An Assessment of the Psychometric Properties of the Perceived Stress Scale‐10 (PSS10) with Business and Accounting Students

Using a sample of 557 undergraduate business students from three U.S. comprehensive universities, this study examined: (a) the factor structure of the Perceived Stress Scale‐10 (PSS10; Cohen and Williamson, 1988); (b) the invariance of its factor structure; (c) the scale's reliability; and (d) its convergent and divergent validity. Confirmatory factor analyses supported a structure with two primary factors, General Distress and Ability‐to‐Cope, loading on a single second‐order factor, Perceived Stress. Furthermore, this model was confirmed for designated subpopulations including the 264 accounting majors who participated in the study. Notably absent in prior research, this study found two items, numbers 2 and 9, to load significantly on both the General Distress and Ability‐to‐Cope factors with men and the full sample, respectively. Item–total correlations, coefficient alphas, and Spearman‐Brown reliability coefficients supported the reliability of the items loading on the full scale as well as on each of the two primary factors. Combined, these findings provide compelling evidence in support of the PSS10 as a stress assessment measure for business students in general, and accounting students in particular. In fact, given its practical expediency in terms of administration and scoring, the PSS10 appears to be a tool that could be used by university administrators and potentially by human resource personnel at accounting and business organizations to assess student/employee perceived stress levels before the onset of burnout tendencies, thus facilitating more timely and cost‐effective intervention strategies.     

An Instructional Case Comparing the Accounting Policies and Financial Results of Online Retailers

In the role of financial analyst for a venture capital firm, you are assigned the responsibility of evaluating two online retailers who have applied for financing to build a distribution center in western Canada. Based on your developing knowledge of Canadian accounting standards for private enterprises (ASPE), you evaluate the financial reporting policies and financial results of the two companies to identify the company that is best suited for your firm's support. Through this case, you will refine your understanding of ASPE and you will exercise your reasoning and analytical skills.     

Thunder Bay Transportation: A Case of Business Valuation and Negotiation*

Thunder Bay Transportation (TBT) is a very versatile case that can be used in several milieus and at various levels of difficulty. The case describes the process involved in the purchase and sale of a private business. Mr. Getzko, owner/manager of TBT, is attempting to sell his business to pursue retirement. Sudbury Systems (SS) is pursuing an acquisition of TBT. Students are required to assume the role of either Mr. Getzko’s accountants (seller) or Sudbury Systems’ accountants (buyer) to: (1) develop a preliminary business value, (2) negotiate adjustments, and (3) arrive at an agreed‐upon business value to finalize the sale. Students will explore both business valuation approaches (earnings based and asset based) and various business valuation concepts (e.g., normalized earnings, sustaining capital reinvestment, earnings multiple, redundant assets, etc.).     

Aggregating Incomplete Lists of Journal Rankings: An Application to Academic Accounting Journals*

We introduce a branch‐and‐cut algorithm to aggregate published journal rankings based on subsets of the accounting literature in order to create a consensus ranking. The aggregate ranking allows specialist and regional journals, which may only be ranked in a limited number of studies, to be placed with respect to each other and with respect to the generalist journals that are usually included in ranking studies. The approach we develop is a significant advance over ad hoc approaches to aggregating journal rankings that have appeared in the literature and may provide a theoretically sound and replicable basis for further exploration of the concept of journal quality and the stability of journal rankings over time and ranking methods.     

Hydro One IPO

The case describes the initial public offering of Hydro One, one of the largest ever in Canada. The focus is on the financial statement analysis and business valuation of Hydro One from the perspective of a potential institutional investor. The case discusses several alternative valuation methodologies, with particular emphasis on the peculiarities of performing a prospective analysis for a rate‐regulated entity.     

Entebbe Ltd.: A Tax Case

This case is designed to integrate two major tax issues—wind‐up of a company versus sale of shares—with business valuations. Thus, it is designed to incorporate key tax and finance CPA competency areas. There are two valuations required in this case. One is the valuation of shares; the other is the valuation of an intangible asset (a patent). Students have to recognize that before they can decide whether a wind‐up or sale of shares is preferred, they first need to determine the fair market value (FMV) of the shares. However, to determine the FMV of the shares, the valuation of a patent must be done first, as its value will impact the FMV of the shares. Thus, this case requires students to sequence their analysis. Residency issues (“departure tax”) upon leaving Canada permanently are also indirectly identified in the case.     

Cucina Roma

Focusing on a client organization wanting to outsource its food services, this case provides the opportunity for students to analyze the issues from the perspectives of both the outsourcing company and the food service company (Cucina Roma). The client wants employees to increase their use of the café in order to improve employee morale, productivity, and work‐life balance. The Cucina Roma case requires students to use a budget to dynamically plan tactics that will encourage employees to use the company café. Students are tested for budgeting and planning, both quantitatively and qualitatively. The challenge for students is to convert the qualitative analysis into numbers.     

