Browsing by Author "Alharbi, Khalid"

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Corporate Social Responsibility Disclosure and Real Activities Earnings Management: The Interaction Impact of Corporate Governance and IFRS in Saudi Arabia
(Saudi Digital Library, 2023-10-25) Alharbi, Khalid; Islam, Sardar
Corporate social responsibility disclosures (CSRD) have gained increased attention in business debate and practice, from businesses and stakeholders globally. Despite the increasing importance of CSRD, there are concerns about the purpose of these disclosures. These principally hinge on two perspectives: ethical and managerial opportunism. Ethically, the argument holds that participation in CSRD reduces opportunistic behaviour. In addition, CSRD reduces agency problems by providing an environment that decreases motivation to engage in earnings management practices. Managing earnings is the intentional alteration of an organisation’s external financial reporting. Managers who engage in earnings management practices may resort to CSRD to deflect stakeholder attention from their opportunistic actions, thereby protecting their positions. Previous studies that have examined the relationship between CSRD and real activities earnings management (RAEM) remain contested. Further, there is a lack of knowledge regarding CSRD practices in developing countries. In terms of earnings management, associated studies have primarily examined accrual-based earnings management with a limited focus on RAEM. Moreover, little research has been conducted on RAEM in Saudi Arabia. The interaction effect between International Financial Reporting Standards (IFRS) has yet to be explored. There has been limited investigation into the interaction between various components of internal corporate governance (e.g. board characteristics and audit committees) and the ownership structures on the relationship between CSRD and RAEM. The purpose of this research is to address the limitations in the current literature. This research investigated the impact of CSRD on RAEM, in addition to investigating IFRS, internal corporate governance and ownership structures on the RAEM, and their interaction on the relationship between CSRD and RAEM. Data for this research were derived from 704 observations from non-financial firms listed on the Saudi stock exchanges between 2013 and 2020. A balanced panel of data consisting of multiple observations over an eight-year period is utilised. To collect secondary data, two approaches were taken. First, study data were collected from the selected companies’ annual reports, which are available through DataStream. In the second approach, data were collected manually from annual reports available on the Saudi Arabian stock exchange (https://www.tadawul.com.sa). More specifically, the variables gathered manually from the annual reports are the CSRD, internal corporate governance and ownership structures. RAEM measures were calculated using a well-known evaluation model developed by Roychowdhury (2006) and the modified 2020 model by Cohen et al. (2020). This research develops the CSRD index by building 40 checklists. An ordinary least squares model with robust standard errors and an industry fixed effect were applied to all models in the study. The findings of this research reveal that CSRD and RAEM are significantly negatively associated. The researcher applies three approaches to address potential endogeneity issues: (i) an instrumental variable analysis (2SLS) technique, (ii) propensity score matching (PSM) and (iii) reverse causality. This research finds that the results are robust to endogeneity concerns. The researcher applies various robustness tests to provide evidence that CSRD firms are less likely to engage in RAEM practices. The results of IFRS with RAEM indicate that they are significantly positively related. The results of internal corporate governance (board size, presence of the royal family on the board and frequency of audit committee meetings) are negatively and significantly related to RAEM. Managerial ownership, institutional ownership, government ownership and family ownership are negatively significantly related to RAEM. It appears that RAEM practices were more constrained for CSRD firms during the pre-IFRS adoption period. The high presence of the various components of internal corporate governance strengthens the negative relationship between CSRD and RAEM practices, compared with the low presence of the same internal corporate governance components. The findings of this research indicate that the presence of managerial ownership, institutional ownership, government ownership and family ownership strengthens the negative relationship between CSRD and RAEM practices in comparison with the absence of managerial ownership, institutional ownership, government ownership and family ownership. This research is the first to: (i) investigate the relationship between CSRD and RAEM in the Saudi context; (ii) investigate whether the adoption of IFRS influences earnings management through RAEM by Saudi listed companies; (iii) explore various components of internal corporate governance, characteristics of the board, audit committees and ownership structures on RAEM within Saudi listed companies; and (iv) assess the interaction impact of IFRS, various components of internal corporate governance, characteristics of the board of directors, audit committees and ownership structures on the relationship between CSRD and RAEM. A theoretical explanation is presented using an integrative approach, in which the researcher applies numerous theories, including agency, institutional, legitimacy and stakeholder theories. This research provides policymakers and companies with a variety of implications related to regulations, company monitoring measures and the importance of CSRD. This research will aid understanding of the value of integrating elements of internal corporate governance to a high degree combined with CSRD on constrained RAEM. This research can inform policymakers and companies of the importance of the presence of ownership structure. These findings will benefit Saudi Arabia and countries that maintain similar institutional environments to Saudi Arabia, such as Gulf Cooperation Council countries.
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The Social Meanings of Affrication in Saudi Arabia: A Perception Approach
(Saudi Digital Library, 2023-07-10) Alharbi, Khalid; Nycz, Jennifer
Previous work in Arabic sociolinguistics uses first-wave production approaches to variation, where the speech of a set of speakers is analyzed and correlated with sociodemographic and linguistic factors (e.g., Abd-el-Jawad, 1987; Al-Wer, 2007; Al-Rojaie, 2013). While this body of work contributes to our understanding of sociolinguistic variation in the Arab World, its primary focus on production neglects the role of the listener in the construction of social meaning. In this dissertation, I build on previous research by taking a third-wave perception approach (Campbell-Kibler, 2005; 2009; 2010; Eckert, 2012) to explore the social meanings of /k/ variation - realized via the local affricated variant [ts] and the supralocal stop variant [k] - in a variety of Arabic spoken in the north of Saudi Arabia. This study employs preliminary metalinguistic interviews, followed by an online survey to collect local listeners’ evaluations of digitally manipulated sets of guises containing the two variants in both of these phases. The resulting analysis draws on the reactions of 12 participants in the metalinguistic interview phase, and 133 participants in the survey study, all native speakers of the local dialect of focus. The results uncover important insights into the social meanings of /k/ in Saudi Arabia. The interview phase, which concerns explicit perceptions of the variants, reveals two sets of findings: (a) participants assigned a range of sociocultural, social class, and age-related meanings to the variants; and (b) attitudes towards the northern dialect (of which the variable in question is a distinguishing feature) highlighted a range of ideological associations with it in the broader linguistic context of Saudi Arabia, where it is often contrasted with a perceived supralocal “unmarked dialect”. The findings of the online survey, which mainly deals with the implicit perceptions of the variants, show that the two variants are associated with different social meanings related to social status, sociocultural, and interpersonal dimensions, and that listener-related factors affect perceptions of /k/ in important ways. Specifically, they indicate that the supralocal variant is favored on the social status dimension, while the local variant is favored on the sociocultural one, but no statistically significant difference is observed for the interpersonal dimension. Additionally, the local variant is shown to exhibit older age associations. The results were interpreted through a closer examination of listener-related factors, including gender, self-reported use of the local variant, and label-scale correlations, among others. This dissertation presents the first comprehensive account of a salient sociolinguistic variable through third-wave variation approaches in the north of Saudi Arabia. By extending the scope of sociolinguistic research in the Saudi Arabian context to perception, this dissertation provides a window into the locally-oriented nature of the variable’s social meanings in which listeners play an important role. Further, it suggests that more perception work is needed to capture the dynamic indexical nature of variation in Saudi Arabia and in the broader context of the Arab World.
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