Digital Commons Network^™

Family Wealth Advisory Services In China – What Kind Of Advisors Can Be More Competent And Successful?, Yang Shen

Dissertations and Theses Collection (Open Access)

High net worth wealth owners generally need various advisory services to meet their wealth management needs, such as investment / global asset allocation, intergenerational succession planning, personal and family tax planning, next-generation education, health management, immigration arrangement for family members, etc.

At the current stage, this paper tries to answer below central research questions for Chinese wealth advisors:

1. From the Perspective of high-net-worth individuals (HNWI) in China, what characteristics should their wealth advisors bear to be considered competent?
2. Which key competency factors are mostly important in making the wealth advisor successful (reflected through performance rating of wealth advisors)?

The research …

Peer Effects In Equity Research, Kenny Phua, Mandy Tham, Chi Shen Wei

Research Collection Lee Kong Chian School Of Business

We study the importance of peer effects among sell-side analysts who work at the same brokerage house, but cover different firms. By mapping the information network within each brokerage, we identify analysts who occupy central positions in their network. Central analysts incorporate more information from their coworkers and produce better research. Using shocks to network structures around brokerage mergers, we identify the influence of peer effects and the importance of industry expertise on analysts’ performance. A portfolio strategy that exploits the forecast revisions of central analysts earns up to 24% per annum.

Scalable And Globally Optimal Generalized L1 K-Center Clustering Via Constraint Generation In Mixed Integer Linear Programming, Aravinth Chembu, Scott Sanner, Hassan Khurram, Akshat Kumar

Research Collection School Of Computing and Information Systems

The k-center clustering algorithm, introduced over 35 years ago, is known to be robust to class imbalance prevalent in many clustering problems and has various applications such as data summarization, document clustering, and facility location determination. Unfortunately, existing k-center algorithms provide highly suboptimal solutions that can limit their practical application, reproducibility, and clustering quality. In this paper, we provide a novel scalable and globally optimal solution to a popular variant of the k-center problem known as generalized L1 k-center clustering that uses L1 distance and allows the selection of arbitrary vectors as cluster centers. We show that this clustering objective …

Following Their Predecessors' Journey? A Review Of Emne Studies And Avenues For Interdisciplinary Inquiry, Peter J. Buckley, Lin Cui, Liang Chen, Yi Li, Yoona Choi

Research Collection Lee Kong Chian School Of Business

In this review article we take stock of international business (IB) research on emerging economy multinational enterprises (EMNEs) over the past three decades. Our review covers 690 articles published in 64 high-impact peer-reviewed journals between 1990 and 2021 (inclusive). We first present bibliometric findings on some key patterns of this vast body of scholarly work. We then conduct content analysis to critically assess this literature and provide a multilevel synthesis of the existing knowledge base. To do so we propose a theoretical framework that highlights three dimensions - micro-foundations, organizational characteristics, and institutional environment - by which the distinction between …

Scalable And Globally Optimal Generalized L1 K-Center Clustering Via Constraint Generation In Mixed Integer Linear Programming, Aravinth Chembu, Scott Sanner, Hassan Khurran, Akshat Kumar

Research Collection School Of Computing and Information Systems

The k-center clustering algorithm, introduced over 35 years ago, is known to be robust to class imbalance prevalent in many clustering problems and has various applications such as data summarization, document clustering, and facility location determination. Unfortunately, existing k-center algorithms provide highly suboptimal solutions that can limit their practical application, reproducibility, and clustering quality. In this paper, we provide a novel scalable and globally optimal solution to a popular variant of the k-center problem known as generalized L_1 k-center clustering that uses L_1 distance and allows the selection of arbitrary vectors as cluster centers. We show that this clustering objective …

The Impact Of Board Heterogeneity On Corporate Internationalization Strategy, Yi Qiang

Dissertations and Theses Collection (Open Access)

This study analyzes the relationship between board heterogeneity and the company’s internationalization strategy to determine the internal mechanism through which board heterogeneity affects the company’s internationalization strategy. Based on the analysis of the primary effect, the moderating effects of contextual factors at various levels, such as individual, organization, and environment, are introduced. Subsequently, this study empirically tests the proposed research hypothesis using the data of Chinese listed companies from 2011 to 2020.

