Recession and Covid-19 Impact on Cost Management, Wizz -Air Company, case study (Published)
Recession, an inevitable economic phenomenon that is difficult to predict by the scientists of the time, a pandemic which hits the economic-financial sphere of a certain region or in global form, but as this phenomenon spreads, what are its consequences? What is the right and most effective way today for an entity to successfully meet this challenge? One of the most appropriate forms is the role that cost and management accounting management has in the performance of an entity, as well as the decisions taken by their managers, as it is the latter who manage to “predict” the consequences of this economic downturn and enable its survival.The purpose of the paper is the role that cost and management accounting plays in the recession, specifically the economic downturn caused by the Covid-19 pandemic, by analyzing how managers managed to cope and what decisions were made. The working methodology is descriptive, comparative and analytical based on the secondary data obtained in the study and specifically focused on the airline “Wizzair”, which is part of the transport sector. This sector, being also related to tourism, is among the most affected by the pandemic of recent years. In the following we will present the decisions that were taken by senior managers and based on the analysis of the results we will conclude whether they were appropriate or not.
Keywords: Budgeting, COVID-19 pandemic, Management, Management Accounting, Recession, cost accounting
Recession and Covid-19 Impact on Cost Management; Wizz-Air Company, case study (Published)
Citation: Ejona Duçi, Rovena Troplini and Xhenisa Myshketa (2022) Recession and Covid-19 Impact on Cost Management; Wizz-Air Company, case study, European Journal of Accounting, Auditing and Finance Research, Vol.10, No. 3, pp.1-17
Abstract: Recession, an inevitable economic phenomenon that is difficult to be predicted by the scientists of the time, a pandemic which hits the economic-financial sphere of a certain region or in global form, but as this phenomenon spreads, what are its consequences? What is the right and most effective way today for an entity to successfully meet this challenge? One of the most appropriate forms is the role that cost and management accounting management has in the entity performance, as well as the decisions taken by their managers, as it is the latter who manage to “predict” the consequences of this economic downturn and enable its survival.The purpose of the paper is to study the role of cost and management accounting in a recession situation, specifically the economic downturn caused by the Covid-19 pandemic. This is done by analysing how managers managed to cope with such situations and what decisions they have taken. Other important elements which have been studied are variable and fixed cost during recession. The methodology of the study is descriptive, comparative and analytical based on the secondary data obtained from statistical institutions in Albania and especially the focus is on the airline company, “Wizz Air”, which is part of the transport sector. This sector, being related to travelling, is among the most affected by the pandemic situation, because of travel restrictions applied in recent years. A regression analysis is used to see the relation between costs and between employees number and employee cost and how Wizz Air company has reduced some possible costs. According to this analysis appropriate conclusions have been shown.
Keywords: Budgeting, COVID-19 pandemic, Management, Management Accounting, Recession, cost accounting
Effect of Financial Sector Lending Management on Economic Growth in Nigeria (Published)
This study investigates the effect of bank lending management on economic growth in Nigeria for the period 1985-2018. The data for the study were obtained from the Central Bank of Nigeria Bulletins, World Development Indicator and National Bureau of Statistics. The variables for the study include Gross Domestic Product, Deposit Interest Rate, Lending Interest Rate, Bank Asset Quality and Deposit Multiplier. Data for the study was analyzed using Descriptive Statistics, Ordinary Least Square method (OLS) and Multiple Regression Analysis. The result of short and long run regression revealed a negative impact of bank lending management on economic growth. The F-statistic (6.67) was also used to test explanatory power of the model with the corresponding probability value of (0.0007) which is statistically significant at 5%, suggesting that the explanatory variables have joint and significant effect on the economic growth of Nigeria. It is recommended that the regulatory authority set up a regulatory framework that will enhance the capacity of deposit money banks in Nigeria to lend to real sector of the economy at a very low interest rate and attract massive deposit by investors through robust deposit interest rate.
Keywords: Financial Sector, Lending, Management, economic growth
Working Capital Management Firm Liquidity and Stock Market Seasonality: Evidence from Nigeria (Published)
This study examines the relationship between Working Capital Management Firm Liquidity and Stock Market Seasonality among quoted firms in Nigeria. Six hypotheses were formulated following the dependent variable of Stock Market Liquidity. The independent variables employed for this study include: Liquidity Ratio, Account Payable Day, Account Receivable Day, Inventory Day, Firm Leverage and Firm Size. This study is based on ex-post facto research design and employed a panel data set collected Fifty (50) non-financial companies over an eight year period ranging from 2011 to 2018 financial year. We analyzed the data set using descriptive statistics, correlation and Panel Ordinary Least Square Regression Analysis. Our finding lends credence to the efficient market theory which holds that share markets prices are unpredictable and as such cannot be forecasted. Specifically, the finding suggests that market liquidity cannot predict stock market returns irrespective of the season of the year. Hence, we carefully hold that the stock market in Nigeria is efficient due to its randomness and will rapidly respond to any information or anomalies presented to it. The study recommends among others that policy makers in emerging markets such as Nigeria should ease entry barriers for prospective firms so as to enhance liquidity. The study further recommends that, proper inventory management system should be put in place in order to avoid working capital mismanagement.
