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Cele două fețe ale monedei – succesul și eșecul afacerilor

Author(s): Sorin Somitca,Alina Somitca / Language(s): Romanian Issue: 5/2022

The role of economic entities in the ecosystem of the world’s economies is widely recognized at all levels, due to their contribution to a country’s economic growth and to generating new jobs and as a key factor for research, development and innovation. This is why the companies’ financial decline is intensely studied, being one of the most analysed topics when it comes to economic enterprises, the impact of a company’s bankruptcy propagating itself with a domino effect, which is difficult to quantify and to define in time. In the literature, studies and articles published by renowned analysts, when referring to enterprises in difficulty, we find a variety of attributes, insolvency, reorganization, bankruptcy, payment default, financial collapse, business collapse, decline or failure, respectively. In substance, all the terms used converge to a financially difficult situation, which makes it impossible to continue the economic activity and to meet financial obligations. In the last 20 years we have witnessed the collapse of several internationally renowned companies, and the bankruptcy of some of them has generated or amplified the great economic and financial crisis of 2008-2009. The COVID-19 pandemic created an unprecedented crisis, the economies of all countries in the world being affected, and many companies were expected to cease their business activity, but government support and funding measures paradoxically reduced the number of insolvent entities, contrary to the fundamental economic principles. The real impact of the current economic crisis after the cessation of liquidity infusions from the states should be tracked in the coming years.

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THE DIMENSION OF TAX EVASION IN ROMANIA

Author(s): Veronica Grosu / Language(s): English Issue: 2/2018

Tax evasion is currently a complex economic and social phenomenon encountered both nationally and internationally. Tax evasion is one of the most important divisions, among the most studied, analyzed, researched in the public finances and within the fiscal and financial law, both by the specialists dealing with theoretical problems, as well as by those dealing with the activity of research, design and technical execution. However, despite everything written about the causes, procedures, size, control, or sanctions related to tax evasion, the words that indicate this phenomenon are inaccurate and the field is relatively uncertain.

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THE FISCAL AND ACCOUNTING IMPACT OF THE GOVERNMENT EMERGENCY ORDINANCE NO. 79/2017 REGARDING THE TRANSFER OF SOCIAL SECURITY CONTRIBUTIONS FROM THE EMPLOYER TO THE EMPLOYEE

Author(s): Daniel Drăguţ,Dorel Mateş,Liviu Tulcan / Language(s): English Issue: 3/2018

The multitude of legal changes in the fiscal and accounting field determines the professional accountant to find himself under a permanent turmoil due to the need to adapt on the go both of the accounting system and of the accounting policies in order to provide an accurate image of the entity assets, debts, financial position, profit or loss. The present article aims at clarifying some aspects and changes related to the social security contributions calculated for the incomes obtained by the taxpayers contributing both to the state budget and to the state social security budget in Romania.

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O dyskrecjonalnej władzy zarządzania procedurami podatkowymi

Author(s): Hanna Filipczyk / Language(s): Polish Issue: 2/2022

The article aims to analyse the discretion given to tax authorities in managing tax procedures – to describe it and postulate how it should be regulated by law and exercised in practice. In the study, the dogmatic method was used; in particular, a case of discretion in initiating a customs and tax audit was studied. It is demonstrated that this type of discretion is vast and multiform; it is also only weakly determined by law. It manifests itself in, among other things, the authority to decide tax cases by taking account of the odds of winning the case before the court. Assessment of the odds may lead, and in fact often indeed leads, to a tax authority settling the case informally with a party to a proceeding (a taxpayer) instead of pursuing it in court. For the most part, discretion in managing tax procedures has escaped the attention of the Polish legislator. This discretion should be analysed by legal scholarship and subjected to legal regulation. This will make its exercise more transparent and controllable.

