Volume 14 (2018): Edizione 1 (March 2018)

The article’s objective is to apply probabilistic inference in determination of the impact of the size of the general government sector on the economy and the impact of the economy on the size of the sector in EU Member States. The research indicated that 4 of 13 variables describing the size of the general government sector have a significant impact on the economic parameters and determined their value and that impact of the economy on the general government sector is significantly more identified than determination of the economy by the sector size.

The article presents motives and purposes of provision of loans by non-financial enterprises. Moreover, it describes how provision of loans influences both the internal and market situation of lenders who are not listed on the stock exchange. We point out effects of provision of loans by non-financial enterprises, while, based on literature review, we signal the market reaction (positive and negative) to information about lending activities of non-financial enterprises. On the one hand, the phenomenon of providing loans by non-financial enterprises may be considered positive, as it provides financing for entities with limited access to bank loans or provides liquidity management in a business group. On the other hand, it may lower the viability and amount of investment of companies providing loans. Loans obtained from outside the business group enable borrowers and the business group to use a tax shield, yet they increase the bankruptcy costs and limit the investment of lenders. An empirical study was carried out with the use of a panel approach (generalized method of moments GMM). The research sample includes 31 075 observations from the financial statements of limited liability companies and unlisted joint-stock companies for the years 2003-2014.

The paper presents an empirical verification of the main assumptions underlying the calculation of terminal value in DCF valuation models. The test results suggest that the volatility of free cash flows and the dynamism of the operating environment do not allow us to make a reliable long-term forecast of value creation potential of the public companies in Poland. Regardless of their organic growth phase, the overwhelming majority of the sampled firms are evidenced to exhibit extreme year-on-year fluctuations of sales, investments and cash flows over the short- and medium-term observation windows. The variability of operating results and the probabilistic nature of company-level fundamentals may preclude the possibility of constructing a reliable cash flow forecast for the purposes of a DCF valuation. This methodological issue appears to pose a particular challenge during the calculation of terminal value, which is heavily dependent on highly subjective and uncertain steady-state fundamentals. Therefore, the predictive power of the deterministic DCF models may be reduced to a snapshot of the current market sentiment regarding a particular stock. The paper postulates that a further discussion on the tenets of terminal value calculation may be necessary in order to overcome the existing flaws and increase the accuracy of valuation models. We contribute to this discussion by outlining the principal methodological and theoretical issues which challenge the practicing valuators at the stage of terminal value calculation. Our conclusions may help to shed light on the problems of market short-termism, and high inconstancy of investment recommendations.

The concept of Corporate Social Responsibility (CSR) has become popular among organizations, the public, and external stakeholders. Recently, it has been appreciated by capital markets the indexes of which are constructed in such a way as to account for companies’ CSR. One of these indexes is the Respect Index of the Warsaw Stock Exchange. This paper analyses the financial condition of Respect Index companies in Poland using the desk research method. The analysis utilizes indicators of the so-called Du Pont’s pyramid (for all companies under consideration) and stock market indices such as a book value per share (BVPS) and a price-to-earnings ratio (P/E) (for the banking and insurance sectors and all other sectors, respectively). The analysis shows that the financial condition of the studied Respect Index companies in the years 2013 – 2015 was stable in the period of analysis, despite the not-so-optimistic financial situation of their industries. Socially responsible management can often result in good financial position and increase in the company’s rate, which may be indicated by the fact that the Respect Index increased by 40% in 2009-2015 compared to a lower increase WIG (18%) or WIG20 (-20%) decline. To find out more about the relationship between the stability of companies’ financial results and their CSR, more investigations and analyses of companies included in the Respect Index as well as other companies dedicated to CSR issues need to be conducted.

The purpose of the article is to analyze the relevance of the audit in minimizing the risk of fraud. The methodology of the research: literature analysis, internal audit research and questionnaires for the selected group of companies were carried out for the purpose of the article. The result: internal audit of micro-enterprises is implemented sporadically, so it is difficult to talk about its effectiveness, while in other entities it fulfills its role, provided it is properly carried out, which means while maintaining its independence and impartiality.

The Health sector, as a part of the national economy, is extremely important for economic development. A well organized and operating healthcare system constitutes an important notion for both patients and national policy. That is why the organisation of healthcare systems is the subject of reform in many countries. The aim of this study is to identify homogeneous groups of countries from the OECD in terms of the level of delivery of medical services. Countries considered in the study will be analysed through the prism of selected characteristics. The results of the study will form the basis for international comparisons and application of solutions used by countries with better healthcare systems. The study will be backed up by a chosen multivariate statistical analysis — cluster analysis.