Bridging theory and practice: International valuation standards and asset valuation in the telecommunications sector
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Author(s)Mohammed Hayder Mohammed ShanshoolLink to ORCID Index: https://orcid.org/0009-0003-7124-8871
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Bushra Najem Aubdullah Al-MashhadaniLink to ORCID Index: https://orcid.org/0000-0002-6574-3783
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DOIhttp://dx.doi.org/10.21511/imfi.21(2).2024.24
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Article InfoVolume 21 2024, Issue #2, pp. 300-309
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107 Downloads
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Creative Commons Attribution 4.0 International License
In the rapidly evolving telecommunications industry, accurate valuation of tangible assets remains a critical challenge that requires adherence to universally recognized standards. This study addresses the pressing need for transparent and precise asset valuation methodologies that are pivotal for informed investment decisions and financial reporting. It aims to bridge the theoretical and practical divide in asset valuation by applying International Valuation Standards (IVS) 300 and 400 to Asiacell Communications PJSC, a leading entity in the sector. Focusing on five key tangible assets from 2018 to 2022 – lands, buildings, plant and equipment, means of transport and transfer, and furniture and office equipment – the study employs the income approach, augmented by a random walk model for future cash flow forecasting and the weighted average cost of capital for discounting. This innovative methodology offers a comprehensive valuation framework, revealing that despite Asiacell’s consistent growth rate of 4.63%, all asset categories experienced a depreciation upon revaluation. The study’s findings underscore the significance of implementing IVS in elucidating the asset valuation process, demonstrating the potential discrepancies between book values and standards-based valuations. The application of IVS 300 and IVS 400 not only enhances the transparency and accuracy of asset valuation but also provides valuable insights into the contributions of tangible assets to future income within the prevailing market conditions. By offering a replicable model for asset valuation in dynamic industries, this study contributes to the broader discourse on financial reporting and investment analysis, setting a foundation for future exploration in the field.
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JEL Classification (Paper profile tab)M41, M49
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References47
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Tables5
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Figures0
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- Table 1. Tangible assets in book value of Asiacell Communications PJSC (million dinars)
- Table 2. Relative weight of tangible assets
- Table 3. Total cash flows of Asiacell Communications PJSC (million dinars)
- Table 4. Contribution of tangible assets to cash flow of Asicacell Communications PJSC (million dinars)
- Table 5. Tangible assets of Asiacell Communications PJSC measured according to the IVS 300 and IVS 400 using the income approach (million dinars)
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Industrial development in Saudi Arabia: disparity in growth and development
Anis Ali
doi: http://dx.doi.org/10.21511/ppm.18(2).2020.03
Problems and Perspectives in Management Volume 18, 2020 Issue #2 pp. 23-35 Views: 2956 Downloads: 1004 TO CITE АНОТАЦІЯIndustrial development in any nation plays a vital role in the strengthening of the economy and employs human resources as per specifications and directly towards the mainstream of the nation. In Saudi Arabia, there was rapid industrialization for four decades. Some manufacturing industries performed well, while some internal and external business environment factors influenced the others’ performance. The study focuses on historical development, as well as recent trends of well-performing and poor-performing industries of Saudi Arabia. Small manufacturing industries in Saudi Arabia are underdeveloped and need more attention to attain sustainable and progressive growth rate in the form of the number of establishments to enjoy the potential. Manufacture of tobacco, computer, electronics and optics, pharmaceuticals and transport equipment are the deprived and underdeveloped industries of the manufacturing sector. There should be some easy credit schemes for the development of deprived or underdeveloped manufacturing industries. To attain sustainable growth and development of the manufacturing sector, a positive attitude of the government towards underdeveloped manufacturing industries, favorable labor laws, and entrepreneurial awareness, technical and financial assistance are necessary. The growth and development of the manufacturing sector of Saudi Arabia will be helpful in the attainment of goals of Vision 2030.
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Why banks should consider ESG risk factors in bank lending?
Sarwar Uddin Ahmed ,
Samiul Parvez Ahmed ,
Ikramul Hasan
doi: http://dx.doi.org/10.21511/bbs.13(3).2018.07
Banks and Bank Systems Volume 13, 2018 Issue #3 pp. 71-80 Views: 2794 Downloads: 1124 TO CITE АНОТАЦІЯWhy banks should be concerned about incorporating environmental, social and governance (ESG) criteria in the lending process? What is the motivation? This study aims to find the motives for considering environmental, social and governance (ESG) criteria in bank lending process. A primary survey has been conducted to know the current status and motivation for incorporating ESG factors in investment decisions. Sample comprised 30 private commercial banks (PCBs) operating in Bangladesh. Data collected were analyzed with graphs, descriptive statistics, and regression analysis. Findings of the study indicate that banks are mostly considering basic environmental, social and governance factors set by regulators qualitatively. They are lagging behind in considering the advanced ESG criteria needed for sustainable and efficient credit risk management. Based on motivation for incorporating ESG factors, it was found that banks pioneering in incorporating ESG factors in lending decisions are compensated through better financial performance. Findings of the study are expected to encourage practitioners and policy-makers to take more pragmatic steps to incorporate ESG risk factors quantitatively in lending decision-making process.
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Integrated reporting and financial performance of South African listed banks
Reon Matemane ,
Rozane Wentzel
doi: http://dx.doi.org/10.21511/bbs.14(2).2019.11
Banks and Bank Systems Volume 14, 2019 Issue #2 pp. 128-139 Views: 2742 Downloads: 536 TO CITE АНОТАЦІЯThe recent development of integrated reporting intends to address the limitations associated with corporate reporting practices. This paper aims to examine whether a statistically significant relationship exists between integrated reporting quality and financial performance. Secondary data was used, namely the integrated reports and annual financial statements of South African banks listed on the Johannesburg Stock Exchange (JSE) for 2010–2014. For the period 2005–2009, only the financial statements were used, since integrated reporting was not yet mandatory. The research design was longitudinal and it combined qualitative and quantitative methods. Descriptive statistics and Feasible Generalized Least Square (FGLS) were used to explore the relationships between financial performance and integrated reporting quality. The results indicate that there is a positive relationship between integrated reporting quality (IRQ) and earnings per share (EPS). However, there is no significant relationship between IRQ and Tobin’s q (Q-Ratio), IRQ and return on equity (ROE), IRQ and return on assets (ROA) as well as IRQ and economic value added (EVA). Moreover, there are no significant differences on the financial performance of the listed banks before and after the introduction of integrated reporting.
