Search

The purpose of this study is to examine the profitability and financial sustainability of banks in Bangladesh before and during COVID-19. The study compares the profitability and financial sustainability of 23 listed private commercial banks. The data for short-term periods before the COVID-19 and during the COVID-19 crisis we used. Financial ratios, descriptive statistics, correlation matrix and linear regression model estimations are used for the analysis of data. The mean values of ROA, ROE and NIM are found before the COVID-19 crisis as 0.0019, 0.0270 and 0.0054, and during the COVID-19 as 0.00128, 0.01856 and 0.00321 respectively. On the other hand, the mean values of NFLR, CCR, ICR, and OSR are found before COVID-19 as 2.0936, 6.852, 0.9314 and 0.4751, and during COVID-19 as -2.5961, 5.879, 0.7673 and 0.3587 respectively. The findings construe a significant impact of the unprecedented pandemic. Within a short period of time, sample banks’ profitability and financial sustainability deteriorated significantly. A key implication of our study is that the private-sector commercial banks in Bangladesh experienced severe financial difficulties during COVID-19 which impacted their profitability and financial sustainability. The findings of the study suggest that adverse economic events have substantial effects on the financial realities of financial institutions. The findings of the study are expected to be useful to both academics and policymakers.

Purpose Money laundering offences occur worldwide, with recent discussions involving issues related to the low levels of compliance among professional accountants towards the anti-money laundering (AML) regime. Under the regime, professional accountants are required to implement compliance programs (Know Your Customer, Clients Due Diligent, Record Keeping) and to submit any suspicious transaction report encounters to the authorities. Due to the lack of research in this sector, this study aims to examine the compliance determinants towards AML regimes among professional accountants in Malaysia. Design/methodology/approach Premised on protection motivation theory, a questionnaire was developed and distributed among 1,100 professional accountants. Of which 275 questionnaires were returned and subjected to regression analysis. Findings Based on the findings, “perceived risk of non-compliance” and “awareness of Anti-Money Laundering Act 2001 and Financial Action Task Force standard” were significantly related to the level of compliance towards the AML regimes. Meanwhile, “compliance cost” did not influence the compliance behaviour of professional accountants. Moreover, the findings demonstrated that awareness programs among the reporting institutions should be enhanced, specifically the professional accountants. Practical implications This study recommends the professional bodies particularly professional accountants in Malaysia to establish a blueprint as a guideline for money laundering reporting. Originality/value This is one of the pioneer studies looking into AML compliance determinants among the professional accountants in Malaysia. This study will provide insights on the current practices and recommend ways to improve the current AML reporting practices among the professional accountants.

Purpose This study aims to understand the member countries’ current asset recovery mechanism based on two elements, namely, confiscation policy and asset recovery management framework. Design/methodology/approach Content analysis was performed on the Financial Action Task Force (FATF) Mutual Evaluation Report (MER) of eight countries. Findings The result showed that only a few countries established a centralised asset recovery centre or special task force to manage recovered assets. Research limitations/implications This study is limited to information mentioned in the FATF MER. Practical implications This study highlights the need to have a centralised asset recovery management centre as an initiative to improve the outcome of money laundering investigations. The study findings will benefit regulators to understand further the practical challenges of the asset recovery mechanism for future improvement. Originality/value FATF recommends that each country establish a centralised asset recovery centre and work closely with the investigating officers and prosecutors in deciding on assets confiscation. However, the implementation is contingent on their local environment and resources at the member countries’ discretion. Therefore, this study aimed to understand the member countries’ current asset recovery mechanism based on two elements, namely confiscation policy and asset recovery management framework.

Purpose The purpose of this study is to understand the reasons behind the different patterns of Sharīʿah non-compliant income (SNCI) disclosures amongst Islamic banks and, in particular, the extent to which Islamic banks make SNCI disclosures. The process involved in gaining and maintaining moral legitimacy forms the framework for this study. Design/methodology/approach Interviews were conducted with managers of Islamic banks involved in the reporting of SNCI in company annual reports. Findings The interview findings show that Islamic banks prefer to use procedures to gain and enhance moral legitimacy amongst their customers, business partners and staff. The constraints and challenges that Islamic banks face in SNCI reporting make this a popular means of securing moral legitimacy. However, these practices may not lead to enhanced and more communicative SNCI disclosures by Islamic banks. Originality/value To the best of the authors’ knowledge, this is the first study that explains the motivations behind SNCI reporting by Islamic banks and frames these motivations under the moral legitimacy framework.

