Do going concern opinions provide incremental information to predict corporate defaults?

Review of Accounting Studies - Investors, regulators, and academics question the usefulness of going concern opinions (GCOs). We assess whether GCOs provide incremental information, relative to...     

Financial comparisons of under‐vine management systems in four South Australian vineyard districts*

Conventional viticultural practice in Australia and elsewhere involves removal of under‐vine vegetation using herbicides or cultivation. Concerns over the long‐term effects of herbicides on soil health, evolution of resistant weeds and possible impacts on human health motivate the search for alternative weed management options. Industry‐supported trials on commercial vineyards in four South Australian regions investigated standard practices of straw mulch and bare earth created with herbicides, compared to under‐vine cover crops, focusing on soil health attributes (soil carbon, soil microbiological processes, etc.) and grape yields in 2016 and 2017. Measured yields with the Control (herbicide) treatment were combined with published district grape prices and yields over the 12‐year (2006–2017) period, defining multivariate distributions of gross revenues ($/ha). Assuming all treatments produce grapes of equal quality and price as the Control, our results showed median per‐hectare gross margins greater than the Control in the Barossa district, lower than Control in Riverland, and mixed results in Langhorne Creek and Eden Valley. Multi‐year risk profiles, based on decadal whole‐farm (50 ha) cash flows for each treatment, were calculated using Monte Carlo analysis, based on historical yield and price distributions. These risk profiles showed the under‐vine treatments may result in major differences in long‐term vineyard financial viability.     

Organizational coping with institutional upheaval in transition economies

The radical change in corporate governance systems is fundamental to the period of institutional upheaval characterizing transition economies. Using an institutional theory framework, this paper develops a model of responses to this change. The model is tested with data from 1,723 firms in 22 countries in Central and Eastern Europe and the Newly Independent States. The results suggest that a firm’s adaptation to the new governance order will be facilitated or hampered depending on the characteristics of the institutional and organizational contexts it faces. A major implication of the study is the need to consider cultural and contextual embeddedness in explaining how governance systems transform.     

On the shoulders of giants: a meta-review of strategic human resource management

Abstract

Recent years have witnessed significant growth in the field of strategic HRM. This article summarizes the literature in this field by conducting a meta-review, a review of the reviews that have covered various topics of strategic HRM. In doing so, the authors highlight theoretical frameworks and empirical findings of studies in the field over the past three decades, identify methodological issues and challenges in the previous research, and discuss recent trends in the field of strategic HRM. The author concludes by suggesting some interesting and important directions for future work.     

Assigned versus assumed: Towards a contemporary,detailed understanding of subsidiary autonomy

This paper critically documents the rise of autonomy in subsidiary management literature, and develops an agenda for future research in this key area. Integrating and updating the seminal works of Paterson and Brock (2002) and Young and Tavares (2004), the paper begins with a critical review of subsidiary autonomy within the streams of subsidiary management literature. This leads to an assessment of the key contemporary issues requiring further investigation. These issues center around two key types of autonomy: assigned and assumed. We argue these types represent a more accurate, in-depth conceptualization of subsidiary autonomy, and also have significant implications for key related topics, including subsidiary development. This is depicted in an integrative model that draws upon agency theory, the network model of the MNE, the decision process perspective and the bundling model in presenting a revised view of subsidiary autonomy, and offers a basis for further research within the field.     

