International Research Journal of Finance and Economics
 Issue 147
 May, 2016
Determinants of Capital Structure: Case of Property and Real Estate Companies listed in Indonesian Stock Exchange (IDX)
Purwohandoko, Tsarina P. Yudanty

This study investigates the impact of the variables: tangibility, profitability (ROA), firm growth (growth), firm size (size), corporate tax rate (CTR) and Good Corporate Governance (GCG) on the capital structure of sector property and real estate in Indonesian Stock Exchange (IDX) from 2008-2014. The population of the analysis are all property and real estates listed in Indonesian Stock Exchange (IDX) during 2008-2014, there were totally 52 companies. Using purposive sampling method, the samples of the study are 16 companies. The result of the analysis showed that tangibility firm growth and Good Corporate Governance (GCG) had negative significant on the capital structure. On the other side, firm size (size) has shown positive significant on the capital structure. Finally, profitability (ROA) and corporate tax rate (CTR) was not significant on the capital structure.
Keywords: Tangibility, Profitability (ROA), Firm growth (growth), Firm size (size), Corporate tax rate (CTR), and Good corporate governance (GCG)
The Impact of Computerized Accounting System on Accountants Performance in the Jordanian Medicine Shareholding Companies: A Field Study
Feras Izzat Oqlah Kasasbeh

The study revealed that computerized accounting system have a positive impact on accountants in Jordanian medicine shareholding companies. This study shows a very important issue concerning the significance of computerized accounting because through it all complicated applications may be done easily and accurately and reliability etc. In this field study we have used 85 questionnaires out of which 75 responses has been received and data has been analyzed through SPSS software in calculating value of Data has been received in seventh Jordanian Medicine Companies. The results showed the positive Impact Accountants skill, knowledge, innovation and through them can be analyzed that team work between programmer and company accountants would cooperative and positive results on skill innovation, knowledge etc. This study arrived to the following recommendations: Jordanian Medicine shareholding companies should adopt specialized Accounting programs to enhance the performance of accountants, adopt the providing rewards, incentives and promotions with a concentration on the financial or material incentives to motivate the accountants to take part in the training courses to increase the accountantsí innovations , involve the accountants in the conferences and internal and external courses ensure increasing the efficiency and effectiveness of outputs of computerized accounting system.
Keywords: Computerized Accounting System, Innovation, skill, knowledge
The Role of Stock Markets in Achieving Economic Growth of Developing Nations
Abeer F.A. Al Abbadi and Marwan Mohammad Abuorabi

Middle East financial markets have witnessed several unexpected price fluctuations during the past two decades which caused dangerous effects on these markets and caused serious financial turmoil that reached to uncertainty levels in the region. According to this, concerned experts should analyze and illustrate the experimental effects and results and should document them and for future situations. Considering Jordan as one of the affected countries, it has been selected as a case to present an experimental view in this regard. This research paper has analyzed the behavior of Amman Stock Exchange (ASE) for the periods of high fluctuation. It highlighted the impact of the fluctuations in the market in terms of efficiency and the incomes.
This study examines the effects of Amman Stock Market fluctuations on the Jordanian economic growth for the period of 2004-2012 using both the Generalized Autoregressive Conditional Heteroskedasticity (GARCH) and Autoregressive Conditional Heteroskedasticity (ARCH). The study reveals that the sudden and continuous fluctuations in the stock prices of Amman Financial Market is one of the permanent effects due to the large number of causes of this fluctuation, which works on the Jordanian economic growth distortion.
In the light of the results, the study recommends preventing the continuous fluctuations increase in Amman Stock Exchange stock prices, by working on promoting employment size and the quality of professionals and craftspeople in the producing enterprises with special emphasis on independent and aiming researches, the mechanism of monitoring and taking immediate decisions to maintain the momentum of the production as well as the effective monitoring by the technical Committee of the Securities Commission.
Keywords: Stock Markets, Growth of Developing Nations, GARCH, Jordan.
The Impact of the Dividends Policies on the Value of the Stock of Public Shareholding Companies in the Jordanian Industrial Sector
Abeer F.A. Al Abbadi, Asma'a Al-Amarneh and Marwan Mohammad Abuorabi