Information and Communication Technology (ICT) supports the sharing of information to improve the Quality of Governance (QoG). Many studies found a relationship between ICT diffusion and globalization and between ICT diffusion and the Quality of Governance. This study investigates the influence of both ICT diffusion and globalization in explaining the country level QoG while incorporating gross domestic product (GDP) per capita, human capital, and government expenditure in the context of the ASEAN (Association of Southeast Asian Nation) region. To this end, we used Panel Autoregressive Distributed Lags (ARDL) to analyze panel data from 1984 to 2017. In contrast to research conducted in other countries, our research shows that the impact of ICT diffusion on QoG is not significant in the ASEAN region. The findings can be explained by a lack of coherent ICT-strategy among the countries and a lack of institutional mechanisms to ensure ICT efforts’ effectiveness. However, the relationship between globalization and QoG is positive and significant.

Purpose The purpose of this paper is to investigate the extent of fraud prevention disclosure on the Malaysian public universities’ websites. Design/methodology/approach The level of fraud prevention information disclosure was examined using content analysis of all 20 public universities in Malaysia based on the university fraud prevention disclosure index (UFPDi) previously developed by the authors’ research team. Findings The disclosures of eight aspects of fraud prevention policies, responses, initiatives and mechanisms were not satisfactory. Possible reasons could be because of lack of awareness and appreciation on the institutional mechanisms and lack of formal pressure from the relevant authority. Research limitations/implications Data collection for analysis was conducted during a period of one month only due to rapid changes of the information on the websites. Social implications The low level of disclosure using UFPDi will prompt the Malaysian public universities to take proactive actions in promoting transparent and good governance among the university staff hence assisting the government in addressing the fraud problem that is plaguing the nation. Originality/value This paper is an extension to the authors’ previous work on UFPDi. It further explains and highlights the extent of fraud prevention disclosures among academic institutions who are receiving financial resources from the government.

Within a framework that includes economic activity, real interest rate, grants, and subsidies, we aim to explore the role of renewable energy, technological innovation, and particularly the environmentally damaging militarization in driving green growth, which fosters sustainable economic growth by ensuring the values of natural assets, considering OECD countries. Our examination affirms a positive proposition between the development of renewable energy, technological innovation, and green growth in the long run by implementing the cross-sectional dependency panel autoregressive-distributed lags (CS-ARDL) framework in a dynamic heterogeneous panel setting. The findings also suggest that militarization is antagonistic to green growth. Our decomposed analysis is compatible with our premier analysis, indicating a conducive impact of both biomass and non-biomass types of renewable energy on green growth. We also document a negative association between the real interest rate (RIR) and green growth, while income muddles the results. The robustness tests confirm the sensitivity of our main findings to the magnitude of the subsidies and grants provided to renewable energy. The paper concludes with several policy recommendations.

The study aimed to provide additional insights on how supply chain management practices are used to promote sustainable development in line with Maqasid Al-Shariah principles of Islam. A multiple case study approach involving two major automotive firms in Malaysia was used to address key research issues. The results show that these SCM practices, viz. resources, information, integration, and relationship practices support the promotion of Maslahah for all human beings which is consistent with the aims of Maqasid Al-Shariah principles for sustainable development. The findings provide some guidance to facilitate the achievement of SDGs especially among Muslim countries through their SCM practices. Studies which examined SCM practices for sustainable development from an Islamic perspective are limited. Therefore, the present study aims to provide additional insights on how SCM practices are used to promote sustainable development in line with Maqasid Al-Shariah principles. Some SCM practices are congruent with Maqasid al-Shariah particularly when the practices are examined through the Islamic lens that focuses on the goal of creating value to mankind.

Purpose This paper aims to explain the development of fraud prevention disclosure index (FPDI) for Malaysian public universities. Design/methodology/approach The paper reported a comprehensive review on fraud prevention and control plans of several international policies and of local and international universities. Findings The final 8 categories and 100 items under review have been developed in an instrument, the proposed FPDI, to measure the level of commitment of public universities in preventing fraud. Research limitations/implications The FPDI will serve as an evaluation tool to measure the level of commitment of public universities toward preventing fraud practices through disclosure practices. Social implications The FPDI is hoped to inculcate anti-fraud culture amongst public universities and to promote accountability, widen and strengthen good organization’s ethics, create ethical work place environment and enhance corporate governance framework by instilling a culture of professional conduct that is free from corruption. Originality/value This paper is among the first paper that develops the index specifically to measure the universities’ level of commitment to prevent fraud.

Machine learning has been widely used in solving the problem of prediction and classification. It is also beneficial in the problem of tax avoidance detection. This study presents the utilization of machine learning classification approach for detecting tax avoidance of Malaysian government-linked companies (GLCs). There were nine machine learnings algorithms have been used on the real dataset collected from datastream and companies annual reports. The performance of these algorithms have been observed based on different training approaches and different features selection. The findings have revealed that the accuracy of results from each machine learnings were divergent according to the training approaches and features selection.

