The effect of more rules‐based guidance on expense disclosure under International Financial Reporting Standards

International Financial Reporting Standards (IFRS) are often described as principles‐based; however, we show that IFRS and Australian pre‐IFRS expense‐related standards are more rules‐based than pre‐IFRS expense disclosure in New Zealand. Thus, we examine expense disclosure in New Zealand and Australia around IFRS adoption to provide evidence on the effect of more or less rules‐based standards on voluntary disclosure. First, we add to the rules versus principles‐based standards debate by finding higher voluntary expense disclosure under more rules‐based standards (e.g. IFRS). This contrasts with expectations, as we would expect fewer voluntary disclosures under more rules‐based standards as there would be fewer possible voluntary disclosures. Second, we document that New Zealand firms have significantly less voluntary expense disclosure than size‐ and industry‐matched Australian firms in both the pre‐ and post‐IFRS period. However, all measures of expense disclosure significantly improved post‐IFRS for New Zealand, whilst little change occurred for Australian firms. Thus, there is greater financial statement comparability across these countries post‐IFRS, but not full harmonization. Third, we show that the relationship between most firm characteristics and expense disclosure is weaker post‐IFRS. In addition, cross‐listed firms and loss‐making firms have a higher level of expense disclosure, as contrasted with firms in the investment and property industry which have a lower percentage of unspecified expenses but also report fewer voluntary expenses.     

The Brazilian Cattle Sector: Status, Prospects and Controversies

The cattle sector in Brazil (and in other countries of South America) is substantial in terms of size and potential impacts in world markets. Due to the sheer magnitude and potential of the Brazilian cattle sector, it merits our attention. A trend to more productive cattle systems, new rules for trade in livestock products and more effective control of hoof and mouth disease in some areas of Brazil could cause it to become a more formidable beef exporter. Brazil also warrants attention because of the controversial practice of deforestation for cattle production in the Amazon rain forest. A vocal environmental lobby has decried cattle production in the Amazon, but this practice continues. This paper reviews the status, prospects and controversies of the beef sector in Brazil, with a special focus on deforestation and cattleproduction in tropical ecosystems.     

From sponsorship to partnership in academy-industry relations

One practical result of the advent of the knowledge society has been an increased reliance on academic-industry partnerships as important sources for the creation of economic value. This paper argues that this renewed emphasis on knowledge has led to a shift in the nature of the relations between the academy and industry from sponsorship to partnership and the formation of new research institutions that allow researchers and practitioners to engage in continuous rather than problem based dialogue. These developments are illustrated by providing a case study based on the experience of one research team with its industrial partners. The paper presents results pertaining to some of the issues and challenges raised by continuous dialogue in partnerships, and emphasises the creative yet demanding implications of close collaboration between the two communities.     

Significant Issues for the Future of Product Innovation

In this issue, Merle Crawford and Milton Rosenau present their thoughts on some of the issues confronting product development professionals. Both reflect on the emergence of new products management as a profession—a field with its own requirements for success. Crawford wonders about the sustainability of our current use of teams for much of our work, the need for improved measurements, and the overall relationship between the management of new initiatives and the ongoing work of the organization. As new products work become more integrated with corporate operations, what new responsibilities will we face, beyond our current challenges? Rosenau looks squarely at the complex issues of rewards and compensation. How can we modify systems that have traditionally evaluated individual performance and adjust them to fit various cooperative work patterns necessary in new product development? He calls for formal study of these important issues. These essays continue a year-long series of contributions that the editor-in-chief solicited from members of the editorial board. Members were asked to reflect on changes and opportunities that they feel will influence our profession during the coming decade. Both of these short essays are designed to introduce new perspectives. It is not essential that you agree with the recommendations, but we hope that you are stimulated as you reflect on the issues that are raised.     

Bovine Brucellosis Programs: An Economic/Epidemiologic Analysis

This report analyzes the economic and epidemiologic impact of eight alternative bovine brucellosis programs in terms of their costs and benefits to society, consumers, producers and related agricultural industries. BRUSIM, a systems simulation model, was developed to measure the impact of various program components upon selected epidemiologic parameters and for determining associated costs and physical losses of brucellosis control/eradication programs for 1976 through 2005. The United States was delineated into 16 regions based upon such factors as prevalence, producer characteristics and cattle population. TECHSIM, an econometric model, was used for determining the total and net benefits accruing to society, consumers, producers, and related industries as a result of changes in beef and milk losses from alternative programs compared to a base program. The discounted values and associated program costs were used for determining benefit/cost ratios and related economic decision criteria. Cette étude analyse le choc économique et épidémiologique de huit programmes alternatifs de la brucellose pour bovine en termes de leurs coûts et avantages pour la société, les consommateurs, les producteurs et les industries agricoles reliées. BRUSIM, un modèle de simulation de système, a été développé pour mesurer le choc de divers composants d' un programme sur les paramètres épidémiologiques choisis et pour déterminer les coûts associés et les pertes physiques des programmes de contrôle ou d' éradication de la brucellose de l' année 1976 à travers 2005. Les Etats-Unis ont été divisés en 16 régions dependant des facteurs tels que la prévalance, les caractéristiques de producteur et la population de bétail. TECHSIM, un modèle économétrique, a été utilisé pour déterminer les bénéfices totals et nets que retirent la société, les consommateurs, les producteurs, et les industries reliées à cause des changements dans les pertes de rendement de viande et de lait dû aux programmes alternatifs en comparaison avec le programme de base. Les valeurs escomptées et les coûts associés des programmes ont été utilisés pour déterminer les rapports coûts-bénéfices et les critères de décisions économiques reliés.     

Generic Skills in Audit Education

The academic literature and higher education benchmark statements identify groups of skills that are desirable both for students seeking employment and for employers seeking to recruit students. Professional accounting education pronouncements also stipulate skills that are necessary for an individual to possess in order to act as a competent accountant and auditor. Through a questionnaire survey, this research examines: (i) which of these skills audit and accounting practitioners expect UK universities to teach; (ii) which skills audit and accounting academics believe are important for students to acquire; (iii) which skills audit academics believe that employers require; and (iv) which skills audit academics teach in the UK. Institutional theory is used to develop and interpret this research.     

Bidding asymmetries in multi-unit auctions: Implications of bid function equilibria in the British spot market for electricity

This paper introduces and tests Bid Function Equilibria (BFE) in the British spot market for electricity. BFE extend von der Fehr and Harbord's (1993) multi-unit auction model of wholesale electricity markets by allowing firms to have heterogeneous costs for different generating units. Pure-strategy equilibria in BFE predict asymmetric bidding by producers: a single firm (the “price-setter") bids strategically while other firms (“non-price-setters") bid their costs. We test for asymmetries in firms' bid functions in the British spot market between 1993 and 1995 and find strong empirical support for the theory. We conclude that BFE have important implications for the design and governance of electricity markets.     

Differences in the Cost of Mortgage Credit Implications for Discrimination

This paper estimates the mortgage interest rate differences paid by Asian, Hispanic, and African–American borrowers to a national home mortgage lender in the years 1988–1989. Controlling for differences in market rates, rate lock protection, and borrower risk factors, conventional loan interest rates are almost perfectly race-neutral. The single deviation from race-neutrality is that when interest rates fall during the borrower's rate-lock period, only African–American borrowers are unable to capture a share of this decline. Government (FHA and VA) credit models show small premia paid by African–American borrowers of about $1.80 per month on average. In government lending, Hispanic borrowers alone are unable to capture rate declines occurring during the borrower's rate-lock period.