Journal of Finance and Accounting

Current Issue» Volume 2, Number 4 (2014)

Article

Auditing Practices and Organizational Efficiency in Local Government Authorities: A Case Study of Tanzania

1Department of Accounting, The Institute of Finance Management, Dar Es Salaam, Tanzania, East Africa


Journal of Finance and Accounting. 2014, 2(4), 100-114
DOI: 10.12691/jfa-2-4-3
Copyright © 2014 Science and Education Publishing

Cite this paper:
Mwamini Madhehebi Tulli. Auditing Practices and Organizational Efficiency in Local Government Authorities: A Case Study of Tanzania. Journal of Finance and Accounting. 2014; 2(4):100-114. doi: 10.12691/jfa-2-4-3.

Correspondence to: Mwamini  Madhehebi Tulli, Department of Accounting, The Institute of Finance Management, Dar Es Salaam, Tanzania, East Africa. Email: mwaminit@yahoo.com

Abstract

The study investigated and adds to our understanding of auditing practices and their contributions towards organizational efficiency in the context of Local Government Authorities (LGAs) in emerging and less developed countries. The research explored the manner and extent to which auditing practices interact in a multiple stakeholder scenario. The research was conducted in four local government authorities in Tanzania. The findings of this research revealed that there was a Wrestling for internal efficiency in the LGAs. Wrestling for internal efficiency is a product of the perceived dream of having LGAs which are efficient, effective, transparent and accountable. Despite a persistent decline in the performance of the LGAs, various LGAs’ actors believed that effective LGAs could be attained if the internal actors in LGAs played their parts effectively and efficiently. The study contributes to the existing debate posed by Power (1994) about whether audits can deliver what they promise in the form of greater accountability, efficiency or quality, or whether they, in fact, fuel the problems? In addition, the study provides practical evidence about how auditing can be used as an instrument to foster organizational efficiency. From the substantive theory of wrestling for internal efficiency, it was observed that auditing has a substantial role to play in achieving organizational efficiency. For example, the research uncovered that audit has increased interactions among actors, through participatory audits and the use of audit reports by various stakeholders. It was also revealed that in the LGAs, auditing was found to be a catalyst for a number of reforms and measures introduced by the Central Government, including migrating to the use of International Public Sector Accounting Standards (IPSASs) and the appointment of an Internal Auditor General in Tanzania. Furthermore, the external overseeing bodies, particularly the Local Authorities Accounting Committee (LAAC) and the External Auditor, emerged as the most useful overseeing bodies to make the LGAs’ actors perform. The close relationship between the LAAC’s and the External Auditor’s functions were found to increase Executives’ accountability in the LGAs.

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References

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Article

Board of Directors and Tobin’s Q: Evidence from U.K.Firms

1Lecturer in accounting and financeat the Faculty of Economics, Omar Al-Mukhtar University, Al Bayda – Libya


Journal of Finance and Accounting. 2014, 2(4), 82-99
DOI: 10.12691/jfa-2-4-2
Copyright © 2014 Science and Education Publishing

Cite this paper:
Ramadan El-Faitouri. Board of Directors and Tobin’s Q: Evidence from U.K.Firms. Journal of Finance and Accounting. 2014; 2(4):82-99. doi: 10.12691/jfa-2-4-2.

Correspondence to: Ramadan  El-Faitouri, Lecturer in accounting and financeat the Faculty of Economics, Omar Al-Mukhtar University, Al Bayda – Libya. Email: ramfaitori@gmail.com

Abstract

This study investigates whether board of director characteristics have an impact on corporate performance. Recent studies highlight that findings that such characteristics do have an impact may be affected by endogeneity issues in the data, which could lead to biased results. This study responds to this concern by using a generalised method of moments regression model) developed by WintoDYki et al. (2011). Data for the analysis are extracted from BoardEx, FAME, and Datastream databases for the period 1999 – 2009. The final sample includes a total of 634 UK firms listed in the London Stock Exchange. The results suggest that board structure is partly determined by past corporate performance. Considering this, the results document that there is no relation between characteristics of the board of directors and corporate performance measured by Tobin’s Q. This is inconsistent with much prier empirical studies and policy recommendations on corporate governance that suggests that corporate governance mechanisms develop corporate performance. In addition, this result indicates that the findings of the earlier corporate governance studies that do not take into account the dynamic nature of corporate governance may be affected by bias.

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Article

Portfolio Selection via Shrinkage by Cross Validation

1Department of Economics, Emory University, United States


Journal of Finance and Accounting. 2014, 2(4), 74-81
DOI: 10.12691/jfa-2-4-1
Copyright © 2014 Science and Education Publishing

Cite this paper:
Xiaochun Liu. Portfolio Selection via Shrinkage by Cross Validation. Journal of Finance and Accounting. 2014; 2(4):74-81. doi: 10.12691/jfa-2-4-1.

Correspondence to: Xiaochun  Liu, Department of Economics, Emory University, United States. Email: xiaochun.liu@emory.edu

Abstract

Given the importance of the loss function choice [Christoffersen, P. and K. Jacobs (2004) The importance of the loss function in option valuation. J. Financial Economics 72: 291-318], this paper proposes the nonparametric technique of cross validation, to tuning the shrinkage intensity estimation of Ledoit and Wolf [Ledoit, O. and W. Michael (2003) Improved estimation of the covariance matrix of stock returns with an application to portfolio selection. J. Empirical Finance 10: 603-621; Ledoit, O. and W. Michael (2004) Honey, I Shrunk the Sample Covariance Matrix. J. Portfolio Management 30: 110-119; Ledoit, O. and W. Michael (2004) A well-conditioned estimator for large-dimensional covariance matrices. J. Multivariate Analysis 88: 365-411]. By aligning the loss function of out-of-sample forecast identical to the one used for the shrinkage intensity estimation, the proposed cross validation approach shows the significant gains in terms of both the variance reduction and information ratio improvement to various portfolios of the U.S. firms.

Keywords

References

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