The impact of financial development (FD) on economic growth in the context of Malaysia and Indonesia has been examined in this study regarding the role of the financial crisis and strategic changes in the institutional setup. Autoregressive distributed lags and threshold regression were applied, and time series data were analyzed for the period between 1984 and 2017 revealing that FD promoted the economic growth in both economies during this period. A nonlinear analysis also revealed that FD and economic growth follow an inverted U‐shape relation in the case of Malaysia whereas, in Indonesia, it followed a U‐shape relation. It was discovered that not all measures of FD promote economic growth. For instance, market capitalization was profound in the Malaysian economy while credit to the private sector and money supply was conducive for the Indonesian economy. The analysis demonstrated that the Asian and global financial crisis adversely affected economic growth in the case of Indonesia due to poor institutional quality (IQ), whereas in Malaysia it was relatively safe from the adversity brought about by the financial crisis due to the presence of IQ and good corporate governance. However, a positive change in IQ was found to have a much greater impact on augmenting economic growth rather than playing a mediating role in connection with FD and economic growth in Malaysia. In the context of Indonesia however, IQ was found to impede economic growth but played a positive and significant mediating role in the nexus of FD and economic growth. The spill‐over analysis revealed that Malaysian FD is positively associated with Indonesian economic growth while Indonesian FD is negatively associated with the Malaysian economy. This study provided all economic and anecdotal explanations in supporting the results of this study.

Money laundering is a global issue that must be effectively mitigated across the nation. Despite various initiatives, investigation outcome either in the form of prosecution, conviction, or confiscation remains low. Therefore, this study aims to investigate the factors influencing money laundering investigating outcome, based on rational choice theory. The study conducted focus group interviews with 15 investigating officers to have an in-depth understanding of factors and challenges faced by investigating officers in conducting money laundering investigation which influences their investigation outcome. The findings demonstrate that money laundering investigation outcome is influenced by three factors, which are cost-benefit analysis, individual belief, and organizational context. The findings of the study provide significant contributions in confirming the theoretical foundations underpinning this research and suggest recommendations for the relevant regulators in improving money laundering investigation and prosecution decision making.

Most studies of management accounting practices (MAPs) globally, and specifically of Malaysia, mainly focus on large manufacturing companies. This study examines the adoption of MAPs among small and medium enterprises (SMEs) engaging in export-oriented manufacturing in selected industrial hubs in Malaysia. In the digital era, these firms are expected to adopt some relatively sophisticated management accounting techniques in their manufacturing processes and marketing strategies. Based on 2019 statistics, SMEs constitute about 98.5% of all Malaysian business establishments. Most export-oriented SMEs are very structured in nature as they must adhere to stringent international market requirements. The objectives of the present study are to evaluate the level of perceived business uncertainty facing these SMEs and to explore their level of MAPs-adoption. Questionnaires were used to collect data from the export-oriented SME respondents: of the 410 distributed questionnaires, 78 (19%) were completed, returned, and used for analysis. The results show that, overall, export-oriented firms mainly market their products within the ASEAN region and, as such, most respondents perceived their business environment as “stable and predictable.” In relation to MAPs, it is evident that the export-oriented manufacturing SMEs rely more on traditional tools and techniques, like operating budget, standard costing, capital budgeting, variable costing, cost variance analysis, full costing, CVP analysis, and ratio analysis, for the purpose of product cost information.

Corruption might occur in many places within the government. Information and communication technology (ICT) can be used to create a more open and transparent government enabling the control of corruption (CoC). The research presented in this paper aims to analyze the effect of ICT on CoC in open government. Using panel data of ASEAN countries over 33 years from 1984 to 2016, this study examined the data utilizing panel auto-regressive distributed lags (ARDL). The results of this study reinforce the existing literature on the positive effects of ICT on CoC. However, the assumed relationship is more complicated than often assumed. This study shows the presence of a quadratic (non-linear) inverted u-shaped relationship between the ICT development and CoC, which implies that there is no further opportunity for ICT alone to reduce corruption once a threshold is reached. ICT might even be used to facilitate corruption. Hence, ICT needs to be complemented by institutional and organizational measures and education to fight corruption. © 2021 IGI Global. All rights reserved.

Corporate tax avoidance reduces government revenues which could limit country development plans. Thus, the main objectives of this study is to establish a rigorous and effective model to detect corporate tax avoidance to assist government to prevent such practice. This paper presents the fundamental knowledge on the design and implementation of machine learning model based on five selected algorithms tested on the real dataset of 3,365 Malaysian companies listed on bursa Malaysia from 2005 to 2015. The performance of each machine learning algorithms on the tested dataset has been observed based on two approaches of training. The accuracy score for each algorithm is better with the cross-validation training approach. Additionationally, with the cross-validation training approach, the performances of each machine learning algorithm were tested on different group of features selection namely industry, governance, year and firm characteristics. The findings indicated that the machine learning models present better reliability with industry, governance and firm characteristics features rather than single year determinant mainly with the Random Forest and Logistic Regression algorithms.

