Accounting Commons^™

An Empirical Investigation Of Voluntary Non-Ifrs Earnings Reporting During The Recent Financial Crisis : Australian Evidence, Elisabeth Sinnewe

Dr Elisabeth Sinnewe

This study examines how the financial crisis affected the reporting choice of and market reaction to earnings that are different from the profit firms report on their income statement under International Financial Reporting Standards (IFRS). These non-IFRS earnings reflect management’s subjective of view of earnings. By observing management’s reporting choices and investors’ reaction in Australia prior to, during, and after the financial crisis, this study shows a distinctive effect of the economic condition on reporting non-IFRS earnings. As such, this study contributes to the limited attention hypothesis suggesting that information-equivalent disclosure is perceived as value relevant by management and investors …

Internal Audit, Sarbanes-Oxley And Athletic Departments: An Examination And Recommendations For Reform, Michael Akers, Gregory Naples

Michael D. Akers

During the past fifteen to twenty years the integrity of intercollegiate athletics has been seriously questioned as a result of an increased awareness of problems associated with institutional controls over athletic departments. Limited empirical evidence has been used in the debate regarding institutional controls pertaining to the athletic department. This paper provides empirical evidence regarding the use of the internal audit function as an institutional control. Our findings indicate that while the internal audits of athletic departments are adequate, the communication of these audit results is inadequate. We also discuss the applicability of recent legislation, Sarbanes-Oxley Act of 2002, to …

An Examination Of The Differences Between Personal Values And Value Types Of Female And Male Accounting And Nonaccounting Majors, Michael Akers, Don Giacomino

Michael D. Akers

Research has shown that a person's values affect his or her behavior. While there has been considerable research regarding the ethical perceptions and behavior of business students, there has been limited research regarding the personal values that affect such perceptions and behavior. This study was designed to determine the differences between values and value types of accounting and nonaccounting majors, as well as differences between values and value types of males and females. The values survey questionnaire developed and validated by Schwartz (1992) was used for this study. The instrument, containing 56 values, was administered to business students in three …

Personal Values Of Certified Internal Auditors, Michael Akers, Don Giacomino

Michael D. Akers

Internal auditors are being asked to assist in the development of codes of conduct and to audit ethical compliance and thus are expected to adhere to strict standards of behavior. It is, therefore, important for the Institute of Internal Auditors and other organizations to understand the personal values that underlie behavior in order to determine whether internal auditors' values are consistent with the Standards of Conduct. This article reports the results of a study, which focuses on the personal values of certified internal auditors. The study's main purpose is to determine if the personal values and value systems of CIAs …

Designing And Implementing An Accounting Assessment Program, Michael Akers, Don Giacomino, James Trebby

Michael D. Akers

The Accounting Department at Marquette University responded to the desire to improve processes and to external pressures by designing and implementing an assessment program. The selection and involvement of the assessment team, the development of the 6 intended student outcomes, the establishment of the quantifiable goals, the development of the measurement tools used to evaluate the goals, and the identification of mechanisms used to provide feedback are examined. Results of the implementation indicate that improvement is needed in the following areas: oral communication skills, business writing skills, and microcomputer skills.

Internal Audit's Role In Systems Development: The Ceo's Perspective, Meredith Maher, Michael Akers

Michael D. Akers

For the past 30 years, the development of the role and management's expectations of the internal audit function as related to information technology has been an evolutionary process. A sample of CEOs were surveyed to ascertain their opinions on internal audit's involvement in systems development, including whether internal auditors' independence is compromised by such involvement and whether auditors should act as consultants for systems development projects. The prevailing sentiment among the CEO respondents was that internal auditors should be involved primarily in testing the accuracy of the systems being developed. A comparison of CEOS' and chief audit executives' opinions shows, …

Personal Values Profiles And Value Types Of The Most Influential People In Accounting, Don Giacomino, Michael Akers

Michael D. Akers

This chapter reports on the results of a study of values of the most influential people in accounting. The study measures the personal values and value types of people included in the 100 most influential people in accounting in Accounting Today and managing partners in the largest 100 public accounting firms. We also compare the results of our study with those of a study of exemplary physicians' values. Both studies found that the influential accountants and exemplary physicians rate Power and Influence very low among their personal values. We also compared our study with other studies that we have conducted …

