계학술대회
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• pp.69-71
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• 2023

The Modigliani-Miller Proposition II (MM2) is a cornerstone in the field of corporate finance, positing that in a frictionless environment with perfect capital markets, the cost of equity capital is linearly related to a firm's leverage. This paper critically re-evaluates this proposition, particularly examining the determination of the cost and value of equity. We find that under specific circum-stances, especially when the value of a tax shield is influenced by endogenous variables, the cost and value of equity may be ambiguous. This calls into question the universal applicability of MM2. Our research offers new perspectives on the theoretical underpinnings of financial management and underscores the significance of situational factors in the practical application of these theories.

• The Journal of Asian Finance, Economics and Business
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• 제7권7호
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• pp.105-112
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• 2020

The study investigates and measures the impact of capital structure, profitability and financial performance on the success of the business organization. Capital structure of the business organization refers to the proportion of external funds and internal funds, i.e., debt and equity. In Saudi Arabia, petrochemicals companies are working on equity, but financial performance reflects negative trend for the period 2004 to 2016. The research is based upon secondary data available on the websites of petrochemicals companies of Saudi Arabia. Financial Ratio variability analysis and Trend Indices of financial ratios (TI_CBI) measure and compare the financial variability and sensitivity of financial ratios of the business organization. Correlation between Trend Indices (TI_CBI) of independent variable and dependent variables are to be calculated to know the impact of changes in debt equity on other dependent variables. The results reveal the unexpected performance of petrochemicals companies due to under-utilization of the resources caused by low demand and lower prices of the products governed by some internal and external factors. The study finds that size, demand, cost of production, profitable streams of products, and low cost capital in external funds are the factors responsible for overall growth development of the petrochemicals industry of Saudi Arabia.

• The Journal of Asian Finance, Economics and Business
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• 제9권1호
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• pp.353-362
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• 2022

Small and medium businesses (SMEs) play a critical role in the economy, yet they are plagued by a shortage of finance. Determining the influence of cash sources both inside and outside the firm is critical to the company's survival and growth. As a result, the purpose of this research is to determine the impact of capital on the growth of SMEs in Vietnam. The key factors of this research are equity and liabilities, which are two proxies for a firm's capital. The data is based on the results of a survey conducted every two years from 2005 to 2015, which included over 2,600 SMEs in 20 processing and manufacturing industries in ten provinces and cities, including Hanoi, Hai Phong, Ho Chi Minh City, Ha Tay, Phu Tho, Nghe An, Quang Nam, Khanh Hoa, Lam Dong, and Long An. The findings show that characteristics such as equity capital, total workforce growth rate, and male entrepreneurs have a positive impact on enterprise growth, whereas liabilities, firm age, and export have a negative impact on enterprise growth. The study has demonstrated that equity has a positive impact while liabilities have a negative impact on the growth of Vietnamese SMEs.