Understanding the structure of audit workpaper error knowledge and its relationship with workpaper review performance

This study examines the veracity of two important, yet untested, premises underlying the interpretation of hierarchical variation in workpaper review performance. Prior research has argued that auditors at different hierarchical levels structure their knowledge of workpaper errors differently, and that these differences in knowledge structure give rise to hierarchical variation in the ability of auditors to identify mechanical and conceptual workpaper errors. This study directly examines the way in which audit firm managers, seniors and staff auditors structure their knowledge of audit workpaper errors and finds variation across hierarchical levels. These differences in knowledge structure were found to be associated with variation in workpaper review performance as they related to the identification of conceptual errors, but not, as proposed in prior research, mechanical workpaper errors. These results guide future research efforts aimed at improving workpaper review performance.     

Accounting for the Public Sector at a Time of Crisis

This Special Issue is based on papers initially presented at the ‘Accounting for the Public Sector at a Time of Crisis’ Conference at the Centre for Not-for-profit and Public-sector Research, Queen's University Belfast, UK in 2018. The public sector consists of organizations that are owned and operated by government; organizations that exist to provide goods and services for a country's citizens. What is particularly distinctive about such organizations, and what makes them different from businesses, is that they are (or, at least perhaps, should be) not-for-profit. In addition, they frequently have wide social and cultural goals that are central to what they do. They are pervasive in most societies. Yet, it is argued, they face crisis on a number of fronts: in terms of the influence of potentially inappropriate, business-like new public management ideas related to performance management and the embracing of related accounting and budgeting approaches; and in terms of the impact of austerity, following the Great Recession in 2008. In such a context it is suggested that public sector governance, accounting, and accountability systems are heavily involved. The papers included in this Special Issue present an opportunity to reflect on aspects of this crisis in terms of how it connects with accounting systems and accounting changes. Key arguments of these papers, and overarching themes of this Special Issue, are explored in this editorial.     

Immigration and labour-market outcomes in the United States: a political-economy puzzle

Based on a larger survey of the literature (Gaston and Nelson,2000), this paper argues: (i) that econometric research uniformlyfinds very small labour-market effects of immigration; (ii)that labour and trade economists have differed in their interpretationof this finding; and (iii) that this difference is driven exclusivelyby different dimensionality assumptions (with labour economistspreferring a 1-sector x m-factor model and trade economistsan n-sector x m-factor model). It is then argued that the tradeeconomists' model, along with its presumption of factor-priceinsensitivity to immigration is the more useful as a presumptiongenerator. The paper concludes with a discussion of the political-economyimplications of these results.     

Host–guest authentication of intangible cultural heritage: a literature review and conceptual model

ABSTRACT

Cultural tourism and intangible cultural heritage (ICH) play a key role in tourism worldwide, and are especially important for communities in developing countries, due to the demand for authentic experiences. This article provides a review of existing literature on the authenticity and authentication of ICH. The review reveals scholarly inquiry has evolved from external-expert ‘cool’ authentication to direct host–guest on-site or ‘hot’ authentication whereby tourists participate in the process of determining authenticity. Further, existing models for authentication of ICH have focused only on either a guest’s or host’s perspectives with little attention to the inevitable mutual interaction of the host and guest in the authentication of ICH. Mutual authentication can enhance the tourist experience and improve community empowerment. This paper develops a conceptual model of the mutual (host–guest) authentication of ICH, incorporating both hosts’ and tourists’ perspectives. The model has application in ICH based tourism and emphasizes power relationships between the host and guest, and community empowerment across political, social, psychological and economic domains. Future research is needed to test and validate this conceptual model.     

Missing Price Information and Its Impact on Equilibrium Price Dispersion: Evidence From Gasoline Signboards*

This article seeks to quantify the importance of price information in reducing consumer search costs and equilibrium price dispersion in a competitive setting. It exploits a natural experiment in the retail gasoline industry in which stations post the prices of only certain grades of gasoline on large street-side signboards, and not others, except where required by law. Differential-by-grade signboard information predicts a specific curvature in price dispersion across grades, and differentiates itself from other noninformational factors such as income and cost. The impact of readily-available price information on search and price dispersion is found to be exceptionally large.     

Telecommunications in the United States and Changing Productive Efficiency

The issue explored is whether incentive regulation in the telecommunications industry in the United States has resulted in an increase in productive efficiency. After providing an overview of the nature of incentive regulation, the methodology for measuring the effects of incentive regulation on productive efficiency is reviewed. An approach is introduced that not only provides a measure of the change in productivity but also allows for a decomposition into two mutually exclusive and exhaustive components—changes in technical efficiency over time and shifts in technology over time. Using annual data on four output measures and six input measures for the period 1988–1999 for nineteen individual local exchange carriers, the results indicate that productivity increased by about 4.9% per year. This growth is due primarily to innovation rather than improvements in efficiency. Of the 19 LECs in the sample, 12 were operating efficiently throughout the entire 1988–1999 period. Of the remaining seven, three showed a slight improvement in efficiency while the efficiency of four declined. In the aggregate, however, there was virtually no change in efficiency.     

A Note on Measuring the Productivity Offset for Regulatory Purposes

Calculation of the productivity offset or the X-factor used in setting price caps has a fundamental flaw when it is based on conventional growth accounting total factor productivity analysis. The problem is discussed in the context of incentive regulation used by the Federal Communications Commission in the United States and the appropriate correction is indicated. An example of the problem and its correction, using the access charge for interstate service in telecommunications, is provided. The correction shows that the appropriate X-factor is 12 percent greater than that based on conventional growth accounting total factor productivity analysis.     

Productivity Change,Technical Progress,and Efficiency Improvement in Telecommunications

Implementation of incentive regulation intelecommunications requires the accurate measurementof the change in productivity. An approach isintroduced that not only provides a measure of thechange in productivity but also allows for adecomposition into two mutually exclusive andexhaustive components – changes in technicalefficiency over time and shifts in technology overtime. Using annual data on four output measures andsix input measures for the period 1988 to 1998 fornineteen individual local exchange carriers, theresults indicate that productivity increased by about5.0 percent per year. This growth is due primarily toinnovation rather than improvements in efficiency. Ofthe nineteen LECs in the sample, thirteen wereoperating efficiently throughout the entire 1988–1998period. Of the remaining six, two showed a slightimprovement in efficiency while the efficiency of fourdeclined. In the aggregate, however, there wasvirtually no change in efficiency. Finally, acomparison is made between two methods of estimatingthe change in productivity. The conventional growthaccounting approach yields a lower estimate of therate of change in productivity than does the Malmquistindex approach. The difference between theseestimates is interpreted as the lower bound of thebias associated with the conventional growthaccounting approach to measuring the growth inproductivity.