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Item Impact of Firm Characteristics and Corporate Governance Variables on Internet Financial Reporting: Evidence from Listed Companies in Sri Lanka(Department of Accountancy, Faculty of Commerce and Management Studies, University of Kelaniya, 2020) Samarathunga, S.L.M.D.H.G.; Wijekoon, W.M.H.N.In the modern era with the rapid growth of internet technology, it has enables the companies to disclose financial and non-financial information to the stakeholders through the adoption of websites as a media of communication. The objectives of the study are therefore, to examine the extent to which Internet Financial Reporting (IFR) practices are adopted by listed companies in Sri Lanka and to identify the impact of corporate governance practices on the level of IFR adoption. The extent of IFR practices were evaluated based on a comprehensive index consisting of 35 items under the main dimensions of content and presentation. The scores of IFR Indices of companies were analyzed using both descriptive statistics and univariate analysis of one sample t test. Corporate governance practices of the sample companies were assessed in terms of eight individual influential characteristics identified through extant literature and a Corporate Governance Index (CGI) that was developed to capture the effect of all individual corporate governance characteristics identified. The findings of the study reveal that Sri Lanka is still at an embryonic stage in terms of adopting IFR practice, while the concentration on presentation dimension of IFR practices depicts that more attention is deviated towards the format and outlook of the websites at the less importance forwarded towards the content and fullness of the information provided in the websites. This implies that IFR practices in Sri Lanka is not oriented towards the voluntary information dissemination for investors and other interested parties in making economic decisions on behalf of the company such that it does not enlighten the agency problems due to persistent information asymmetry.Item Impact of Sustainability Reporting on Organizational Financial Performance(Department of Accountancy, Faculty of Commerce and Management Studies, University of Kelaniya, 2020) Thathsarani, S.H.T.; Lakshan, A.M.I.Sustainability is meeting our own needs without compromising the ability of future generation to meet their own needs. Sustainability reports present organization values, governance model and demonstrate the organization strategy via the information published about economic, environmental and social impact. This research investigates the impact of SR on organizational financial performance. Moreover, SR expects to influence overall performance and profitability of the organizations. It might impact on organizational financial performance positively as well as negatively. In Sri Lanka context, this area is under researched and in–depth investigations need to be carried out to recognize the factual impact of sustainability reporting. Therefore, the research problem is to investigate how SR impact on the companies’ financial performance. Accordingly, the aim of this study is to empirically examine sustainability reporting in publicly listed companies (financial sector) in Sri Lanka, its extent, nature and possible drivers, specifically considering the use of the Key Performance Indicators and its impact on firm performance. The study is based on secondary data from 13 banks, 41 diversified financials and 08 insurance companies listed on Colombo Stock Exchange. The independent variable is SR (general, economic, environmental, and social) and dependent variables are Return on Assets (ROA) and Return on Equity (ROE). Apart from these, the analysis uses control variables of total assets (TA) and total equity (TE). The study covers data for 5 years from 2015 to 2019. Panel data regression was used to analyze data using E-views. The findings of the study important to the stakeholders of the relevant companies mainly, primarily investors who are interested in the accuracy of their investment decisions and the customers who cares about the companies’ stability and regulatory bodies of SR initiatives. The findings are also important to the employees as they focus on remuneration increments bonuses and job security.Item Impact of Liquidity and Financial Leverage on Profitability of Industrial Sector In Sri Lanka(Department of Accountancy, Faculty of Commerce and Management Studies, University of Kelaniya, 2020) Senanayaka, S.S.S.R.; Lakshan, A.M.I.Liquidity and financial leverage are two of the important aspects that every business organization should manage in the best way. Proper management of these two aspects are very important to the performance of each company. This study investigates simultaneously the impact of liquidity and leverage on the profitability of Industrial sector listed companies in Sri Lanka. The literature indicates