Information Systems Content In The Cma Examination, Michael Akers, Lloyd Doney

Michael D. Akers

This study examines 12 recent CMA exams administered from June 1987 through December 1992 to determine the extent of information systems (IS) coverage. We evaluated each exam using a definition of IS knowledge and skills from the common body of knowledge developed by the Institute of Management Accountants (IMA). The results of the study indicate that the IMA has recognized the importance of IS knowledge, as evidenced by the extent of exam coverage and the relevance of the items tested. Because information systems courses are included in a model curriculum recommended by the IMA, the results of this study may …

Corporate Governance, Risk Assessment And Cost Of Debt, Husam Aldamen, Keith Duncan, Ray Mcnamara

Ray McNamara

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 …

Multi-Perspective Performance Reporting And Organisational Performance: The Impact Of Information, Data And Redundant Cue Load, Errol Iselin, Lokman Mia, John Sands

Errol Iselin

Multi-perspective performance reporting systems (MPRS), such as the balanced scorecard (BSC), have become popular. The BSC reports performance about four perspectives (learning and growth, internal business processes, customer and financials). Although these systems are important, research in these areas has only just scratched the surface, hence the motivation for this study. A possible problem with multi-perspective systems is that they may cause information/data/redundant cue (I/D/C) overload and thus detrimentally affect the performance. The objectives of this research are to: (1) explore the relationship between MPRS and organisational performance and (2) study the relationship between I/D/C load and organisational performance in …

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 …

The Effect Of Regulation On Statement Disclosures In The 1915 Moody's Manuals, Jeffrey Archambault, Marie Archambault

Jeffrey Archambault

United States firms in the early 20th century were subject to public and private regulation. Forms of regulation included rate regulation and stock exchange listing requirements. These regulations created incentives to report income statement information. This study utilizes the 1915 Moody’s Analyses of Investments to test whether regulated firms in the United States reported more income statement information than unregulated firms. Rate regulation influenced utilities to report income statements more frequently than industrial companies.

Stock market listing requirements also influenced the reporting of income statements. Therefore, the results indicate that both public and private regulations influenced financial reporting in the …

Financial Reporting In 1920: The Case Of Industrial Companies, Jeffrey Archambault, Marie Archambault

Jeffrey Archambault

This study uses the 1920 Moody’s Analysis of Industrial Investments to assess the extent of financial reporting by U.S. indus­trial companies. The reporting of an income statement and a balance sheet, as well as the amount of disclosure in both of these statements, is examined empirically to determine which economic factors influ­ence this reporting. The results show that corporate-governance, op­erating, and financing factors all significantly influence the reporting of financial statements and the extent of disclosure within those state­ments. However, the significant factors vary across the two financial statements and the two decisions considered (reporting a particular statement and the …

Social Networking Information Disclosure And Continuance Intention: A Disconnect, D. Mcknight, Nancy Lankton, John Tripp

Nancy K. Lankton

This paper tests a privacy calculus model for Facebook users. Privacy calculus means that individuals weigh a complex set of factors—including both costs and benefits—to decide whether to disclose personal information. Because information disclosure is closely related to use for many information technologies (IT), our privacy calculus model proposes that costs and benefits of user privacy will simultaneously influence users’ information disclosure and usage continuance intention. Based on past research, our model includes as ‘costs’ privacy concern and information sensitivity, while it includes as ‘benefits’ perceived usefulness, enjoyment, and trust. In a sample of business college students’ use of a …

Revenue Management With Dynamic Pricing And Advertising, Leo Macdonald, Henning Rasmussen

Leo MacDonald

In this article, we analyze the temporal pricing and advertising strategy of a monopolist with a fixed inventory to sell over a finite horizon. The arrival of the customers is modeled by a Poisson process where the arrival rate is given by an increasing convex function of the advertising expenditure, and the willingness of a customer to pay is modeled by a decreasing function of the price. For specific functions for the arrival rate and willingness-to-pay, we derive and solve a system of ordinary differential equations for the optimal pricing and advertising strategy. We show that this optimal strategy is …

A Comparison Of Different Demand Models For Joint Inventory-Pricing Decisions, John Wilson, Leo Macdonald, Chris Anderson

Leo MacDonald

Pricing and inventory research often focuses on stylized models to illustrate pricing and ordering decision dynamics. Although decision insight is useful, the individual retailer faces tougher decisions on actually modeling demand. In an effort to understand the impact of demand modeling choices on inventory and pricing decisions, we evaluated different price-dependent demand models and the resulting profit produced through their implementation. To avoid complications created by other demand drivers, for example promotional and advertising activities, we illustrate the impacts with data from a name-your-price retailer selling a commoditized product where price is the key driver. As our data are provided …