Keywords: Firm, Liquidity, Management, Nigeria, Stock Market, Working capital., seasonality
Effect of Credit Risk Management on Financial Performance of Commercial Banks in (Published)
The main purpose of this study is to investigate the effect of credit risk on the financial performance of commercial banks in Nepal. The balance panel data of ten commercial banks with 160 observations for the period of 2001 to 2016 have been used for the analysis. The regression results revealed that capital adequacy ratio (CAR), non-performing loan ratio (NPLR), and management quality ratio (MQR) have significant relationship with the financial performance (ROA) of the commercial banks in Nepal. Similarly, credit to deposit ratio (CDR) and risk sensitivity (RS) have no significant impact on the financial performance of the commercial banks in Nepal.
Keywords: Capital Adequacy Ratio, Management, Return on Asset, and quality ratio, credit to deposit ratio and risk sensitivity, non-performing loan ratio
Effect Of Management Of Receivables Ratio on Corporate Profitability of Industrial/Domestic Products in Nigeria (Published)
This study examines the effect of the management of accounts receivable ratio on the profitability of industrial/Domestic products manufacturing firms in Nigeria.The variables of this study include accounts receivable ratio, debt ratio and sales growth rate. Only secondary sources of data were used for the period 2000-2011. The hypotheses were tested using the multiple regression technique. The results show that accounts receivable ratio, debt ratio and sales growth rate had positive and significant relationship with the profitability of the firms under study
Keywords: Corporate profitability, Industrial and Domestic Products, Management, Nigeria, Receivables Ratio
Efficiency and Accountability of Public Sector Revenue and Expenditure in Nigeria (1970-2014) (Published)
Nigeria is the sixth largest producer of oil and gas in the world, but the average Nigerian on the street is poor and there is poor infrastructure like power supply, roads, hospitals etc. This study examines the efficiency and accountability of public sector revenue and expenditure in Nigeria (1970-2014). Data on total federal government revenue and expenditure, state governments’ revenue and expenditure were collected from Statistical bulletin from the Central Bank of Nigeria from 1970-2014. The results were analysed using relevant statistical tools. The findings reveals that the level of accountability is very poor in Nigeria because the attributes of accessibility, comprehensiveness, relevance, quality, reliability and timely disclosure of financial information, social and political information about government activities are completely non available or partially available for the citizens to assess the performance of public officers mostly the political office holders. Conclusively and evidently the study has revealed that there is significant relationship between efficiency of public sector expenditure, recurrent expenditure and capital expenditure in Nigeria from 1970-2014. On the basis of these, the paper recommends among others that for accountability to be successful in the management of public funds in Nigeria there must be a reduction in the level of corruption, improving public sector accounting and auditing standards, legislators as champions of accountability and restructure the public accounts committees and the value of money must be applied in the conduct of government business.
Keywords: Accountability, Financial Reporting, Financial Resources, Management, Nigeria, Public Finance, Public Sector Accounting
CORPORATE GOVERNANCE AND RISK MANAGEMENT IN THE BANKING SECTOR OF GHANA (Published)
The purpose of this research is to examine the degree to which banks in Ghana use risk management practices and corporate governance in dealing with different types of risk. A modified questionnaire, divided into two parts was developed and administered to the selected banks’ board of directors, senior risk management officers and selected staff. The first part of the questionnaire covered five aspects: understanding risk and risk management, risk identification, risk assessment and analysis, risk monitoring, and corporate governance and risk management practices. This part included 32 closed-ended questions based on an interval scale. The second part consisted of two closed-ended questions based on an ordinal scale dealing with two topics: methods of risk identification, and risks facing the sampled banks. The result of the study indicated that, Board of Directors, senior staffs and not all staff are actively involved in risk management and the most important types of risk facing the sampled banks are credit risk, operating risk, solvency risk, interest rate risk, and liquidity risk. The study also found out that the sampled banks are efficient in managing risk
Keywords: Commercial Banks, Corporate Governance, Ghana, Management, Risk