disparate findings everywhere in the world to the topic. Therefore, the impact of leverage and liquidity on profitability is an interesting research question to investigate. The sample of the study consists of 40 Sri Lankan listed companies. The sample includes listed Energy, Materials, Capital goods, Consumer Durables & Apparel, Household & Personal Products companies. The sample is selected based on market capitalization on March 20, 2020. This study uses secondary data extracted from the published financial statements of the selected companies for a period of five years, from 2015 to 2019. This study used panel data Regression analysis by the use of the E-Views software to investigate the impact of liquidity and leverage on profitability. It is found that Current ratio and Debt ratio indicate negative and significance relationships with ROE. Quick ratio and Debt to Equity ratio positively and significantly impact on ROE. Debt ratio and ROA indicates a negative and significance relationship. The results revealed that there is a positive relationship between Quick ratio and profitability and negative relationship between current ratio and profitability. There is a positive relationship between Debt to Equity ratio and profitability and negative relationship between Debt ratio and profitability. The findings will be practically important to the listed and non-listed companies and managers of those companies in determining proportions of liquidity and financial leverage ratios. This study contributes empirically and practically to the literature.Item The Effect of Corporate Governance on Equity Finance of Sri Lankan Listed Companies(Department of Accountancy, Faculty of Commerce and Management Studies, University of Kelaniya, 2020) Premathilaka, D.M.R.; Lakshan, A.M.I.The concept of corporate governance (CG) is a common concept that must be used by every listed company in the world. Further, better CG results in increasing investors trust towards the corporation and on the other hand, it helps corporations to access more equity finance in their capital market. This study aims to investigate the type of relationship that exists between CG and equity finance in Sri Lankan listed companies. In the context of Sri Lanka, to the researcher’s best knowledge, there is no any published study available in terms of firm-level CG and equity financing patterns. This study attempts bridge this gap and to enhance the existing literatures. This study aims to examine the relationship between firm-level Corporate Governance (CG) and firm equity finance as the primary objective. Subsequently, the study aims to investigate the relationships between individual organizational factors (Frim size, Profitability, Leverage, Age and Growth rate) and equity finance while identifying the variable that has a highest impact on firm’s equity finance. To measure the firm-level CG Index (CGI), this study uses 59 dichotomous CG practices under five sub-indices (Ownership concentration, Board structure and procedures, Shareholder rights, Internal controls and Disclosures and Corporate social responsibilities). Further, this study uses secondary data from published annual reports. Sample size is 76 list companies and data collected for 4 years from 2016 to 2019. Ordinary Least Squared (OLS) multiple regression model is used in SPSS to identify the relationships. The findings of this study are highlighted the need for Sri Lankan companies to formulate an optimal CG structure, which in turn would lead to the eradication of possible malpractices such as corruption, fraud and misappropriation of resources to ensure higher financial performance and long-term sustainability. Hence, policy makers and regulators such as SEC, CA Sri Lanka, and the Central Bank of Sri Lanka can draw insights from the findings of this study in making CG reforms in relation to minority protection and other related areas in developing an appropriate CG structure for public listed companies.Item The Impact of Credit Risk Management on Profitability of Financial Institutions in Sri Lanka(Department of Accountancy, Faculty of Commerce and Management Studies, University of Kelaniya, 2020) Kumara, A.A.S.; Wijekoon, W.M.H.N.This study examines the impact of credit risk management on profitability of financial institutions in Sri Lanka. Return on Assets (ROA) used as profitability indicator and Gross Non- Performing Loans (GNPL), Provision for Loss Facilities / Credit Facilities ratio (PLFCF), Capital Adequacy Ratio (CAR) and Total credit interest/Credit facility Ratio (TCICF) are employed as measures of credit risk management. Secondary data were collected from 31 Licensed Finance Companies (LFCs) and 10 Licensed Commercial Banks (LCBs) in Sri Lanka for the period from 2015 to 2019. A series of statistical tests will be performed in order to test the impact of credit risk management on profitability of financial institutions in Sri Lanka. Findings of the study will provide