Template-Type: ReDIF-Article 1.0 Author-Name: Mishari Alfraih Author-Name: Faisal Alanezi Title: THE VALUE RELEVANCE OF MANDATORY CORPORATE DISCLOSURES: EVIDENCE FROM KUWAIT Abstract: This study is the first to explore the association between the level of compliance with International Financial Reporting Standards (IFRS) mandatory disclosures and the value relevance of accounting information to market participants. This association is examined in the context of listed companies in the emerging economy of Kuwait – a jurisdiction with a history of applying international accounting standards but with lax enforcement. The research design of the study consists of two parts. First, the level of compliance with mandatory IFRS disclosures of Kuwait Stock Exchange (KSE) listed firms in 2010 is examined using a disclosure index. Second, the value relevance of financial statement information, specifically, earnings and book values, is examined empirically using Ohlson’s (1995) valuation model that captures the level of compliance with IFRS among KSE listed firms. The results show a significant association between the level of compliance with IFRS and the value relevance of earnings and book values to KSE investors, highlighting the importance of establishing and maintaining adequate monitoring and enforcement mechanisms to ensure compliance with accounting standards. The outcomes of this study serve to inform regulators and companies on whether moving toward stricter compliance with IFRS will necessarily improve the value relevance of financial statement information Classification-JEL: M48 Keywords: Value Relevance, International Financial Reporting Standards, Compliance, Disclosure Index, Kuwait Journal: The International Journal of Business and Finance Research Pages: 1-18 Volume: 9 Issue: 3 Year: 2015 File-URL: http://www.theibfr2.com/RePEc/ibf/ijbfre/ijbfr-v9n3-2015/IJBFR-V9N3-2015-1.pdf File-Format: Application/pdf Handle: RePEc:ibf:ijbfre:v:9:y:2015:i:3:p:1-18 Template-Type: ReDIF-Article 1.0 Author-Name: Elif Akben Selcuk Author-Name: Halil Kiymaz Title: THE IMPACT OF DIVERSIFYING ACQUISITIONS ON SHAREHOLDER WEALTH: EVIDENCE FROM TURKISH ACQUIRERS Abstract: This study examines the impact of diversifying acquisitions on acquiring Turkish firms. Using a sample of 98 acquisitions during 2000-2011, the study finds that acquiring firms experience statistically significant wealth gains surrounding the announcement date. The cross-sectional regression results show that diversifying acquisitions create higher wealth gains to acquirers compared with focused acquisitions. The results also show that smaller firms experience higher abnormal returns compared to larger firms and that acquiring public firms result in higher wealth gains to acquirers. Finally, the findings indicate that results differ among group affiliates and independent firms. If an acquisition is made by an independent firm, diversifying acquisitions generate higher abnormal returns compared to focused acquisitions. However, if the acquirer is a group affiliate, there is no significant difference between the two types of acquisition activities in terms of wealth effects Classification-JEL: G14, G20, G34 Keywords: Shareholder Value, Wealth Effect, Stock Prices, Turkish Market Journal: The International Journal of Business and Finance Research Pages: 19-32 Volume: 9 Issue: 3 Year: 2015 File-URL: http://www.theibfr2.com/RePEc/ibf/ijbfre/ijbfr-v9n3-2015/IJBFR-V9N3-2015-2.pdf File-Format: Application/pdf Handle: RePEc:ibf:ijbfre:v:9:y:2015:i:3:p:19-32 Template-Type: ReDIF-Article 1.0 Author-Name: Russell E. Triplett Author-Name: Ranjini L. Thaver Title: SOUTH AFRICA’S IMPORT DEMAND FUNCTION WITH CHINA: A COINTEGRATION APPROACH Abstract: During the past decade China has emerged as South Africa’ largest trade partner. In an effort to understand this important and remarkable trend, we estimate South Africa’s import demand function with China over the period 1993-2012. Specifying an error-correction model, we use the bounds testing approach of Pesaran, Shin and Smith (2001) and find evidence of long-run cointegration among the variables. Our long-run elasticity estimates suggest that income is the most important factor in the determination of South Africa’s imports from