The empirical results indicate that board heterogeneity has a positive impact on the company’s internationalization strategy. When the board chairman is female or has a longer tenure, board …

Social New Retailing Business Model And Its Applicable Regulatory Pattern, Rui Wang

Dissertations and Theses Collection (Open Access)

With the booming development of mobile Internet in China, social platforms have unlocked new channels for commodity supply chain and retailing and promoted business model innovation. Online social networking has fundamentally changed the way the entire society communicates. Social networking is no longer constrained by space, social platforms have become a stage for many ordinary people to showcase themselves, and the popularity of mobile payment has made mobile phones the wallets of Chinese residents as well. The innovative contents and interaction styles delivered by social software have triggered a qualitative change in the efficiency of everyone's communication and interaction, making …

Taxthemis: Interactive Mining And Exploration Of Suspicious Tax Evasion Group, Yating Lin, Kamkwai Wong, Yong Wang, Rong Zhang, Bo Dong, Huamin Qu, Qinghua Zheng

Research Collection School Of Computing and Information Systems

Tax evasion is a serious economic problem for many countries, as it can undermine the government’s tax system and lead to an unfair business competition environment. Recent research has applied data analytics techniques to analyze and detect tax evasion behaviors of individual taxpayers. However, they have failed to support the analysis and exploration of the related party transaction tax evasion (RPTTE) behaviors (e.g., transfer pricing), where a group of taxpayers is involved. In this paper, we present TaxThemis, an interactive visual analytics system to help tax officers mine and explore suspicious tax evasion groups through analyzing heterogeneous tax-related data. A …

The Role Of Trust In Advice Acceptance From Non-Human Actors, Rahul Banerjee

Dissertations and Theses Collection (Open Access)

Advancements in technology are now allowing non-human actors in the form of robot-advisors, driverless cars, medical assistants to perform increasingly complex tasks. While technological change is as old as civilization, these non-human actors can do novel tasks. One such task is that they provide advice which is a credence service (Dulleck, & Kerschbamer, 2006). Using a financial services context this thesis studies the role trust plays in advice acceptance.

Robo-advisors are rapidly replacing human financial advisors as the agent-provider for portfolio investment services. For centuries, it was the banker (human financial advisor) who was responsible for providing his investors with …

Analysis Of Chinese Real Estate Follow-Up Investment Operation Effect And Mechanism, Yinyu He

Dissertations and Theses Collection (Open Access)

Follow-up investment system has become a fundamental system for the development of most real estate development enterprises. In the upward cycle of real estate, follow-up investment based incentive mechanism is of great importance for performance growth of real estate development enterprise. However, real estate development enterprises lack a relatively mature model to effectively build a follow-up investment system. While building a follow-up investment system, most real estate development enterprises find a benchmark object and copy it mechanically.

The author explored the basic implementation status of follow-up investment system of Chinese real estate enterprises through 310 questionnaires survey, interview and literature …

Mitigating Financial Fraud Risk With Data Analytics, Clarence Goh, Gary Pan

Research Collection School Of Accountancy

The risks associated with financial fraud that modern CFOs face today is particularly high. The same report examined Accounting and Auditing Enforcement Releases (AAERs) issued by the Securities and Exchange Commission (SEC) in the US from 2014 to 2019 and found that while the SEC frequently charged the person directly responsible for perpetuating the financial fraud, the CFO was among the most commonly charged employees. Data analytics techniques can play an important role in mitigating the risk of financial fraud for CFOs.

The Future Of Work Now: Ai-Driven Transaction Surveillance At Dbs Bank, Thomas H. Davenport, Steven M. Miller

Research Collection School Of Computing and Information Systems

One of the most frequently-used phrases at business events these days is “the future of work.” It’s increasingly clear that artificial intelligence and other new technologies will bring substantial changes in work tasks and business processes. But while these changes are predicted for the future, they’re already present in many organizations for many different jobs. The job and incumbents described below are an example of this phenomenon. Steve Miller of Singapore Management University and I co-authored the story.