Dynamic Linkages Among Financial Markets In The Greater China Region: A Multivariate Asymmetric Approach, Kin-Yip Ho, Zhaoyong Zhang

Zhaoyong Zhang

This study examines the volatility dynamics of the Greater China stock markets by employing a multivariate framework that incorporates the features of asymmetries, persistence and time-varying correlations. The multivariate framework with these features will contribute to a better understanding of the interdependence and integration among the stock markets in the Greater China region. Our results confirm the existence of volatility persistence and asymmetries, and there is some evidence of a common degree of persistence ('co-persistence') among the markets. It is also found that the Mainland Chinese markets are actually less volatile than the Taiwan and Hong Kong stock exchanges in …

Volume, Volatility And Information Linkages In The Stock And Option Markets, Kin-Yip Ho, Lin Zheng, Zhaoyong Zhang

Zhaoyong Zhang

This paper examines the relationship between option trading activity and stock market volatility. Although the option market is uniquely suited for trading on volatility information, there is little analysis on how trading activity in this market is linked to stock price volatility. The bulk of the discussion tends to focus on whether trading activity in the stock market is informative about stock volatility. To analyze the information in option trading activity for stock market volatility, a sample of 15 stocks with the highest option trading volume is selected. For each stock, it is noted that the trading activities in the …

Monetary Integration And Exchange Rate Issues In East Asia, Paul De Grauwe, Zhaoyong Zhang

Zhaoyong Zhang

Not available

Should Chinese Renminbi Be Blamed For Its Trade Surplus: A Structural Var Approach, Zhaoyong Zhang, Kiyotaka Sato

Zhaoyong Zhang

During the recent years, the Renminbi (RMB) exchange rate issue has been at the centre of ongoing debate over the source of global current account imbalance, especially with the United States. The objective of this study is to contribute to the current discussion by providing some new evidence on China’s exchange rate policy and the impacts of RMB devaluation/revaluation on China’s trade balance using a structural vector autoregression (VAR) approach. The results indicate that the dynamic effect of exchange rate on China’s trade balance is still very limited and China’s balance of trade is mainly determined by the world demand …

An Empirical Assessment Of A-Share Ipo Under-Pricing In China, Chan-Hyun Sohn, Albert Tsui, Feng Zhang, Zhaoyong Zhang

Zhaoyong Zhang

This paper investigates the under-pricing and long-run performance of 230 A-share IPOs issued in the Chinese markets using comparable firm multiples. We find that A-share IPOs are severely under-valued by issuers and underwriters at the offer, but over-valued by investors on the listing day. Both contribute to the severe under-pricing of IPOs in China. Our findings are robust across stock exchanges, classification of firms, criteria for choosing matching firms; absence of CSRC regulation and B-share market prices, respectively. The results also show that those over-valued IPOs by investors on the listing day under-perform those under-valued IPOs in the long-run.

New Estimates Of The Equilibrium Exchange Rate: The Case For The Chinese Renminbi, Kiyotaka Sato, Junko Shimizu, Nagendra Shrestha, Zhaoyong Zhang

Zhaoyong Zhang

We estimate the nominal equilibrium exchange rate (EER) of the Chinese renminbi (RMB) vis-à-vis the US dollar from 1995 to 2009. While most of the recent empirical studies on the EER employ a cross-country analysis, country-specific factors, especially supply-side real factors, are not fully taken into consideration in estimating the EER. To better reflect China's processing exports in the context of growing intra-regional trade in Asia, we incorporate in the empirical analysis the source-country breakdown data on import prices and input coefficients of intermediate inputs by constructing an annual new International input-output (IIO) table for the period from 1995 to …

Risk Management Association Estatement Studies Database Review, Marc Vinyard

Marc Vinyard

Redefining Internal Audit Performance: Impact On Corporate Governance, Razimah Abdullah

Razimah Abdullah

One of the preventive measures to situations akin to world financial crises increasingly forwarded is effective internal audit function (IAF) (e.g., Imhoff, 2003; Mohamad & Muhamad Sori, 2011). Internal audit, a component of corporate governance, continues to evolve due to changes in business strategies and requirements placed on it by legislators. The roles of internal auditors and audit committees (ACs), the key personnel in IAFs, are changing to a more value-added approach as business strategies move towards corporate sustainability and organisational excellence. Suggestions forwarded to improve the performance or determining the quality of IAF include effective involvement of ACs in …