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The Impact of Interest Rate and Inflation Rate Towards Exchange Rate: A Case of Sri Lanka
Morawaggoda Kankanamalage Tharaka Nayana Hansi
Issue:
Volume 11, Issue 3, September 2023
Pages:
107-124
Received:
10 June 2023
Accepted:
29 June 2023
Published:
6 July 2023
Abstract: Exchange rate can be explained as one of the key factor, which emphasis countries macro-economic stability. As an emerging market Sri Lanka is mainly focused on international markets and highly depend on international trade. This study is on the influence of interest rate (Weighted Average Call Market Rate - CR) and inflation (Colombo Consumers' Price Index (CCPI) - INF), to the exchange rate (USD/LKR - NEXR). The research analysis monthly data of CR, NEXR and CF for the period of October 2000 to March 2013 based on Vector Error Correction Model. This research uses stationary test, cointegration test, stability test, impulse response function, residual test has generated to compile and analysis data. Results of the study proves that the exchange rate has negative relationship with interest rate for the given period. However, the exchange rate shows positive relationship with inflation. Those relationships are significant in long run causality, where it takes much more time to become equilibrium position. Further, there is no short run causality as well. The negative relationship between exchange and interest rates creates a favorable environment to capital inflows to the country. However, manipulation of exchange rate volatility by the relevant market players will lead to a change in the expected relationship of the variables. According to the results, policy makers should estimate most appropriate policy interest rate level in Sri Lanka to manage sustainable growth. Further, the regulatory authorities should manage appropriate intervention mechanisms to the foreign exchange market to control exchange rate to avoid market manipulations.
Abstract: Exchange rate can be explained as one of the key factor, which emphasis countries macro-economic stability. As an emerging market Sri Lanka is mainly focused on international markets and highly depend on international trade. This study is on the influence of interest rate (Weighted Average Call Market Rate - CR) and inflation (Colombo Consumers' Pr...
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Identification and Ranking of High-Risk Nodes in Complex Financial Networks
Issue:
Volume 11, Issue 3, September 2023
Pages:
125-134
Received:
18 June 2023
Accepted:
12 July 2023
Published:
17 July 2023
Abstract: Financial markets are ever closer interconnected, the superimposed impact and scope of multiple systemic financial risks such as epidemics, wars, and supply chains are expanding day by day, and the risk of contagion and spread of financial crises has become a problem that cannot be ignored. With the deepening of the theoretical research of complex networks, the combination of systemic financial risks and complex networks has become more closely connected. Financial networks are characterized by the accumulation of multiple risks, and their overall stability depends on the stability of specific nodes in the network. Therefore, accurately identifying and ranking high-risk nodes has become a difficult point restricting the improvement of resource utilization efficiency, and it has become extremely critical. Based on the complex network theory, firstly, a directed graph from the massive financial risk warning information is constructed in this paper, and obtains the subject community of financial risk incidents. Then the superimposed impact of multiple systemic financial risks is measured from the three dimensions of complex network topology, financial risk behavior and risk propagation probability. Finally, the influence distribution and dissemination rules of nodes are analyzed in the subject community, and a high-risk nodes identification algorithm CIRA (community-based identifying and ranking algorithm) is proposed. Experiments show that the algorithm can effectively mine potential high-risk nodes and obtain higher risk density.
Abstract: Financial markets are ever closer interconnected, the superimposed impact and scope of multiple systemic financial risks such as epidemics, wars, and supply chains are expanding day by day, and the risk of contagion and spread of financial crises has become a problem that cannot be ignored. With the deepening of the theoretical research of complex ...
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The Role of Management Support in the Relationship Between Objectivities, Organizational Setting and Auditee Attributes in Higher Education in Sumatra, Indonesia
Yeni Trijayanti,
Yusnaini Yusnaini,
Hasni Yusrianti
Issue:
Volume 11, Issue 3, September 2023
Pages:
135-145
Received:
4 July 2023
Accepted:
24 July 2023
Published:
9 August 2023
Abstract: The purpose of this study was to analyze the effect of objectivity, organizational arrangements, and auditee attributes on internal audit effectiveness with management support as a moderating variable in the Internal Supervisory Unit at State Universities in Sumatra. The sample of this study was 205 respondents as the Internal Supervisory Unit (Satuan Pengawas Internal/SPI) personnel at State Universities in the Sumatra Region. Data was collected through a questionnaire and obtained as many as 137 respondents. Data analysis in this study is to use a PLS-based Structural Equation Modellling (SEM) approach using Smartpls. The tests carried out are convergent validity test, validity and reliability test, discriminant validity test, R-Square test. To test the hypothesis, the data from the research questionnaire were analyzed using bootstrapping calculations. The results showed that objectivity, organization setting, and auditee attributes have a positive effect on internal audit effectiveness. Management support cannot moderate objectivity on internal audit effectiveness, however it can moderate organizational settings and auditee attributes on internal audit effectiveness. The implication of this research is that it can provide practical benefits for the Internal Supervisory Unit at State Universities in highlighting areas that need attention in improving internal audit effectiveness. Another implication is that it supports institutional theory and attribution theory used in the study of internal audit effectiveness.
Abstract: The purpose of this study was to analyze the effect of objectivity, organizational arrangements, and auditee attributes on internal audit effectiveness with management support as a moderating variable in the Internal Supervisory Unit at State Universities in Sumatra. The sample of this study was 205 respondents as the Internal Supervisory Unit (Sat...
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Triangle Model of Responsibility Theory in Perspective of Internal Auditor's Responsibility for Fraud Detection
Issue:
Volume 11, Issue 3, September 2023
Pages:
146-153
Received:
7 July 2023
Accepted:
9 August 2023
Published:
22 August 2023
Abstract: This paper aims to show the role of the triangle model of responsibility theory in the responsibility of detecting fraud which is one of the duties of internal auditors, especially government internal auditors. The theory suggests that perceptions of responsibility are a direct function of the strength of the three psychological relationships between the three formative elements (professional obligation, task clarity and personal control). The three elements are the relationship between prescription, event and identity. This article discusses the results of previous research related to auditor responsibility using the perspective of the triangle model of responsibility theory. This paper also shows that external factors and a person's psychological factors also shape the perception of auditor responsibilities such as the type of fraud, accountability, cognitive style and moral development. The discussion in this paper shows how the concept of responsibility perceived by government internal auditors will shape their desire to be responsible for detecting fraud. The results of this paper are expected to contribute to researchers in using appropriate theory to measure perceptions of responsibility for other professions. For practitioners and regulators, the discussion of this paper can be used as a reference for assessing and building auditor competence in increasing responsibility for detecting fraud.
Abstract: This paper aims to show the role of the triangle model of responsibility theory in the responsibility of detecting fraud which is one of the duties of internal auditors, especially government internal auditors. The theory suggests that perceptions of responsibility are a direct function of the strength of the three psychological relationships betwe...
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