Abdullah Sallehhuddin

Changing pattern of competitive disadvantage from disclosing financial information

Purpose – To empirically examine the changing pattern of competitive disadvantage experienced by the reporting companies in disclosing segmental information in the Malaysian environment.Design/methodology/approach – The study consists of a final sample of 116 Malaysian companies listed on the Malaysian Bourse for the years 2000‐2002. Four hypotheses were developed to investigate the relationship between segmental information disclosure and competitive disadvantage. Adopting weighted average correlation (WAC) techniques and total performance index (TPI), a multivariate least square regression model was employed to test the four formulated hypotheses.Findings – The statistical analysis employed provides a mixed pattern yet comprehensive understanding of relationship between segmental information disclosure and competitiveness level among 116 reporting companies listed in Malaysian Bourse from the years of 2000‐2002.Research limitations/implications – The proprietary theory assumes at least two forms that di...

Competitive disadvantage and segment disclosure: evidence from Malaysian listed companies

Purpose – This paper seeks to investigate the level of competitive disadvantage experienced by Malaysian listed companies by disclosing segmental information as required by the new accounting standard on segments disclosure by Malaysian Accounting Standards Board.Design/methodology/approach – A total of 116 Malaysian listed companies are included in the study. Their annual reports for financial year ended 2002 are the main sources. The dependent variable is competitive disadvantage, which is proxied by Total Performance Index. The independent variables are quality of segmental disclosure by employing weighted average correlation technique, size of companies, the use of stricter accounting standard and the choice of business segment or geographical segment as the primary segment. To examine the developed hypotheses of the study; a multivariate least square regression model is employed. The analysis is also supported by correlation technique.Findings – The outcomes of the study indicate that competitive dis...

Corporate social responsibility disclosure and corporate governance in Malaysia

Using 743 Malaysian public listed companies, this study attempts to investigate the impact of corporate governance mechanism on corporate social responsibility (CSR) disclosure level and to examine the difference of CSR disclosure level in government-linked companies and non-government linked companies. Employing multivariate analysis, the study reveals that the presence of larger non-executive directors and a higher involvement of institutional shareholders, which is dummied by government-linked companies cause significant increase in level of CSR disclosure. Besides, even though statistically insignificant, the duality role negatively affects disclosure level. In addition, existence of larger number of independent non-executive directors and employment of big four auditing firms contribute towards increased disclosure of CSR. This study is expected to add to the existing accounting literature by introducing instrument in measuring CSR disclosure and benefits regulators in improving corporate governance initiative in developing economic environment.

Segmental reporting and competitive disadvantage: a study of Malaysian companies

This study aims to investigate whether competitive disadvantage is experienced by Malaysian companies as they disclose segmental information under the new accounting standard known as FRS 114, Segment Reporting. The study consists of 374 Malaysian publicly listed companies which disclosed segmental information in their 2006 annual reports. Four hypotheses were developed to examine the relationship between segmental reporting disclosure and competitive disadvantage. The logistic regression model was employed to test the formulated hypotheses. The results reveal four main points: a) smaller companies experience greater competitive disadvantage than larger companies as they disclose segment information; b) disclosing the business segment as the primary segment does not lead to greater competitive disadvantage; c) companies which are highly leveraged do not experience greater competitive disadvantage as they disclose segmental information; d) there is no significant association of competitive disadvantage with industrial membership. The insights of this study should benefit various interested stakeholders, as Malaysian companies adopt the new FRS 114, Segment Reporting which calls for more extensive reporting compared to the old standards, IAS 14 and MASB 22.

Avoiding losses and earnings decrease by Malaysian companies before and after major corporate governance initiatives

This paper investigates the distribution of the cross-sectional earnings per share and changes in earnings per share to exceed two psychological benchmarks that are avoiding losses and avoiding earnings decrease using sample of 4,565 firm years and 1,530 firm years of Malaysian public listed companies respectively covering financial data from 1994 to 2003. This study further compares the smoothness of the distribution of deflated earnings and changes in deflated earnings before and after the Asian financial crisis. It is found that Malaysian companies do avoid reporting losses even after the major reforms on corporate governance. However, the study found no tendencies among the firm to avoid earnings decrease. This research might be of interest to regulators as to where to look in conducting their oversight function, i.e. firms reporting small EPS just to avoid losses and reporting small EPS decrease may require closer scrutiny.