The decision of dividends is considered as one of the most important and hardest decision that must be taken by the organizations' managements in accordance with its objectives, its future and the value of the market. The decision trades off between two choices; the dividends to share holders or the detention of those retained earnings to be invested in new activities in order to achieve more profits. This paper aims to identify the impact of the dividends' policies on the stock value of the companies. The results showed that there is an impact for the dividends policies on the Jordanian industrial companies' market price.
The results of the major hypothesis examination showed an existence of a statistically significant effect at the significant level (α<0.05) of the dividends policies on the Jordanian industrial companies' price market.The first minor theory examination results showed an existence of a statistically effect at the significant level (α<0.05) of the cash dividends policies on the Jordanian industrial companies' price market. The second minor theory examination results showed an inexistence of a statistically significant effect at the significant level (α<0.05) of the stocks dividends policies on the Jordanian industrial companies' price market. The third minor theory examination results showed an inexistence of a statistically significant effect at the significant level (α<0.05) of the stocks repurchasing policy on the Jordanian industrial companies' price market.
Keywords: Dividends policy, Cash dividends, stock dividends, stock repurchases, stock market price, Industrial sector, Amman Stock Exchange (ASE).
A Portfolio Approach for R&D Project Selection: Case study of Petroleum Industry
Boghsian, Albert and Vesali Fallah Sara

Project portfolio selection and activities related to the management of selected projects throughout their life cycle are important activities in many organizations since the project management approach is commonly used in many industries for activities such as research and development of new products, implementation of new systems and processes in manufacturing and informational systems and contracting engineering and constructing projects. Thus the choices should be made on the proper construction of the project portfolio. There are slightly different techniques that can be used to estimate, evaluate and select a portfolio of projects. But many of these techniques are not used much because they are too complicated and require too much input data, do not provide adequate treatment of risk and uncertainty, failed to identify the relevant terms and relationships, it may be difficult to understand and use them or may not be applicable in the context of an organized process.
The purpose of this study is to assess the current state of the oil industry and offer suitable method for optimal project portfolio selection that allows decision makers to use a subset of the available methods for the selection of research-technology projects in a logical flexible manner.
Keywords: Optimization model, Optimization, Research project, Portfolio, Project portfolio, Profit and Risk, Project portfolio selection
JEL classification: F37-G31-G11-G18-H41-H61-Q40-L21-O22
Bayesian Model Selection under Different Priorís Beliefs and Distributions
Islam Azzam

Model selection uncertainty can alter inferences from economic forecasting models. Classical model-selection criteria perform poorly with small sample sizes. In addition, attempts in the classical literature to incorporate model-selection uncertainty and improve inferences from vector autoregressive (VAR) models fail in cases that are common in empirical macroeconomics. Accordingly, a one might use Bayesian model averaging approach in which model-selection uncertainty is methodologically not an issue. This paper examines the sensitivity of Bayesian model-selection in unrestricted VAR models to changes in the priorís beliefs and distributions. Bayesian approach accounts for model-selection uncertainty by using Bayesian model averaging while classical approach accounts for that by using Kilianís (1998b) endogenous lag order algorithm. This paper also evaluates the repeated sample inference of Bayesian model averaging (BMA) through calculating the interval coverage accuracy and average length for impulse response estimates from the BMA under Minnesota prior.
Exchange Rate Regime and Inflation: Whatís Choice for Emerging Countries?
Houda Jendoubi

This study aims at identifying the optimal exchange rate regime that enables emerging countries to reduce their rate of inflation. Based on a sample of 24 emerging countries during the 1974 -2008 period, our results show that the level of inflation in emerging countries started to decrease noticeably after 1990. Also, we see that the fixed regime has recorded the lowest level of inflation and the flexible regime has achieved the highest level of inflation. Moreover, the estimation of our model shows that the fixed regime offers the lowest level of inflation. However, when the inflation level exceeds 40%, the three exchange rate regimes (fixed, flexible and intermediate) have no more impact on inflation.
Keywords: exchange rate regime, inflation level, emergent countries.
JEL code: F31-E31
The Determinants of Working Capital Requirement and Speed of Adjustment: Evidence from Vietnamís Seafood Processing Enterprises
Nguyen Thanh Cuong and Bui Manh Cuong