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The Nexus Between Bank Credit Risk and Liquidity: Does the COVID-19 Pandemic Matter? A Case of the Oligopolistic Banking Sector

Author(s): Margaret Rutendo Magwedere,Godfrey Marozva / Language(s): English Issue: 1/2022

Background: There is a raging debate on how the COVID-19 pandemic disrupted the financial market environments, affected the banks’ strength as the credit channel, and the nexus between market liquidity and credit risk. During the COVID-19 crisis in the banking sector, credit risk and liquidity risk cannot be ignored as they have a considerable bearing on the performance and survival of banks. Purpose: Within the context of COVID-19, bank-specific and external factors were examined to determine the relationship between liquidity and the credit risk of South African domiciled banks. Research methodology: Quarterly panel data from 13 South African domiciled banks from 2018 to 2021 were examined using panel data methodologies: fixed effects and the system GMM. Results: In an analysis of the period between 2019Q1 to 2021Q1 the results suggest a positive relationship between liquidity and credit risk, the COVID-19 pandemic was found to have an implication on the nexus as the COVID-19 dummy variable was significant. Also, the results show that liquidity deteriorated with an increase in COVID-19 cases during the pandemic period. During the Pre-COVID-19 liquidity improved with a decrease in credit risk. Nevertheless, during COVID-19 liquidity was not influenced by credit risk. The results are contrary to the pre-COVID-19 period as the government interventions to support households and non-financial firms could have changed the dynamics of liquidity and loan losses. Novelty: The pandemic has ushered in a novel set of responses whose lasting impacts are not yet certain. The originality of the article lies in the nature of the investigation, where the nexus between liquidity and credit risk under the COVID-19 shocks/pandemic set-up. This is a unique study as the study revealed that policymakers and researchers alike should pay particular attention to the vulnerabilities to shocks from within and outside of the financial system as COVID-19 was found to significantly affect liquidity and credit risk. Since the pandemic is still active, further research is necessary to examine the cointegrating and causal relationship in the long run.

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The Deterioration of Financial Ratios During the COVID-19 Pandemic: Does Corporate Governance Matter?

Author(s): Hussam Musa,Frederik Rech,Chen Yan,Zdenka Musová / Language(s): English Issue: 1/2022

Research background: Corporate governance plays an important role in companies’ financial performance and its true importance and relevance are revealed during an economic shock, such as the COVID-19 pandemic. In the past, research regarding corporate governance and financial variables focused solely on performance variables such as Tobin’s Q and ROA. This assessment completely ignores that corporate governance principles have a broader implication on financial variables than only performance. Purpose: Our research aimed to determine whether companies with good corporate governance practices were more resilient during the COVID-19 pandemic, measured by the deterioration of various financial variables. Research methodology: To achieve the aim, in the empirical part of the article, information on companies’ corporate governance and financial variables was collected, and based on them, correlation, regression and scatter plot analyses were conducted. Results: Our correlation, regression, and scatter plot analyses revealed that on both group and individual company levels, companies with higher levels of corporate governance would have their financial variables deteriorate significantly more compared to companies with low levels of compliance. Novelty: This is the first publication on the given topic. While few publications are assessing the impact of the pandemic on companies using corporate governance, none of these publications have focused on financial variables.

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Analyzing the Effects of Food Imports on Food Production and Balance of Payments in Nigeria

Author(s): Ephraim Ikechukwu Ugwu,Olubunmi Efuntade,Christopher Ehinomen / Language(s): English Issue: 1/2022

Research background: Past measures to increase food production in Nigeria, were not effective enough to curb food imports and increase food production thus leading to a deficit balance of payment for the country and a total neglect of the agricultural sector. Purpose: This study analyzes the effects of food imports on food production and Balance of Payments (BOP) in Nigeria from 1960 to 2020. Research methodology: The Auto Regressive Distributed Lag (ARDL) bound cointegration test procedure is utilized. Results: The empirical results show that food imports adversely affect food production both in the long and the short run. While for the BOP equations, food importation positively affected the country’s balance of payments in the long run. The short run error-correction term coefficients are signed negatively for both the food production and BOP equations. The results show that the gap between the equilibrium values and the actual value of the dependent variables are corrected with speed of adjustment equal to 40% and 85% annually. The stability test result on the food production equation showed that the null hypothesis of no stable residuals in both the short and long run are rejected, while the estimated model is not effective with stable recursive residuals for the BOP equation. Novelty: The study therefore recommends that efforts should be geared towards boosting the country’s food production by encouraging foreign investors’ participation in the agricultural sector.

