SHIRKING,STANDARDS AND THE PROBABILITY OF DETECTION

By relaxing the common efficiency wage assumption of exogenous shirking detection probabilities, we demonstrate how standards and efficiency wages are related. In a more general setting where the probability of detection depends upon the equilibrium effort level of non‐shirkers, we show that the uniformly positive (negative) supply‐side relationship between wages (unemployment insurance) and effort is no longer guaranteed. Profit maximization on the part of the firm, however, ensures that effort will depend positively (negatively) on wages (unemployment insurance) in equilibrium.     

IFRS adoption,reporting incentives and financial reporting quality in private firms

This study examines financial reporting quality (FRQ) effects around voluntary International Financial Reporting Standards (IFRS) adoptions by German private firms across two important dimensions, earnings quality and disclosure practices. To capture differences in the motivations for IFRS adoptions, we identify four different types of IFRS adopting firms based on a comprehensive set of firm characteristics. We observe earnings quality improvements around IFRS adoptions primarily for one type of firm, which is young, fast growing and seeking access to public equity markets. Using a matched sample of private German GAAP and IFRS reporting firms, we find some evidence suggesting that IFRS also contribute to higher earnings quality. Recognizing that our earnings quality metrics are only incomplete measures of FRQ, we also compare the disclosure practices of IFRS and German GAAP firms. We find that all IFRS firm types disclose significantly more information in their financial reports and show a higher propensity to publish their financial reports voluntarily on the corporate website. Our findings indicate that failure to identify earnings quality changes around IFRS adoption cannot be automatically interpreted as IFRS adoption having no effect on the FRQ of (private) firms. Collectively, our results suggest that both incentives and accounting standards shape private firms’ FRQ.     

‘Passionate and professional’: reconciling logics in public service accounting

In order to deliver public value, the UK government sought to build relationships and connect ‘the public’ with public servants (including back-office workers), but with what effect? Drawing on interviews with public service accountants, the authors found that how these accountants conceptualized ‘the public’—as society or people—shaped whether public value was considered as a monetary or moral concept. Accountants who regarded the public as people spoke of an improper level of involvement and struggled to maintain their professionalism.     

Institutionalising multiple accountability logics in public services: Insights from Australia

This paper reports on a field study of how a range of inter-institutional and inter-organisational forces shape the evolving rhetoric and practice of multiple accountabilities in public services. Drawing on the institutional logics perspective, we carried out a qualitative field study in the Australian Commonwealth Public Service involving semi-structured interviews, two focus group discussions, and the examination of internal accounting, management reports, and government archival records. The findings suggest that emphasis on conventional instrumental mechanisms and reporting tools, such as budgeting and accrual-based reporting, support managerial (instrumental) accountability through compliance logics. We conclude that an emphasis on public (relational) accountability through public dialogue is central to the public sector accountability debate, and that more attention needs to be paid to the question of how to balance the dual logics (instrumental and relational) in public services. The findings provide practical insights for public sector managers, policymakers and governments responsible for designing and implementing reforms, accounting tools, and accountability practices.     

The role and impact of professional accountancy associations on accounting education research: An international study

This paper explores the relative influence of the accounting academy and accountancy professional associations in the debate concerning the profile and quality of accounting education research. This research analyses 13 semi-structured interviews undertaken with members of key accounting professional associations in Australia, New Zealand (ANZ) and the United Kingdom and Ireland (UKI). The paper makes a theoretical contribution by the novel application of the institutional logics theory to the literature concerning professional accounting associations (PAAs) demonstrating the dominant commercial logic of the education function and the more traditional fiduciary logic of the technical function. The research finds that the primary stakeholders in the professional accounting curriculum development model are the PAAs and employers, whilst the accounting academy is relatively absent. The relative independence of the education and research and technical functions within PAAs is also identified: academic research and technical activity has little influence on professional education and vice versa. However, PAAs’ funding of academic research is common across all four countries for brand recognition and in some instances to influence policy rather than informing the professional curriculum.     

Rethinking the Career Anchors Inventory framework with insights from a finance transformation field study

It is claimed that the re-engineering and automation of routine work should free accountants to adopt broader, so-called ‘value-adding’ roles as partners to business decision-makers. The ‘new world of work’, involving new process-based methods, single instance ERP systems and the wholesale relocation of professional work to lower cost areas, brings opportunities for accountants in systems design and adding value to the business. For many others, the new reality may be a more competitive and less secure working environment, with a mid-level career bottleneck reflecting a polarisation between the upper and lower layers of the finance function.Based upon Schein's theory of career anchors and using exploratory sequential mixed methods, we consider the impact on the career perceptions of individual accountants as accounting expertise, traditionally embodied in people, is codified and embedded within end-to-end business processes in the context of a finance shared service centre. Key findings include new perceptions of careers with greater emphasis on the acquisition of general managerial competence and leadership skills, with the importance of cultivating a sense of ‘global connectedness' to maintain individual employability. Suggestions are made to update Schein's Career Orientation Inventory to better reflect the reality of accounting in the ‘new world of work'.     

