Modelling Performance Improvement and Switching Behaviour in Team Learning

Accounting educators and agencies have sought to incorporate team learning activities into conventional learning methods. The readiness-assurance process (RAP) of team learning, in which students take quizzes first as individuals and second as members of student teams, has been shown to be effective in this regard. We analyse the RAP with a fixed-effects regression model to identify the factors that contribute to performance improvement and we use ordered logit regression to estimate, probabilistically, switching behaviour within student teams. A longitudinal study was conducted over the course of a semester in which 101 undergraduate accounting students, comprising 22 teams, completed six quizzes. Within-team knowledge disparity was shown to be a significant indicator of performance improvement, and individuals appeared more likely to switch their answers after the first quiz. There were no significant effects for either performance or switching associated with demographic measures of sex and English fluency. Implications for accounting educators are discussed.     

A Model for Analyzing the Impact of Selective Lapsation on Mortality

Abstract

This paper presents a model for examining the effect of various relationships between mortality rates and lapse rates on the mortality experience of a cohort of insured lives. The approach is individual rather than the aggregate traditionally used in analyzing selective lapsation. The model assumes that insured lives are healthy at policy issue, but later may move to an impaired state from which the lapse rate is zero. Associated with each insured is an unobservable “risk level” random variable, which reflects the heterogeneity of the insured group. Individual mortality and lapse rates are functions of the risk level. A numerical illustration provides some interesting results obtained by using this model.     

The explanatory power of trading volume and insider activity in a pari-mutuel betting market

In this paper, we examine the role played by the holders of privileged information (insiders) in stimulating trading volume which adds explanatory power to a price-based model of returns in a market where the actions of insiders can be isolated – a pari-mutuel betting market. We conduct conditional logit analyses based on data relating to 19,164 horses running in 2078 races (49 racetracks) staged across the UK between 1 June and 31 August 1996. These analyses indicate that prices generally fail to incorporate fully information contained in trading volumes. However, the betting public fully discounts volume information in markets most commonly viewed as attracting bets from insiders. Isolation of the actual degree of insider activity sheds light on the variation in volume effects.     

An analysis of the reasons for the asymmetries surrounding earnings benchmarks

Several studies report an asymmetry in the distribution of earnings around specified benchmarks. However, doubt has arisen over whether the observed ‘kink’ in the distribution of earnings is solely caused by earnings management. We use a ratio analysis approach to examine a range of specific accruals for evidence of earnings management. We find little evidence that firms immediately above the benchmark have abnormal receivables, inventories or provisions. However, they do increase cash‐from‐customers and reduce inventory. Thus, our results support the recent research that suggests that firms engage in real actions to meet earnings benchmarks.     

Individual approaches to futures thinking and decision making

This paper presents results of a second international web-based survey designed to gather data about how individuals approach thinking about their futures and making decisions regarding their futures. Five hundred and five respondents from 38 countries participated in the survey. Similar to the first survey, the sample has gender, age and religious diversity but is not representative with respect to education, income and race/ethnicity. The results suggest that the external environment provides a great deal of stimuli for people to think about the future (e.g., special occasions like New Years day, birthdays, and funerals). Individuals tend to think about the future more in the morning, and just before bed. Overall, most respondents experience happiness, confidence, and lightness when thinking about the future. Respondents employ many different approaches to thinking about the future, such as relying on personal past experiences, imagining future situations, and relying on their personal intuitions. Most respondents do not pattern their futures decision making on decisions made by others or on tradition. Most respondents believe that their thinking about the future is very worthwhile; most develop plans and take decisive action as a result of their efforts. About three quarters of the respondents report that they are able to predict their personal futures at least one-half of the time. Most respondents face few barriers to thinking about the future, although many reported it would be nice to have more energy, be able to concentrate better, and be able to better organize their thoughts. Females report that thinking about the future is a more emotional experience than it is for males. Males, on the other hand, have more confidence in their futures-oriented decision making abilities. Age plays a big part in how individuals relate to and think about the future. Younger respondents think more about the future more times during the day and find thinking about the future more fearful and anxious. They also pattern their decisions more on those made by others and older individuals. Older respondents tend to rely a great deal upon their lifetime of experiences and worry less about the future. Middle-aged respondents report worrying more about financial and career issues and report that thinking about the future can be emotionally draining.     

Public trust,the law,and financial investment

How does trust evolve in markets? What is the optimal level of regulation and how does this affect trust formation and economic growth? In a theoretical model, we analyze these questions, given the value of social capital and the potential for growth in the market. When social capital is valuable, regulation and trustfulness are substitutes. In this case, regulation may cause lower aggregate investment and decreased economic growth. When the social capital is less valuable, regulation and trustfulness may be complements. In the paper, we analyze the optimal level of regulation and highlight the novel predictions of the model.     

A singular chain of events

This paper presents a scenario, a written narrative that describes a series of events that could lead to the extinction of humans as a species. The scenario is built upon three blocks of events. The first contains events that could severely and rapidly reduce human population in a relatively few years. The second block of events describes the regression of human civilization and technological base and the further loss of human population. The third block encompasses global environmental events that the remaining humans are subsequently unprepared to handle. The scenario posits the death by asphyxiation of the last human being by the year 3000.     

South Africa’s transition from apartheid: The role of professional closure in the experiences of black chartered accountants

As apartheid gave way to political freedom in South Africa in the last quarter of the 20th century, chartered accounting firms began to hire black South African trainees for the first time. The study examines the oral histories of black chartered accountants within the context of social closure theory and South Africa’s changing political and ideological landscape. The evidence indicates that processes of professional closure and credentialing excluded the majority population from the ranks of the profession on basis of race and class throughout the period 1976–2000.     

An empirical analysis of audit fee price competition after the Korean 1999 Omnibus Cartel Repeal Act

This study examines the audit service market in Korea after the 1999 Omnibus Cartel Repeal Act to determine if increased competition has led to audit fee discounting. Until 19 December 2001, when the Korean government enacted The Financial Supervisory Regulations, researchers could not address questions related to price competition in the Korean audit market due to data limitations. The new regulations allow researchers to examine audit effort for the first time because both audit hours and audit fees are now recommended disclosures. We use audit fee data of Korean companies for the 6-year period 1999–2004, and find evidence that total audit fees paid have been increasing but audit fees per hour have been decreasing. We also find that Big 5 auditing firms’ fees per hour are significantly lower than non-Big 5 auditing firms and are decreasing across time. These price pressures should be of concern to regulators and investors because prior research has demonstrated that price competition leads to discounting, which can result in unrealistically low audit fees and poor audit quality. Finally, as in previous research, we also find discounting of initial audit engagements in the Korean market.     

Monitoring and Motivation in Principal-Agent Relationships: Some Issues in the Case of Local Authority Services

This paper examines a number of issues concerning the effects of monitoring on principals and agents involved in the provision of local authority services subject to competition. It examines, and then extends, existing theoretical work indicating the potential for sub-optimal outcomes which result from the principal introducing monitoring schemes which focus upon the measurable aspects of the agent's performance. The paper then departs from the received principal-agent paradigm in order to consider whether monitoring and competitive regimes more generally have negative effects on the welfare and performance of principals and agents in both theory and practice.