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The Impact of the Activity-Based Costing on SMEs’ Financial Performance in Lusaka, Zambia (I)

Author(s): Anthony Mwila,Vincent Masaka,Kaombe Tukumana / Language(s): English Issue: 6/2022

While several studies have been conducted regarding the impact of Activity-based costing (ABC) system on the financial performance of a firm, to a larger extent they were focused on large enterprises who are mainly established in developed economies. There have been very few studies focused on small and medium sized enterprises and specifically those in the developing/emerging economies. This project therefore sought to explore the impact of Activity-based costing on the financial performance of small and medium sized enterprises based in Lusaka, Zambia, being a developing economy. The specific objectives of the study were to investigate the relationship between Activity-based costing and financial performance in SMEs based in Lusaka, the impact of the implementation of ABC in SMEs on cost control and cost reduction, and the reasons why the majority of SMEs have not adopted the use of the ABC system. An analysis of the responses from 20 participants in the survey revealed that only seven respondents (35%) had implemented the ABC system, while the other 13 (65%) were still using a traditional costing system. The study further revealed that all the SMEs who had adopted the ABC system had reported a positive impact on their financial performance, as well as on cost control and cost reduction. Furthermore, the study showed that there were three major reasons that the respondents indicated for not adopting the system, namely being satisfied with the traditional costing system (53.85% of the respondents), the high cost of implementing the ABC system (30.77% of the respondents), and lack of expertise to implement the ABC system (15.38% of the respondents). The contribution of this study to the body of knowledge is that the findings will contribute to the understanding of the impact that the adoption and implementation of the ABC system has on the financial performance of SMEs particularly those based in Lusaka, this being the first study on this topic. In addition, the findings of the study will contribute to the understanding of the reasons for low implementation of the ABC system among SMEs in Lusaka.

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PROBLEMS OF REFORMING ACCOUNTING AND FINANCIAL REPORTING IN POST-SOVIET COUNTRIES (Case of Georgia)

Author(s): Levan Grigalashvili,Bidzina Grigalashvili / Language(s): English Issue: 3/2021

Like in the entire post-Soviet space, at the end of the last century, the change in the economic and political system caused the necessity of the reforms in all spheres of public life in Georgia. Even in the first years of the transition period to a market economy, there was revealed the vital importance of accounting and financial reporting for the correct management of the economic activities of companies. There was a need to create an appropriate accounting and reporting system for a market economy. Post-Soviet countries which are currently independent states, met these processes unprepared. They faced two major challenges: first, they had to create a national legal regulatory framework for accounting, and second, they had to transform the system in accordance with the requirements of the market economy.

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An Empirical Assessment of the Financial Development – Environmental Quality Nexus in the European Union

Author(s): Alexandra Horobet,Irina Mnohoghitnei,Dan Gabriel Dumitrescu,Ștefania Cristina Curea,Lucian Belașcu / Language(s): English Issue: 61/2022

Our study examines the dynamic relationship between financial development and environmental degradation in the European Union (EU) in a panel VAR (Vector Autoregressive) methodological framework over the period 1996-2018. Panel causality tests and impulse response functions show that financial development contributes to higher carbon emissions, although this effect is stronger in the short run and weaker in the long run. At the same time, financial institutions development is the major contributor to fostering increased environmental degradation instead of financial markets, which points towards an engagement of financial institutions towards offering financial products that led to environmental degradation and/or lagging financial markets in terms of promoting environmentally-related securities and ESG principles. By providing new insights into the relationship between financial development and carbon emissions, we hope to assist EU policymakers and businesses in reconsidering the role of financial development as an effective means of decreasing environmental degradation in the region.

