Search

This study examines the impact of corporate governance mechanisms on accounting conservatism in Pakistan. A sample of 100 firms is drawn from non-financial companies listed on Pakistan Stock Exchange from 2009 to 2015. Corporate governance mechanisms often pave the way for the expropriation of minority shareholders at the hands of controlling shareholders and also support to hide their professional misconduct via conservative accounting reports. Multivariate panel data regression analysis is employed as the estimation procedure. The results show that some corporate governance mechanisms are related to accounting conservatism. This study reports an empirical evidence of a positive association between institutional shareholding and accounting conservatism as well as the negative association between board size, CEO duality, managerial ownership and accounting conservatism in case of listed firms in Pakistan. However, some corporate governance attributes that were not previously examined in Pakistan like CEO turnover, and gender diversity on board is found to have no significant impact on accounting conservatism. The results suggest that users of financial statements should consider the corporate governance mechanisms while evaluating non-financial listed in a country like Pakistan where corporate governance is undergoing an evolutionary process and numerous family-controlled firms exist.

This study aimed to investigate the determinants of trading volume. For this purpose a sample of fifty firms listed at KSE had been considered. 50 firms based on capitalization were selected from non-financial sector covering a time period from 2005 to 2014. Descriptive statistics, Variance inflation factor, and panel data estimation model have been employed for the purpose of analysis. The findings revealed that determinants have significant effect on trading volume. It has been observed that abnormal return, volatility (systematic & residual risk), size, institutional holding, dividend yield, positive returns, and negative returns have positive effect on trading volume, while institutional holding has no effect on trading volume.

This study is aimed to explore the relationship between country rating and volatility of Karachi Stock Exchange for the period 1999 to 2012. This study employs daily data of country ratings and stock market returns to investigate influence of rating on volatility of market. Univariate Asymmetric GARCH model is used to explore the relationship and results reveal that country rating has a significant role in explaining volatility in Karachi Stock Exchange.

The main purpose of this study is to examine the impact of the corporate governance mechanism on firm performance. The variable employed in this study to measure firm performance, is return on assets. The empirical results indicate that firm performance is in positive and significant relation to corporate governance. On the other hand, the relationship between firm performance and corporate governance is moderated by size of the firm where as the leverage does not play its role in moderating the relationship between the variables of interest of this study.

This study evaluates the relationship between real exchange rate and trade balance prevailed in Pakistan during the 1985-2010 period. Engel Granger residual based and Johansen Juselius tests have been used to inquire into the long term connection between exchange rate and trade balance. Error correction model is then employed to study the short term connection. It has been discovered that there exists a connection between real exchange rate and trade balance in long as well as short run. The evidences set forth lead to a decisive conclusion that Marshall Lerner Condition and J curve effect both hold in case of Pakistan.

The study explores whether the firm’s financial decisions are affected by the peer firm’s financial decisions. Book leverage is used as a dependent variable against two sets of independent variables; 1) Firm specific characteristics (equity shocks, size, tangibility, profitability and book-market ratio) and 2) peer firms averages (equity shocks, tangibility, profitability and book-market ratio). The results reveal that peer firms equity shocks negatively associated with book leverage but statistically insignificant. This implies that peer effect through the actions of peer firms is not present in Pakistan. Peer firms' market-to-book ratio, profitability and tangibility are significantly and negatively associated with book leverage. These results suggest that the peer firm effect operates in Pakistani selected industries through peer firm characteristics as opposed to peer firm actions (peer firm equity shocks). Among firm specific variables, i.e. profitability, tangibility, market-to-book ratio and size, only profitability has a significant negative relationship with book leverage. It provides evidence that in selected industries more profitable firms follow the suggestions of pecking order theory.