The Effect of Internal Control Certification Regulatory Changes on Real and Accrual-based Earnings Management

ABSTRACT

This study examines the effect of changes in internal control certification requirements (ICCR) on the earnings management choices of Australian firms in the period 2007–2015. The Australian setting is unique as the certification requirements change from voluntary in 2004–2007 to mandatory in 2008–2014, before being abolished in 2015. Consistent with the notion that real earnings management (REM) is less susceptible to detection, the results suggest that firms place greater reliance on REM than on accrual-based earnings management (ABEM) when having to comply with certification requirements. In particular, I find voluntary certifiers have lower REM and ABEM relative to first-time certifiers in the mandatory period between 2008 and 2014, and there is an increase in REM activities among first-time mandatory period certifiers. Moreover, firms that discontinue certification, after the abolition of the requirement in 2015, switch from REM to ABEM. This suggests that regulatory ICCR changes affect firms’ earnings management choices.     

CEO Branding: Between Theory and Practice — Case Studies of Israeli Corporate Founders

This is the first interdisciplinary study to empirically test a theoretical model described in 2013 by Bendisch, Larsen, and Trueman, regarding the CEO branding process—by comparing three founder CEO brands in Israel. The findings validate the model and display strongly perceived “authenticity” in each case study, strengthening the reliability of the CEO brand. The study clearly shows that each of these successful CEO brands has: a clear brand identity, built on the alignment of its human identity and its managerial identity; a strong CEO brand reputation, built on its human reputation and aligned managerial reputation; clear congruence between the CEO brand identity and reputation, producing a distinct, differentiating CEO brand positioning leading to CEO brand equity. These findings, along with stakeholders’ internalization of CEO Brand Reputation values, produce stakeholder positive perceptions of the company—largely through the central role of the business media in the process of CEO branding. Surprisingly, none of these founder CEOs had any prior intention of creating a CEO brand. This study also offers a clear, detailed replication methodology for studying other types of CEOs, in other countries/cultures.     

Understanding road traffic risks from the street hawker’s perspective

This study explored street hawkers’ lived experiences and risks in traffic using the phenomenological case study design. Data from 24 hawkers at three hawking spots and field observations form the basis of our study. A stratified purposeful sampling scheme was employed to ensure a balance of gender and age. Thematic data analytic strategy was employed in the data analysis. We found that participants’ traffic incidents were mainly self-induced, attributable to their negligence on the road, indiscriminate road crossing and car-following behaviour. Our results suggest a perceived relationship between socio-demographic characteristics and personal traffic accident encounters. Also, we noted that the ability to manage traffic risk seem to influence hawkers’ traffic risk perceptions, with gender and age as possible mediators. As this study is exploratory, we recommend further scientific enquiry to explain these issues and to provide the basis for appropriate interventions to manage the road safety implications of this activity.     

Estimating the economic cost of the COVID-19 pandemic

Business Economics - Our study presents a framework to estimate economic costs of the COVID-19 pandemic for the U.S. economy. We characterize whether the pandemic-related damages are short-lived or...     

Are yield-curve/monetary cycles’ approaches enough to predict recessions?

Business Economics - This paper proposes a new framework that identifies a threshold between the fed funds rate and the 10-year Treasury yield and, when the threshold is breached, the risk of a...     

Special issue: Australian Accounting Standards Board Research Forum

The Australian Accounting Standards Board (AASB) engages with academics and encourages them to make practical recommendations for the standard‐setter across three sectors: for‐profit, public and other not‐for‐profit sectors. In doing so, the AASB organised Research Forums in 2016 and 2017 that were of great value to researchers, practitioners and the standard‐setters. Four papers from the Forums in 2016 and 2017 were submitted and accepted for publication in this special issue. This paper provides an overview of the Forum, discusses the impact of conducting research and how the findings of the researchers informed the AASB’s standard‐setting process.     

The sexual division of care in mainland China and Hong Kong

The aim of this paper is to explore the extent to which the sexual division of domestic labour in Hong Kong and mainland China is influenced by traditional Chinese values and contemporary political and economic factors. It discovers that women in these two societies assume far more caring responsibilities than men. This is similar to women in traditional Chinese society. An important reason is that the political and economic conditions in Hong Kong and mainland China favour the reproduction of traditional Chinese values. Hence it can be argued that the unequal division of domestic labour between men and women will continue as long as the political and economic conditions are unfavourable to women. Le but de cet article est d’explorer jusqu’à quel point les valeurs chinoises traditionnelles et les facteurs politiques et économiques contemporains influencent la division sexuelle du travail domestique à Hong Kong et en Chine. Cet article a découvert que, dans ces deux sociétés, les femmes ont beaucoup plus de reponsabilités sociales que les hommes. Ceci est similaire à la société chinoise traditionnelle. Une raison importante est que les conditions politiques et économiques à Hong Kong et en Chine favorisent la reproduction des valeurs chinoises traditionnelles. On peut donc dire que la division inégale du travail domestique entre les hommes et les femmes continuera tant que les conditions politiques et économiques seront désavantageuses pour les femmes.     

The accounting practitioners/accounting educators dialogue — A short survey

The collective mission of accounting educators in any college or university is to keep the accounting program in-tune with current practices in public accounting, the industrial sector, and in governmental accounting. A Practitioners/Educators Dialogue is one way to meet the challenge of keeping the level of instruction and the accounting program relevant with current practices and standards. This paper reports on a survey of Accounting Department Chairpersons concerning the degree of interest in the concept of a Practitioners/Educators Dialogue Program.