This paper studies the relationship between social capital on the green growth in Malaysia, with the aim of ascertaining whether faith based social capital has a role in sustaining economic growth. The study utilizes the annual data over the period of 1970-2015. This study employs the Autoregressive Distributed Lag (ARDL) model and causality using the Vector Error Correction Model (VECM). The findings demonstrate the long and short-run associations between social capital and green growth in Malaysia. The causality only runs in a unidirection from social capital to the green economic growth. The findings have important policy implications for green economic growth measurement to account for social well-being and to fulfil the objectives of Islamic Sharia.

This study examines the role of institutional ownership in moderating the relation between fundamental factors of a company and Corporate Social Responsibility (CSR) and Enterprise Value (firm value). The type of this research is an explanation research method. The sampling method was a proportional random sampling method of the population of banking companies of the Indonesian Stock Exchange. The method of data collection was documentation. The method of data analysis was Multiple Regression Analysis. The results of this study showed that simultaneous net profit margin and corporate social responsibility had a significant effect on the firm value. Partial test shows that net profit margin variables had an effect on the firm value and corporate social responsibility variables, which consist of economy, and had no influence on firm value. The results also indicated that institutional ownership strengthened the relation of fundamental factors and corporate social responsibility with the Enterprise Value.

Purpose This paper aims to conduct a comparison on the effectiveness of the law enforcement agencies (LEAs) of Australia and Malaysia in investigating money laundering cases by looking into the legal system and operational issues faced in conducting the investigation. Design/methodology/approach The purpose of this paper is to review and analyze the data collected from the Financial Action Task Force (FATF) Mutual Evaluation Report, focusing on the information outlined in the third chapter. The legal system and operational issues cover the area of technical compliance and effectiveness compliance, which were introduced in the latest FATF Evaluation Methodology issued in 2013. Findings The results show that both countries have the power needed to investigate money laundering and terrorism financing under their respective Anti-Money Laundering Act. However, Australia is seen to have a better investigative support system to assist LEAs during the investigation process. This explains the reason for difficulties in increasing the number of prosecutions for money laundering and terrorism financing cases. Hence, improvement actions are needed in curbing this issue. Practical implications The result suggests that Malaysia should strengthen the cooperation, coordination and capacity among LEAs to ensure effective targeting, investigation and prosecution of money laundering. The government should also revise the money laundering investigation time frame and broaden the power of LEAs in retrieving information during the investigation process. Malaysia should also enhance the investigative support system, which will be helpful for LEAs in gathering sufficient evidence to support their money laundering charges. Unlimited power in gathering evidence is prominent to charge money launders as it helps to gather information required for prosecution. Originality/value Prior literature focuses on the prevention mechanism, where this paper aims to focus on detection and investigation mechanism focusing on money laundering investigation conducted by LEAs. Lack of study on money laundering investigation calls for this research to be done to understand the strengths and weaknesses to improve its effectiveness in the future.

Purpose The purpose of this study is to examine the relationship between financial strength or condition and managerial practices in preparing financial statements of public limited companies. The objectives of this study are threefold – to measure the financial strength, to measure integrity index and to examine the relationship between management practices and financial strength. Design/methodology/approach Financial ratios, Altman’s Z-Score, integrity index, ranking approach and chi-square test are used to achieve the objectives. A multi-year cross-country analysis is done by considering sample of seven Asian countries, namely, Malaysia, Singapore, Thailand, Indonesia, Hong Kong, China and Japan. Findings The study catches the relationship between management practices and financial strength across sample countries. Management practices is one of the responsible factors for this relationship. They use discretionary power in preparing financial statements to control the trading results. The principles of accounting do not support the alteration of financial data to look the company better on paper. The cost of financial statement fraud is higher than other occupational fraud. Research limitations/implications This study does not cover factors other than management practices and further study could be conducted to look for the other reasons that may also responsible for the deviations. Practical implications Conflict of interest between shareholders and board of directors is not a new phenomenon. Auditing system is introduced to minimize this conflict of interest, but they failed to uphold their position in reality. Management also needs to prove their integrity in financial statements. Ethical consideration is the highest priority. Social implications Stakeholders, especially regulators, professional bodies and academics, should concentrate on the issue on ‘how to reduce the manipulation in financial statements’ to create a safe investments avenue for the nation. Originality/value This study provides empirical evidences regarding the influence of management practices on financial statements and financial strength of listed companies across countries. The culture, attitudes, beliefs, perceptions, etc., are different from country to country. The aim is to contribute empirical evidence about the relationship between management practices and financial health in different settings. This study is first of its kind.

