ACCOUNTABILITY AND GOVERNMENTAL FINANCIAL REPORTING

Accountability is the cornerstone of Governmental Generally Accepted Accounting Principles (GGAAP) in the United States according to the Governmental Accounting Standards Board (GASB). This paper analyzes the implications of alternative definitions of the concept of accountability for GGAAP and for GASB. It also discusses the costs and benefits of accountability information, the effect of diverse users of governmental reports, and alternative mechanisms for achieving accountability in governments. Finally, a governmental accounting research agenda based on accountability is proposed for the future.     

ASSET PRICING AND FINANCIAL REPORTING WITH CHANGING PRICES

This study empirically investigates the recent SFAS No. 33 requirements to determine if the inflation disclosures, or information similar to it, are impounded in security returns. An attempt is also made to determine which of the two diverse disclosures best represent the information impomded by the market. The investigation utilizes a methodological framework arising out of currently accepted asset pricing theory. The results suggest that the current cost data parallels the information impounded in security returns and that it provides risk information not included in the commonly employed systematic risk factor, beta.     

ON THE LINKAGE BETWEEN FINANCIAL RISK TOLERANCE AND RISK AVERSION

We explore the linkage between financial risk tolerance (FRT) and risk aversion. To do this, we obtain FRT scores from a psychometrically validated survey and conduct a battery of online lottery choice experiments involving the same nonstudent participants. We contrast: real and hypothetical payoffs, low and high stakes, decisions involving gains and losses, and order effects. Our key finding is that the two approaches to analyzing decision making under uncertainty are strongly aligned. We present evidence that this is particularly the case for the female participants in our sample and when high‐stake gambles are employed.     

国际财务报告准则下的评估

欧盟各国上市公司从2005年1月1日起采用国际财务报告准则。为了解在其执行过程中评估准则的应用情况,国际评估准则委员会(IVSC)对欧洲主要不动产投资公司按国际财务报告准则(IFRS)编制的年报中评估准则应用的一致程度,以及不动产评估的价值定义情况进行了调查分析。译者对该调查分析结果进行了编译,供读者参阅。     

防范金融创新风险 加强金融稳定

信用衍生产品和投资型结构产品的发明和创新以及市场的发展．有助于改进金融稳定，因为这些产品的市场活动加速了信用风险的分散和负债压力的缓释．传统上由银行业机构背负的经营风险．在更广泛的领域和基础上分散到各类投资人身上。由此．银行业机构承受信用风险、市场风险的能力及其盈利能力都可得到一定的加强。     

DEBT, FOLKLORE, AND CROSS-COUNTRY DIFFERENCES IN FINANCIAL STRUCTURE

Conventional wisdom has long held that, in relationship-based economies such as Japan and Germany, corporations are able to borrow more than U.S. companies, which in turn reduces their cost of capital and gives them a competitive edge. But such folklore does not stand up to scrutiny. In Japan and Germany, large businesses do not borrow more than U.S. companies–and, in fact, judging from coverage ratios, German companies (as well as U.K. companies) seem to borrow considerably less than their international competitors.
The article also reports that, in countries where financial markets are transparent, the development of the banking sector has little additional impact on the growth of financially dependent industries. That is, although industries that require a lot of external finance grow faster in countries where the bank credit-to-GDP ratio is high, the growth rates of such industries are much more correlated with the level of accounting standards (with high standards serving as a proxy for well-developed capital markets) than with a strong banking system.     

BAYLOR UNIVERSITY ROUNDTABLE ON INTEGRITY IN FINANCIAL REPORTING

At the center of the U.S. corporate governance controversy are questions about the integrity of the U.S. financial reporting system. Can investors trust the numbers now being reported in corporate financial statements? And, if not, what steps are being taken to bring about the return of investor trust and confidence? The academics and practitioners who took part in this discussion began by expressing their reluctance to describe the current situation as a “crisis.” The consensus was that the recent governance failures are not the reflection of a general decline in corporate moral standards, but rather the work of a handful of opportunists who found ways to exploit some weaknesses in the present system. Part of the discussion focused on the expected benefits (and costs) of the heightened regulatory scrutiny provided by the Sarbanes‐Oxley Act and the newly formed Public Company Accounting Oversight Board. But most of the panelists placed greater emphasis on the role of self‐regulation in resolving problems such as the conflicts of interest within auditing and brokerage firms that played a major role in scandals like Enron and WorldCom. And rather than relying on more vigorous SEC oversight of financial statements, a number of panelists argued that top priority should be given to comprehensive reform of U.S. accounting standards, which are said to be a major source of confusion for both managers and investors.     

A JUDGEMENTAL INTERNATIONAL CLASSIFICATION OF FINANCIAL REPORTING PRACTICES

This paper briefly surveys some recent "empirical" international classifications. It suggests that their data contains errors and is not designed for classification, and that their methodology relies upon the doubtful data to generate hypotheses rather than to test them. This paper proposes a hypothetical classification which is more detailed and defines its universe more precisely than previous research. The testing selects factors deemed to represent fundamental aspects of difference in measurement practices, and scores these overtly and with explanation. Analysis is performed in several ways, including computer-assisted clustering techniques. The results seem to confirm the hypothetical classification, and to be consistent with (but more detailed than) some earlier classifications.     

INTEREST RATE RISK AND EQUITY VALUES OF HEDGED AND UNHEDGED FINANCIAL INTERMEDIARIES

This paper uses an approach developed by Flannery and James to show that interest rate changes have different effects on equity values of hedged and unhedged financial institutions. Equity values of (generally unhedged) savings and loans are significantly more sensitive to unexpected interest rate changes than equities of (generally hedged) commercial banks. The interest rate sensitivity of (generally hedged) life insurance equities is similar to that of bank equities. Overall, the equity values of unhedged financial institutions are more sensitive to interest rate changes than the equity values of financial institutions that more closely balance the maturities of their assets and liabilities.