Discretionary Dissemination On Twitter, Richard M. Crowley, Wenli Huang, Hai Lu

Research Collection School Of Accountancy

Using an unsupervised machine learning approach to analyze 12.8 million tweets posted by S&P 1500 firms from 2012 to 2016, we find that firms tweet more financial information around significantly negative or positive earnings announcements or accounting filings. Specifically, we observe a symmetric U-shaped relation between the number of financial tweets and the materiality of accounting information events. This relation is consistent with the theoretical prediction in Hummel et al. (2018) which assumes that managers are sensitive to their firm’s fundamental value. We document that this relation also holds for hyperlink usage in tweets about financial information around important events, …

Addressing The Auditor Independence Puzzle: Regulatory Models And Proposal For Reform, Martin Gelter, Aurelio Gurrea-Martinez

Research Collection Yong Pung How School Of Law

Auditors play a major role in corporate governance and capital markets. Ex ante, auditors facilitate firms’ access to finance by fostering trust among public investors. Ex post, auditors can prevent misbehavior and financial fraud by corporate insiders. In order to fulfill these goals, however, in addition to having the adequate knowledge and expertise, auditors must perform their functions in an independent manner. Unfortunately, auditors are subject to conflicts of interest by, for example, providing non-audit services or the mere fact of being hired and paid by the audited company. Therefore, even if auditors act independently, investors have reason to think …

A Data-Analytics Approach For Risk Evaluation In Peer-To-Peer Lending Platforms, Feng He, Yuelei Li, Tiecheng Xu, Libo Yin, Wei Zhang, Xiaotao Zhang

Research Collection School Of Accountancy

The goal of this article is to investigate the roles of individual behavior characteristics and Internet finance industry risk in the light of bank run theory for P2P. We know that risk evaluation is clearly important for peer-to-peer (P2P) lending platforms in China, as during the last two years, the industry has experienced thousands of platform crashes. Traditional approaches to evaluate enterprise risk are increasingly ineffective in this industry, due to the difficulty of assessing the real information. In addition, the Internet business model makes it possible to record new kinds of information. By applying a data-driven analytics method, we …

What Are You Saying? Using Topic To Detect Financial Misreporting, Nerissa C. Brown, Richard M. Crowley, W. Brooke Elliott

Research Collection School Of Accountancy

We use a machine learning technique to assess whether the thematic content of financial statement disclosures (labeled topic) is incrementally informative in predicting intentional misreporting. Using a Bayesian topic modeling algorithm, we determine and empirically quantify the topic content of a large collection of 10‐K narratives spanning 1994 to 2012. We find that the algorithm produces a valid set of semantically meaningful topics that predict financial misreporting, based on samples of Securities and Exchange Commission (SEC) enforcement actions (Accounting and Auditing Enforcement Releases [AAERs]) and irregularities identified from financial restatements and 10‐K filing amendments. Our out‐of‐sample tests indicate that topic …

Chief Financial Officer Demographic Characteristics And Fraudulent Financial Reporting In China, Jinghui Sun, Pamela Kent, Baolei Qi, Jiwei Wang

Research Collection School Of Accountancy

We investigate whether management's cognitions, values and perceptions are associated with fraud for 18 863 firm-years for Chinese listed firms from 2000 to 2014. Demographic characteristics of the chief financial officer (CFO) are used as proxies for management's cognitions, values and perceptions. We find that fraudulent financial reporting is higher when CFOs are younger, male, and have lower education backgrounds. An analysis of inflated earnings, fictitious assets, material omissions and other material misstatements provide similar results, with the exception that CFOs with higher education levels are associated with more inflated earnings. Accounting and Finance

Addressing The Auditor Independence Puzzle: Regulatory Models And Proposal For Reform, Aurelio Gurrea-Martinez, Martin Gelter

Research Collection Yong Pung How School Of Law

Auditors play a major role in corporate governance and capital markets. They facilitate firms’ access to financing by creating trust among public investors with efforts to prevent misbehavior and financial fraud by corporate insiders. In order to fulfill these goals, however, in addition to having the adequate knowledge and expertise, auditors should perform their functions in an independent manner. Unfortunately, auditors are subject to conflicts of interest by, for example, providing non-audit services or the mere fact of being hired and paid by the audited company. Therefore, even if auditors act independently, investors have reason to think otherwise. This lack …

