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Papers by Edmark Rustico
In the light of growing interest in capital markets, particularly those in the newly emerging eco... more In the light of growing interest in capital markets, particularly those in the newly emerging economies, this paper attempts to predict the value of share prices through regression analysis using secondary data. Through sample companies that make up the Philippine Stock Exchange Index, the researcher gathered stock prices from 2010-2015 and regressed it with independent variables covering company fundamentals and macroeconomic figures. Results showed that book value per share and return on equity have a positive significant correlation to share price. A negative significant relationship however was noted between share price and current ratio. The book value per share emerged as having the greatest influence to share price because investors would expect that as the company increase in equity, the value of their investment is positively influenced. Other company fundamentals such as dividends per share and price earnings ratio, registered an insignificant negative effect to share price. Country specific factors were determined to be insignificant to share prices, though the model predicts different directions for each. Gold price, foreign exchange rate and inflation have insignificant negative effects to share prices. Meanwhile, the country's credit rating and the average annual lending interest rates by banks insignificantly impact share prices in a positive way. Further studies can be ventured into by increasing the number of observations and perhaps covering a longer period with a corresponding emphasis on 'noises' during those period. While many researches have been conducted to predict share price, this paper offers novelty to existing literatures by (1) combining macroeconomic variables and company fundamentals in a regression model; (2) adding new variables such as current ratio and return on equity as significant predictors of share price; and (3) employing a two-step way of normalizing a continuous data which exhibits non-normality as developed by Tembleton (2010).
Highest Standards: The Official Technical Journal of The Board of Accountancy (Philippines), 2015
The increasing concern for environmental degradation and climate change has paved the way for alm... more The increasing concern for environmental degradation and climate change has paved the way for almost all sectors worldwide to take measures in reducing their environmental impact. This in turn, resulted to companies incorporating in their reports environmental activities they undertake, thus coining the term “Environmental Accounting (EA)”. Using a sample of companies registered as of December 31, 2011, this paper determines the extent of environmental accounting practices employed by large companies in Bacolod City. Factors that significantly affect the companies’ environmental accounting practices are likewise identified. Results showed that degree of environmental accounting development among companies in Bacolod City remains at a low level primarily because such practice is not mandated and that there is an absence of clear guidance as to its implementation. Unawareness of the companies about this new development contributes to this low result. This study further reveals that degree of compliance to ISO 14001 – Environmental Management System and the regulatory environment of companies significantly affect the extent of environmental practices of the companies. Establishing objective standards specific to environmental accounting would help companies develop their environmental accounting practices. Furthermore, mandatory requirement from the government would also advance EA in the country. The professional organization of the accountants can also do its share by conducting seminars and conferences regarding the matter and training people who will become “experts” in this field.
Drafts by Edmark Rustico
The collapse of some of the world's most successful businesses has been partly attributed to prof... more The collapse of some of the world's most successful businesses has been partly attributed to professional accountants' misconduct and questionable ethical behavior along with the company's mismanagement. This paved the way for the accountancy profession to take steps in ensuring that accountants will act in a manner that promotes the general welfare of the society, hence, the promulgation of the code of Ethics. The purpose of this study is to evaluate the usefulness of the Code of Ethics in resolving ethical conflicts faced by the professionals. Also the paper determines the ethical dilemmas faced by accountants in the Philippines and describe the frequency of their encounter with such dilemmas. Using a descriptive-relational approach, the researchers surveyed a total of 265 CPAs and found out that Filipino accountants in general, rarely face ethical conflicts. Overall , accountants rated the code of ethics as "useful" in resolving ethical issues. The study concluded that there is a significant association between the frequency of encountering ethical issues and usefulness of code in resolving them. As CPAs view the code of ethics as a useful tool in resolving ethical dilemmas, the less frequent they see themselves faced with those dilemmas because through the provisions of the code, they are able to mitigate the circumstances that will likely lead to them deviate from the mandate of the profession. Despite the overall positive view about the code of ethics, regulators and members of the profession can still take steps to further improve the awareness of professionals about matters in ethics through continuous review of Continuing Professional Development programs and strengthening ethics education.
