Journal Articles
Permanent URI for this collectionhttps://mro.massey.ac.nz/handle/10179/7915
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Item Local government enterprises climate action: An exploration of New Zealand container seaports' climate-related disclosure practices(John Wiley and Sons Ltd, 2025-01-09) Ehalaiye D; Moses O; Laswad F; Botica Redmayne NThis study examines voluntary climate-related disclosure practices among New Zealand (NZ) container seaports, in achieving Sustainable Development Goal 13 (SDG13) on climate action. Using a uniquely constructed Climate Change Disclosure Index (CCDI) and interviews, it assesses disclosure practices aligned with the Task Force on Climate-related Financial Disclosures (TCFD) framework. The CCDI results indicate a 20% average level of climate-related disclosures. Governance (36%) is the leading thematic area, whereas others track behind with limited disclosures among the sampled hybrid seaport entities. Evidence from the interviews reveals financial and legitimacy considerations, stakeholders, and community expectations, including forthcoming regulations, to be motivations for climate-related disclosures. However, technological limitations, Scope 3 measurement, and regulatory inconsistencies constrain progressive climate actions of these entities. The study emphasizes the need for adaptable approaches to climate change beyond policy mandates and contributes to our understanding of sustainability practices in public sector hybrid entities. The findings hold implications for SDG13 attainment and the development of climate-related accounting standards.Item Internal Audit in Microfinance Institutions-Evidence from Transitional and Developing Economies(John Wiley & Sons Ltd on behalf of European Bank for Reconstruction and Development., 2023-12-11) Omidiji A; Botica Redmayne N; Ehalaiye D; Gyapong EMicrofinance institutions (MFIs) are hybrid organisations that strive to balance business and social goals. This paper examines the determinants of the internal audit (IA) function in MFIs, with particular emphasis on the business goals, specifically efficiency, productivity, regulation and the gross portfolio yield. We also investigate whether the establishment of an IA function is associated with MFI's focus on their social objectives relating to outreach, and women director appointments. Multivariate regression results from 1025 MFIs across 63 countries show that MFIs' focus on their social objectives is related to their propensity to establish an IA function. Thus, outreach and women director appointments are positively related to the establishment of an IA function. Similarly, in terms of the performance emphasis, the gross portfolio yield (inefficiency) increases (decreases) the likelihood of establishing an IA, but productivity and regulation have no effect. The findings suggest that MFIs' dual focus on social and business objectives impacts the establishment of internal audits. The results are robust to various measurements and estimations.Item The value of discretion in Africa: Evidence from acquired intangible assets under IFRS 3(World Scientific Publishing Company, 2020-06) Tunyi A; Ehalaiye D; Gyapong E; Ntim C; Chaney, PKThis paper examines the value of managerial discretion in financial reporting by exploring the value relevance of intangible assets acquired in business combinations (AIA) before and after the 2008 International Financial Reporting Standard (IFRS) 3 amendment. The 2008 IFRS 3 amendment gave managers the discretion to recognize previously unrecognized intangibles in the target firm, hence, we posit that if managerial discretion improves the quality of financial reporting, we should observe an increase in the value relevance of AIA after the amendment. Our empirical analysis is based on a dataset of 603 mergers announced between 2004 and 2016, across seven African countries. Consistent with our main hypothesis, we find that the value relevance of AIA, predominantly acquired goodwill (AGW), increased after the amendment, suggesting that managerial discretion improves the quality of financial information. Our results further show that the value of discretion is moderated by the underlying institutional quality, with the value relevance of AIA being greater in high-quality institutional contexts. Our findings are robust to alternative measures of AIA, alternative models for testing value relevance, and various controls for endogeneity. Overall, our findings have important implications for accounting standard-setters, governments, investors, and practitioners.Item Insights on Management Commentary in financial reports: The views of users, preparers and auditors(Emerald, 31/01/2022) Botica Redmayne N; Laswad F; Ehalaiye D; Stent WPurpose: New Zealand (NZ) has no reporting standard or guidance for management commentary (MC) that accompanies financial reports. This is unusual, considering MC is provided by many entities and valued by users. Further, the guidance on MC provided by the International Accounting Standards Board (IASB) in their Management Commentary Practice Statement 1 (MCPS1), which was issued in 2010, is currently under review. Thus, the purpose of this paper is to examine the views of NZ’s financial reporting stakeholders, particularly users, preparers and auditors of financial reports for insights regarding the usefulness of MC. Design/methodology/approach: To gain insights into the views of NZ’s financial reporting stakeholders on MC, this paper surveyed users, preparers and auditors of financial statements. This paper includes an analysis of their views on the objectives, content and principles that should underlie MC in financial reporting, based on the IASB’s MCPS1 with consideration of recent work by the IASB on the revision of MCPS1. In addition, the analysis provides insights as to whether the reporting of MC should be made mandatory, and whether assuring MC would increase its usefulness. Findings: This study found that auditors generally view MC as less useful and more in need of assurance than do preparers and users. Respondents’ ratings indicate that the most important objective for MC is “to enable the assessment of the quality of management’s stewardship”. “Assessing the entity’s future prospects”, and “assessing future cash flows” are also highly rated objectives. The most important principle in preparing MC is identified as “focus on the most important and relevant information”, while the most important content element identified is “the entity's financial performance and position, and cash flows”. Originality/value: This paper highlights the views of various stakeholders regarding MC reporting, particularly preparers and auditors whose views have not been noted previously in the literature. Also, this study should be of interest to both international and national financial reporting standard setters and regulators. It is particularly timely in view of the current IASB work towards revision and updating of MCPS1, as it provides current insights into what users, preparers and auditors perceive as the most important considerations for MC. This study also has implications for the XRB in NZ, where there is no prior research on stakeholders’ views on MC.Item Competition and Commercial Banks Risk-Taking: Evidence from Sub-Saharan Africa Region(Taylor and Francis Group, 26/04/2018) Akande JO; Kwenda F; Ehalaiye DThis study investigates the relationship between competition and the risk-taking attitude of banks. We test how this relationship manifests in the Sub-Saharan African(SSA) region’s commercial banks in light of the competition-fragility view, using the generalized methods of moments. We studied 440 commercial banks in 37 SSA countries over the period 2006–2015. The results provide evidence that supports a positive relationship between competition and banks’ overall risk as well as their credit risk but suggests that off-balance sheet risk reduces with competition. We, therefore, conclude that the propensity to undertake higher risk in a competitive banking environment largely accounts for fragility as argued in the competition-fragility view.