useful insights to decision makers of Licensed Commercial Banks and Licensed Finance Companies to educate about values of Credit risk management. Empirical evidences will provide suggestions for managers of Licensed Finance Companies and Licensed Commercial Banks in Sri Lanka, how to improve the finance company’s profitability by managing the credit risk faced by those financial institutions. Accordingly, they can better organize and assign their resources concerning the situation of credit risks.Item The Effect of Corporate Governance Characteristics on Corporate Social Responsibility Disclosure: Empirical Evidence from Public Listed Companies of Sri Lanka(Department of Accountancy, Faculty of Commerce and Management Studies, University of Kelaniya, 2020) Karunarathna, N.P.; Lakshan, A.M.I.In the current business environment, organizations believe that they have an obligation to act for the benefit of the community at large. CSR disclosure has become an essential requirement of stakeholders and thus, it become a mainstream component of corporate strategies. This study investigates the level of Corporate Social Responsibility (CSR) disclosure provided in the annual reports of companies listed on Colombo Stock Exchange (CSE) of Sri Lanka and to assess the impact of corporate governance characteristics on the extent of CSR disclosures. As a developing country, the underlined research area is not much discussed in previous researches in Sri Lankan context. CEO duality, board independence, audit committee, foreign ownership, board meetings and board size were considered as independent variables. Corporate social responsibility disclosures were used as dependent variables. Firm size, profitability and leverage were used as control variables. Data was collected for the last five financial years (2014/15 to 2018/19) from annual reports of 90 listed companies on Colombo Stock Exchange (CSE) of Sri Lanka representing all business sectors other than banks, diversified finance and insurance. A literature review was carried out to identify factors of corporate governance and corporate social responsibility disclosure. The research hypothesis was formulated and descriptive statistics are used to examine the importance of identifying corporate governance factors, and correlation and regression analyses are performed to identify relationships/impacts between independent variables and dependent variable. The findings of the study will provide useful insights to stakeholders, decision makers, investors and statutory bodies to take into consideration in identifying the corporate governance characteristics and CSR disclosures related measures.Item The Effect of Corporate Governance on Tax Avoidance in Listed Companies of Sri Lanka(Department of Accountancy, Faculty of Commerce and Management Studies, University of Kelaniya, 2020) Wimalaweera, H.C.C.; Perera, PrabathTax avoidance is a transaction scheme to reduce tax amounts by making use of the loophole of tax regulations in a country. Corporate Governance is a mechanism or system that provides regulations and controls a company to create value added for all stockholders. The purpose of this study is to find the effect of corporate governance on tax avoidance in listed companies in Sri Lanka. This area is not widely researched in Sri Lanka, but a few studies have been selected in this area to study the global context and up until now, researchers have failed to generate knowledge that can fit into the local context. So, the focus of this study is to fill this knowledge gap and to determine the exact relationship between corporate governance and tax avoidance in Sri Lanka. The dependent variable in this research is tax avoidance and the independent variables in this research are institutional ownership, managerial ownership, independent commissioner board, audit committee and audit quality. The samples of this study were 50 companies in the food, beverage and tobacco sector and the capital goods sector listed in the Colombo Stock Exchange for the period of 2014 – 2020. The data were analyzed using the E-views Statistical Package. The findings of the study can have important implications for the Government, business owners, researchers and academicians, board of directors and employees, bank and financial institutions and potential investors.Item The Impact of Sustainability Reporting on Company Performance of Public Listed Companies in Sri Lanka(Department of Accountancy, Faculty of Commerce and Management Studies, University of Kelaniya, 2020) Sanurika, M.R.; Perera, PrabathSustainability Reporting is a voluntary requirement that consists of three aspects which are economic performance, environmental performance and social performance. The purpose of this study is to investigate the impact of sustainability reporting as a whole, and each of the aspects of sustainability reporting on company performance of Sri Lankan public listed companies. The sample of this study