Purpose This paper aims to examine whether individual factors (religiosity and ethical values) and organizational factors (ethical leadership and whistleblowing practices) contribute to employee fraud mitigation. Design/methodology/approach Guided by Corporate Integrity System Malaysia, this study developed and collected 101-questionnaire survey from Royal Custom officers. Findings The findings revealed that individual factors (religiosity and ethical values) significantly contribute to fraud reduction, and organizational factors (both ethical leadership and whistle blowing practices) do not significantly contribute to employee fraud mitigation. Originality/value This study serves as a useful guide to alert and educate employers, professionals, law enforcement officers and policymakers of the importance of individual and organizational factors in mitigating employee fraud. There is very little empirical research conducted on employee fraud in Malaysia. This research helps bring that to light.

Purpose This paper aims to study the roles of Muslim CEO, Muslim Chairman and Muslim board of directors in mitigating earnings management via real activities manipulation. Design/methodology/approach In total, 656 firm year-observations from 2007 to 2014 of Malaysian Top 100 firms listed on Bursa Malaysia is used to examine the relationship between real earnings management (REM) and the religious ethical values of Muslim top leadership of the firms. Findings The study provides evidence that there was no significant relationship between ethical values and REM measures among Muslim top corporate leaders. However, through additional analysis on sub-sample firms, this study finds that Muslim CEO and Muslim Chairman have a significant and negative association with proxies of REM: RCFO and RPC. Research limitations/implications The results show that Muslim CEO and Muslim Chairman are the actors that contribute more control in limiting REM especially in family-owned firms in Malaysia. Originality/value This is the first published paper that focuses on Islamic ethical values of corporate top leadership and REM in Malaysia, as previous studies have focused more on accruals earnings management.

The inspiration to delve into the contemporary status of Islamic banking and finance in the Philippines has led this study to analyze the financial condition of Amanah Islamic Bank (AIB) and recommend improvements in its financial performance. This secondary databased study utilizes library research and content analysis, particularly using the capital, asset, management, earnings, and liquidity parameters. AIB is the rebranded version of Al-Amanah Islamic Investment Bank of the Philippines. At present, AIB has nine branches and is the only authorized bank in the Philippines to offer Islamic banking products and services. Presidential Decree No. 542, which was signed in 1974, directed the AIB to implement an Islamic model of banking and financing, particularly following the "no interest principle" and partnership mechanisms. However, this order was not completely implemented because "conventional banking" dominated the AIB's operation. This study contributes to the continuing effort to convert AIB into a full-fledged Islamic bank and simultaneously contend with the emerging growth of the banking industry. © 2018, Kolej University Islam Sultan Azlan Shah.

Purpose The purpose of this paper is to examine the broad concept of forfeiture, its legal positions in the UK and Malaysia, and to highlight the implications of such forfeiture systems and legislations. Design/methodology/approach This paper uses a doctrinal legal analysis and secondary data, which analyses primary sources, the POCA (2002) and the AMLATFA 2001, and secondary sources including case law, articles in academic journals, books and online databases. Findings The authors contend that the civil forfeiture system and law have far-reaching implications, affecting not only law enforcement agencies, but also on property owners, the courts and bona fide third parties. Also, civil forfeiture law as contained in AMLATFA 2001 represents one of the most serious encroachments on private property rights. Not only that, such a legal rule has made property, and not the owner, guilty until proven innocent. Originality/value This paper could be a useful source of information for practitioners, academicians and students. It could also be a beneficial guide for policymakers for any possible future amendments to the law.

Purpose The purpose of this study is threefold: first, to detect trends in financial statement manipulation; second, to measure the level of manipulation and to measure the variation in manipulation between countries; and, third, to identify widely used techniques in financial statements manipulation. Design/methodology/approach This study uses financial data of listed companies from Asia, namely, Japan, Singapore, Malaysia, Indonesia, Thailand, Hong Kong and China. The study adopts financial ratios, financial forensic tool, dichotomous approach and statistical tools to analyze the data (84,000 observations) over a period of four years from 2010 to 2013. Findings The results show that 34 per cent of sample companies in selected Asian countries are involved in the manipulation of financial statements; the average level of manipulation (overall manipulation index) is 72 per cent; and there is a significant difference between countries at 5 per cent level. The study also identifies four most commonly used techniques, namely: days’ sales in receivable (DSRI), depreciation (DEPI), assets quality (AQI) and total accruals to total assets (TATA). Research limitations/implications Although this study found a significant national difference between countries in terms of practicing manipulation in financial statements, it did not address the issue of why some countries have higher level of manipulation and greater fluctuations in manipulation than others. Further study could be conducted to look for the reasons on these issues. Practical implications Investors and other stakeholders are advised to judge the manipulation in financial statements before fixing up for investment. At least they should examine Sales, Accounts Receivable, Depreciation, Value of Fixed Assets and Accruals data before accepting the financial statement in good faith. Social implications The trend of manipulation in financial statements is increasing day by day and that is why it needs to prevent to protect our society from white collar crime. The cost of white collar crime is much higher and key executives are making money at the expense of investors and other stakeholders. This kind of study creates awareness among stakeholders about the manipulation as well as provides techniques to examine the faithfulness of financial statements. Then, managers will not overstate or understate either revenues or expenses easily, as it can damage the goodwill. Originality/value This is the first study of its kind addressing measurement of manipulation score, overall manipulation index (OMI) and identification of widely used variables of manipulation in financial statements are new contributions towards existing literature of earnings manipulation.