Board Governance Attributes and Organizational Characteristics of Mosque Co-Operatives in Malaysia

Performances of mosque co-operatives rely on the effectiveness of the board of governance. The board has responsibilities to determine the strategic direction of mosque co-operatives, oversight management, and ensure the integrity of members’ rights and interests. The board of governance functions is becoming more challenging since the launching of National Co-operative Policy II (2011-2020), which among another, place greater emphasis on the expansion of mosque co-operatives movement via initiative of 1 Community, 1 Cooperative. Furthermore, the board of governance of mosque co-operatives is expected to deliver not only economic performance but also socio-economic governance, especially in supporting the activism of mosque institutions. Hence, as an initial observation, this study attempts to highlight the board governance attributes and mosque co-operatives organisational characteristics. The initial findings are essential in assisting regulator and policy maker like Ministry of Domestic Trade, Co-operative, and Consumerism (KPDNKK), Malaysia Co-operative Societies Commission (SKM), and Malaysia National Co-operative Movement (ANGKASA) in preparing the Mosque Co-operative Strategic Plan 2017-2020, and National Co-operative Policy III (2021-2030).

An analysis of moral intensity, intention and socially responsible investment behaviour among fund managers of Malaysian unit trust companies

This study examines the impact of moral intensity on perceived socially responsible investment (SRI) behaviour. Questionnaires have been distributed to 320 fund managers. On a scrutiny of the sent-in questionnaires, it has been found that only 73 are fit for further processing. Structural equation modelling analysis showed the goodness of fit for the model indicating the appropriateness of the use of instrument and measurement. The analysis found that perceived potential benefit has a significant and positive direct effect on perceived SRI behaviour. Besides, it has a significant and positive indirect effect on perceived SRI behaviour through intention variable. However, the study found no evidence to support the influence of perceived social pressure. Even though limited by a lower response rate, the studys outcomes provide good understanding on the interaction of moral intensity components, intention and behaviour in the context of socially responsible investment in emerging economies like Malaysia.

EXPLAINING SRI BEHAVIOUR OF MALAYSIAN UNIT TRUST FUND MANAGERS USING THEORY OF PLANNED BEHAVIOR

This study aims to examine the impact of Theory of Planned Behavior components – attitude, subjective norms and perceived control behavior on perceived socially responsible investment (SRI) behavior among fund managers of unit trust fund companies with intention to engage in SRI as a mediating variable. This cross sectional study employs questionnaire to collect the opinion from respondents. Three hundred and twenty questionnaires have been distributed but only 84 have been returned by the fund managers, with a response rate of 26.25 per cent. A scan of such questionnaires further revealed that only 73 could be taken up for analysis. Thus, the usable rate is 22.81 percent. Structural Equation Modeling (SEM) that has been used in the study has revealed that the model has a good fit for the model (above minimum requirements for goodness of fit criteria) which indicates the appropriateness of instrument and measurement. The analysis shows that subjective norms have significant and positive direct effect on perceived SRI behavior. In addition, subjective norms also have a significant and positive indirect effect on perceived SRI behavior through intention to engage in SRI. Attitude has a positive and significant direct impact on intention, while it does not have a significant direct effect on perceived SRI behavior. Besides, the study has evidenced significant direct effect of intention on perceived SRI behavior. However, the study has not found any evidence to support the association of perceived control behavior with intention and perceived SRI behavior. The major limitation of this existing study is a lower response rate; nevertheless it provides good understanding on the interaction of attitude, subjective norms, perceived control behavior, intention and behavior in the context of socially responsible investment in emerging economies like Malaysia.

Factors influencing FRS 114 segmental reporting: evidence from Malaysia

Employing 451 annual reports of 2006 from Malaysian public listed companies, this study attempts to investigate the organisational factors like company size, its listing status, financial leverage and industrial membership that influence the disclosure of segmental information under the jurisdiction of new FRS 114 (segment reporting). The study is relevant to the introduction of new accounting standard governing the segmental information disclosure in Malaysia. Using non-parametric tests, the study concludes that except for the company size, its financial leverage and industrial membership do have a significant influence on segmental disclosure. The results of this study can be expanded in future for comparing similar variables of public listed companies of other emerging economies.

A quality of segmental disclosure: a case study in Malaysia

In response to the concern of various financial information users regarding segmental disclosure, the Malaysian Accounting Standards Board (MASB) issued MASB 22, Segment Reporting in 2000. It became effective for the accounting year beginning on or after 1 January 2002. This paper attempts to examine the quality of segmental disclosure of 116 public listed companies at Malaysian Bourse, previously known as Kuala Lumpur Stock Exchange, for a year between 2000 and 2002. The quality of segmental disclosure is measured using the Weighted Average Correlation (WAC) technique. The findings indicate significant changes of quality of disclosure with the introduction of MASB 22, Segment Reporting. However, the generalisation of analysis remains a concern owing to inherent limitations, such as the number in the sample and the existence of material judgments in segmental information provided by the companies under study.