Discourses surrounding the evolution of the IASB/FASB Conceptual Framework: What they reveal about the “living law” of accounting

The International Accounting Standards Board (IASB) and the Financial Accounting Standards Board (FASB) recently published the final version of Chapter 1 of their joint Conceptual Framework for Financial Reporting (IASB/FASB, 2010). In this article, we focus on two of the key issues addressed in Chapter 1: stewardship and the definition of the primary user groups of financial statements. To address the discourses surrounding the evolution of Chapter 1, we introduce the concept of “living law” from sociological jurisprudence into accounting scholarship. We first trace the role of stewardship/accountability in the evolution—from antiquity to the present day—of the living law of accounting. We then explore the origin, nature, and implications—from a living law perspective—of the moral traditions associated with stewardship/accountability. Our analysis suggests that stewardship has been, and continues to be, embedded in the living law of accounting—notwithstanding the formal pronouncements of standard setters. We also examine the social accounting project from a living law perspective and we suggest that such an analysis provides new possibilities for addressing core social accounting concerns. We conclude by arguing that, particularly in light of the far reaching impact of the neoliberal agenda, there is an urgent need for scholars in both contemporary “social” and “mainstream” accounting to recognize and build upon their shared living law heritage rooted in the age-old traditions of stewardship/accountability.     

Neue Wege in der Kapitalanlage: Die Symbiose zwischen Banken und Versicherungen im Bereich der ‚Alternative Assets‘

The current low interest rates pose a major challenge in particular for life insurers. The introduction of Basel III in the banking and Solvency II in the insurance sector will have major impacts on both industries. This paper provides insight into possible products supplied by banks, which offer the possibility for life insurers to invest in ‘alternative assets’, especially in infrastructure projects. The focus lies on investments in infrastructure loans. If these are placed in a SPV, which itself emits bonds, the lowest amount of regulatory equity capital for both, the bank and the insurance company is required.     

The Impact of Accounting Education Research

Abstract

This paper presents an exploratory study into the nature and patterns of usage of accounting education research. The study adopts the most accessible metric, Google Advanced Scholar citations, to analyse the impact of research published in the six principal English-language accounting education journals. The analysis reveals a global readership for these journals but evidence of relatively low citation levels. However, papers tended to be cited more than expected in cross-disciplinary education journals, discipline-specific education journals, and non-education journals. Guidance is offered to authors seeking to maximise the impact of their research, and issues of concern are identified for editors and publishers. This is the first paper to look beyond content at the usefulness of research in accounting education as indicated by citations. In doing so, it contributes to the current debate on the quality of this research, and of research in accounting and finance in general.     

The perilous leap between exploration and exploitation

Research summary : R&D‐based exploration and exploitation are necessary in order for firms to have sustainable competitive advantage. Yet, transitioning between these orthogonal types of R&D is considered profound organizational change. Building on recent research showing that compact, significant changes in R&D expenditure is an antecedent to the transition between explorative and exploitative R&D, I show that this leap between exploration and exploitation is quite hazardous. The magnitude of changes in R&D expenditure, whether increases or decreases, is positively associated with organizational failure. Firms maintaining higher levels of absorptive capacity are more capable of surviving the leap from R&D‐based exploitation to exploration, and firms that do not use reductions in R&D expenditure to manipulate short‐term earnings performance are more likely to survive the leap from exploration to exploitation. Managerial summary : In order to survive and thrive, innovative companies must be able to exploit their existing competencies, and to explore for new ones once those current competencies decline in value. However, transiting from one form of innovation to the other is difficult because the skills required to explore are fundamentally opposed to those required to exploit. In this article, I describe how difficult this leap between exploration and exploitation can be. I show that the move between R&D‐based exploration and exploitation is related to organizational failure. In addition, firms that are superior learners are more likely to survive the leap from exploitation to exploration, and firms that are not cutting R&D expenditure to manipulate earnings are more likely to survive the leap from exploration to exploitation. Copyright © 2015 John Wiley & Sons, Ltd.     

Far Beyond the Quarterly Call: CECP's First CEO‐Investor Forum

The authors begin by describing how the existing structure of corporateshareholder communications encourages short‐term planning and performance evaluation horizons. Then, after summarizing the substantial evidence that corporate management, boards, and investors are concerned about the failure of current corporate‐shareholder communications to reflect longer‐run corporate investment and its expected payoffs, the article holds up the long‐run plans presented by the CEOs of five large public U.S. companies (and the CFO of IBM) at the first ever CECP CEOInvestor Forum as providing a promising model for the future. Such presentations are also evaluated against a set of criteria the authors propose for assessing the effectiveness of those presentations—criteria that were developed through extensive investor and CEO feedback. The article concludes by discussing the three main programs that make up CECP's Strategic Investor Initiative to further the development of such longterm plans. One program is focused on identifying different kinds of investors, with the aim of helping management attract longer‐term shareholders. A second program is designed to improve the ways companies communicate with their non‐investor stakeholder groups, with particular emphasis on The Statement of Material Audiences and its role in identifying the critical stakeholders and their contributions to the long‐run success of the company. Third and last is the development of a common language and tool‐kit for longterm plans, with the aim of bringing about the broad adoption of longterm plans as a mainstream element in corporate‐shareholder communications.     

The value of conserving genetic resources for R&D: A survey

The value of genetic resources for R&D is placed within the framework of discussions concerning sustainability. We assess the extent to which society is able to invest now in order to prepare for future risks and uncertainties in the arrival of biological problems. Each of the approaches to valuation is discussed within this setting. Weitzman's approach to measurement is seen to be one that considers society's current objectives and information to be little relevant to future risks and uncertainties. Sedjo, Simpson and Reids' search-theoretic perspective is seen to reduce future uncertainties to highly tractable and known problems. Goeschl and Swanson's bio-technological approach also constrains the problem to be one without any real uncertainty, and focuses on the need to maintain genetic resources in order to maintain control over the problem. Kassar and Lasserre place uncertainty at the core of the problem, and assess the extent to which additional value is added by this feature. In sum all of the approaches to the problem evince a pessimism regarding the capacity of future technological change automatically to resolve these problems. Given this, the value of genetic resources depends on beliefs concerning the ability of current objectives to anticipate future risks and uncertainties.     

Sensory Experiences and Expectations of Italian and German Organic Consumers

We explore sensory experiences and expectations of Italian and German organic consumers when purchasing and eating organic food. Ten focus group interviews were performed and the results were analyzed using qualitative content analysis. Outcomes indicated that although sensory attributes are not the main purchase drivers, flavor and odor are the most important in driving consumers' choice. Findings also suggested that training consumers' sensory abilities offers new market opportunities to organic marketers. From a marketing perspective, Italian consumers seem to equally appreciate nonsubjective as well as subjective marketing information about organic products, whereas in Germany non subjective aspects appear to be predominant.     

Regulating harmless activity to fight crime

This paper establishes that regulating harmless activity can be an effective instrument of law enforcement when the harmless activity and the harmful activity are interdependent. This type of regulation is not without cost, as it distorts the individual choices made by both law-abiding and non-law-abiding individuals. However, it can be socially advantageous when the impact on welfare resulting from changes in the choices of offenders dominates the impact of changes in non-offenders’ decisions; in addition, increasing deterrence by other means (such as raising the probability of detection or the magnitude of sanctions) can incur much higher costs.