Teaching accounting information systems using a case study approach

The Accounting Information Systems course has been a difficult and frustrating course to teach. This article explains the case study approach taken at BYU that seems to solve many of the problems encountered with this approach. The cases used are described as well as the benefits and problems encountered with this approach.     

On the use of risk analysis for the evaluation of industrial R&D expenditures

This paper focuses on a particular aspect of the R&D decision process, i.e. the screening of alternative projects at the firm level. A review of the traditional methods of risk analysis, based on two-parameter measures of risk and return, strongly suggests that they are unable to capture the essential skewed nature of R&D decisions due to the underlying assumption of normal distributions. Fortunately, the availability of alternative models based on ‘distribution free’ methods has significantly increased our ability to evaluate highly skewed returns. This paper sets out, in some detail, the case of using one such model, the stochastic dominance paradigm, to screen R&D proposals.     

Developing priorities for improving the urban social environment: A use of Delphi

A specially modified Delphi exercise was designed to satisfy two study objectives: (1) to develop components for satisfaction indicators of the modern urban milieu, and (2) to determine the importance and alterability of components of dissatisfaction experienced by the urban dweller. The study of both importance and alterability of components of dissatisfaction leads to priorities for application of resources in both improving existing conditions in modern cities and in developing plans for the design of new cities.     

Corporate taxation and the choice of patent location within multinational firms

Corporate patents are important assets in the modern economy, where knowledge is highly valued. In many multinational enterprises (MNEs), they constitute a major portion of the business's value. The intra-firm transfer pricing process for patent-related royalty payments is moreover often highly intransparent and patents thus represent a major source of profit shifting opportunities between multinational entities. For both reasons, MNEs have an incentive to locate their patents at low-tax affiliates to minimize the corporate tax burden. The purpose of our paper is to empirically test for this relationship by exploiting a unique dataset that links information on patent applications to micro panel data for European MNEs. Our results suggest that the corporate tax rate (differential to other group members) exerts a negative effect on the number of patent applications filed by a multinational affiliate. The effect is quantitatively large and robust to controlling for firm size and unobserved heterogeneity between the entities. The findings moreover prevail if we account for royalty withholding taxes and binding ‘Controlled Foreign Company’ rules.     

Creating Customer Value in Participating Life Insurance

The value of a life insurance contract may differ depending on whether it is looked at from the customer's point of view or that of the insurance company. We assume that the insurer is able to replicate the life insurance contract's cash flows via assets traded on the capital market and can hence apply risk‐neutral valuation techniques. The policyholder, on the other hand, will take risk preferences and diversification opportunities into account when placing a value on that same contract. Customer value is represented by policyholder willingness to pay and depends on the contract parameters, that is, the guaranteed interest rate and the annual and terminal surplus participation rate. The aim of this article is to analyze and compare these two perspectives. In particular, we identify contract parameter combinations that—while keeping the contract value fixed for the insurer—maximize customer value. In addition, we derive explicit expressions for a selection of specific cases. Our results suggest that a customer segmentation in this sense, that is, based on the different ways customers evaluate life insurance contracts and embedded investment guarantees while ensuring fair values, is worthwhile for insurance companies as doing so can result in substantial increases in policyholder willingness to pay.