Search

The article focuses on the evaluation of revenues, EBITDA (Earnings Before Interest, Taxes, Depreciation, and Amortization), net profit, and corporate income taxes in relation to the income side of the Slovak state budget. Topics include the structure of financial statements in Slovakia, the correlation between financial performance indicators and corporate income tax obligations, and the role of tax audits by the Financial Administration of the Slovak Republic.

Analyzing hand-collected credit agreements for a sample of middle-market firms over 2010–2015, we find that one-third of all loans are directly extended by nonbank financial intermediaries. Two-thirds of such nonbank lending can be attributed to bank regulations that constrain banks' ability to lend to unprofitable and highly levered borrowers. Firms with negative EBITDA and debt/EBITDA greater than six are 32 |$\%$| and 15 |$\%$| more likely to borrow from nonbanks. These firms pay significantly higher interest rates, especially following the 2013 leveraged loan guidance revisions. Nonbank borrowers also receive different nonprice terms compared to firms borrowing from banks. Authors have furnished an Internet Appendix , which is available on the Oxford University Press Web site next to the link to the final published paper online. [ABSTRACT FROM AUTHOR]

Academics and professionals alike are highly interested in Corporate Social Responsibility (CSR), Corporate Governance (CG), environmental, social, and governance (ESG) and corporate non-financial reporting (CNFR) and how they can improve a brand's reputation, financial efficiency, and sustainability within businesses and organisations. The main objective of our study was to examine whether the financial data of large companies can be correlated with the data in their non-financial reports and provide information on the level of corporate governance and corporate responsibility and to examine the correlation between them. For this purpose, we conducted research by examining the 100 largest companies in Greece, over a period of 3 years, collecting both financial and non-financial data from their official reports. Using appropriate quantitative tools such as similarity, classification and econometric methods (stepwise method and panel least-squares method), the correlations between the data for CSR, CG and non-financial actions and key financial performance ratios are evaluated. Our research has revealed a strong link between financial performance and ESG actions of large companies and, in particular, we demonstrated the positive correlation of CSR performance with their total assets and whether they are listed on the stock exchange, and of CG with CSR and EBITDA. This study adds to the existing academic discourse on the relationship between financial and non-financial information of corporations in the areas of Corporate Responsibility and Governance and provides a valuable way to assess the decisions of businesses. [ABSTRACT FROM AUTHOR]

On 1 January 2021, a regulation limiting deductible interest expenses entered into force in Peru. The new rule applies to taxpayers' net interest expenses and, in line with the OECD's various recommendations on the matter, establishes that only 30% of the previous year's tax EBITDA is deductible. This article analyses the key elements of this regulation and offers a critical view of its most controversial aspects. [ABSTRACT FROM AUTHOR]

Purpose: To identify the variables responsible the methodological differences that cause incompatibilities in the EBITDA disclosed by the companies listed on B3, related to errors in data collection and undue changes in the formula by the reconciliation issuers. Methodology: Application of descriptive statistics on a sample of 35 entities that disclosed the incompatible EBITDA for 2018, observing the behavior of the indicator's variables in the years 2018, 2019 and 2020. Results: The most common calculation errors occurred when collecting data from the financial statements. The variable that most impacted erroneously calculated values was related to depreciation, amortization and depletion. It is concluded that, even with the standardization of the disclosure of EBITDA by the Securities and Exchange Commission of Brazil as of 2012, errors in the calculation of this indicator are still common, which reinforces the need for practical studies that verify the conformity of these companies' non-GAAP disclosures. Contributions of the Study: Considering that non-GAAP performance measures, such as EBITDA, are disseminated worldwide among investors and analysts to analyze corporate results, such measures are at risk of error and manipulation by the issuers' managers. In this sense, the study contributed in the practical sphere because it demonstrated which errors companies effectively made when calculating and demonstrating their EBITDA reconciliations. In addition, it bridges an academic gap concerning the methodology for calculating EBITDA, since even with the growing literature related to non-GAAP disclosures, the method of calculating the indicator has received low attention. [ABSTRACT FROM AUTHOR]

This article analyzes non‐GAAP, pro forma earnings metrics of large German publicly traded companies to better understand their usage and relevance in practice. We base our analysis on a hand collected data set compiled from annual reports. Almost all companies in our data set use pro forma earnings. Typically, legal, restructuring, acquisition and accounting related costs get adjusted. EBIT, EBITDA, EPS and Net income are the most frequently adjusted earnings metrics. In almost all observed cases, pro forma earnings are higher than their underlying GAAP earnings. Our study addresses the challenge of investors to understand a company's "true" operating performance. Only when one understands the historically observable financial performance, one can make better predictions of its recurring, future financial performance. The article adds to the existing literature by analyzing in which part of the annual report pro forma earnings are typically disclosed, how transparent they are presented and reconciled, and what impact adjustments have compared to the unadjusted GAAP earnings. [ABSTRACT FROM AUTHOR]