Determinants of satisfaction for entrepreneurs

This study considers the extent to which entrepreneurs are satisfied with their businesses in their third year of business ownership. Entrepreneurial satisfaction might be viewed as a basic measure of performance. It may bear upon decisions by individual entrepreneurs about whether to invest more time and money, whether to cut back, or whether to close down. It may also influence whether entrepreneurs work effectively with their customers and employees. For researchers, the investigation of why, in particular settings, some entrepreneurs may be more satisfied than others may aid in the interpretation of past research, which has used this as a performance measure.This research draws upon a theoretical framework used in investigations of employee satisfaction. Called discrepancy theory, it suggests that individual satisfaction is determined, in part, by whether there is a “gap” between actual rewards or performance and the individual's goals or expectations.In this research, it was hypothesized that entrepreneurs emphasizing primarily noneconomic goals (such as doing the work they wanted to do) would have higher satisfaction when the business was experiencing lower levels of performance. For higher levels of performance, there would be no difference. In essence, the satisfaction of those emphasizing economic goals would vary more with economic performance. A related hypothesis was that, for this sample of start-up firms (many of which would be experiencing low levels of performance), those emphasizing noneconomic goals would have higher average levels of satisfaction. This was based upon the expectation that many start-up firms would be experiencing marginal performance, so that the “gap” between goals and performance would be greater for economically oriented entrepreneurs. The research also focused upon expectations, because one aspect of discrepancy theory suggests that satisfaction decreases if there is a gap between expectations and performance. Accordingly, it was hypothesized that, controlling for performance, entrepreneurs with higher initial expectations would subsequently have lower levels of satisfaction. Previous research suggests that membership in particular demographic groups may influence expectations. This led to hypotheses that older entrepreneurs, female entrepreneurs, and minority entrepreneurs would have lower levels of initial expectations. This, in turn, may influence later satisfaction. Thus, it was hypothesized that, controlling for performance, entrepreneurs in each of these groups would have higher satisfaction because their initial expectations would be lower. The study utilized a sample of 287 entrepreneurs who were followed over a 3-year period. The data on predictors of satisfaction were gathered in year 1, when the average owner had been in business for 11 months. The satisfaction measures were gathered 2 years later. By that time there should have been some stabilization in the routines of the business, and the entrepreneur could reflect upon historic performance and experiences in judging the extent to which business ownership had been satisfying. The data were analyzed primarily using path analysis, in which it was hypothesized that certain variables would have both direct and indirect effects upon satisfaction.It was found that the satisfaction of entrepreneurs emphasizing economic goals was not more sensitive to economic performance, at least within the range of performance considered in this sample. For this group of firms, many of which appeared to be experiencing marginal performance, those emphasizing noneconomic goals did express higher levels of satisfaction. It had been expected that those with higher initial expectations would later be less satisfied because they would have a greater expectation-performance gap. However, the opposite was found; those who were more optimistic initially were more satisfied later, even when controlling for performance. Demographic influences on initial expectations were examined. Contrary to expectations, none of the demographic traits was significantly related to initial assessment of likelihood of success. Older entrepreneurs, women entrepreneurs, and minority entrepreneurs were just as optimistic as those in other groups. The relationship between membership in these demographic groups and later satisfaction was also examined. No significant relationships were found for older entrepreneurs and minority entrepreneurs. However, there was some evidence (p = .07) that women entrepreneurs were more satisfied with business ownership.Two of the most interesting findings were those related to initial expectations and to women entrepreneurs. Contrary to discrepancy theory, those who had higher initial expectations were later more satisfied, not less. This may suggest, as Staw and Ross (1985) found in a longitudinal study of employee satisfaction, that attitudes are, in part, a function of stable individual traits. Those who had a positive view of their initial prospects later viewed the experience of business ownership more favorably, regardless of subsequent performance. For women entrepreneurs, the higher levels of satisfaction may reflect a view that they have fewer attractive alternatives; it may also be that they discover greater relative satisfaction from the day-to-day aspects of business ownership.For entrepreneurs and their advisors, the findings suggest that particular goals, attitudes, and backgrounds are likely to be associated with greater satisfaction. This may influence whether entrepreneurs stay with marginal businesses. For researchers, the study provides insight into discrepancy theory by considering its application to entrepreneurs rather than the hired employees normally studied. In addition, subjective measures of performance, such as satisfaction, have often been used in previous research on entrepreneurial performance. This study casts light on why, in particular settings, some entrepreneurs may be more satisfied than others.     

Measuring the Performance of Voluntary Organizations

In the current political and economic climate, there are rapidly escalating demands from public funders and other stakeholders for indicators which can capture the achievements and impacts of the voluntary sector. Having clarified the context of these demands, the primary aim of this article is to develop criteria for measuring the ‘performance’ of voluntary organizations. This is undertaken by marrying relevant international theoretical literature suggestive of their roles and contributions with a ‘production of welfare’ approach, which has a proven track record in the evaluation of human services. Eight domains of performance are suggested (economy, effectiveness, efficiency; choice/pluralism; equity; participation; innovation and advocacy), embracing twenty-two separate indicator sets.     

Are consumers with disabilities receiving the services they need?

People with disabilities in the U.S. command a buying power of $220 billion. This study combines service quality theory and disability orientation theory to focus on perceived service quality for this segment, with attribution theory providing a connecting framework. The results show that there is much room for improvement. A survey among people with disabilities reveals that retailers are rated lower on accessibility than on traditional service quality dimensions. Furthermore, feelings of disability pride and social activism (mediated by a sense of exclusion) significantly affect ratings of accessibility. Service “intangibles” such as assurance and empathy have the greatest positive effect on service quality ratings, which in turn significantly affect purchase intention (mediated by customer satisfaction). Implications and research issues are discussed.