China. Interestingly, the effect of the real relative price is positive, but this counterintuitive result is consistent with evidence from other middle-income countries. These combined factors imply that the South African trade deficit with China will continue to widen despite a real depreciation of the rand Classification-JEL: F10, F14 Keywords: South Africa, China, Bilateral Trade, Elasticities, Cointegration Journal: The International Journal of Business and Finance Research Pages: 33-44 Volume: 9 Issue: 3 Year: 2015 File-URL: http://www.theibfr2.com/RePEc/ibf/ijbfre/ijbfr-v9n3-2015/IJBFR-V9N3-2015-3.pdf File-Format: Application/pdf Handle: RePEc:ibf:ijbfre:v:9:y:2015:i:3:p:33-44 Template-Type: ReDIF-Article 1.0 Author-Name: Mark Schaub Author-Name: Todd A. Brown Title: LONG TERM ADR PERFORMANCE: HOW DO REGIONAL ISSUES LISTED ON THE NYSE COMPARE TO US AND REGIONAL INDEX RETURNS? Abstract: This study examines the long-term performance of Asia Pacific, European, and Latin American ADRs versus the S&P500 and their respective regional indexes from 1990-2010. The sample was dividend by stable markets (1990s) and volatile markets (2000s). We find that, when analyzed in total, regional indexes perform similarly to the S&P500. However, the Asia Pacific and Latin America regions do offer diversification benefits individually. Furthermore, the ADRs from each region underperform in stable markets (1990s) and outperform in volatile markets (2000s) leading to great diversification benefits Classification-JEL: G11, G15 Keywords: American Depositary Receipts, Regional Indexes, Emerging Markets Journal: The International Journal of Business and Finance Research Pages: 45-58 Volume: 9 Issue: 3 Year: 2015 File-URL: http://www.theibfr2.com/RePEc/ibf/ijbfre/ijbfr-v9n3-2015/IJBFR-V9N3-2015-4.pdf File-Format: Application/pdf Handle: RePEc:ibf:ijbfre:v:9:y:2015:i:3:p:45-58 Template-Type: ReDIF-Article 1.0 Author-Name: Jun-Biao Lin Title: HEDGING STRATEGY COMPARISONS OF VOLATILITY INDEX OPTIONS USING DIFFUSION MODELS Abstract: With the innovation of derivatives, the Standard and Poor’s (S&P) 500 index -- as an underlying asset of the volatility index (VIX) introduced by the Chicago Board Options Exchange (CBOE) -- was adopted as the research subject in this study. Since the financial crisis of 2008, the degree of market volatility has increased substantially. In addition, a random process has been found jumping about in the VIX data. In this study we compare VIX options based on different diffusion models. In this study, when a jump component is considered in the VIX process, the expectation maximization (EM) method is used to estimate parameters; this is a different perspective of evaluation from other studies. This paper further analyzes different hedging strategies based on different diffusion models Classification-JEL: G13, G17 Keywords: VIX, Jump Process, MLE, EM Algorithm, Hedging Strategy Journal: The International Journal of Business and Finance Research Pages: 59-69 Volume: 9 Issue: 3 Year: 2015 File-URL: http://www.theibfr2.com/RePEc/ibf/ijbfre/ijbfr-v9n3-2015/IJBFR-V9N3-2015-5.pdf File-Format: Application/pdf Handle: RePEc:ibf:ijbfre:v:9:y:2015:i:3:p:59-69 Template-Type: ReDIF-Article 1.0 Author-Name: Mike Siew Wei Leong Author-Name: Sheela Devi Sundarasen Title: IPO INITIAL RETURNS AND VOLATILITY: A STUDY IN AN EMERGING MARKET Abstract: This study examines the impact of firm characteristics, signaling variables and financial variables on IPO initial returns and the volatility of initial returns. Hierarchical regression is first performed on all the three blocks of variables, after which a stepwise regression is executed to further test on the significance of the relationship amongst the respective individual variables. The results designate differences in the relationship between firm characteristics, signaling variables and financial variables on IPO initial returns and the volatility of initial returns. It is conjectured that oversubscription of IPOs have a positive impact on the initial returns, whilst prospective dividend yield has a negative impact on the volatility of IPOs’ initial returns Classification-JEL: G1, G12, G14, G120 Keywords: IPO, Initial Returns, Volatility of Initial Returns Journal: The International