Pre-adoption market reaction to IFRS 9:a cross-country event-study

We are the first to examine the market reaction to 13 announcement dates related to IFRS 9 for over 5400 European listed firms. We find an overall positive reaction to the introduction of IFRS 9. The regulation is particularly beneficial to shareholders of firms in countries with weaker rule of law and a smaller divergence between local GAAP and IAS 39. Bootstrap simulations rule out the possibility that sampling error or data mining are driving our findings. Our main findings are also robust to confounding events and the extent of the media coverage for each event. These results suggest that investors perceive the new regulation as shareholder-wealth enhancing and support the view that stronger comparability across accounting standards of European firms is beneficial to international investors and outweighs the costs of poorer firm-specific information.

Secondary market pricing behaviour around UK bond auctions

Using an event study approach, this article reports evidence that the UK Treasury bond market displayed anomalous pricing behaviour in the secondary market both immediately before and after auctions of seasoned bonds. Using a benchmark return derived from the behaviour of the underlying yield curve, the market offered statistically and economically significant excess returns, around the auctions held between 1992 and 2004. A cross-sectional analysis of the cumulative excess returns shows that the excess demand at the auctions is a key determinant of this excess return.

An empirical investigation of the effect of rights issue announcements on share returns and the determinants of abnormal returns on the Kuala Lumpur Stock Exchange

This thesis examines the effect of rights issue announcements on stock prices by companies listed on the Kuala Lumpur Stock Exchange (KLSE) between 1987 to 1996. The emphasis is to report whether the KLSE is semi strongly efficient with respect to the announcement of rights issues and to check whether the implications of corporate finance theories on the effect of an event can be supported in the context of an emerging market. Once the effect is established, potential determinants of abnormal returns identified by previous empirical work and corporate financial theory are analysed. By examining 70 companies making clean rights issue announcements, this thesis will hopefully shed light on some important issues in long term corporate financing. Event study analysis is used to check on the efficiency of the Malaysian stock market; while cross-sectional regression analysis is executed to identify possible explanators of the rights issue announcements' effect. To ensure the results presented are not contaminated, econometric and statistical issues raised in both analyses have been taken into account. Given the small amount of empirical research conducted in this part of the world, the results of this study will hopefully be of use to investors, security analysts, corporate financial managements, regulators and policy makers as well as those who are interested in capital market based research of an emerging market. It is found that the Malaysian stock market is not semi strongly efficient since there exists a persistent non-zero abnormal return. This finding is not consistent with the hypothesis that security returns adjust rapidly to reflect new information. It may be possible that the result is influenced by the sample, consisting mainly of below average size companies which tend to be thinly traded. Nevertheless, these issues have been addressed. Another important issue which has emerged from the study is that there is some evidence to suggest that insider trading activity existed in this market. In addition to these findings, when the rights issue announcements' effect is compared to the implications of corporate finance theories in predicting the sign of abnormal returns, the signalling model, asymmetric information model, perfect substitution hypothesis and Scholes' information hypothesis cannot be supported.

Corporate restructuring: empirical evidence from the UK

Corporate restructuring is perceived as a challenge to research. Prior studies do not provide conclusive evidence regarding the effects of restructuring. Since there are discernible findings, this research attempts to examine the effects of restructuring events amongst the UK listed firms. The sample firms are listed in the LSE and London AIM stock exchange. Only completed restructuring transactions are included in the study. The time horizon extends from year 1999 to 2003. A three-year floating window is assigned to examine the sample firms. The key enquiry is to scrutinise the ex post effects of restructuring on performance and value measures of firms with contrast to a matched criteria non-restructured sample. A cross sectional study employing logit estimate is undertaken to examine firm characteristics of restructuring samples. Further, additional parameters, i.e. Conditional Volatility and Asymmetry are generated under the GJR-GARCH estimate and reiterated in logit models to capture time-varying heteroscedasticity of the samples. This research incorporates most forms of restructurings, while prior studies have examined certain forms of restructuring. Particularly, these studies have made limited attempts to examine different restructuring events simultaneously. In addition to logit analysis, an event study is adopted to evaluate the announcement effect of restructuring under both the OLS and GJR-GARCH estimate supplementing our prior results. By engaging a composite empirical framework, our estimation method validates a full appreciation of restructuring effect. The study provides evidence that restructurings indicate non-trivial significant positive effect. There are some evidences that the response differs because of the types of restructuring, particularly while event study is applied. The results establish that performance measures, i.e. Operating Profit Margin, Return on Equity, Return on Assets, Growth, Size, Profit Margin and Shareholders' Ownership indicate consistent and significant increase. However, Leverage and Asset Turn Over suggest reasonable influence on restructuring across the sample period. Similarly, value measures, i.e. Abnormal Returns, Return on Equity and Cash Flow Margin suggest sizeable improvement. A notable characteristic seen coherently throughout the analysis is the decreasing proportion of Systematic Risk. Consistent with these findings, Conditional Volatility and Asymmetry exhibit similar trend. The event study analysis suggests that on an average market perceives restructuring favourably and shareholders experience significant and systematic positive gain.

