https://www.um.edu.mt/library/oar/handle/123456789/25460 2026-04-26T22:08:50Z https://www.um.edu.mt/library/oar/handle/123456789/120485 Title: The effect of second pillar pensions on a Maltese listed company Abstract: Purpose: Pensionable income has become a great concern. Therefore, the objectives of this study are to describe second pillar pensions in Malta, evaluate accounting treatment and disclosures as required by IAS 19, Employee Benefits, and assess the effect of a second pillar pension scheme on a Maltese listed company. A walkthrough along the years presents the amendments that occurred under IAS 19, with special attention to recent amendments, followed by the financial implications of the introduction of a Defined Benefit or Defined Contribution scheme on a Maltese listed entity. Design: This study looks into additional costs that a company would sustain by the introduction of a Defined Benefit or Defined Contribution scheme. A base case scenario is presented for each scheme, followed by a sensitivity analysis. A qualitative case study approach was deemed the most appropriate methodology for this dissertation. Furthermore, the necessary data was provided by the listed company, and was used to compute the necessary computations as required by IAS 19. Findings: Findings demonstrate that under a Defined Benefit scheme, additional pension obligations to be paid upon employees‟ retirement are material, and profits decreased by €0.77m to €4.96m. Conversely, under a Defined Contribution scheme, increase in liabilities was much lower due to a lower percentage being paid into the fund, and the decrease in profits ranged from €0.29m to €0.9m. Conclusion: This study concludes that Defined Benefit schemes are more costly when compared to Defined Contribution schemes since they use actuarial assumptions, including Present Values, to determine the company‟s liabilities, as well as Fair Value accounting for its assets, leading to greater volatility in the accounts. Implications: If a rigorous legal framework is established together with the necessary support and guidance, second pillar pensions might be the next step forward to combat the pension crisis. Description: M.ACCTY. 2017-01-01T00:00:00Z https://www.um.edu.mt/library/oar/handle/123456789/30967 Title: Developing a costing system for an early stage digital agency start-up Abstract: Purpose: The development of a costing system is the main aim behind this case study. The business model of the case study is to be understood and used as a basis on which the costing system is designed while analysing different profitability levels under different cost structures. Design: A qualitative research method was used to arrive at the research question and be able to analyse the case company. Thus, a case study approach was chosen and semistructured interviews internally in the case company and with industry market players were conducted. Findings: The findings portrayed that the case company was operating nearly at full capacity. Each package provided resulted to be profitable, and that a direct relationship between the level of capacity and the fixed cost per unit of production exists. The biggest effect on profitability was created by the fixed costs rather than the variable cost of production. Thus, the introduction of a piece rate system was looked into which resulted to be beneficial to the case company. Furthermore, a pricing examination was conducted which portrayed the ideal price strategy to use leading to the best profit scenario. Conclusion: A costing system will allow the case company to plan and take informal decisions based on numeric internal facts rather than intuition. The designed system provides a basis for continuation of current service creation practices while allowing for the introduction of new service lines. Description: M.ACCTY. 2017-01-01T00:00:00Z https://www.um.edu.mt/library/oar/handle/123456789/30966 Title: Changes in listed companies’ CEOs and their corporate governance implications Abstract: Purpose: This study analysed the reasons for changes in CEOs and evaluated the CEO selection process adopted by MLCs. Furthermore, the study assessed the impact of CEO turnovers on selected corporate governance aspects in those MLCs that experienced a change in CEO between 2012 and 2016. Design: A mixed methodology approach was applied in order to achieve the objectives of this study. Semi-structured interviews, consisting of both qualitative and quantitative questions, were conducted with eight MLCs, three Big Four Audit Firms and four stockbrokers. Findings: Initially, this study showed that CEOs are normally dismissed on the basis of performance. Subsequently, it was revealed that experience was the main criteria considered by MLCs in the CEO selection process. This study also indicated that since CEOs have leading positions within MLCs, a CEO turnover have implications on corporate governance. Conversely, Boards are composed of individuals with strong personalities and the ability to scrutinise the new CEOs. Another interesting result is that the CEOs’ influence on corporate governance aspects increased over time after taking position. Finally, the organisational culture was the most affected CG aspect. Conclusions: Firstly, this study concluded that performance is a mechanism for change. Boards are enhancing control mechanisms in order to decrease the extent of influence exerted by new CEOs. However, there is still room for improvement as new CEOs still influenced certain CG aspects such as the Boards’ structure and the Boards’ monitoring on the CEO. Given the opportunity, new CEOs will strive for a Board that supports their proposals in order to have more influence on corporate governance aspects. In fact, as the progression of the CEOs term of office increases, CEOs tend to build a relationship with directors resulting in a greater influence on the selected CG aspects. Furthermore, it was concluded that new CEOs find it much more difficult to influence the activities at Board level rather than at management level. This is due to the fact that the Boards trust CEOs with the management of the organisation. Value: This study would raise awareness on the implications that a CEO turnover would have on the corporate governance of a listed company. It is expected that it helps those MLCs that are going to experience a CEO turnover and sheds light on what the companies’ expectations should be after the change in CEO. Therefore, companies can refer to this study and implement control mechanisms before the CEO turnover occurs. Description: M.ACCTY. 2017-01-01T00:00:00Z https://www.um.edu.mt/library/oar/handle/123456789/30965 Title: Emphasis of matter paragraph in Maltese statutory audit reports : an analysis Abstract: PURPOSE: This study explores the use of the EOM paragraph by local auditors between 2010 and 2014. The main objectives are to ascertain the regulatory framework relating to the EOM paragraph, assess the nature and frequency of use of this paragraph, and determine whether it is in consonance with the applicable auditing standards. DESIGN: A sequential mixed methods design was adopted for this research project. The first part involved an analysis of 1,885 audit reports of a random sample of 377 companies. Those which had an EOM paragraph were taken up for further research and the main quantitative findings were used to develop the interview schedule for the second part of the study. Twelve semi-structured interviews were conducted with auditors from Big Four and non-Big Four audit firms, as well as sole practitioners. FINDINGS: Local auditors thought that the auditing standards pertaining to the EOM section of the audit report were adequate. An increase in the use of this section was noted although the rate of usage decreased over the five-year period from 19.1% in 2010 to 15.9% in 2014. Despite the decreasing trend, the proportion of the EOM paragraphs highlighting GC issues increased when compared to previous periods. This is thought to be due to the very few GC qualifications issued locally, as auditors are more inclined to use an EOM paragraph instead of qualifying the audit opinion. A notable difference in the use of the EOM paragraph was also observed between the different types of auditors. In addition, various elements of departure from the applicable auditing standards were identified, ranging from incorrect headings and incomplete wording, to the wrong positioning of the paragraph in the audit report. CONCLUSION: Notwithstanding the decrease in the use of the EOM section from 2010 to 2014, it is still being overused by local auditors. Auditors should assess the circumstances of each case individually to determine whether the inclusion of an EOM paragraph is necessary or sufficient, as required by the standards. This applies particularly to the smaller audit firms and sole practitioners which have less strict methodologies and controls than Big Four audit firms. VALUE: Despite the QAU’s efforts to encourage proper use of the EOM paragraph, this study’s findings indicate that there is still the need for continuous emphasis on the importance for auditors to be ISA-knowledgeable and informed on the latest developments within the profession. Description: M.ACCTY. 2017-01-01T00:00:00Z