Purpose This study aims to discuss the Financial Action Task Force (FATF) Special Recommendation IX (SR IX) and the importance of complying with the recommendation, which focuses on cross-border declaration or disclosure with the objective to detect and prevent illicit cross-border transportation of cash and bearer negotiable instruments (BNIs). This study also looks into compliance ratings of Asia Pacific Group (APG) 40 countries on the FATF SR IX. Design/methodology/approach This study reviews the mutual evaluation reports issued by APG on money laundering from 2006 to 2012. Based on the mutual evaluation reports, this study also looks into recommendations and comments given by respective panels. The compliance ratings together with panel’s recommendations and comments compiled in this study will be helpful to relevant authorities for future improvement. Findings Complying to FATF SR IX helps relevant authorities in detecting and preventing illicit from cross-border transportation of cash and BNIs. Out of 40, only two countries received compliant rating, which shows the need of improvement to ensure that the country is compliant on FATF SR IX. Research limitations/implications This study is limited to the panel’s reviews and recommendations on mutual evaluation report and only focuses on FATF SR IX. Originality/value This paper analyzes the compliance characteristics of countries based on their FATF mutual evaluation report. It highlights the comments and recommendation for future improvement to ensure that these countries will comply with FATF SR IX.

Purpose This paper aims to explore the effectiveness of an artificial neural network (ANN) in predicting fraudulent financial reporting in small market capitalization companies in Malaysia. Design/methodology/approach Based on the concepts of ANN, a mathematical model was developed to compare non-fraud and fraud companies selected from among small market capitalization companies in Malaysia; the fraud companies had already been charged by the Securities Commission for falsification of financial statements. Ten financial ratios are used as fraud risk indicators to predict fraudulent financial reporting using ANN. Findings The findings indicate that the proposed ANN methodology outperforms other statistical techniques widely used for predicting fraudulent financial reporting. Originality/value The study is one of few to adopt the ANN approach for the prediction of financial reporting fraud.

Objective: This study aims to look at the financial management practices of two groups of micro entrepreneurs; sahabats of AIM and asnafs entrepreneurs from PPUAZ. Method Analysis: Adopting a mixed method approach, this study combines both quantitative (surveys) and qualitative (interviews) approaches. The surveys were conducted first to provide the overall and background information of the micro enterprises and their financial management practices. Adopting the purposive sampling method, samples were chosen based on the participants' willingness to participate in the study. However, to ensure that the questions were answered by the targeted respondents, participants were asked on whether they were actively involved in running a business before answering the survey questions. Then, the findings from the questionnaire are verified in the interview sessions with the selected micro entrepreneurs. Findings: Data from the surveys and interviews were analyzed, and it was found that although asnafs are given "free money" from the PPUAZ, they generally have better financial management practices as compared to the sahabats. This study also found that that majority of the micro entrepreneurs score low on the financial management variables. This suggests that the micro entrepreneurs in general are not practicing a good record keeping. As financial management is vital for all types of entrepreneurship including micro, it is a concern as 21% of the micro entrepreneurs in this study are not recording anything from their business activities.

The purpose of this research is to know and analyze the condition of cooperatives through the capital factor, human resources, managerial aspects, passive members and socialization, public awareness, spoilage, and economic democracy, which strongly influence the barriers and effectiveness of lending cooperatives in Indonesia. The dependent variables are the main constraints of cooperatives in lending, whereas the independent variables are capital, human resources, managerial aspects, passive members and socialization, public awareness, spoilage, and economic democracy. In this research, descriptive analysis and the structural equation modeling test are the data analysis techniques that were used to measure the research instruments. The research samples used in this study consist of 203 cooperative management institutions in North Sumatra, Indonesia. The sampling technique used was the purposive sampling method. This study concludes that managerial factors, passive members and socialization, public awareness, lack of economic democracy, capitalization, and a lack of participation have a significant effect on the barriers and effectiveness of lending cooperatives.