Empirical studies of corporate governance in China

The thesis aims to provide empirical studies towards Chinese corporate governance. Since China initially established its stock exchange system in the 1990s, it has gone through different stages of changes to become a more market-oriented system. Extensive studies have been conducted in Chinese corporate governance, however, many were theoretical discussion focusing on the early stages and there‘s a general lack of empirical analysis. This paper provides three empirical analysis of the Chinese corporate governance: the overall market discipline efficiency, the impact of capital structure on agency costs, the status of 2005- 2006 reform that substantially modified ownership structure of Chinese listed firms and separated ownership and control of listed firms. The three empirical studies were selected to reflect four key issues that need answering: the first empirical study, using event study to detect market discipline on a collective level. This study filled a gap in the Chinese stock market literature for being the first one ever using cross-market data to test market discipline. The second empirical study endeavoured to contribute to the existing corporate governance literature regarding capital structure and agency costs. Two conclusions can be made through this study: 1) for Chinese listed firms, higher gearing means higher asset turnover ratios and ROE, i.e. more debts seem to reduce agency costs; 2) concentration level of shares appears to be irrelevant with company performance, controlling shareholders didn‘t seem to commit to the improvement of corporate assets utilization or contribute to reducing agency costs. This study addressed a key issue in Chinese corporate governance since the state has significant shareholding in most big listed companies. The discussion of corporate governance in the Chinese context would be completely meaningless without discussing the state‘s role in corporate governance, given that about 2/3 of the almost all shares were non-circulating shares controlled by the state before the 2005-2006 overhaul ownership reform. The third study focused on the 2005-2006 reform of ownership of Chinese listed firms. By collecting large-scale data covering all 64 groups of Chinese listed companies went through the reform by the end of 2006 (accounting for about 97.86% and 96.76% of the total market value of Shanghai (SSE) and Shenzhen Stock Exchange (SZSE) respectively), a comprehensive study about the ownership reform was conducted. This would be first and most comprehensive empirical study in this area. The study of separated ownership and control of listed firm is the first study conducted using the ultimate ownership concept in Chinese context.

The effect of timeliness and credit ratings on the information content of earnings announcements

Abstract: This paper investigates the impact of timeliness and credit ratings on the information content of the earnings announcements of Greek listed firms from 2001 to 2008. Using the classical event study methodology and regression analysis, we find that firms tend to release good news on time and are inclined to delay the release of bad news. We also provide evidence that the level of corporate risk differentiates the information content of earnings according to the credit rating category. Specifically, firms displaying high creditworthiness enjoy positive excess returns on earnings announcement dates. In contrast, firms with low creditworthiness undergo significant share price erosions on earnings announcement days. We also observe a substitution effect between timeliness and credit ratings in relation to the information content of earnings announcements. Specifically, we find that as the credit category of earnings-announcing firms improves, the informational role of timeliness is mitigated.

Using system dynamics in a discrete-event simulation study of a manufacturing plant

Purpose - To provide an example of the use of system dynamics within the context of a discrete-event simulation study. Design/methodology/approach - A discrete-event simulation study of a production-planning facility in a gas cylinder-manufacturing plant is presented. The case study evidence incorporates questionnaire responses from sales managers involved in the order-scheduling process. Findings - As the project progressed it became clear that, although the discrete-event simulation would meet the objectives of the study in a technical sense, the organizational problem of "delivery performance" would not be solved by the discrete-event simulation study alone. The case shows how the qualitative outcomes of the discrete-event simulation study led to an analysis using the system dynamics technique. The system dynamics technique was able to model the decision-makers in the sales and production process and provide a deeper understanding of the performance of the system. Research limitations/implications - The case study describes a traditional discrete-event simulation study which incorporated an unplanned investigation using system dynamics. Further, case studies using a planned approach to showing consideration of organizational issues in discrete-event simulation studies are required. Then the role of both qualitative data in a discrete-event simulation study and the use of supplementary tools which incorporate organizational aspects may help generate a methodology for discrete-event simulation that incorporates human aspects and so improve its relevance for decision making. Practical implications - It is argued that system dynamics can provide a useful addition to the toolkit of the discrete-event simulation practitioner in helping them incorporate a human aspect in their analysis. Originality/value - Helps decision makers gain a broader perspective on the tools available to them by showing the use of system dynamics to supplement the use of discrete-event simulation. © Emerald Group Publishing Limited.

