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Purpose: This study aims to explore the use, effectiveness, motives and obstacles of analytical procedures (APs) used by auditors in Palestine, a context characterised by a pool of small and medium enterprises (SMEs), a limited skill set, poor quality of data, political uncertainty and a community-based business culture. Design/methodology/approach: The study considers the audit market in Palestine using a sequential mixed-methods approach combining a questionnaire survey and a series of in-depth interviews. A total of 129 Big-4 and non-Big-4 auditors were surveyed. Findings: The use of APs is driven by the auditor size (Big-4 vs non-Big-4) and the client size (large vs SMEs). Even though the use of APs has increased over the past decade, audit objectives, know-how, and personal, family and social connections among auditors and clients influence the quality of the audit process. Practical implications: Small firms take advantage of the lack of audit governance in Palestine. Our findings suggest that the regulators should help bridge the knowledge-sharing programmes between the small and large audit firms to help improve audit quality. Originality/value: Studies on audit quality, particularly using APs, in the context of politically unstable cases such as Palestine are limited. The study has implications for the use of APs in the case of SMEs to prepare for the technological revolution that will modernise audit procedures and quality soon. [ABSTRACT FROM AUTHOR]

The goal of this research is to identify the factors that influence the net interest margin (NIM) for Palestinian conventional banks. Palestine is a unique country with poor governance, political uncertainty, and regulatory insufficiency, adding higher information asymmetry to the decision-making process. The sample is comprised of unbalanced panel data from 15 commercial banks for the period 2011–2020. The research used a pooled OLS, a fixed-effect model, a random effect model, a robust pooled OLS, a difference GMM, and a system GMM estimators. Evidence collected supports that net interest margin is positively influenced by risk aversion, operating costs, and loan-to-deposit, while being negatively related to credit risk. The effect of size is positive but not robust. The results imply that banks and policymakers can increase efficiency by better controlling these factors. Particularly, operating costs can be reduced by implementing efficient banking technologies and improving management practices that reduce the cost of staff. In future research, other factors should be considered, including the bank's ownership structure and type, whether Islamic or conventional. [ABSTRACT FROM AUTHOR]

Purpose: This paper aims to explore how the presence of an audit committee is associated with other corporate governance mechanisms, i.e. board structure, ownership structure and quality of external audit. The present study evaluated whether the presence of the audit committee complements or substitutes other governance mechanisms in Palestinian companies. Moreover, the effect of investment opportunities on the relationship between the formation of the audit committee and the quality of the auditor was addressed. Design/methodology/approach: The association between the formation of the audit committee and other governance variables was modelled as a binary logistic model. The sample comprising 44 firms listed on Palestine exchange for the period between 2013 and 2017, amounting to 220 firm-year observations. Findings: Based on the investigation, the results have indicated that board independence, the distinction between the chairman and chief executive officer function, ownership concentration and audit quality enhance the chance of audit committee formation, implying complementary effect. Contrastingly, board size and board ownership serve as a substitute to audit committee formation. It has also been found that investment opportunities act as an effective moderating factor that strengthens the relationship between audit quality and the formation of the audit committee. Originality/value: The study provides valuable insight into the interaction between multiple corporate governance mechanisms within the economy of Palestine where the external uncertainty is high and investment opportunities are constrained by the decisions of the occupying authority. The findings may help regulators and policymakers in Palestine alongside those of other countries with similar environmental features to revise and update their corporate governance codes to ensure that the best control can be achieved, subsequently attracting more foreign and domestic investments. [ABSTRACT FROM AUTHOR]

This paper investigated the relationship between board characteristics and corporate performance of firms in Palestine. The degree to which the board is effective in performing its duties and tasks depends on several factors manifested by certain characteristics. Particularly, this research examined the impact of CEO duality, board size, board independence, board gender diversity, board academic background, and frequency of board meetings on the level of corporate performance. The sample encompassed all firms listed in the Palestine Stock Exchange (PSE) with available data for the years 2012 to 2014 with total 141 firm-year observations. The data was manually collected from the audited annual reports downloaded from PSE website. Generalized least square estimators were obtained for the multiple-linear relationship between board characteristics and firm performance. The results indicate that corporate performance of Palestinian listed firms is positively related to board duality, board gender diversity, and number of board meetings. Meanwhile, board size, board independence and board academic background seem to negatively affect performance. The results are consistent with the stewardship theory where the board plays a supportive role by empowering executives leading to, potentially, higher performance. In this context decisions are executed faster, the ambiguity between the processes and the objectives of the firm is reduced and performance is enhanced. Our results have an implication to any future corporate governance code setting. The stewardship theory not the agency theory should guide the lawmakers in constructing any new legislation related to corporate governance. [ABSTRACT FROM AUTHOR]

This article discusses the productivity of the Information and Communication Technology (ICT) sector using cross-sectional data from 793 service firms in Palestine. The authors have examined the impact of ICT growth on service sector productivity in Palestine using a set of indicators for ICT including internet usage, e-commerce, networks, websites, and use of "smart" phones. They find that using ICT (mainly Internet) in commerce (e-commerce) is one of the most important levers of labor productivity among service firms. Service firms that are less ICT-intensive are less productive than more ICT-intensive firms; moreover, the use of mobile phones for services other than send-andreceive calls, highly improves the labor productivity of service firms. Conversely, using a website and computer network does not positively affect the labor productivity. Regarding geographical differences in labor productivity, the analysis shows that firms in Jerusalem are characterized by higher productivity than firms in the West Bank, while firms in Gaza have a lower productivity compared to firms in the West Bank. [ABSTRACT FROM AUTHOR]