Government-linked companies (GLCs) play an essential role in the expansion of the Malaysian economy. GLCs are contributing a significant percentage of the nation’s gross capital formation and National Gross Domestic Product and they have been regarded as instruments of national growth and supplementing government’s effort in promoting social and economic goals. Nevertheless, the performance of GLCs remains as a major concern. Although many research have been done on organisations and enterprises there is lack of research done on GLCs’ performance. Previously, the performance of GLCs in Malaysia has been affected by the poor performance of its key companies such as Proton Holdings Berhad and Malaysia Airline System (MAS). Hence, this study attempts to examine on the effect of ethical culture practices, leadership qualities, entrepreneurship orientation, and innovation existence towards the performance of Malaysian GLCs. In this study, the data is gathered via questionnaires survey collected from 102 state and federal level GLCs. The results of coefficient of independent variables showed that leadership qualities and innovation are positively correlated with organisational performance. This study suggests to improve the performance of GLCs through emphasizing on leadership qualities and placing high emphasis on innovation.

Purpose The purpose of this paper is to conceptualize the concept of terrorism, terrorism financing, the relationship between money laundering and terrorism financing and the governance of terrorism financing. Design/methodology/approach This paper adopts a doctrinal, content analysis and secondary data, of which the Anti-Money Laundering and Anti-Terrorism Financing Act 2001 and the Penal Code are the primary sources. The secondary sources for this paper include articles in academic journals, books and online databases. Findings Several methods are involved in the commission of terrorism financing such as raising, moving and using of funds. The activities relating to terrorism financing under the Penal Code are broader than such activities. Despite the adherence by Malaysia to international policies established by the Financial Action Task Force, terrorism financing has remained a threat that must be addressed by the relevant authorities. Practical implications This paper could be a useful source of information for the practitioners, academicians, policymakers and students studying this particular area of crime. Originality/value This paper contributes to a discourse on terrorism financing in the Malaysian context.

Purpose Corporate crimes in Malaysia are increasing each year. These issues are bothersome to the investors, creditors and the public as a whole because of the huge impact on all of them. Employees lose their jobs, investors do not get optimal return on their investments and creditors are unable to get their payments, and as a result, the public lose their faith on the legislation. The purpose of this study is to analyze the cases charged under Securities Commission and Bank Negara Malaysia. Design/methodology/approach This study analyzes the cases in Securities Commission and Bank Negara under four criteria which are the corporate profiles, details on crime committed, perpetrators profile and, finally, the offence. Findings The findings show that top-level management, especially the directors, usually commit such crime and many of them are male. Originality/value This study looks into the criteria of the cases charged under both institutions, Securities Commission and Bank Negara, which can be used to create awareness among the organizations in Malaysia.

Dealing with money laundering has been one of the toughest struggles nations around the world, including Malaysia, have had to face. Prevalent international concerns over such crime have led to the establishment of international policies and standards by the Financial Action Task Force (FATF), which aimed at preventing and ultimately criminalising such crime within the national boundary. In accordance with such policies, Malaysia has introduced the Anti-Money Laundering Act in 2001 (AMLA) as a legal modality in governing such crime. It has been amended and renamed the AMLATFA in 2003 to include terrorism financing. Again, recently in late 2013, AMLATFA has been amended to keep up with changing standards and times. Within this legal landscape, this paper will highlight the instrumental and normative problems surrounding the said legislation. The authors contend that despite the adherence to global governance standards, legal deficiencies in the AML/ATF law in Malaysia remained, which merits urgent attention and action from the relevant authorities. This paper employs a doctrinal legal research and secondary data of which the AMLATFA is the primary source. The secondary sources for this article include decided cases, articles in academic journals, books and online databases.

The current study examines the link between internal locus of control on whistleblowing intention, by specifically testing the mediating role of organisational commitment. To test this study's hypotheses, we analysed 196 employees of the Riau Province Government (Indonesia) using structural equation modelling (SEM) based on partial least squares. The major finding revealed that internal locus of control positively affects the whistleblowing intention. Furthermore, this study discovered that organisational commitment mediates psychological processes underlying the relationship between internal locus of control and whistleblowing intention.

This paper studies the relationship between social capital on the green growth in Malaysia, with the aim of ascertaining whether faith based social capital has a role in sustaining economic growth. The study utilizes the annual data over the period of 1970-2015. This study employs the Auto-regressive Distributed Lag (ARDL) model and causality using the Vector Error Correction Model (VECM). The findings demonstrate the long and short-run associations between social capital and green growth in Malaysia. The causality only runs in a uni-direction from social capital to the green economic growth. The findings have important policy implications for green economic growth measurement to account for social well-being and to fulfill the objectives of Islamic Sharia.

This paper aims to explain the development of the Bumiputera Communicated Identity Index for Malaysian statutory bodies. The final 16 themes consist of 213 items have been developed in the instrument. The Bumiputera Communicated Identity Index will serve as the evaluation tool for Malaysian statutory bodies to identify themselves as the agencies that are actively improving the socio-economic status of Bumiputera community by promoting participation with stakeholders and citizens, which could be done via website. The Bumiputera Communicated Identity Index hopefully can be used to reduce the differences between public and private sectors. Transparency and accountability will be simultaneously improved.