In the light of growing interest in capital markets, particularly those in the newly emerging eco... more In the light of growing interest in capital markets, particularly those in the newly emerging economies, this paper attempts to predict the value of share prices through regression analysis using secondary data. Through sample companies that make up the Philippine Stock Exchange Index, the researcher gathered stock prices from 2010-2015 and regressed it with independent variables covering company fundamentals and macroeconomic figures. Results showed that book value per share and return on equity have a positive significant correlation to share price. A negative significant relationship however was noted between share price and current ratio. The book value per share emerged as having the greatest influence to share price because investors would expect that as the company increase in equity, the value of their investment is positively influenced. Other company fundamentals such as dividends per share and price earnings ratio, registered an insignificant negative effect to share price. Country specific factors were determined to be insignificant to share prices, though the model predicts different directions for each. Gold price, foreign exchange rate and inflation have insignificant negative effects to share prices. Meanwhile, the country's credit rating and the average annual lending interest rates by banks insignificantly impact share prices in a positive way. Further studies can be ventured into by increasing the number of observations and perhaps covering a longer period with a corresponding emphasis on 'noises' during those period. While many researches have been conducted to predict share price, this paper offers novelty to existing literatures by (1) combining macroeconomic variables and company fundamentals in a regression model; (2) adding new variables such as current ratio and return on equity as significant predictors of share price; and (3) employing a two-step way of normalizing a continuous data which exhibits non-normality as developed by Tembleton (2010).
Highest Standards: The Official Technical Journal of The Board of Accountancy (Philippines), 2015
The increasing concern for environmental degradation and climate change has paved the way for alm... more The increasing concern for environmental degradation and climate change has paved the way for almost all sectors worldwide to take measures in reducing their environmental impact. This in turn, resulted to companies incorporating in their reports environmental activities they undertake, thus coining the term “Environmental Accounting (EA)”. Using a sample of companies registered as of December 31, 2011, this paper determines the extent of environmental accounting practices employed by large companies in Bacolod City. Factors that significantly affect the companies’ environmental accounting practices are likewise identified. Results showed that degree of environmental accounting development among companies in Bacolod City remains at a low level primarily because such practice is not mandated and that there is an absence of clear guidance as to its implementation. Unawareness of the companies about this new development contributes to this low result. This study further reveals that degree of compliance to ISO 14001 – Environmental Management System and the regulatory environment of companies significantly affect the extent of environmental practices of the companies. Establishing objective standards specific to environmental accounting would help companies develop their environmental accounting practices. Furthermore, mandatory requirement from the government would also advance EA in the country. The professional organization of the accountants can also do its share by conducting seminars and conferences regarding the matter and training people who will become “experts” in this field.
The collapse of some of the world's most successful businesses has been partly attributed to prof... more The collapse of some of the world's most successful businesses has been partly attributed to professional accountants' misconduct and questionable ethical behavior along with the company's mismanagement. This paved the way for the accountancy profession to take steps in ensuring that accountants will act in a manner that promotes the general welfare of the society, hence, the promulgation of the code of Ethics. The purpose of this study is to evaluate the usefulness of the Code of Ethics in resolving ethical conflicts faced by the professionals. Also the paper determines the ethical dilemmas faced by accountants in the Philippines and describe the frequency of their encounter with such dilemmas. Using a descriptive-relational approach, the researchers surveyed a total of 265 CPAs and found out that Filipino accountants in general, rarely face ethical conflicts. Overall , accountants rated the code of ethics as "useful" in resolving ethical issues. The study concluded that there is a significant association between the frequency of encountering ethical issues and usefulness of code in resolving them. As CPAs view the code of ethics as a useful tool in resolving ethical dilemmas, the less frequent they see themselves faced with those dilemmas because through the provisions of the code, they are able to mitigate the circumstances that will likely lead to them deviate from the mandate of the profession. Despite the overall positive view about the code of ethics, regulators and members of the profession can still take steps to further improve the awareness of professionals about matters in ethics through continuous review of Continuing Professional Development programs and strengthening ethics education.