Collaborative Resource Solutions

Collaborative Resources Solutions (CRS) is based on a real situation outlining the issues related to buying a service organization. This instructional case requires students to provide advice to a client who is considering purchasing a 50 percent ownership of a similar consulting business with the vision of blending the two companies together and increasing the knowledge base of her current company; therefore improving the ability to target more to clients. The case requires the students to evaluate the strategic, valuation, and financial issues in considering the acquisition of the existing business. In order to do so, students are required to analyze the financial information provided, both historical and forecasted, as well as analyzing key internal operations issues that may impact the future success of the business. This case is suitable for use in upper‐level undergraduate business strategy courses and accounting courses, as well as in master‐level accounting courses. Assessment rubrics and teaching notes accompany the case for use by instructors.     

Examining the Ethical Behavior of Ontario Chartered Accountants: A Longitudinal Review of the Disciplinary Process

The governing bodies of the Chartered Accountant (CA) profession and business schools go to great lengths to ensure accounting professionals are equipped with a skill set that meets technical, professional, ethical, and other general requirements. In spite of a strict code of ethics, violations of the professional conduct rules leading to disciplinary action are a reality. Using the total CA membership (N = 36,465) of Ontario, Canada, this study makes a 27‐year retrospective assessment of the frequency of disciplinary cases, the characteristics of offenders, the disciplinary process, and the sanctions imposed. Results indicate that: (i) approximately 1.38 percent of the members have been charged with violations of the Rules of Professional Conduct by the Institute of Chartered Accountants over that period; (ii) most were sole proprietors engaged in public accounting; (iii) on average, men make up 76 percent of the CA membership, outnumbering women by three to one (3:1); yet, men were 16 times more likely than women to be charged; (iv) the majority of the offences occurred while members with public accounting licenses were conducting external audits; and (v) sanctions ranged from a “rap on the knuckles” admonishment to expulsion from the CA profession. This study is exploring the CA disciplinary process as observed through disciplinary notices and suggests improvements to the system.     

Current Trends within Social and Environmental Accounting Research: A Literature Review

Given the recent rise in the evolution and maturity of social and environmental accounting (SEA) research and scholarship, we provide a literature review of the current trends within this area in a concise and harmonized manner for a wider audience in academia and practice. More specifically, we visit the current state of scholarly work, which can be useful in facilitating future research questions and further development of SEA research associated with relations between corporate social performance (CSP), corporate social disclosure (CSD), and corporate financial performance (CFP). Our goal is to offer insights to the current state of SEA research that is informative to both novice and expert SEA scholars, with the hope to promote and stimulate further advancement of research in this particular area. Drawing knowledge from relevant disciplines such as accounting, management, finance, and economics, this article visits the current trends within SEA research in terms of definition, research topics, theoretical viewpoints, methodological approaches, as well as suggestions for future research.     

Cybersecurity Disclosure by the Companies on the S&P/TSX 60 Index

Cybersecurity has become a topic of great interest since 2010. Accounting issues surrounding cybersecurity governance, management, and disclosure have gained attention from accounting standard setters, large accounting firms, and professional associations, but only a limited number of studies have looked at cybersecurity disclosure. In this study, we examine whether the content of cybersecurity disclosures of Canadian firms comprising the S&P/TSX 60 index is aligned with best practices—that is, financial regulators' guidelines in that matter. A content analysis was performed of documents issued between January 2017 and mid‐2018, consisting of recent annual information forms (AIFs), annual and quarterly management's discussion and analysis (MD&As), proxy circulars, material change reports, and news releases. To assess the nature and extent of cybersecurity disclosure, we developed a scoring grid featuring 40 items based on financial regulators' guidelines. Results show that cybersecurity disclosure levels are low. Companies vary widely in the amount of detail they provide, and the information is often not company‐specific. The variations among industrial sectors involve the categories related to cybersecurity risk, cybersecurity risk mitigation, and other items. Most of the companies provided cybersecurity disclosures in the annual MD&A, and several reiterated some disclosure items in the AIF and proxy circular. The results of this study highlight some areas where cybersecurity disclosures have evolved and others where they could be improved. They suggest that some firms strive to avoid boilerplate language and be more company‐specific. The findings also suggest that financial regulators could issue more stringent requirements.     