The aim of this paper is to provide empirical evidences of the relationships between the financial abilities towards in the financial statement to the earnings management level (EM) among of public sector companies on Bursa Malaysia from year 2001 until 2012. Primarily, the initial samples comprised 375 selected public listed companies with 4500 firm-years observation. From the samples, those companies who have not implied with the earnings management activities was excluded as a sample of the study. Thus, the final sample of this study was comprises 3971 firm-years observation. The study was adopted the Kothari Model as a measurement model for earnings management level in the business organization. Meanwhile, the findings of this study indicated significant relationships between earnings ability (EAB), financial structure's ability (FSAB), debt repaying ability (DRAB) and non-financial factors (NFF) towards the earnings management level (EM) in the business organization. Therefore, these evidences can be used as new financial mechanisms to potential and existing stakeholders in order to assist them for any decision making purposes.

Evolution in the business environment will play a key role in spurring the growth of Small Medium Enterprises (SMEs) globally. Growing changes in business competition, daily operation, new strategy and technology are driving transformation in employees productivity and the future business environment that have significant impacts to organizations. Many organizations are demanding for proactive entrepreneurs with a dynamic team, who can run and steer their businesses to becoming more cost-efficient, which may lead to increased efficiency of firm performance. Literatures in management accounting recognize the important role of Management Accounting Practices (MAP) in Small Medium Enterprises (SMEs). This study examines the relationships between budgetary participation, commitment and performance measures through the tools and techniques of MAP in firm performance. A case study approach with heavy reliance on semi-structured interview was used, where 16 informants who are key decision makers and officer from different management levels were interviewed in the case study. Other sources of evidence have also been sought to enhance the desirability of the findings discussed. Our findings revealed that usefulness of MAP in the company improved employees’ accountability and firm performance. It also showed that budgetary participation and commitment from employees’ accountability have improvement activity when using MAP. This is directed towards helping others in achieving the desired business results by strategically positioning themselves into MAP in making informed decisions in their business undertaking. Further, the budgetary participation and commitment are predictors of managerial performance and accountability in perceived usefulness of MAP of firm performance outcomes.

Purpose – The purpose of this paper is to contribute to the debate and find out the impact of cash flow on changes in dividend payout decisions among non-financial firms quoted at Bursa Malaysia as compared to earnings. There has been renewed debate in recent finance and accounting literature concerning the key determinants of changes in dividends payout policy decisions in some jurisdictions. The conclusion in some is that firms base their dividend decisions on cash flows rather than published earnings. Design/methodology/approach – The research made use of panel data from 1999 to 2012 at Bursa Malaysia, using generalized method of moments as the main method of analysis. Findings – The research finds that Malaysia non-financial firms consider current earnings more important than current cash flow while making dividends payout decisions, and prior year cash flows are considered more important in dividends decisions than prior year earnings. We also found support for Jensen (1986) in Malaysia on agency theory, that managers of firms pay dividends from free cash flow to reduce agency conflicts. Practical implications – The research concludes that Malaysian non-financial firms use current earnings and less of current cash flow in making changes in dividends policy. The policy implication is that current earnings are dividends smoothing agents, and the more they are considered in dividends payout decisions, the less of dividends smoothing. Social implications – If dividends smoothing is encouraged, it could lead to dividends-based earnings management. Originality/value – The research is our novel contribution of assisting investors and government in making informed decisions regarding dividends policy in Malaysia.

Fraud has been of concern for many corporate managers and regulators since many businesses have been victim of business failures. Business failure corporations have reported and become an element of fraudulent financial reporting.Therefore, the first aim of this study is to examine whether a collective prediction tool can be used to predict business failure and fraudulent financial reporting.The second and more important objective of this study is to examine whether business failure companies are associated with fraudulent financial reporting. The collective prediction tool is based on ratio analysis, Beneish M-score model and Z-score model. Using publicly available information in the annual reports of 24 failed firms matched with 24 non-failed firms listed on Bursa Malaysia, relevant information are extracted and applied in the three models to assist in predicting business failure and detecting fraudulent financial reporting. A total of 10 ratios, cash conversion cycle, Beneish M-score model and Altman's Z-score model were identified for examination as potential predictors of business failure and fraudulent financial reporting. Based on the results, the model was accurate in classifying the total sample of approximately 96 per cent as predictors of business failure and approximately 83.3 per cent as predictors of fraudulent financial reporting as well as predicting the relationship between business failures and fraudulent financial reporting. Hence, it can be concluded that these model functions effectively and can be adopted by regulators, bankers, management, internal and external auditors and to the forensic accountants so that proper preventive or corrective action can be taken to mitigate fraud at its inception.