Journal of Business and Finance Research Pages: 71-82 Volume: 9 Issue: 3 Year: 2015 File-URL: http://www.theibfr2.com/RePEc/ibf/ijbfre/ijbfr-v9n3-2015/IJBFR-V9N3-2015-6.pdf File-Format: Application/pdf Handle: RePEc:ibf:ijbfre:v:9:y:2015:i:3:p:71-82 Template-Type: ReDIF-Article 1.0 Author-Name: Ezzeddine Abaoub Author-Name: Yosr Nouri Title: EARNINGS MANAGEMENT AND ANALYST COVERAGE CHANGES AROUND IFRS IMPLEMENTATION: EVIDENCE FROM FRANCE Abstract: Using a sample of French companies listed on the stock index CAC ALL TRADABLE, this paper analyzes the relation among analyst coverage and earnings management. We find that after the introduction of International Financial Reporting Standards (IFRS) and over a period from 2005 till 2011, analysts’ coverage and experience reduce the level of earning management Classification-JEL: G29 Keywords: Analyst Coverage, Analyst Experience, Discretionary Accruals, French, IFRS Standards Journal: The International Journal of Business and Finance Research Pages: 83-94 Volume: 9 Issue: 3 Year: 2015 File-URL: http://www.theibfr2.com/RePEc/ibf/ijbfre/ijbfr-v9n3-2015/IJBFR-V9N3-2015-7.pdf File-Format: Application/pdf Handle: RePEc:ibf:ijbfre:v:9:y:2015:i:3:p:83-94 Template-Type: ReDIF-Article 1.0 Author-Name: Zuhrohtun Author-Name: Zaki Baridwan Title: DETERMINANTS OF EARNINGS OPACITY: INDONESIA EVIDENCE Abstract: The opacity index of Indonesia ranks 35 of 48 countries in the world (Milken Institute, 2009) and 32 of 34 countries (Bhattacharya et al., 2003). It indicates that earnings quality of Indonesian public companies is low. The factors affecting earnings opacity of Indonesian public firms remains a question. This study investigates whether: (1) firms with concentrated ownership have higher earnings opacity compared to those of dispersed ownership, (2) firms audited by Big Four accounting firms have lower earnings opacity relative to those audited by non-big four firms, (3) financial firms have higher earnings opacity compared to non-financial firms, and (4) smaller firms have lower earnings opacity compared to larger firms. The sample for the study consist of all firms listed on the Indonesia Stock Exchange in 2008-2010. This study used independent sample t-test and regression analysis to test the hypotheses. Research findings suggest that: (1) smaller firms tend have greater earnings opacity than larger firms and it is used to maintain their private information from competitors, (2) firms with higher concentrated ownership tend to have lower earnings opacity. This finding suggests that a single majority ownership plays an important role in monitoring the transparency of information Classification-JEL: G30 Keywords: Earnings Opacity, Concentrated Ownership, Smaller Firms, Larger Firms, Financial Firms, Big Four, Non Big Four Journal: The International Journal of Business and Finance Research Pages: 95-104 Volume: 9 Issue: 3 Year: 2015 File-URL: http://www.theibfr2.com/RePEc/ibf/ijbfre/ijbfr-v9n3-2015/IJBFR-V9N3-2015-8.pdf File-Format: Application/pdf Handle: RePEc:ibf:ijbfre:v:9:y:2015:i:3:p:95-104 Template-Type: ReDIF-Article 1.0 Author-Name: Qasim M. Zureigat Title: DETERMINANTS OF MANDATORY CORPORATE GOVERNANCE: EVIDENCE FROM AN EMERGING MARKET Abstract: This study investigates whether listed companies in Jordan comply with mandatory governance rules and explores factors that affect the governance compliance level. A checklist was designed to construct a governance index for each of 128 Jordanian listed companies that disclose the necessary data to calculate the variables under study. The results indicate that on average Jordanian listed companies comply with mandatory governance rules. This compliance depends on some crucial variables. Company size, profitability, age as a listed company on the ASE, size of the auditor and type of industry significantly affect the compliance level Classification-JEL: G34, M48 Keywords: Corporate Governance, Audit, Emerging Market, Compliance, Jordanian Listed Companies Journal: The International Journal of Business and Finance Research Pages: 105-114 Volume: 9 Issue: 3 Year: 2015 File-URL: http://www.theibfr2.com/RePEc/ibf/ijbfre/ijbfr-v9n3-2015/IJBFR-V9N3-2015-9.pdf File-Format: Application/pdf Handle: RePEc:ibf:ijbfre:v:9:y:2015:i:3:p:105-114