Asian Journal of Business and Accounting

Accounting Conservatism and Income Smoothing after the Japanese Sarbanes–Oxley Act

Ian Eddie — 2024-06-30

Manuscript type: Research paper

Research aims: This study examines the effect of the Japanese Sarbanes-Oxley Act (J-SOX) on accounting conservatism and income smoothing behaviour.

Design/Methodology/Approach: We perform multiple regression analyses with a dummy variable for the post-J-SOX period to compare the levels of accounting conservatism and income smoothing between the pre- and post-J-SOX periods.

Research findings: We find that accounting conservatism has increased and income smoothing has decreased after J-SOX implementation. This finding suggests that financial reporting transparency in Japanese firms may have increased following J-SOX implementation.

Theoretical contribution/Originality: This study adds new evidence to the literature regarding the effect of internal control regulations on managers’ accounting behaviour.

Practitioner/Policy implications: Our findings suggest that J-SOX may be effective in improving financial reporting transparency although the procedures are relatively concise. Therefore, policy makers and accounting standard setters should consider not only strictness but also cost-effectiveness.

Research limitation: We cannot rule out the possibility that factors occurred during our study period other than J-SOX affected our results.

Operating Cash Flows, Board Characteristics and Adoption of IR 4.0 Technologies

Shu-Fen Chuah — 2024-06-30

Manuscript type: Research paper

Research aims: This study examines the effect of operating cash flows (OCF) on firm innovation, as represented by the adoption of fourth industrial revolution (IR4.0) technologies. Board characteristics which act as the corporate governance mechanisms, are introduced as the moderators.

Design/methodology/approach: The sample of the study consists of 954 publicly listed firms traded on Bursa Malaysia in 2019. The logistic regression model is employed.

Research findings: Our study found that increasing OCF encourages firm innovation. Board size and board independence are positive moderators, while multiple directorships and busy boards are negative. Chairman-CEO duality is not a significant moderator but has a direct negative impact on firm innovation.

Theoretical contribution/originality: This study proposed that the adoption of IR4.0 technologies could be observed via (i) the hiring of key personnel with IR4.0 experience, (ii) the appointment of a chief information officer (CIO), (iii) the establishment of the technology committee, and (iv) the acquisition of IR4.0 technology. The positive moderating effects of board size and independence indicate that the board of directors is a crucial resource that connects the firms with external contingencies (following resource dependence theory). In contrast, multiple directorships and busy boards are negative moderators, highlighting the importance of effective board monitoring to alleviate agency costs and improve firm innovation (following agency theory).

Practitioner/policy implications: This study reveals approaches firms could undertake to welcome IR4.0 and improve firms’ corporate governance policies.

Research limitation: It is challenging to quantify firm innovation. The mentioned approaches may only partially reflect the adoption of IR4.0 technologies of the firms.

Corporate Social Responsibility in the Formal Strategic Planning of South African Listed Companies

Md Humayun Kabir — 2024-06-30

Manuscript type: Research paper
Research aims: This study investigates the relationship between formal
strategic planning and corporate social responsibility (CSR) in the South
African context, considering JSE-listed companies.
Design/Methodology/Approach: This study employed multiple-scale
items with a five-point Likert scale to measure CSR and formal strategic
planning. A chi-square test was performed to test the significance of the
relationship between the variables.
Research findings: The analysis of all South African listed companies
(i.e., JSE-listed companies) revealed that formal strategic planning is
significantly associated with CSR, suggesting that CSR concerns are
addressed during the formal strategic planning process.
Theoretical contribution/Originality: The respondents are only limited
to JSE-listed companies and the findings are related to the links only
between formal strategic planning and CSR.
Practitioner/Policy implication: The JSE is the largest stock exchange in
Africa. Thus, it is becoming increasingly important for them to maintain
their corporate reputation with stakeholders. Accordingly, addressing
stakeholders’ demand for CSR through the formal strategic planning
process would benefit the organisation is vital.
Originality/Value: This study contributes a deep intuitive knowledge of
companies’ perceptions of CSR demonstrations by considering formal
strategic planning in the South African context.