The impact on stock prices of deferral and elimination of internal control audit requirement for small firms

This paper examines the cumulative market reaction to the events related to deferral of internal control audit requirement under the Sarbanes-Oxley Act of 2002 and its elimination under the Dodd-Frank Act of 2010 for nonaccelerated filers (small firms). We document that small firms experienced negative cumulative abnormal returns around these events; and the differences between the cumulative abnormal returns for small firms and the two control groups (accelerated and large accelerated filers) were negative and significant at the 1% level. These results support the notion that market participants value the reliability of financial information irrespective of the firm size. Within the small firms, we find no firm characteristic significantly explains the market reaction to the events considered. That is, all small firms lost market value in reaction to the events that delayed and eliminated their internal control audit requirement.     

Schmoozers,not snoozers: Busting the Kevin and Angela stereotypes in public accounting

In contrast to the well-known stereotype of the boring, unsociable accountant, today’s public accounting professionals argue that they are boundary spanners. Working at the intersection of the firm/client interface, these professionals contend that sociability is a requisite skill for routinely navigating the many interactions they have with multiple personnel at client organizations. This research aims to address this disconnect and to confront whether the public perception is warranted. Using the Trait Emotional Intelligence Questionnaire (TEIQue), we assess the sociability of 176 public accounting professionals and discover that, contrary to the stereotype, male public accountants are more sociable than males in the general population. Our analysis also demonstrates that female public accountants are no more or less sociable than females in the general population. Additional analysis shows that while male public accountants are more sociable than female public accountants, this effect is attributable to differences at lower levels of the profession and that male-female differences disappear when comparing male managers and partners to female managers and partners. Given the importance of sociability in public accounting, this research offers recruiting strategies that will help to dispel the myth of the unsociable accountant and provides training tips for enhancing sociability within the ranks.     

Time,space and accounting at Nonantola Abbey (1350–1449)

Accounting historians have provided several accounts of monastic life and accounting's role in it, considering important settings such as Montecassino and San Pietro abbeys in Italy and Durham Cathedral Priory in England. Research has shown how their governance arrangements and common values enabled the Benedictines to manage their monasteries in an efficient manner which was essential in tackling the misappropriation of resources by organisational actors, including abbots. Other studies have shed light on the use of practical and effective accounting practices by the Benedictines to manage their considerable wealth and pursue their spiritual and temporal goals. Nevertheless, this body of literature is yet to explicitly consider the dimensions of time and space and their relationship with accounting practices. This study begins to address this oversight by analysing the surviving accounting records of the Benedictine abbey of Nonantola in northern Italy from 1350 to 1449. In the accounting books of Nonantola Abbey linear and cyclical conceptions of time coexisted and had an impact on the way in which transactions were reflected in the accounts. At the same time, the abbey was at the centre of a complex network of accountabilities which included lay accountants, farmers and the lessees of the abbey's properties. The main characteristic of this system was not the accuracy of the records in detailing the assets, liabilities, expenses and revenue of the abbey but the maintenance of a control system to administer an extensive agricultural network and the identification of the relationships between the abbey and the stakeholders inhabiting its space.     

Perceptions of the benefits of the A3 planner in facilitating project-based learning in accounting education

This paper evaluates ways of instilling project management skills into accounting-based learning by the use of an iterative A3 planner to plan, monitor and review assignment progress. The application of an A3 planner to facilitate a project-based learning (PBL) group assignment in undergraduate accounting education has been critically evaluated in terms of both the student and tutor experience. The study uses a mix of qualitative and quantitative data. Quantitative data assisting exploration of perceptions were collected through 100 undergraduate students. A series of focus group discussions were carried out to investigate students’ engagement and tutors’ teaching experiences regarding the adoption of the A3 planner. The results suggest that the A3 planner promotes active planning and effective management of a PBL group assignment. It makes students’ thought processes more visible thereby facilitating and enhancing the tutoring/mentoring process. Moreover a more interactive and transparent approach by doing assignment via the use of an iterative A3 planner has ensured more feedback points and action based efficiency in the doing approach for learners.