The impact on stock prices of deferral and elimination of internal control audit requirement for small firms

This paper examines the cumulative market reaction to the events related to deferral of internal control audit requirement under the Sarbanes-Oxley Act of 2002 and its elimination under the Dodd-Frank Act of 2010 for nonaccelerated filers (small firms). We document that small firms experienced negative cumulative abnormal returns around these events; and the differences between the cumulative abnormal returns for small firms and the two control groups (accelerated and large accelerated filers) were negative and significant at the 1% level. These results support the notion that market participants value the reliability of financial information irrespective of the firm size. Within the small firms, we find no firm characteristic significantly explains the market reaction to the events considered. That is, all small firms lost market value in reaction to the events that delayed and eliminated their internal control audit requirement.     

Prioritizing Long-term Watershed Management Strategies Using Group Decision Analysis

There is a growing consensus that an effective way of enhancing long-term water resources management and environmental sustainability is through locally based planning at the watershed scale. Managing watershed resources for particular uses requires interactive dialogue among all stakeholders who have different objectives. Therefore, the resolution of inter-group conflict should be an acknowledged task of the planning process. In this paper, an integrated framework for prioritizing watershed management strategies is proposed. A case study is employed to highlight the challenges of using group decision analysis in strategic planning and to illustrate the interaction between different stakeholders on watershed issues. In particular, two group decision-making approaches are used to assess and analyse different stakeholders' preferences for various strategies and alternatives. Professional experts, government agencies and community leaders constitute the different parties included in the framework. The main focus is on the application of group decision analysis in the long-term watershed planning process. The results of the overall preference analysis show that water resources development is the most important strategy followed by agricultural and range management.     

Joint pricing and inventory control for non-instantaneous deteriorating items with partial backlogging and time and price dependent demand

In this paper, a joint pricing and inventory control for non-instantaneous deteriorating items is developed. We adopt a price and time dependent demand function. Shortages is allowed and partially backlogged. The major objective is to determine the optimal selling price, the optimal replenishment schedule and the optimal order quantity simultaneously such that, the total profit is maximized. We first show that for any given selling price, optimal replenishment schedule exists and unique. Then, we show that the total profit is a concave function of price. Next, we present a simple algorithm to find the optimal solution. Finally, we solve a numerical example to illustrate the solution procedure and the algorithm.     

A Multi-Model Nonstationary Rainfall-Runoff Modeling Framework: Analysis and Toolbox

Water Resources Management - We present a framework and toolbox for multi-model (one at a time) nonstationary modeling of rainfall-runoff (RR) transformation. The designed time-varying nature of...     

Effect of side slope of main channels on formation and penetration of scour hole in confluences

In an open‐channel confluence, deep scour holes and depositional point bars are usually formed due to high bed‐shear stresses and secondary circulations. In the present study, presuming the effectiveness of channel geometry on the flow dynamics at the confluence, some variables including different side slope angles of the main channel (θ = 45°, 60°, 75°, 90°), lateral to downstream discharge ratio (Q_r), and downstream densimetric Froude number (Fr_g3) were experimentally studied under clear‐water condition for the confluence angle α = 90°. According to the results, the increase of θ led to a greater penetration of scour hole across the main and tributary channels, whereas a little scour development was observed along those channels. Meanwhile, an increase in Q_r and Fr_g3 caused further scouring, but their effects on the dimensions of scour hole diminished with increase of θ. Thus, with increase of Q_r from 0.194 to 0.552, the mean penetration rate of scour hole to all directions for θ = 45°, 60°, 75°, and 90° was obtained 42.8%, 32.4%, 25%, and 20.5%, respectively. In addition, considering the effect of θ, Q_r, and Fr_g3, some empirical relationships were obtained for estimating the penetration length of scour hole. The derived relationships show that Fr_g3 plays more important role on the dimensions of scour hole than θ.     

Correction to: Monitoring and Predicting Saltwater Intrusion via Temporal Aquifer Vulnerability Maps and Surrogate Models

Water Resources Management -     

Investor legal protection and earnings management: A study of Chinese H-shares and Hong Kong shares

Under the unique “one country, two systems” arrangement, the more stringent investor protection rules in Hong Kong are not enforceable in firms that are incorporated in China but listed on the Hong Kong stock exchange (H-shares). As such, H-shares and other local Hong Kong firms are subject to different investor protection regimes in the same stock market. We find that H-shares are associated with higher earnings management than local Hong Kong firms after controlling for disparity in economic development, types of controlling shareholders and other factors. More importantly, this relationship is weaker after China implemented the Securities Law in 1999. The results are robust after considering the dual-listing status of H-shares and board characteristics. These results provide direct evidence showing the effect of investor legal protection on financial reporting quality.     

An empirical study of the determinants of UK oil and gas voluntary disclosures

Significant oil and gas firm market value is derived from their physical reserve quantum, assets which are not recorded on their statements of financial position. This article provides empirical evidence regarding voluntary disclosure of such reserves in line with the previously unresearched UK sector with regard to its unique reporting guidelines. The study considers both the reporting of the reserve quantum and the quality of that reporting. This article seeks to inform the International Accounting Standards Board’s (IASB’s) on-going consideration of mineral resource reporting. Listed companies are considered to evidence forms of reserve disclosure with a logistical regression approach applied to measure determinants of reporting. The risk associated with mineral reporting reserves is hypothesized as the key disclosure driver whilst controlling other relevant variables. The majority of firms disclosed reserve quantities in some form but only a minority disclosed in line with recommended practice, disclosure quality being more variable between companies. The findings indicate that a voluntary disclosure approach is ineffective, partially explained by agency related behaviour. Risk, proxied by the stage of production, drives reserve disclosure showing that producer firms are more likely to disclose reserve quantum balances and of a significantly higher quality.     

Getting ahead or falling behind: Findings from the second wave of the National Income Dynamics Study

The National Income Dynamics Study is the first national panel study of South African individuals. Its objective is to track these individuals over time to study social mobility. This paper documents the survey design and a successful recontact record in Wave 2 before providing an overview of the key findings from the other papers in this issue of the journal. Those from the top of the income distribution were hardest to recontact. The papers show that average real incomes grew slightly between 2008 and 2010. However, life satisfaction and expectations of future upward mobility declined. Being unemployed and moving into unemployment is associated with the lowest level of life satisfaction. Aggregate employment did not decline much but there was significant labour-market churn. The National Income Dynamics Study data reveal high levels of grade repetition and a slow transition from school to work. Relocating is shown to be an important part of schooling and employment decisions.