Determinants of Public Investment Decision in Forex Robots Trading: Evidence from Indonesia

Uus Ahmad Husaeni — 2024-06-30

Manuscript type: Research paper
Research aims: This study aims to analyse the factors that influence
investment decisions on forex trading robot users in Indonesia by
using four factors that influence investment decisions: financial literacy,
investment knowledge, financial behaviour, and risk tolerance.
Design/Methodology/Approach: The method used in this research is
quantitative with a survey approach. The data analysis technique used
Structural Equation Modeling (SEM) through the Partial Least Square
(PLS) approach. The data collection technique was carried out by
distributing questionnaires with a Google form on the WA Forex robot
trading user group. In the end, 200 users filled out the questionnaire.
Research findings: This study shows that financial literacy and
investment knowledge significantly influence public decisions.
Meanwhile, financial behaviour and risk tolerance do not significantly
affect people’s investment decisions in forex robot trading. This shows
that forex trading robot users have good financial literacy and investment
knowledge in deciding to invest. However, trading robot users have
financial behaviour that tends to be wrong, so they are tempted to profit
that is promised by 10-60 percent every month by forex trading robot
companies without paying attention to the risk tolerance of the amount of
property they invest. As a result, if the return from investment encounters
obstacles, forex trading robot users will experience financial difficulties.
Theoretical contribution/Originality: This study provides information that can help potential investors be careful and understand the risks when investing using forex trading robots. Research on investment decisions on forex trading robots in Indonesia is the first research that has been conducted due to the proliferation of companies offering forex trading robots that have led to Scams or Ponzi Schemes so that investors are harmed.
Practitioner/Policy implication: The government of the Republic of Indonesia is to immediately pass the Law on the Use of Trading Robots in Indonesia so that it becomes the basis for the legality of trading using robots. Meanwhile, for the investment community using trading robots, even though trading robots promise large profits, they have weaknesses that allow the public to experience financial losses.
Research limitations/Implications: Future research can consider the UTAUT model in measuring investment decisions in trading robots in Indonesia. Research regarding trading robots needs to be carried out continuously as public literacy material to avoid investment models that end in Ponzi schemes—also using a legal approach to be able to explain the criteria for trading robot providers that are close to or by the legislation in Indonesia which is currently being drafted.

Research on Effects of Board of Directors’ Characteristics on Corporate Social Responsibility Disclosure - Manufacturing Listed Firms on the Stock Exchange of Vietnam

Pham Thi Bich Thu — 2024-06-30

Manuscript type: Research paper
Research aims: This study aims to assess how corporate governance
characteristics affect the disclosure of corporate social responsibility (CSR)
among manufacturing companies listed on the stock market of Vietnam.
Design/Methodology/Approach: The study analyses the annual reports of
195 companies listed on the Vietnam stock market between 2018 and 2022,
to investigate the influence of board size, board independence, women on
board, board meetings, managerial ownership, and female leadership on
corporate social responsibility disclosure (CSRD). The Fixed Effects Model
(FEM) and Random Effects Model (REM) were employed to determine the
optimal model. Subsequently, defects and regression were analysed using
the General Least Squares (GLS) model.
Research findings: The findings reveal that the managerial ownership
factor has the most substantial negative impact on CSRD; followed by the
female leadership a positive influence on CSRD. Lastly, the board size
factor has a positive effect on CSRD, with a significant alignment with
previous research. Additionally, board independence, women on board,
and board meetings have an insignificant influence on CSRD.
Theoretical contribution: Based on the findings, manufacturing
companies listed on the stock market of Vietnam demonstrate a level
of corporate social responsibility disclosure that is slightly below
average (47.9%). The findings revealed that the involvement of women
in management becomes meaningful when they possess actual control,
whereas their mere presence on boards does not affect CSR disclosure.
Practitioner/Policy implications: The results provide valuable insights for
policymakers in identifying the corporate governance characteristics that
can foster CSR reporting in Vietnamese listed companies.
Research limitation/Implications: The research relied on annual CSR
reporting as a metric to assess CSR disclosure, disregarding various
other communication channels used by companies to communicate their
CSR initiatives. Furthermore, the study did not assess the disparity in
CSRD levels across various types of enterprises and different scales of
businesses.