The purposes of this study are to analyse the determinants of working capital requirement (WCR) and to examine the speed with which firms can adjust toward their target WCR. Based on a sample of 112 Vietnamís seafood processing enterprises (SEAs) during 2005Ė2014, a target adjustment model and panel data techniques are employed to examine the significant determinants of the WCR and speed of adjustment. The results, which are robust for endogeneity, show that SEAs pursue the target working capital investment levels and they adjust relatively slowly towards their target levels. Moreover, we present an evidence that the speed of adjustment is not equal across all firms and it depends on access to external capital markets. In addition, the results also show that the WCR increased significantly with increasing in the firmís sales growth and profitability. In contrast, the WCR decreases significantly with increasing in the size, fixed investment, cost of external finance and sales volatility of the firm. From the results obtained, this research proposes some policies to implications for SEAs in making investment decisions on working capital reasonably in order to maximize the firm's value.
Keywords: Target adjustment model; Speed of adjustment; Working capital requirement; Working capital management; SEAs.
JEL Classification: G30; G31; G32
The Impact of Acquisitions On The Performance Of The Acquiring Firms Evidence From Kuwait
Ahmad T. Al-Sultan and Zafereh Alam

This paper provides an evaluation of the impact of acquisitions on the performance of the acquiring firms listed in the Kuwait Stock Exchange (KSE) using a sample of acquisitions occurred in Kuwait during the period from 2008 to 2012, and examines whether such acquisitions, added value to the acquiring firms. It empirically evaluates the short-term effect of acquisitions on the acquiring firms by studying their stock price reaction to the acquisition announcement using an event study methodology. It also examines the longer-term impact of acquisition by comparing post-acquisition profitably of the acquirers over 2 years with the corresponding pre-acquisition period using profitability ratios of Return on Equity (ROE) and Return on Assets (ROA) as parameters. Additionally, this paper compares the reaction of the acquiring firmís stock price to the acquisition of foreign versus domestic targets and examines whether the acquisition of foreign targets results in a more positive stock price reaction than acquisition of Kuwaiti targets. Further, it evaluates the impact of involvement in any of such acquisitions on the acquirersí profitability over 2 years. The overall results indicated that acquisitions do not create wealth for the shareholders of the acquiring firms neither in the short run nor in the long-run. The acquirers do not earn any abnormal returns around the acquisition announcement day, and their ROA and ROE deteriorated in the years prior to acquisition in comparison with the corresponding pre-acquisition period. Furthermore, comparison between domestic and cross-border acquisitions indicated that none of such acquisitions led to creation of value for the shareholders, however the international acquisitions were more value destructive than the domestic ones.
Examining the Efficiency of Decay RBF Neural Network in Predicting Stock Prices in Tehran Stock Exchange
Mahmood Reza Rakhshani and Fatemeh Zolfaghari

Predicting the stock price in the stock market has always been the focus of attention of investors. Tehran Stock Exchange is under the influence of various social, political, economic, etc. factors and thus predicting the stock prices in Tehran Stock Exchange with conventional classic and smart methods is difficult. In this study, we have compared the ability of Decay RBF neural network in predicting stock price of Tehran Stock Exchange with MLP neural network techniques and fuzzy regression. The population of this study is the firms listed in Tehran Stock Exchange and using previous research and according to economic and political conditions in Iran, twelve effective variables in stock pricing are considered. These variables are extracted using information and midterm financial statements of last 6 months and daily information of these companies during 4 months from Codal website and Tehran Securities Exchange Technology Management. The experiments show that Decay RBF neural network has more ability in estimating functions with noise compared to fuzzy regression and MLP techniques.
Keywords: Tehran Stock Exchange, fuzzy regression, MLP, Decay RBF