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Articles 1 - 10 of 10
Full-Text Articles in Business
Relationship Between The Audit Function And Effective Governance, Keith Duncan
Relationship Between The Audit Function And Effective Governance, Keith Duncan
Keith Duncan
Extract: As early as 1200 A.D. incorporated guilds in the United Kingdom (UK) required annual audits by a committee of members (Watts et al. 1983). The historical evidence suggests that the audit function evolved as an effective monitoring and bonding technology (Watts et al. 1983) that today consists of an international profession fulfilling regulatory requirements for assurance services. Despite auditing’s long history we might well ask, in the light of financial frauds such as Enron and the demise of their auditor Arthur Anderson, and the recent global financial crisis, does the modern audit function enhance effective governance? Is the audit …
Valuation Of Family Firms: The Limitations Of Accounting Information, Tim Hasso, Keith Duncan
Valuation Of Family Firms: The Limitations Of Accounting Information, Tim Hasso, Keith Duncan
Keith Duncan
This conceptual paper explores the extent to which reported accounting information captures unique family firm decision-making and intangible asset factors that impact financial value. We review the family firm valuation-relevant literature and identify that this body of research is predicated on the assumption that accounting information reflects the underlying reality of family firms. This research, however, fails to recognise that current accounting technology does not fully recognise the family firm factors in the book value of the firm or the implications for long-run persistence of earnings. Thus, valuation models underpinning the extant empirical research, which are predicated on reported accounting …
Corporate Governance, Risk Assessment And Cost Of Debt, Husam Aldamen, Keith Duncan, Ray Mcnamara
Corporate Governance, Risk Assessment And Cost Of Debt, Husam Aldamen, Keith Duncan, Ray Mcnamara
Keith Duncan
This paper examines the impact of corporate governance practices on the reported cost of contracted debt for Australian listed companies. Good governance decreases the variability in cash flows, reduces the probability of default (reduces default risk), increases the quality of value-relevant information disclosed (reduces the information risk) and thereby lowers the cost of debt (Ashbaugh-Skaife, Collins, and LaFond 2006; Sengupta 1998; Bhojraj and Sengupta 2003; Beekes and Brown 2006; Klein 2002; Easley and O'Hara 2004). Similarly our Australian data confirms that cost of debt is positively related to default and information risks. We show that increased corporate governance reduces default …
Pricing Of Innate And Discretionary Accruals In Australian Debt, Husam Aldamen, Keith Duncan
Pricing Of Innate And Discretionary Accruals In Australian Debt, Husam Aldamen, Keith Duncan
Keith Duncan
This paper addresses the conflicting evidence on the role of accruals in debt pricing. We show that the two subcomponents of accruals quality, innate and discretionary accruals, both impact the debt pricing. Higher innate accruals increases cost of debt, consistent with the prior evidence (Francis et al., 2005; Gray et al., 2009). However, we also find that higher discretionary accruals reduce the cost of debt. This contrasts with the prior evidence of a positive association between discretionary accruals and cost and debt (Francis et al., 2005), and no association (Gray et al., 2009). We show that noisy measurement of cost …
Audit Committee Characteristics And Firm Performance During The Global Financial Crisis, Husam Aldamen, Keith Duncan, Simone Kelly, Ray Mcnamara, Stephan Nagel
Audit Committee Characteristics And Firm Performance During The Global Financial Crisis, Husam Aldamen, Keith Duncan, Simone Kelly, Ray Mcnamara, Stephan Nagel
Keith Duncan
We address the question ‘do governance enhancing audit committee (AC) characteristics mitigate the firm performance impact of significant-adverse-economic events such as the Global Financial Crisis (GFC)?’ Our analysis reveals that smaller audit committees with more experience and financial expertise are more likely to be associated with positive firm performance in the market. We also find that longer serving chairs of audit committees negatively impacts accounting performance. However, accounting performance is positively impacted where ACs include blockholder representation, the chair of the board, whose members have more external directorships and whose chair has more years of managerial experience. We contribute to …
Empires Of The Mind: Cross Cultural Cooperative Business Education, Keith Duncan, Simone Kelly, Raymond Mcnamara
Empires Of The Mind: Cross Cultural Cooperative Business Education, Keith Duncan, Simone Kelly, Raymond Mcnamara
Keith Duncan
This paper explores current trends in knowledge growth and decay, globalization, technology and education. Business education in the new millennium is shaped by these trends. This contextual backdrop raises both educational and business issues which are explored with exemplars from a successful cross-cultural blended MBA program. The educational issues considered include educational relevance, lifelong learning objectives, education vs. training, needs of the target audience, what is the language of instruction, as well as issues of assessment and outcome measurement. The business issues include a fair return to all parties, responsibilities, management and communication systems and dispute resolution. In a globalized, …
Micro And Macro Determinants Of Financial Distress, Ray Mcnamara, Keith Duncan, Simone Kelly
Micro And Macro Determinants Of Financial Distress, Ray Mcnamara, Keith Duncan, Simone Kelly
Keith Duncan
One criticism of failure prediction models is the bias resulting from pooling failure data over years when economic conditions might influence the failure of a firm. This research incorporates both macroeconomic variables and firm specific variables in explaining corporate failure. The results suggest that including economic variables improve the explanation of failure by ten percent. The economic variables included in the analysis were one-year lag in change in GDP, a two-year lag in interest rates, a one-year lag in the share price index, and a one-year lag in corporate profits. Economic variables were identified using a principal component analysis of …
Family Ownership And The Value-Relevance Of Earnings And Book Value, Tim Hasso, Keith Duncan
Family Ownership And The Value-Relevance Of Earnings And Book Value, Tim Hasso, Keith Duncan
Keith Duncan
This study investigates the relation between family ownership and the value-relevance of two primary accounting measures, earnings and book value. We provide theories of the effect of family ownership on the value-relevance of earnings and book value. We contend that current accounting technology does not fully recognise the family firm factors in the earnings or book value of the firm. We find that the value-relevance of earnings and is higher for family firms. We attribute this to the long-term orientation and the higher quality earnings of these firms. In contrast, the value-relevance of book value is lower. We believe this …
Income Strategies Of Listed And Unlisted Companies: An Empirical Study Of Accounting Method Choices, Keith Duncan
Income Strategies Of Listed And Unlisted Companies: An Empirical Study Of Accounting Method Choices, Keith Duncan
Keith Duncan
This paper explores whether the political and contracting environments for listed and unlisted companies gives rise to different wealth incentives for management to judiciously select a portfolio of accounting procedures for the firm. The analysis indicates significant differences in the method choices made by the managers of listed and unlisted firms. For the listed firms, size as a proxy for political costs is negatively related to portfolio choice, supporting the political cost hypothesis. In addition, leverage and directors' percentage ownership are positively related to portfolio choice and thus support the debt contracting cost hypothesis. In contrast, none of the contracting …
Gas Reserves And Equity Valuation: Implications For Accounting Standards, Keith Duncan, Simone Kelly, Ray Mcnamara
Gas Reserves And Equity Valuation: Implications For Accounting Standards, Keith Duncan, Simone Kelly, Ray Mcnamara
Keith Duncan
The coal seam gas industry is an important and rapidly developing sector of the Australian mining industry. This sector provides an excellent site to test the relevance of the Hotelling Valuation Principle (HVP) in explaining the market capitalisation of this industry sector. Currently, the majority of listed firms in this sector do not have positive cash flows from the sale of gas. The HVP posits that market values are a function of company reserves. We test five measures of firm reserves as explanations of market capitalisation. After controlling for scale differences, we find that 2P Reserves have the highest explanatory …