Stock Price Contagion Effects Of Low-Quality Audits At The Individual Audit Partner Level, Ferdinand A. Gul, Chee Yeow Lim, Kun Wang, Yanping Xu

Research Collection School Of Accountancy

We use Chinese audit partner data to show that partners associated with financial reporting fraudinduce share price declines among non-fraudulent firms audited by the same audit partners. In cross-sectionalanalyses, we find that share price declines are more pronounced when low-quality partners (LQPs) failed to issuemodified audit opinions during the period in question and when the LQPs were from one of the Top 10 audit firms.Additional analyses show that investors impose larger penalties on contagion firms when fraudulent firms are largerand the time lapse between sanction and fraud commitment is shorter. The personal characteristics of LQPs (exceptgender) do not cause a …

Not Clawing The Hand That Feeds You: The Case Of Co-Opted Boards And Clawbacks, Sterling Huang, Chee Yeow Lim, Jeffrey Ng

Research Collection School Of Accountancy

We examine how board co-option, defined as the fraction of the board comprising directors appointed after the CEO assumed office, is related to clawback adoption. We find that co-opted boards have a lower probability of adopting clawback provisions. Further, the negative association between board co-option and clawback adoption is more pronounced when at least one co-opted member is on the compensation committee and when there is a higher likelihood that a clawback provision will be triggered. Finally, we find that board co-option is an important mechanism through which longer-tenured CEOs reduce the likelihood of clawback adoption.

Do Independent Directors Tell The Truth, The Whole Truth, And Nothing But The Truth When They Resign?, Keren Bar-Hava, Sterling Huang, Benjamin Segal, Dan Segal

Research Collection School Of Accountancy

We examine the informativeness and credibility of independent directors’ stated resignation reasons. We posit that having access to private information, directors may resign in anticipation of weak future underperformance to limit damage to their reputation and further have an incentive to mask the reason for the resignation. Results show likelihood of resignation increases with director’s reputation and weak future firm performance. In addition, the evidence is consistent with directors obfuscating the reason for departure by providing benign and unverifiable resignation reasons. Investors seem aware of the disclosure incentives of departing directors and react negatively to such resignations. However, investors, by …

Managing The Risks Of Corporate Fraud: The Evidence From Hong Kong And Singapore, Wai Yee Wan, Christopher C. H. Chen, Chongwu Xia, Say Goo

Research Collection Yong Pung How School Of Law

Since the Asian financialcrisis of 1997, Hong Kong and Singapore have implemented reforms that promote independenceand monitoring competency of the boards of directors of their listed companies.However, with the advent of the financial crisis of 2007/2008, a wave of fraudcases prompts the question as to the effectiveness of these reforms. Analysing asample of 62 listed companies which are found to have committed fraud between2007 and 2014, and comparing against a matched sample of no-fraud companies, wefind that the fraud companies tend to either combine the roles of chairman andchief executive officer (or they are close family members) and have fewer …

Financial Reporting Changes And Internal Information Environment: Evidence From Sfas 142, Qiang Cheng, Young Jun Cho, Holly I. Yang

Research Collection School Of Accountancy

Using the adoption of SFAS 142 as an exogenous shock, we examine the effect of changes in financial reporting on firms’ internal information environment. SFAS 142 removed goodwill amortization and required firms to perform a two-step impairment test. We argue that complying with SFAS 142 induces managers to acquire new information and, therefore, improves managers’ information sets. Interviews with executives and auditors confirm this argument. Using a difference-in-differences design, we find that firms affected by SFAS 142 (i.e., treatment firms) experience an improvement in management forecast accuracy in the post-SFAS 142 period compared with those not affected. The increase is …

Audit Committees And Financial Reporting Quality In Singapore, Yuanto Kusnadi, Kwong Sin Leong, Themin Suwardy, Jiwei Wang