Theoretical background: Intellectual capital is often considered a critical resource, especially for micro, small, and medium-sized, as well as service companies. Human, structural, and relational capital are often listed as the main components of intellectual capital. This study complements the studies on the impact of intellectual capital and its components on the financial performance of hotel companies in developing economies. Purpose of the article: The study aims to examine the impact of the efficiency of intellectual capital and its components on the financial performance of micro, small, and medium-sized hotel companies in Serbia. The results of the study can be of importance for hotel managers in their efforts to make adequate business decisions and improve the financial performance of hotel companies. Research methods: The sample includes 100 micro, small, and medium-sized hotel companies from Serbia with the highest operating revenues in 2019. The efficiency of the intellectual capital and its components is measured by using the modified value-added intellectual coefficient (MVAIC). Financial performance is measured by using the natural logarithm of earnings before interest, taxes, depreciation, and amortization (EBITDA), EBITDA margin, return on assets (ROA) and return on equity (ROE). Ordinary least squares regression is used to examine the impact of intellectual capital and its components on the financial performance of sample hotel companies from 2015 to 2019. Main findings: The results of the study show that intellectual capital efficiency has a positive impact on all four measures of financial performance. They also show that structural capital has the greatest impact on financial performance and that only this component of intellectual capital has a positive impact on all four measures of financial performance. Capital employed has a positive impact on the natural logarithm of EBITDA and ROE, while human capital has a positive impact on the EBITDA margin and a negative on the natural logarithm of EBITDA. Relational capital has a positive impact only on ROA. [ABSTRACT FROM AUTHOR]

This paper focuses on determining the differences between economic value added (EVA), net operating profit after tax (NOPAT), earnings before interest and taxes (EBITDA), and net income or loss for non-financial business entities operating in the Republic of Croatia in the period 2002-2021. The main objective of this paper is to determine whether non-financial activities create economic value added, and rank them according to selected indicators based on EVA. Research results indicate that there were only 27 out of 309 cases where EVA was positive, indicating that only the information and communication sector generated, on average, positive EVA during this twenty-year period. Positive EVA was generated in certain years in companies conducting human health and social work activities, education, mining, and quarrying, as well as in wholesale and retail trade activities, but the average EVA for this twenty-year period in these sectors was negative. At the same time, net income was achieved in 246 cases, and NOPAT in 285. Meanwhile, EBITDA was positive in all cases, demonstrating an obvious discrepancy between EVA and other financial performance measures. Correlation analysis results indicate that there is a statistically significant moderate correlation between EVA and net income/loss, although the correlation is generally stronger between EVA and EBITDA-based indicators. According to research results, the answer to the question in the title of this paper is negative, emphasizing the possibilities of intensive introduction of EVA as a financial performance indicator. [ABSTRACT FROM AUTHOR]

As one of the most significant pillar industries of China, the medical industry can improve the quality of our lives in many aspects; it is also beneficial to the development of the national economy. After the outbreak of COVID-19, the function of the medical industry was further displayed. This paper is aimed at analyzing some representative stocks in the Chinese medical industry by using fundamental analysis and making recommendations for investors based on the analysis results, and reach a conclusion that investing in stocks in the medical industry is a reasonable choice, and investors had better combine of the absolute valuation results with the relative valuation results while making investment decisions so that some cognitive biases could be avoided. [ABSTRACT FROM AUTHOR]

Copyright of Contemporary Accounting Research is the property of Canadian Academic Accounting Association and its content may not be copied or emailed to multiple sites or posted to a listserv without the copyright holder's express written permission. However, users may print, download, or email articles for individual use. This abstract may be abridged. No warranty is given about the accuracy of the copy. Users should refer to the original published version of the material for the full abstract. (Copyright applies to all Abstracts.)

Signaling theory is a heavily researched topic in the business field. This research uses the act of a stock repurchase and analyzes whether this provides a signal regarding the operating performance of the firm. Consistent with the market timing theory of stock repurchase, we find that companies experience better operating performance in the period with a repurchase. This effect is robust to multiple model specifications and estimation methods. The signaled effect of a stock repurchase is $109,601 on EBITDA for an average firm in our sample. Taken together, the results imply that stock repurchase can be used as a credible signal for firm performance. This result adds to the literature by identifying the commonly practiced activity of stock repurchase and demonstrating the significance of the information content in assessing firm performance. [ABSTRACT FROM AUTHOR]

In this study, we replicate and extend the Dichev and Skinner [DS: 2002] study on the debt covenant hypothesis (DCH). We start by replicating DS and find results consistent with theirs. We then extend their work by changing three aspects of the research design: histogram bin width, calculation of slack, and statistical test of discontinuity. We find that the inference from DS is generally robust to varying these choices, although sensitive to different bin widths, during their sample period. We extend our analysis to the period 2000–2019 and find that support for DCH remains robust. We do, however, find a lack of support for DCH when examining the most common financial covenant, debt‐to‐EBITDA. These findings suggest a more nuanced perspective on DCH, whereby different types of financial covenants provide different incentives and abilities to avoid technical default. [ABSTRACT FROM AUTHOR]