Value Relevance of Fair Values—Empirical Evidence of the Impact of Market Volatility

This study examines empirically the effects of market volatility on the value relevance of fair values. Using the modified Ohlson model ( 1995 ) and a sample of U.S. financial companies for the period of 2008 to 2013, this study shows that fair values are priced at a significant discount when market volatility is high. Song ( 2013 ) shows analytically that the effectiveness of fair value accounting is negatively affected by market volatility. Findings of the current study suggest that investors understand the effects of market volatility on fair values and price them accordingly. The study extends the research on the determinants of the usefulness of fair values by looking beyond factors associated with the reliability of estimated fair values (Level 2 and Level 3 fair values). This study has practical implications: current accounting standards for fair value measurement acknowledge the limitations of the market as a source of fair values by offering a three‐level fair value hierarchy with provisions for fair values to deviate from market prices. Findings of this study shed light on a previously little studied factor, that is, market volatility, on the usefulness of fair values.     

Boxing and Martial Arts Company,A Tax Case

A tax case is developed examining a private Canadian sports company. This case simulates a real‐world start‐up company in the area of Canadian Controlled Private Corporation taxation. The client, Boxing and Martial Arts Co., is a medium‐sized, rapidly growing sports promotion business. It operates in an environment where cash payments are common, especially towards foreign workers. Students must research issues involving tax deductions and revenue recognition. The learning objectives include: reinforcing taxation concepts that most students learn in introductory courses (i.e., revenue recognition, allowable business expenses) as well as improving students’ tax research skills for more complex issues (e.g., international tax treaties).     

The Impact of Better‐than‐Average Bias and Relative Performance Pay on Performance Outcome Satisfaction

Drawing on equity and expectancy theories, we hypothesize that the perception of accountants about their ability to contribute relative to a peer (operationalized as the better‐than‐average [BTA] bias) negatively influences their satisfaction with the outcomes of the performance evaluation process (operationalized as performance outcome satisfaction [POS]). We hypothesize further that this negative influence is mitigated by the amount of relative performance pay. We test these hypotheses using data collected from a survey of and an experiment involving 164 entry‐level accountants. We found that in general our participants rated themselves better than the average audit professional and their immediate work associate; that is, they displayed a BTA bias. Moreover, we found that both the BTA bias and performance pay individually influenced POS; we also found a moderately significant interaction effect. In their entirety, the results indicate that the greater an entry‐level accountant believes that she or he is better than average the more likely her or his performance outcome satisfaction will fall.     

Canada Generators Limited*

This case depicts an armchair situation involving a newly formed small private Canadian company that has recently begun operations in Western Canada. Of concern to the owners is their understanding that Canadian generally accepted accounting principles (GAAP) are about to be replaced by International Financial Reporting Standards (IFRS) at the end of 2010, and so the statements in their present form will have to be conformed to the new standards if the company decides to go public with a share offering, which is an option it is considering. Other issues facing the company concern the appropriate accounting and reporting requirements that will be required in order to allow the company to secure additional financing and engage in some necessary research and development. This case is suitable for students who have progressed beyond the introductory financial accounting level; it involves adjustments to inventory and capital asset accounts as well as income effects including taxation, and it draws out some of the more important nontransitional differences between GAAP and IFRS.     

IFRS within the Multi‐GAAP Canadian Reality: A Teaching and Learning Imperative for Intermediate Financial Accounting

Intermediate accounting instructors need to be engaged in the specific complexities and challenges of the new international financial reporting standards (IFRS) reality within the Canadian multi‐GAAP environment. Intermediate accounting courses are directly affected because they represent substantive coverage of the corporate reporting environment. In this article I make the case that these courses should primarily reflect IFRS standards in order to entrench IFRS competencies in students who wish to pursue a professional designation, to prepare students for the global environment, and to concentrate IFRS expertise issues in a robust instructor group. The competency maps of each of the three Canadian professional accounting bodies clearly reflect IFRS. Students can analyze the implications of major areas of policy differences between IFRS and private enterprise GAAP (PEGAAP) through specific targeted course coverage, but also through active learning elements, particularly research elements. This commentary reflects some of the active debate occurring regarding postsecondary curriculum as Canada adapts to IFRS and PEGAAP, and encourages action.     

What Do FAS 157 “Fair Values” Really Measure: Value Or Risk?

FAS 157, the U.S. accounting standard that prescribes how fair values of assets and liabilities are to be measured when other U.S. GAAP standards require fair valuation, stipulates that fair values be measured as the exit values of assets and liabilities—the proceeds for assets hypothetically sold on the date of the financial report, and, correspondingly, the amount required to settle liabilities on the date of the financial report. This conceptual article argues that exit values do not reflect the value of the net assets of the firm to shareholders, which is best reflected by discounted cash flows to maturity. Moreover, exit values—biasing fair values downward when markets are illiquid—have a pernicious, systemic risk effect; specifically, they give rise to write‐downs that in turn cause contagion: prices of equities and other financial instruments of peers react negatively, leading to further write‐downs by those peers. This may have aggravated the recent financial crisis. However, while exit values are not proper measures of value to shareholders, they are useful measures of downside risk when prospects turn sour for a firm. Thus, both exit values and discounted cash flows should be presented in financial statements.