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The Strategies of Internalizing the Negative Externalities in the Company’s Sustainable Development

Author(s): Dmytro Kozlov / Language(s): English Issue: 3/2021

The study focuses on externalities which play the important role in sustainable development. They indicate the impact of the company’s activity on the third persons. On the basis of findings, the externalities from the company’s financial reports are monetarized. The externalities exerting influence on the profit or loss as well as on the total balance of the company are analysed. Positive and negative externalities are identified in order to internalize the negative externalities with the help of definite strategies of sustainable development. It is emphasized that the long-term action plans to ensure competitiveness, environmental protection and social legitimacy help to adapt to expected market, environmental and social developments. The study discusses current strategies: defensive (reactive), offensive that are viewed from the economic, environmental and social perspective. It is investigated that the defensive strategies are limited to the implementation of relevant laws or agreements in order to avoid negative consequences for the legislator. On the other hand, offensive, inwardlooking strategies are aimed at aligning the company’s structures (organizations) and systems (environmental management systems) with the requirements of sustainable development, motivation and qualification of employees for sustainable development. The environmental sustainable development strategies are focused on a variety of ecological aspects. The emergence of economic, environmental and social risks and opportunities in machinebuilding company with their potential solutions is underlined. As the matter of fact, using the right strategy, the company can easily go through the internalization of negative externality to exert more substantial impact on the society, environment and the economy.

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ДИГИТАЛНИТЕ КОМПЕТЕНТНОСТИ В ОБУЧЕНИЕТО ПО СЧЕТОВОДСТВО

Author(s): Iliyana Ankova / Language(s): Bulgarian Issue: XI/2021

In the past years, the increasing processes of digital transformation have largely determined the economic development. The wide implementation of large data sets, cloud technologies, artificial intelligence, blockchain technologies, etc. have altered accounting as an economic science. The digitalization has also transformed the professional competencies of the accountants. For them, it has become necessary to acquire specific skills of different sciences and new competencies in the field of information and communication technologies. A common issue for higher education is how the educational process can be altered in order to form and develop modern competencies. The aim of this paper is to identify the digital competencies, suitable for the accounting training in higher education in Bulgaria. The following research is grounded on a literature study on the issues of digital competencies in the field of accounting and the competency frameworks of international accounting professional organizations. Based on the curriculum of „Management Accounting“, studied at the bachelor's degree at the Faculty of Economics and Business Administration at Sofia University "St. Кl. Ohridski”, an attempt to identify the digital competencies that can be developed in education has been made. The results can support a comprehensive process of developing and implementing a competency framework, which would prepare future accountants for the challenges of the profession.

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Economic determinants of total factor productivity growth: The Bayesian modelling averaging approach

Author(s): Janusz Sobieraj,Dominik Metelski / Language(s): English Issue: 4/2021

Objective: : The objective of this article is to use the most recent national-level data (reflecting heterogeneity) to explore determinants of total factor productivity (TFP) growth. Research Design & Methods: The article examines the performance of a number of potential TFP growth determinants, relying on the Bayesian modelling analysis (BMA) methodology, which allows for isolating key regressors and assessing their actual contribution in relation to the phenomenon under study. As a scientific methodology, BMA is deeply rooted in statistical theory and directly results in posterior and predictive inferences. Moreover, BMA makes it easier to determine the relative impact of examined processes, while taking into account the uncertainty that accompanies the entire regressors’ selection procedure (Raftery, Madigan, & Hoeting, 1997; Hoeting, Madigan, Raftery, & Volinsky, 1999; Sala-i-Martin, Doppelhofer, & Miller, 2004). Findings: We indicate a number of determinants driving TFP growth, e.g. inequality measured by the Gini coefficient, the growth of information and communications technology (ICT) assets, logistics performance, the quality of logistics services, and migration. Implications & Recommendations: We contribute to a more systematised knowledge of the determinants of TFP growth; the data shows that developed economies exhibit variable returns to scale (VRS). More importantly, there is an increasing contribution of ICT assets to economic growth and economies of scale, which is why whole economic systems exhibit increasing returns to scale (IRS). Some of the economic activity remains under-reported, meaning that economies of scale are even greater than the data reveals. In the era of globalisation, it becomes important to support digital technologies, address inequalities, create appropriate logistics infrastructure, and pay attention to mobility factors, e.g. labour migration. Contribution & Value Added: We conduct an overview of the literature so as to better understand the importance of TFP growth. Based on the literature, we identify a number of potential TFP growth determinants and examine their relevance and robustness using the BMA approach, which has become increasingly popular in recent years.

