Tax Loss Selling: Implications for investor share trading behaviour and industry effects. We will contribute to the national interest in several ways. First, we will provide up-to-date evidence on Tax Loss Selling (TLS), addressing an acute lack of research in this area. Second, a predictive model of TLS is being developed, which is important in understanding when and where significant TLS will arise. Third, we will examine whether the mineral exploration industry has been particularly disadvant ....Tax Loss Selling: Implications for investor share trading behaviour and industry effects. We will contribute to the national interest in several ways. First, we will provide up-to-date evidence on Tax Loss Selling (TLS), addressing an acute lack of research in this area. Second, a predictive model of TLS is being developed, which is important in understanding when and where significant TLS will arise. Third, we will examine whether the mineral exploration industry has been particularly disadvantaged by the Capital Gains Tax. As recognised in the Prosser Report, current tax policy is a potentially important cause of the decline in exploration expenditure. Its role needs to be understood, because the exploration industry contributes substantially to exports and national income, and is critical to the national interest. Read moreRead less
Corporate governance, corporate disclosure policies and the timeliness of price discovery: How competitive is the Australian equity market? This project will help reduce the economic cost of poor corporate governance. It will facilitate more liquid financial markets and potentially it will increase the number and value of worthwhile investment opportunities by lowering the cost to finance them. It will assess Australia's competitive standing in the world's equity markets and establish whether ou ....Corporate governance, corporate disclosure policies and the timeliness of price discovery: How competitive is the Australian equity market? This project will help reduce the economic cost of poor corporate governance. It will facilitate more liquid financial markets and potentially it will increase the number and value of worthwhile investment opportunities by lowering the cost to finance them. It will assess Australia's competitive standing in the world's equity markets and establish whether our market is indeed transparent and a good place to raise risk capital. It will add needed credibility to corporate governance regulation. And it will enhance Australia's standing in the international research community because its research methods can be applied to almost any public capital market.Read moreRead less
Impacts of International Financial Reporting Standards adoption on cost of equity capital, financial statement value-relevance, and firms' financing and investment strategies. The project's insights will assist policy makers to assess, progress and promote approaches to global economic and governance policy reforms. AIFRS adoption disturbs the financial markets equilibria previously struck under Australian accounting standards. Understanding this impact helps underpin micro- and macro- economi ....Impacts of International Financial Reporting Standards adoption on cost of equity capital, financial statement value-relevance, and firms' financing and investment strategies. The project's insights will assist policy makers to assess, progress and promote approaches to global economic and governance policy reforms. AIFRS adoption disturbs the financial markets equilibria previously struck under Australian accounting standards. Understanding this impact helps underpin micro- and macro- economic strategies and policy developments relying upon the role of financial reporting. It also assists capital markets to adapt to the new reporting environment, thus increasing capital allocation effectiveness and efficiency.
Australia's position as an early IFRS adopting nation enables the project to facilitate Australia's international leadership in global economic policy development. Read moreRead less
Quantification issues in corporate valuation, the cost of capital, and optimal capital structure. An estimate of the firm's cost of capital is probably the most important calculation required in corporate finance. It is used as the discount rate in valuation and capital budgeting decisions and forms the basis of pricing structures for many regulated industries. Corporate finance theory has identified the key inputs used to calculate the cost of capital, but the current literature falls short o ....Quantification issues in corporate valuation, the cost of capital, and optimal capital structure. An estimate of the firm's cost of capital is probably the most important calculation required in corporate finance. It is used as the discount rate in valuation and capital budgeting decisions and forms the basis of pricing structures for many regulated industries. Corporate finance theory has identified the key inputs used to calculate the cost of capital, but the current literature falls short of precisely quantifying and measuring many of these inputs. The outcomes from this project will be a framework to quantify three key aspects of the cost of capital - the value of dividend imputation tax credits, the assessment of the optimal capital structure for the firm (in particular, the quantification of bankruptcy and agency costs associated with debt financing), and the estimation of the firm's marginal tax rate.Read moreRead less
Does Australian Corporate Taxation Matter? On a GDP-weighted basis the average OECD corporate rate has fallen from 44 percent in 1985 to 31 percent in 2004. Australia operates a flat thirty percent corporate tax rate and this compares well with the current OECD average. Yet, the Business Council of Australia argues that the Australian corporate tax rate is 'uncompetitive'. Certainly, the corporate tax burden (i.e. corporate tax revenue as a proportion of GDP) is very high in Australia, the thi ....Does Australian Corporate Taxation Matter? On a GDP-weighted basis the average OECD corporate rate has fallen from 44 percent in 1985 to 31 percent in 2004. Australia operates a flat thirty percent corporate tax rate and this compares well with the current OECD average. Yet, the Business Council of Australia argues that the Australian corporate tax rate is 'uncompetitive'. Certainly, the corporate tax burden (i.e. corporate tax revenue as a proportion of GDP) is very high in Australia, the third highest in the OECD, and the highest in the Asia-Pacific region. This project will evaluate the extent that the corporate tax burden is a hinderance to Australian firms and economic behaviour. Read moreRead less
An International Comparison of Corporate Financial Policy. Our research contributes to the finance discipline, corporate decision making and public policy. Existing empirical literature provides managers with insights on the impact of firm characteristics on corporate financial decisions. However, beyond suggesting that well-functioning banks, equity and bond markets are an integral part of corporate financing, no insight is provided as to the role played by the public policy, legal structures a ....An International Comparison of Corporate Financial Policy. Our research contributes to the finance discipline, corporate decision making and public policy. Existing empirical literature provides managers with insights on the impact of firm characteristics on corporate financial decisions. However, beyond suggesting that well-functioning banks, equity and bond markets are an integral part of corporate financing, no insight is provided as to the role played by the public policy, legal structures and the suppliers of capital. In a market such as Australia, where superannuation is a large and increasing part of corporate funding, this is a glaring omission. This study seeks to examine the impact of public policy, legal and institutional structures on these financial choices.Read moreRead less
An international study of seasoned equity offerings: long term returns, earnings management, liquidity, ownership structure, and financial crisis. This study will provide critical insights into the impact of alternative mechanisms for seasoned equity offerings on liquidity and firm value. Considering the lack of confidence in financial markets during the financial crisis, this study will have significant implications regarding the current use and regulation of seasoned equity offerings.
Risk management policies and practices of major Australian firms. High profile corporate failures attributable to incorrect hedging strategies have recently drawn attention to corporate financial risk management, although its important role in financial management is far more ubiquitous and pervasive. The project will shed light on the internal processes of corporate risk management which previous studies have not addressed. It will produce a 'stock-take' of current practices enabling assessment ....Risk management policies and practices of major Australian firms. High profile corporate failures attributable to incorrect hedging strategies have recently drawn attention to corporate financial risk management, although its important role in financial management is far more ubiquitous and pervasive. The project will shed light on the internal processes of corporate risk management which previous studies have not addressed. It will produce a 'stock-take' of current practices enabling assessment against theoretical models and identification of current 'best practice'. Against this backdrop, Australian firms will be able to assess the merits of their current policies and practices, and assist corporate outsiders (regulators, analysts, researchers) in better understanding corporate risk management. Read moreRead less