Optimal employment subsidies and market structures in industries with unemployment

In this paper we analyze the issue of optimal employment subsidiesin imperfectly competitive industries in which a distortionin the labour market generates involuntary unemployment. Asa benchmark case, we focus on monopolies and duopolies and oncomplete information between firms and government. We characterizethe levels and creations of employment in the subsidized industryand we check when such employment policies are more favorableto the least productive firms.     

New development: Local public audit—the changing landscape

This article considers the implications for local public audit of the abolition of the Audit Commission and its audit practice (District Audit). The audit regime of NHS foundation trusts, where the Audit Commission is not responsible for auditor appointments or their oversight, is investigated to provide insights for the future of local public audit.     

Promise-keeping: A Low Priority in a Hierarchy of Workplace Values

Using a sample of over 700 business people and students, this study tested the premise of promise-keeping as a core ethical value in the work place.The exercise consisted of in-basket planning for layoffs within an organization. Only one of the five employees within the group had been given an express commitment/promise of continued employment for a two year period. The layoffs were being considered six months after the two year promise had been made. All five employees were performing their jobs adequately, and each had either personal or work attributes representing competing values that would have made it difficult to choose among them.Clearly, promise-keeping does not matter most in the workplace: subjects overwhelmingly ignored their promises even when legally bound to keep them. Further, promise-keeping consistently was found to rank last in a hierarchy of workplace values. The legal system was suggested as a viable mechanism for encouraging promise-keeping in the workplace. Although the possibility of legal sanctions increased the frequency with which promises were kept, overall fewer than one-third (30%) of the subjects kept their word. Of those respondents who expressly were told that the promise was legally enforceable, the number who stated that they would keep their promise increased to 57%.     

ACCOUNTING FOR (A) PUBLIC GOOD: PUBLIC HEALTHCARE IN ENGLAND

This paper reviews accounting technologies used over recent decades in the National Health Service: a public service (good) and the accounting for public interest (good) therein. The trends in NHS accounting are considered in the context of the defining characteristics of a modern public service. The accounting technologies, collectively known as New Public Financial Management (NPFM), are integral to wider public service reform. The overview of accounting technologies in context attempts to draw out some of the deficiencies or apparent mismatches in accounting technologies and public service reform.     

Corporate incentives for hedging and hedge accounting

This article explores the information effect of financial riskmanagement. Financial hedging improves the informativeness ofcorporate earnings as a signal of management ability and projectquality by eliminating extraneous noise. Managerial and shareholderincentives regarding information transmission may differ, however,leading to conflicts regarding an optimal hedging policy. Weshow that these incentives depend on the accounting informationmade available by the firm. Under some circumstances, if hedgetransactions are not disclosed (i.e., firms report only aggregateearnings), managers hedge to achieve greater risk reductionthan they would if full disclosure were required. In these cases,it is optimal for shareholders to request only aggregate accountingreports.     

The Removal of a Specialist Oversight Body for Local Public Audit: Insights from the Health Service in England

The abolition of the Audit Commission in England and Wales removes the ‘protector of the public purse’. The oversight body and its audit practice are largely replaced by the private sector regime and audit firms. We analyse the audit market for health service foundation trusts, an area of local public audit that operates without oversight from the Commission. We find evidence of premiums paid to some Big4 firms and that the presence of specialist public service auditors results in fee discounts. The firms limit their liability and assurance of audit quality is reduced under new audit regimes and governance structures.