Deciphering Consumer-Based Brand Equity, Brand Preference, and Intentions in Algeria’s Home Appliance Market

Amina Elfekair — 2024-06-30

Manuscript type: Research paper
Research aims: Consumer-based brand equity (CBBE) and purchase
intention are two significant concepts in marketing research that have recently received notable attention from scholars and managers alike. Still, few studies have been conducted in Algeria with a specific focus on the home appliance category. This paper aims to explore the linkages between dimensions of CBBE dimensions (i.e., brand awareness/associations, perceived quality, and brand loyalty) and brand preference and the role of brand preference in shaping purchase intention in the context of home appliance brands in Algeria.
Design/Methodology/Approach: The study conducted a quantitative research approach after collecting data from 294 householders. The PLS- SEM statistical approach is used to test the developed hypotheses.
Research findings: The findings reveal that CBBE dimensions positively and significantly influence brand preference. Furthermore, brand preference positively influences purchase intention.
Theoretical contribution: The study contributes to the understanding of brand dynamics and consumer behaviour in specific market settings of home appliances.
Practitioner/Policy implications: The findings offer insights to brand managers and marketers of home appliances in different cultures, empowering them to develop an effective competitive positioning that crafts customer positive responses and drives sales growth.
Research limitation/Implication: Rather than including only preferences
and intentions, other behavioural and market outcomes may overlook the potential effect of CBBE such as defending negative information and market share; the study was conducted using qualitative and cross- sectional methods, qualitative methods would provide more insights into CBBE and attribute-based preferences.

The Assessment of Usability and Service Quality in E-Commerce Using the Integration of Analytical Hierarchy Process (AHP) and Technique for Order Performance by Similarity to Ideal Solution (TOPSIS)

Alfian Abdul Ghaffar — 2024-06-30

Manuscript type: Research paper
Research aims: This study aims to identify evaluation criteria for
e-commerce platforms and determine the top-performing platform in the
Indonesian marketplace.
Design/Methodology/Approach: The research employs a quantitative
approach, utilising the Analytical Hierarchy Process (AHP) and the
Technique for Order Performance by Similarity to Ideal Solution (TOPSIS)
model analysis. It involves analysing data from 100 respondents who are
users of Shopee, Tokopedia, and Bukalapak e-commerce platforms.
Research findings: The findings suggest that the Usability criterion
outperforms E-ServQual in terms of scores. Based on the AHP and
TOPSIS techniques, Tokopedia, Shopee, and Bukalapak are ranked as the
top three e-commerce platforms.
Theoretical contribution/Originality: This study contributes to
understanding the importance of usability in evaluating e-commerce
platforms and provides insights into customer preferences. It also
demonstrates the sequential integration of AHP and TOPSIS techniques
for evaluating multiple criteria.
Practitioner/Policy implications: This study reveals that Satisfaction,
Efficiency, and Learnability are crucial sub-criteria for customers when
selecting an e-commerce platform. Improving these aspects can enhance
consumer purchasing power and improve the overall user experience.
Research limitation/Implications: The limitation of the study is
its geographic scope, as it was conducted solely in the Jakarta and
Yogyakarta regions. Additionally, the research exclusively employs the
AHP (Analytical Hierarchy Process) and TOPSIS (Technique for Order
Performance by Similarity to Ideal Solution) methods.

Using the Unified Theory of Acceptance and Use of Technology (UTAUT) Model to Study Investors’ Buying Behaviour Towards Mutual Funds