Research Collection School Of Accountancy

We examine three characteristics (independence, expertise, and overlapping membership) of audit committees and their impact on the financial reporting quality for Singapore-listed companies. The main finding is that financial reporting quality will be higher if audit committees have mixed expertise in accounting, finance, and/or supervisory. In addition, we do not find evidence that incremental independence of audit committees enhances financial reporting quality because audit committees already consist of a majority of independent directors. Finally, we fail to find any impact of overlapping membership on audit and remuneration committees on financial reporting quality. Overall, the results have policy implications on improving …

Word Power: The Impact Of Negative Media Coverage On Disciplining Corporate Pollution, Ming Jia, Li Tong,, P. V. Viswanath, Zhe Zhang

Research Collection Lee Kong Chian School Of Business

Sequences of individual words make up media reports. And sequences of media reports constitute the power of the news media to influence corporate practices. In this paper, we focus on the micro-foundations of news reports to elaborate how an atmosphere of negative news reports following an initial exposure of corporate pollution activity can help stop such activity through their impact on corporate managers. We extend our understanding of the corporate governance effect of news media by considering two new aspects of reports—one, the proportion of words in negative reports relative to the total number of words in all reports; and …

The Price Contagion Effects Of Financial Reporting Fraud And Reputational Losses: Evidence From The Individual Audit Partner Level, Ferdinand A. Gul, Chee Yeow Lim, Kun Wang, Yanping Xu

Research Collection School Of Accountancy

This study investigates the existence of price contagion effects for the low-quality audits of individual audit partners and the associated reputational losses in China. Low-quality partners are identified as those whose clients have been sanctioned by regulators for financial reporting fraud. Our evidence shows that sanctions induce a significant stock price decline among the contagion firms that share common low-quality partners and common low-quality audit firms; however, the decline is greater for the former. We also find that the price contagion effects of low-quality partners are more pronounced for firms located in regions with weak institutional development and less pronounced …

Reassessing Board Member Allegiance: Ceo Replacement Following Financial Misconduct, David M. Gomulya, Warren Boeker

Research Collection Lee Kong Chian School Of Business

Research summary: We examine how board members' reactions following financial misconduct differ from those following other adverse organizational events, such as poor performance. We hypothesize that inside directors and directors appointed by the CEO may be particularly concerned about their reputation following deceptive financial practices. We demonstrate that directors more closely affiliated with the CEO are more likely to reduce their support for the CEO following financial misconduct, increasing the likelihood of CEO replacement. Enactment of the Sarbanes-Oxley Act similarly alters governance dynamics by creating a greater expectation for sound corporate governance. We demonstrate our findings in U.S. public firms …

Market Failure And Reemergence: A Study Of Chinese Firms Listed In The Us., Hai Lu, Hai Lu, Wei Luo

Research Collection School Of Accountancy

Our study documents a “Lemons” market failure of Chinese firms listed in the US in 2011 and a subsequent rebound by 2013. Our tests reveal that there was little difference in ex ante observable characteristics of fraudulent and non-fraudulent Chinese firms listed in the US prior to 2011 while entrepreneurs appear to have known their type. We document substantial costs of dishonesty and the failure of traditional market signaling mechanisms such as auditor or underwriter quality. We also show a return of Chinese firms after US and Chinese regulatory intervention in 2013 although this intervention was insufficient to fundamentally change …

Data Mining Journal Entries For Fraud Detection: A Replication Of Debreceny And Gray's (2010) Techniques, Poh Sun Seow, Pan, Gary, Themin Suwardy

Research Collection School Of Accountancy

The alarming frequency of fraud occurrences suggests that corporations continue to face persistent threat of fraud (Cecchini et al., 2010a; Summers and Sweeney, 1998). According to Association of Certified Fraud Examiner (ACFE)’s 2014 Report, a typical organization may lose five percent of its revenue to fraud every year. As such, the consequences of fraud may impact the shareholders, creditors, auditors and the public’s confidence in the integrity of corporations’ financial systems (Rezaee, 2005).

Audit Committees And Financial Reporting Quality In Singapore, Kwong Sin Leong, Jiwei Wang, Themin Suwardy, Yuanto Kusnadi

Research Collection School Of Accountancy

No abstract provided.