consists of all the non-financial companies listed in the Colombo Stock Exchange that disclose sustainability reports using GRI G4 guidelines/GRI Standards during the period of 2014/2015 to 2018/2019. For this study, secondary data were collected from the Colombo Stock Exchange and official websites of companies. Sustainability reporting, disclosure of economic performance, disclosure of environmental performance and disclosure of social performance were considered as the independent variables. Global Reporting Initiative (GRI) guidelines were assisted for calculating the disclosure index as a basis to measure all independent variables. Return on Asset (ROA) was used to measure the company performance. Descriptive statistics and panel data regression were used to test hypotheses using E-views statistical package. The findings of this study encourage public listed companies to adopt sustainability reporting disclosures according to GRI guidelines mainly to attract investors, to take operational decisions, to generate revenue and to achieve shareholder objectives.Item The Impact of Sustainability Reporting on Company Performance of Public Listed Companies in Sri Lanka(Department of Accountancy, Faculty of Commerce and Management Studies, University of Kelaniya, 2020) Sanurika, M.R.; Perera, PrabathSustainability Reporting is a voluntary requirement that consists of three aspects which are economic performance, environmental performance and social performance. The purpose of this study is to investigate the impact of sustainability reporting as a whole, and each of the aspects of sustainability reporting on company performance of Sri Lankan public listed companies. The sample of this study consists of all the non-financial companies listed in the Colombo Stock Exchange that disclose sustainability reports using GRI G4 guidelines/GRI Standards during the period of 2014/2015 to 2018/2019. For this study, secondary data were collected from the Colombo Stock Exchange and official websites of companies. Sustainability reporting, disclosure of economic performance, disclosure of environmental performance and disclosure of social performance were considered as the independent variables. Global Reporting Initiative (GRI) guidelines were assisted for calculating the disclosure index as a basis to measure all independent variables. Return on Asset (ROA) was used to measure the company performance. Descriptive statistics and panel data regression were used to test hypotheses using E-views statistical package. The findings of this study encourage public listed companies to adopt sustainability reporting disclosures according to GRI guidelines mainly to attract investors, to take operational decisions, to generate revenue and to achieve shareholder objectives.Item Effect of CEO Duality, Board Size, Board Composition on Corporate Governance Disclosure in Sri Lanka(Department of Accountancy, Faculty of Commerce and Management Studies, University of Kelaniya, 2020) Perera, B.H.N.U.; Perera, PrabathCorporate Governance (CG) plays an important role for better decision making to all the stakeholders of the organization. This study examines the effect of CEO duality, board size and board composition on corporate governance disclosure practices in Sri Lanka. Related prior studies have examined the level of corporate governance disclosure in various countries by using the same CG disclosure traits. However, no formal research has so far been conducted to measure the effect of duality, board size and board composition on corporate governance disclosure in Sri Lanka. So there is a need for researchers to focus on the development of more reliable and valid measurements of the corporate governance disclosure model. In accordance with that, it will fulfill the gap between effects of duality, board size, board composition in corporate governance within the Sri Lankan context. Accordingly, the main purpose of this study is to investigate the impact of corporate governance traits such as CEO duality, board size and board composition on the level of corporate governance disclosure practices in listed companies in Sri Lanka. This study employs the Corporate Governance Disclosure Score containing 29 items, which are very similar to the S&P disclosure score. To facilitate the analysis, a Corporate Governance Disclosure Index (CGDI) has been computed. For the reviewing purpose of score items, highest market capitalized 64 listed companies had been selected using market capitalization report as at 31.03.2019 of Colombo Stock Exchange. Annual reports of the fiscal year 2015 to 2019 were considered for data collection and used panel regression technique to estimate the model. The findings of this study will provide useful insights to all stakeholders of the company to investigate the accuracy of their decisions. Further, these practices help developing economies to get sustainable rates of growth and enhance the confidence of a national economy.