Pushpa Raj K — 2024-06-30

Manuscript type: Research paper
Research aims: In recent years, we have witnessed tremendous growth in mutual funds in India. There are many reasons behind this
growth trajectory, including diversification, compounding, and a lesser involvement of investors in tracking the performances of individual stocks. Technology has allowed investors to choose their funds based on their risk appetite and tenure when they need their investments to mature. The current advancement in digital technology created a more accessible platform for investors to choose different investment vehicles quickly. Mutual funds are among the most well-liked investment choices, for small-scale investors, as they offer steady income over a more extended period with lesser risk. Digitalisation has led more investors to move towards mutual funds as it involves less paperwork to start investing. Also, digital payments have eased investors’ lives by allowing them to make payments safely and securely without needing to reach Asset Management Companies (AMCs). In this study, we have attempted to study the impact of different variables that affect mutual fund subscriptions.
Design/Methodology/Approach: To demonstrate the causal connection between the various variables, the Structural Equation Modelling (SEM) technique has been employed. We employed a variance-based technique using PLS in our study. With the aid of SmartPLS 3.0, the study model was verified. We follow the normal two-step process, with the first step being the assessment of the measurement model and the second stage is to evaluate models for measurements and structures.
Research findings: The two new additional variables introduced in this study were strongly significant in influencing investors’ intention toward Mutual funds. When making decisions about their buying behaviour in the mutual fund industry, retail investors consider data security and additional charges to be key factors. The researcher performed reliability and validity tests, as well as assessed the structural model. The coefficients of determination R2 and Q2 supported the study model and provided evidence of a significant statistical relationship between the independent and dependent variables.
Theoretical contribution/Originality: The present study is important as we see more mutual fund folios are getting piled up every year. Also, with the advent of technology, more account holders are getting into digital space. Understanding the awareness and benefits of using digital platforms among retail investors’ decision-making is essential to bringing in more retail participation in the mutual fund industry.
Practitioner/Policy implications: These findings can help investors to make investing decisions and are also helpful for regulators or fund managers to attract more investors.
Research limitation/Implications: The study can be extended to different regions in India or outside of India to study different perceptions of retail mutual fund investors.

Preparing Accountants of the Future: Examining an Accounting Data and Analytics Undergraduate Program in Singapore

Poh-Sun Seow — 2024-06-30

Manuscript type: Research paper
Research aims: Due to technological innovations, there is a need for
universities to produce accounting graduates who are proficient in data
and analytics. A university in Singapore launched the accounting data
and analytics (AD&A) second major program to provide students with
skillsets in data and analytics. The aim of this study is to examine the
efficacy of the AD&A program.
Design/Methodology/Approach: 100 participants were surveyed,
involving 70 graduates of the program and 30 employers.
Research findings: The results show that both graduates and employers
were satisfied with the program. The results also show that the program
adequately equips graduates with relevant skills and competencies,
reflecting current needs in the accounting profession.
Theoretical contribution/Originality: This study examines a new
program in accounting data and analytics. Universities need to ensure
that their accounting curricula remain relevant.
Practitioner/Policy implications: This study is timely as the need for
accountants to become more tech-savvy and conversant with data has
been identified as an important way to help the accounting profession
thrive amid digital transformation.
Research limitation: The results may not be generalised to other similar
programs in other universities.

Sustainable Performance: Evidence of SMEs in Indonesia

Maya Indriastuti — 2024-06-30

Manuscript type: Research paper
Research aims: This study aims to analyse the influence of green accounting and intellectual capital on sustainable performance, with financial performance as an intervening variable.
Design/Methodology/Approach: This research used 251 samples of Batik SMEs located in 4 cities/regencies in Central Java, Indonesia they are Semarang City, Semarang Regency, Solo City and Pekalongan Regency, which were analysed using SmartPLS.
Research findings: The research results show that green accounting has a negative effect on financial performance and sustainable performance, while intellectual capital has a positive impact on financial performance and sustainable performance. Financial performance has a positive effect on sustainable performance.
Theoretical contribution/Originality: This study contributes to achieving sustainable performance for organisations by improving processes, conveying information, and stimulating relationships between stakeholders that positively impact environmental and social performance.
Practitioner/Policy implications: This research implies that the presence of intellectual capital in SMEs improves financial performance and realises sustainable performance by considering efforts to protect the environment, reduce carbon footprints, and invest in environmentally responsible businesses.
Research limitation/Implication: This research is still limited to SMEs in 4 cities/regencies in Central Java, Indonesia, namely Semarang City, Semarang Regency, Solo City and Pekalongan Regency.

Editors Note

Norbani Che Ha — 2024-06-30