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Covid-19 and transformational megatrends in the European automotive industry: Evidence from business decisions with a Central and Eastern European focus

Author(s): Anita Pelle,Gabriella Tabajdi / Language(s): English Issue: 4/2021

Objective: The objective of the article is to reveal the effects of the Covid-19 pandemic on the businesses in the European automotive sector, with a special focus on Central and Eastern Europe. The further objective is to identify how these effects relate to the ongoing transformational megatrends in the sector (digitalisation, electrification). Research Design & Methods: We have collected a large (>700 items) sample of relevant business decisions in the European automotive sector over four years (2017-2021), including those taken especially due to the Covid-19 pandemic. In our research, we transformed our qualitative inputs into a quantitatively analyzable database through coding. Then, we applied descriptive statistical analysis on the retrieved data combined with qualitative analysis of the contents behind these data. Findings: Based on our sample, our primary finding is that the Covid-19 pandemic does trigger the already existing trends of digitalisation and electrification in the European automotive sector. Very similar effects characterise the relatively less developed but deeply integrated Central and Eastern European periphery, although to a lesser extent. Obviously, the Covid-19 pandemic has induced numerous temporary business decisions, mainly plant closures. Layoffs occurred as well but these were not prevalent. Then, the second wave of the pandemic in early 2021 brought about the global shortage of semiconductor chips, which substantially affected the sector in Europe. Implications & Recommendations: The longer lasting impact of the short-term pandemic-related European automotive business decisions is yet to be explored. Nevertheless, the global shortage of semiconductor chips is already showing signs of influencing the industry over a longer time scale, in Europe as well. Forward-looking, future-oriented, and brave responses to the pandemic can well be the keys for businesses to successfully overcome the negative effects of the Covid-19 pandemic. Contribution & Value Added: Our sample of more than 700 items and a four-year-long timespan is in itself a unique collection of business decisions in the European automotive sector. In addition, by processing the inputs through coding, our sample becomes a treasury of potential information. In this article, we conduct an exploration along the events to which the decisions can be related, and along the decision types. We also look at the involvement of Central and Eastern Europe. Obviously, our ongoing primary research was ready to be extended to the firm level analysis of the effects of the Covid-19 pandemic, immediately upon its outburst.

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Możliwe kierunki zmian sprawozdawczości finansowej banku centralnego w Polsce

Author(s): Krzysztof Kruszewski ,Joanna Wielgórska-Leszczyńska / Language(s): Polish Issue: 3/2022

Purpose: The article identifies the directions of changes in the financial reporting of the central bank in Poland. It presents the bank's financial reporting at the turn of the 20th and 21st centuries and the possible directions of its evolution. Methodology/approach: The considerations were based on a critical analysis of a literature review, analysis of the financial reporting of the central bank, including an individual case study of the National Bank of Poland (NBP), methods of logical reasoning, as well as observations and the authorsʼ many years of experience. Findings: The analysis indicates the evolution of the financial reporting of the NBP and its greater openness to disclosing information. Financial reporting should go towards integrity and complementarity with other bank reports to meet the expectations of a growing group of stakeholders. This means that its accounting should be more accessible (egalitarianism of accounting), and the financial reporting should aim at an effective narrative construction. Technological progress makes it possible to create a dual financial reporting system (hybrid accounting). Hybrid accounting, as well as supplying financial reporting with information from other sources (statistics, economic analyzes), would lead to the creation of differentiated financial reporting (mosaic reporting). In the bank's future financial reporting, there is also space for stakeholder-co-created participatory accounting and the introduction of the on-demand reporting concept (individualized reporting). Its applica-tion would be an expression of the democratization of accounting. The aim of changes in financial reporting would be to obtain a holistic picture of the central bank. Originality/value: The elaboration is an innovative study on the financial reporting of the central bank and possible directions of its changes. The presented ideas for financial reporting are applicative and can be used by a central bank to improve its financial reporting.

