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Public Sector Accounting in Europe: A Systematic Literature Review

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  • Helio Corguinho Fernandes
  • Joao Lopes Pita
  • Jose Domingues Jesus
  • Guilherme Martins Camara

Abstract

Financial performance is an important issue for entrepreneurs and investors. So far the number of studies on the effect of bankruptcy risk on financial performance of firms is small. Hence, this research investigates the impact of bankruptcy risk on financial performance of companies listed on the Stock Exchange of Thailand and the relevant data cover the period between 2015 and 2019. Excluded are companies operating in the finance industry. The data are analyzed by multiple regression analysis. Altman¡¯s Z-score (1968) is used as a proxy for bankruptcy risk while ROA, ROE, and Tobin¡¯s Q serve as proxies for financial performance. The control variables in this study are liquidity, capital structure, firm size, and inflation rate. Results reveal that Altman¡¯s Z-score and firm size statistically and positively affect financial performance proxied by both accounting-based-measures, i.e. ROA and ROE; and market-based measures, i.e. Tobin¡¯s Q. These results confirm that companies listed on Thailand¡¯s Stock Exchange have low bankruptcy risk and large size is financially performed well.

Suggested Citation

  • Helio Corguinho Fernandes & Joao Lopes Pita & Jose Domingues Jesus & Guilherme Martins Camara, 2021. "Public Sector Accounting in Europe: A Systematic Literature Review," International Journal of Financial Research, International Journal of Financial Research, Sciedu Press, vol. 12(4), pages 88-99, July.
    • Handle: RePEc:jfr:ijfr11:v:12:y:2021:i:4:p:88-99
    DOI: 10.5430/ijfr.v12n4p88
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    References listed on IDEAS

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    1. Michela Arnaboldi & Irvine Lapsley, 2009. "On the Implementation of Accrual Accounting: A Study of Conflict and Ambiguity," European Accounting Review, Taylor & Francis Journals, vol. 18(4), pages 809-836.
    2. Ian Ball, 2012. "New development: Transparency in the public sector," Public Money & Management, Taylor & Francis Journals, vol. 32(1), pages 35-40, January.
    3. Oulasvirta, Lasse, 2014. "The reluctance of a developed country to choose International Public Sector Accounting Standards of the IFAC. A critical case study," CRITICAL PERSPECTIVES ON ACCOUNTING, Elsevier, vol. 25(3), pages 272-285.
    4. Tuna Tasan-Kok & Martijn van den Hurk & Sara Özogul & Sofia Bittencourt, 2019. "Changing public accountability mechanisms in the governance of Dutch urban regeneration," European Planning Studies, Taylor & Francis Journals, vol. 27(6), pages 1107-1128, June.
    5. J. Guthrie & L. Parker & L. M. English, 2003. "A Review of New Public Financial Management Change in Australia," Australian Accounting Review, CPA Australia, vol. 13(30), pages 3-9, July.
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