The aim this study is evaluate the usefulness of relation between future cash flows with liability, it's identified how ratio ability to paid debts, to forecast the financial crises. The analysis is made for companies of Argentina Capital Market, that it faces a context with a strong macroeconomic imbalance. The conclusion what arrives in this study point out that ability to paid debts measure core operating income shows most accuracy that ability to paid debts for the EBITDA, net income, operating flows cash and the Z-score Altman (1968). Moreover, the companies with a higher leverage and less profitability have a higher possibility of get in financial crisis, and it's found that main cause of financial crisis is the drop of operating incomes. [ABSTRACT FROM AUTHOR]

Healthcare specialty real estate investment trusts (REITs) enable an investor to focus on a certain industry's high total return, income, and diversity. COVID-19 has a number of distinct, and at times contradictory, implications for the healthcare business. Although extensive study has been done on the success of REITs and other specialty mutual funds, there has been less research on the relative performance of healthcare REITs and how COVID 19 influences their performance in contrast to past years. This research looks at the performance of healthcare REITs from 2016 through 2020. In addition, we evaluate a REIT's performance against those of its competitors, as well as its own previous performance. Based on earnings before interest, taxes, depreciation, and amortization (EBITDA), return on investment, interest coverage ratio, cash flow per share, and efficiency in utilization of its capital, only three out of twelve healthcare REITs have consistently performed better relative to their peers throughout the sample period of 2016 to 2020. [ABSTRACT FROM AUTHOR]

Purpose: To analyze the value relevance of the new operating result proposed by ED/2019/07 in Brazilian companies in relation to the gaap and non-gaap measure, assessing the relevance of the new operating result associated with the market value of companies. Methodology: We used economic and financial data, available at Economatica, from 149 companies from the 9 economic sectors of B3, which had the annual information necessary to carry out the study in the period from 2010 to 2019. For data analysis, we used a restatement of the current income statement, to assess the new operating income provided for in the Exposure Draft. To assess value relevance, the model by Ohlson (1995) was used, which allows evaluating the explanatory power of the R2 of the regression. Results: The results of the analyzes suggest that, for the analyzed companies, the value relevance of New Operating Income (R²=0.4439) is higher than EBITDA (R² = 0.4321), followed by Net Income (R² = 0.4094). Such results show that the New Operating Result has greater explanatory power for the companies' market value. In this sense, the results corroborate the conclusions of Barton et al. (2010) in which the Operating Result and EBITDA have greater value relevance than the gaap measure and, consequently, a greater association with stock returns. Contributions of the Study: The study provides empirical evidence on the possible impacts of the new income statement, with practical implications, and on how the change in the presentation of the income statement can impact the predictability of actions. In addition to theoretical and practical contributions, as it is a future standard that, it seems, will be implemented in the coming years, this research can contribute to accounting professionals, auditors and regulatory bodies in understanding the benefits and impacts of the proposed changes. [ABSTRACT FROM AUTHOR]

Purpose: Analyze the relationship between socio-environmental responsibility practices in the economic and financial performance of companies listed in [B3]. Methodology: Social and environmental information found in the annual sustainability reports published in accordance with the GRI 4 (Global Reporting Initiative) standard were used. For economic performance, the metrics EBITDA and ROA were considered, while for financial performance, market-to-book and Tobin's Q were used, collected on the Economática® platform. Binomial logistic regression was used to evaluate 220 observations corresponding to the period from 2014 to 2018. Results: It was not possible to verify the relationship between the disclosure of socioenvironmental practices on economic performance, measured by the companies' accounting result variables. However, it suggests that there is a negative influence of the disclosure of information on socio-environmental practices on the financial performance measured by market variables. Study Contributions: Despite the demands made by the set of stakeholders on companies for the practice of socioenvironmental actions, the market does not favorably recognize the organizational effort. The results point to indications that investors may consider organizational investments in socioenvironmental practices as undesirable. [ABSTRACT FROM AUTHOR]

This study attempts to predict high growth firm (HGF) status with financial ratios. Measures related to the firm's effectiveness in using assets to generate profits, EBITDA margin, debt ratio, equity-to-debt ratio and return on assets are associated with HGF status. While the financial ratios improve HGF prediction, prediction remains modest (AUC = 0.627). This study suggests it is difficult to assume a very good HGF forecast from only financial ratios; therefore, the recommendation for researchers and policymakers building models for predicting HGFs is to incorporate non-financial ratio variables, like the intangible innovation and team-related variables. Finally, study suggests a standardized reporting of prediction performance metrics in the out-of-sample and out-of-time simulation for HGF prediction studies. [ABSTRACT FROM AUTHOR]