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Koszty ochrony lasu w zrównoważonej gospodarce leśnej. Przykład Polski

Author(s): Beata Sadowska / Language(s): Polish Issue: 3/2022

Purpose: The main aim of the study is to analyze the costs of forest protection incurred by Poland's State Forests and to present the activities performed as part of forest protection. The specific objective is to present the method and place of disclosing and reporting information on actions to prevent damage to the forest and on the costs of forest protection on a general level. Methodology/approach: The considerations in the study are presented against the views presented in the literature on the subject by selected authors. The methods of criti-cal analysis and synthesis, inference, and a case study were used. The data for the analyses were taken from the financial and economic reports of the State Forests for the years 2016–2019, from the statistical studies „Forestry”, and reports obtained as part of the application submitted to the State Forests for the re-use of public sector information. Pearson's linear correlation analysis was used, as well as an agglomeration grouping method – Ward's method – which uses the analysis of variance approach in its procedures. Findings: The scale of forest protection measures varied between State Forests in the analyzed period. The highest costs for forest protection in total are borne by forest districts located in the area of State Forests in Wrocław, and the lowest costs for forest pro-tection in total are borne by forest districts located in the area of State Forests in Kraków. The smallest area protected against insects covers forest districts located in the State Forests in Krakow. With the increase in the costs of forest protection, State Forest’s own costs also increase. The highest relationship was noted in 2017, with a correla-tion coefficient of 0.86. Research limitations: The research sample is limited to one country. Originality/value: The presented voice in the discussion fills the research gap in terms of information about State Forests’ activities to protect the forest and the subsequent costs incurred. The use of Ward’s method allowed similar regional directorates of State Forests to be grouped from the perspective of forest protection costs and protective measures (area approach), which is the basis for extended research in this area from the point of view of the natural diversity of these units (narrowing the research and conduct-ing it in similar State Forests units).

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Konotacje imion księgowych w świetle badań nadleśnictw w Polsce

Author(s): Piotr Szczypa / Language(s): Polish Issue: 3/2022

Purpose: The article presents the results of research on the connotations of accountants' names in a group of people employed in the accounting units of forest districts in Poland. The research identified the association of a person's name with the accounting profession. Two main research questions were answered: (1) Do individuals with the same first names choose the accounting profession? (2) Does the interpretation of the occupational aptitude range of the Great Dictionary of Names indicate the accountancy profession in the case of the most frequently repeated accountant names in Poland, including accountants of forest districts? Methodology/approach: Quantitative (chi-square test of independence) and qualitative research was used to verify the two hypotheses. The study was conducted on a full sample of 430 forest districts (primary data) as well as on data found in the register of personal identity numbers and the Ministry of Finance. Findings: The profession of accountant in forest districts is most often chosen by women named Anna, Małgorzata and Agnieszka, and by men named Tomasz, Krzysztof and Paweł. There is a relationship between first name and the accounting profession in forest districts, which does not overlap with the distribution of other first names of people living in Poland. Professional predispositions of accountants included in the Great Dictionary of Names are not reflected in the practice of accounting departments of forest districts. Research limitations/implications: The research results do not provide direct guide-lines for human resources management in the group of accountants of forest districts. The research should be continued in accounting groups of other industries. Originality/value: The article is innovative; for the first time in Poland, it provides new and current knowledge about the perception of the accountancy profession, including human capital management, through the prism of the connotation of names. The research is part of the trend of searching for new determinants of human resources man-agement in the professional group of accountants.