The relationship between spoken language and speech and nonspeech processing in children with autism:a magnetic event-related field study

It has been proposed that language impairments in children with Autism Spectrum Disorders (ASD) stem from atypical neural processing of speech and/or nonspeech sounds. However, the strength of this proposal is compromised by the unreliable outcomes of previous studies of speech and nonspeech processing in ASD. The aim of this study was to determine whether there was an association between poor spoken language and atypical event-related field (ERF) responses to speech and nonspeech sounds in children with ASD (n = 14) and controls (n = 18). Data from this developmental population (ages 6-14) were analysed using a novel combination of methods to maximize the reliability of our findings while taking into consideration the heterogeneity of the ASD population. The results showed that poor spoken language scores were associated with atypical left hemisphere brain responses (200 to 400 ms) to both speech and nonspeech in the ASD group. These data support the idea that some children with ASD may have an immature auditory cortex that affects their ability to process both speech and nonspeech sounds. Their poor speech processing may impair their ability to process the speech of other people, and hence reduce their ability to learn the phonology, syntax, and semantics of their native language.

Event related potential (ERP) evidence for selective impairment of verbal recollection in abstinent recreational methylenedioxymethamphetamine (“Ecstasy”)/polydrug users

Objectives Ecstasy is a recreational drug whose active ingredient, 3,4-methylenedioxymethamphetamine (MDMA), acts predominantly on the serotonergic system. Although MDMA is known to be neurotoxic in animals, the long-term effects of recreational Ecstasy use in humans remain controversial but one commonly reported consequence is mild cognitive impairment particularly affecting verbal episodic memory. Although event-related potentials (ERPs) have made significant contributions to our understanding of human memory processes, until now they have not been applied to study the long-term effects of Ecstasy. The aim of this study was to examine the effects of past Ecstasy use on recognition memory for both verbal and non-verbal stimuli using ERPs. Methods We compared the ERPs of 15 Ecstasy/polydrug users with those of 14 cannabis users and 13 non-illicit drug users as controls. Results Despite equivalent memory performance, Ecstasy/polydrug users showed an attenuated late positivity over left parietal scalp sites, a component associated with the specific memory process of recollection. Conlusions This effect was only found in the word recognition task which is consistent with evidence that left hemisphere cognitive functions are disproportionately affected by Ecstasy, probably because the serotonergic system is laterally asymmetrical. Experimentally, decreasing central serotonergic activity through acute tryptophan depletion also selectively impairs recollection, and this too suggests the importance of the serotonergic system. Overall, our results suggest that Ecstasy users, who also use a wide range of other drugs, show a durable abnormality in a specific ERP component thought to be associated with recollection.

Regulation - the movie:a semiotic study of the periodic review of UK regulated industry

This paper explores the regulatory process of UK privatised utilities as manifest in the periodic review of prices. Two separate review processes are identified, operating concurrently - a covert dialogue between the regulator and the regulated and an overt dialogue taking place in the public arena. Using a semiotic analysis of the review the authors argue that the overt event is the real review. Furthermore they argue that the unfolding of each review is so similar that it can be likened to a film script which is constantly re-enacted. The purpose of the review as a legitimating vehicle for the regulator and regulated, who exist in a symbiotic relationship, is explored in terms of the semiotics involved and the myth creation role of legitimation in order to explain the significance of the regulatory process.

Using simulation for facility design: a case study

A discrete event simulation model was developed and used to estimate the storage area required for a proposed overseas textile manufacturing facility. It was found that the simulation was able to achieve this because of its ability to both store attribute values and to show queuing levels at an individual product level. It was also found that the process of undertaking the simulation project initiated useful discussions regarding the operation of the facility. Discrete event simulation is shown to be much more than an exercise in quantitative analysis of results and an important task of the simulation project manager is to initiate a debate among decision makers regarding the assumptions of how the system operates.

