Cuadro comparativo estudiantinas peruanas y colombianas a partir de la rueda

Malaysia, or Malaysian firms in particular are chosen mainly because the milestones that gone through by the firms that can represent the environment of emerging markets. In specific, this thesis considers the following justifications that can make the Malaysia as a worth case to study. Firstly, Malaysia jurisdiction through Companies Act (1965) and guidelines issued by Security Commission and Bursa Malaysia require publicly listed firms to make accurate, timely disclosure of material information to the public and investors. Secondly, quality of earnings report that particularly concerns on the timeliness has been brought about by the implementation of the Malaysian Code of Corporate Governance (MCCG) in 2001, which became an integral part of the revamped listing requirements of Bursa Malaysia. The implementation and integration of MCCG into the Bursa listing requirements provide a natural experiment to test whether the associated improvement in corporate financial disclosure affects the quality of earning reported to the market.

The sample companies were extracted from the population of all companies listed on the Main Market of Bursa Malaysia using random sampling technique. A list of companies obtained from the Bursa Malaysia’s website is used as a reference to extract the respective firm’s financial data from DataStream.

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Finance related companies were excluded from the population because they fell under the provisions of the Banking and Financial Institutions Act of 1989 (BAFIA), which possess unique characteristics and operate in different compliance and regulatory environment. PN4/PN17 classified firms, which are distressed firms which were given time and opportunity to regularise their financial position to the minimum of a public listed firms, were also excluded to avoid the influence of their financial condition on the results of this study. Firms that changed their financial year during the sample period were also excluded. Also, excluded were firms that had undergone significant merger or reconstruction and those with unavailable online annual reports.

The sample being used for analysis is a group of 100 randomly selected firms from the population of 834 firms listed on the Main Market of Bursa Malaysia (Malaysian Stock Exchange) during the period of six years, commencing on 1 January 2004. The process of sample selection was made by considering four criteria to exclude a number of firms from the initial population; (1) firms under liquidation, delisted and suspended, (2) firms in the financial sector, (3) recently listed firms, and (4) firms under restructuring scheme. This was done to disregard several issues which are considered not relevant to the focus of this study. Data pertaining to the firms should be available throughout the years from 2004 to 2009. In addition, to avoid any missing data, firms with no data available online or with incomplete data were excluded from the population list. Eventually, 421 firms were available to be selected as sample firms.

Corporate governance data were collected manually from the sample firms’ annual reports and account data were extracted from DataStream. Initially, 600 firm-year observations were available. However, only 471 final observations were used to run the models after allowing for elimination of the effects of 129 outliers. Outliers were detected using hadimvo command of STATA. The summary of sample selection process is presented in Table 4.1.

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Table 4-1 Derivation of Sample and Observation

Descriptions N

Total number of firms listed on Main Market Bursa Malaysia4 834

Financial related firms (54)

Problematic firms5 (208)

Firms that change financial year end (22)

Firms under restructuring scheme (5)

Firms IPO in 2004 (28)

Firms with unavailable/incomplete online data (96) Initial number of firms available for random selection 421

Randomly selected firm sample 100

Initial firm-year observation6 ₆₀₀

Outliers (129)

Final firm-year observations 471

4 _{Firms are those listed during the whole six year period of this study commencing on 1 January 2004 until}

31 December 2009.

5 _{Problematic firms are firms found to have triggered the requirements of Practice Note No. 4 (PN4) or/and}

the requirements of Practice Note No. 17 (PN17) of Bursa Malaysia. PN4 and PN17 are no longer being separated since 3 January 2005, but have become a single PN17 classification.

6 _{Total number of initial firm-year observations is computed as 100 firms sample multiplied by six (6) years}

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Table 5-2 and 5-3 respectively provides the summary of 471 final usable data breakdown into calendar year and major industry classification made by Bursa Malaysia. With regards to Table 5-2, for each of the six calendar years, there was no full firm observation (100 observations for each year) available. Out of the total 471 observations, the highest was 82 (17.41%) observations which were available in 2006 and 2007 and the lowest was 76 (16.14%) observations which were available in 2005, 2008 and 2009. Among all the sample firms, there is no obvious difference in the number of observations across the six- year period.

Referring to Table 5-3, the highest observations were firms in the industrial product industry, represented by 185 firm-year observations or 39.28% of the 471 total observations, followed by firms in the trading and services industry (24.63%) and the consumer product industry (19.32%). The lowest observations were 14 (2.97%), which were firms in the construction industry.

Table 4-2 Firm-year Observations Breakdown into Calendar Year

Year N % 2004 79 16.77 2005 76 16.14 2006 82 17.41 2007 82 17.41 2008 76 16.14 2009 76 16.14 Total 471 100

Table 4-3 Firm-year Observations Breakdown into Industry

Industry N % Industrial Product 185 39.28 Construction 14 2.97 Technology 38 8.07 Consumer Product 91 19.32 Trading/Services 116 24.63 Plantation 27 5.73 Total 471 100

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