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Ujawnianie ryzyka podatkowego w raportach finansowych spółek publicznych

Author(s): Agnieszka Wencel / Language(s): Polish Issue: 3/2022

Purpose: The purpose of the article is to analyze the scope and quality of tax risk disclosures in financial reports. With this objective, the following research question was formulated: In what areas and in what detail do listed companies in Poland disclose information about tax risk? The subject of tax risk disclosures was raised due to numerous changes to fiscal regulations introduced in recent years aimed at tightening the tax system. In the common opinion of entrepreneurs, the structure and content of the new regulations are ambiguous, raise many doubts, and impose on taxpayers a wide scope of reporting to tax authorities. In conjunction with the imposition of additional penal and fiscal sanctions, it leads to an increase in tax risk. Methodology/approach: A literature review was conducted, and legal acts were analyzed. Also, qualitative empirical research of the content of financial reports was carried out using the original simplified disclosure index. Findings: The results of the survey indicate large disproportions between companies in the scope of disclosed information, and the lack of consistency between various aspects of disclosures. It is also disturbing that the only conducted fiscal inspections help draw attention to this area of business risk. Originality/value: The issue of tax risk disclosure has not been analyzed by Polish researchers so far; thus, this article fills a research gap. The results of the research expand the existing knowledge about disclosures in financial reports. They are also of prac-tical importance both for the companies and their stakeholders.

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Working capital financing and corporate profitability in the ASEAN region: The role of financial development

Author(s): Rahmat Heru Setianto,Rani Septiani Sipayung,W.N.W. Azman-Saini / Language(s): English Issue: 1/2022

Objective: This article empirically investigates the role played by financial development in determining the relationship between working capital financing and firms’ profitability. Research Design & Methods: Employing data of publicly listed manufacturing firms in five ASEAN countries – namely Indonesia, Malaysia, Philippines, Singapore, and Thailand – spanning 2009-2018, resulted in 6183 firm-years observations. This study conducts an analysis using the two-steps generalized method of moments (GMM) estimator. Findings: The inverted U-shape effect of working capital financing on firm profitability is confirmed. Moreover, new evidence appeared that firms which operate in more financially developed regions have the opportunity to utilise a greater percentage of short-term debt without destroying their profitability. Implications & Recommendations: Corporate managers should avoid using excessive short-term debt to finance their working capital requirement as the risk of refinancing and interest outweigh its benefit. Secondly, given the significant role played by financial development, policy makers should give priority to financial reforms and development to ensure firms have access to finance and hence foster their growth for the benefit of the economy. Contribution & Value Added: This article contributes to the existing literature in two ways. Firstly, this is the first study to analyse the role of financial development on working capital financing and profitability relationship. Secondly, the study extends the insight of this research area onto a large emerging region that has never been studied before: the ASEAN region.

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Internal market knowledge sharing in medium-high-tech manufacturing company

Author(s): Marcin Soniewicki / Language(s): English Issue: 2/2022

Objective: The goal of this study is to verify new research model among medium-high-tech manufacturing companies. First of all, the model assumes the influence of both the market knowledge base itself, and the efficiency of internal market knowledge sharing on the competitiveness of analysed entities. Second of all, it analyses the impact of market knowledge perception within business entities and the openness of technical staff on internal market knowledge sharing efficiency. Research Design & Methods: The survey consisted of five latent variables (constructs). The research was conducted by telephone among managers of medium-high-tech manufacturing companies in Poland. The sample consisted of 130 firms. The data was analysed using the PLS-SEM technique. Findings: The research findings proved that both, market knowledge and market knowledge sharing efficiency, had a strong and significant influence on the competitiveness of medium-high-tech manufacturing companies. The results also showed that market knowledge perception and openness of technical staff had statistically significant influence on knowledge sharing efficiency in such companies. Implications & Recommendations: Above all, the study implies that it is not the possession of market knowledge alone, but also importance of sharing this kind of knowledge internally. The article suggests factors that are important for market knowledge sharing, e.g. through properly trained and competent knowledge brokers that enable the examined businesses to gain a competitive edge. The efficiency of market knowledge sharing may be strengthened by putting more attention to market knowledge perception in the company and openness of technical staff. Contribution & Value Added: This study adds to the research on sharing a specific type of knowledge, i.e. market knowledge, within business enterprises and influence of this process on companies’ competitiveness. Various factors important for efficient internal sharing of market knowledge have been proposed in the subject literature, however they have not been verified by quantitative research so far. Moreover, the study focuses on the oft-overlooked type of business entities, i.e. medium-high-tech manufacturing companies.

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