Understanding change in the public sector:a local authority case study

Increasingly managers in the public sector are being required to manage change, but many of the models of change which are available to them have been developed from private sector experience. There is a need to understand more about how the change process unfolds in the public sector. A case study of change in one local authority over the period 1974-87 is provided. The events surrounding housing decentralisation and the introduction of community development are considered in detail. To understand these events a twofold model of change is proposed: a short wave model which explains a change project or event; and a long wave model which considers how these projects or events might be linked together to provide a picture of an organisation over a longer period. The short wave model identifies multiple triggers of change and signals the importance of mediators in recognising these triggers. The extent to which new ideas are implemented and the pace of their adoption is influenced by the balance of power within the organisation and the political tactics which are used. Broad phases in the change process can be identified, but there is not a simple linear passage through these. The long wave model considers the way in which continuity and change feed off one another. It suggests that periods of relative stability may be interspersed with more radical transformations as the dominant paradigm guiding the organisation shifts. However, such paradigmatic shifts in local government may be less obvious than in the private sector due to the diverse nature of the former.

Palaeozoic volcanogenic mineral deposits at Parys Mountain, Avoca, and S.E. Canada: a comparative study. Available in 2 volumes.

The sulphide mineralisation at Avoca and Parys Mountain is intimately related to volcanism and is of volcanogenic sedimentary type. The associated volcanics are predominantly pyroclastics of rhyodacitic composition and of Upper Ordovician age. They were erupted from discrete small volcanic centres, products of single local volcanic events, whose spatial distribution was related to fractures in the sialic basement of the paratectonic Caledonides of the British Isles. These fractures resulted in linear controls on volcanic, plutonic and tectonic features; they are the result of predominantly strikeslip stresses generated in this part of the European plate during closure of the Iapetus ocean. The mineralisation, predominantly pyritic, consists of a siliceous footwall zone containing bedded and cross-cutting sulphides and an overlying non-siliceous zone of bedded sulphides which may show vertical zoning of metal ratios. The sulphides are associated with chert and iron formation and have been affected by slumping. Mineralisation developed near the vents during intense fumarolic activity accompanying strong volcanism; at Parys Mountain, fumarolic activity commenced prior to, and continued after, the rnain volcanic event. Comparison with similar deposits in Newfoundland and at Bathurst, in the Canadian Appalachians, shows that mineralisation can be associated with any discrete pulse of acid magmatism in shallow subaqueous conditions. Local features of the sulphides and associated sediments are similar, although in more distal deposits (with respect to a volcanic centre) footwall alteration and mineralisation are less well developed. The nature of the basement and the presence or absence of earlier volcanics are not critical, although establishment of a local tensional regime at the time of ore formation may be important. The volcanics hosting mineralisation are rhyodacitic pyroclastics, generally related to a small centre and representing a single episode of volcanism.

Translation strategies and cross-cultural contraints : a case study of the translation of advertising texts

Since the transfer of a message between two cultures very frequently takes place through the medium of a written text qua communicative event, it would seem useful to attempt to ascertain whether there is any kind of pattern in the use of strategies for the effective interlingual transfer of this message. Awareness of potentially successful strategies, within the constraints of context, text type, intended TL function and TL reader profile will enhance quality and cost-effectiveness (time, effort, financial costs) in the production of the target text. Through contrastive analysis of pairs of advertising texts, SL and TL, French and English, this study will attempt to identify the nature of some recurring choices made by different translators in the attempt to recreate ST information in the TL in such a manner as to reproduce as closely as possible the informative, persuasive and affective functions of the text as advertising material. Whilst recurrence may be seen to be significant in terms of illustrating tendencies with regard to the solution of problems of translation, this would not necessarily be taken as confirmation of the existence of pre-determined or prescriptive rules. These tendencies could, however, be taken as a guide to potential solutions to certain kinds of context-bound and text-type specific problem. Analysis of translated text-pairs taken from the field of advertising should produce examples of constraints posed by the need to select the content, tone and form of the Target Text, in order to ensure maximum efficacy of persuasive effect and to ensure the desired outcome, as determined by the Source Text function. When evaluating the success of a translated advertising text, constraints could be defined in terms of the culture-specific references or assumptions on which a Source Text may build in order to achieve its intended communicative function within the target community.