Decomposition of Fraud‐Risk Assessments and Auditors' Sensitivity to Fraud Cues*

Practitioners and regulators are concerned that when auditors perceive management's attitude or character as indicative of low fraud risk, they are not sufficiently sensitive to high levels of incentive or opportunity risks in their overall fraud‐risk assessments. In this study, we examine whether a fraud‐triangle decomposition of fraud‐risk assessments (that is, separately assessing attitude, opportunity, and incentive risks prior to assessing overall fraud risk) increases auditors' sensitivity to opportunity and incentive cues when perceptions of management's attitude suggest low fraud risk. In an experiment with 52 practicing audit managers, we find that auditors who decompose fraud‐risk assessments are more sensitive to opportunity and incentive cues when making their overall assessments than auditors who simply make an overall fraud‐risk assessment. However, this increased sensitivity to opportunity and incentive cues appears to happen only when those cues suggest low fraud risk. When opportunity and incentive cues suggest high fraud risk, auditors are equally sensitive to those cues whether they use a decomposition or a holistic approach. We discuss and examine potential explanations for this finding.     

Use of oxygen for the cleaning, passivation, and preservation of power-generating equipment at the Kharanorskaya SAPP

Studies conducted on two power-generating units at the Kharanorskaya SAPP relative to the steam-water-oxygen passivation, preservation, and partial cleaning of all boiler-heating surfaces, including the surfaces of the reheater, and passivation of the surfaces of the high-pressure heaters on the steam and water sides by the steam-oxygen method, as well as partial passivation, preservation, and cleaning of turbine blading are presented. __________ Translated from élektricheskie Stantsii, No. 6, pp. 56–64, May, 2006.     

Effective sludge solubilization treatment by simultaneous use of ultrasonic and electrochemical processes.

Sludge disintegration treatment by using simultaneously ultrasonic irradiation and electrolysis was investigated experimentally. A lab-scale diaphragm cell irradiated with ultrasound at a constant oscillating frequency of 20 kHz was used as a reactor. The batch experiments were carried out under different conditions of electric outputs of the ultrasonic generator, electric current for the electrolysis and different initial SS concentrations. A simultaneous treatment in the cathodic compartment without any chemical doses considerably facilitated the sludge solubilization, compared to the sonication alone. An increase in the electric current up to 400 mA under a constant ultrasonic density decreased the specific energy by 55% within the experimental range. The specific energy consumption was also reduced when the initial SS concentration increased. In addition, before carrying out the simultaneous treatment, a brief electrolysis was effective for further reduction of the specific energy and the acceleration of soluble COD generation.     

Using a weight-of-evidence approach for management of watersheds.

This research used a weight-of-evidence approach to evaluate sources of contaminants in a drinking water watershed that serves as part of the City of Boston's water supply. The approach incorporated land use analysis using GIS, sanitary surveys, traditional water quality monitoring and microbial source tracking (MST) tools. Case-study tributaries were selected based on elevated faecal coliform counts. Land use analysis and sanitary surveys were used to identify suspected microbial sources, including residential septic systems, agricultural animal operations, commercial/industrial operations and wildlife activity. Sampling sites were selected to hydrologically isolate potential contamination sources. Samples were collected seasonally over 1 year and analysed for traditional and MST parameters. Results demonstrated that both septic systems and a horse stable were contributing microbial loads in the first tributary. In the second tributary, septic systems from the townhouses were contributing microbial loads while a plant nursery was contributing organic matter. This evidence was used to evaluate best management practices to mitigate the contamination.     

Endogenous Group Formation

While the rules governing the formation of groups engaging in collective action may have significant impact on group size and behavior of members, most experiments on public goods have been conducted with the subjects in exogenously fixed groups or of fixed sizes. We study endogenous formation of groups in a public‐goods provision game by allowing subjects to change groups under three sets of rules: free entry/exit, restricted entry with free exit, and free entry with restricted exit. We find that the rules governing entry and exit do have a significant impact on individual behavior and group‐level outcomes.     

Seeking convergence between history and futures research

The objective of this paper is to analyse how much the traditions of history research (HR) and futures research (FR) have in common and how they could assist each other. First, the role of time is analysed. Second, the path dependence theory, strategic decision-making, knowledge management and visionary management are discussed. Examples of the application of the latter in water and sanitation services and their long-term development are shown. Finally, some argumented views are presented on how the convergence between FR and HR could be improved.The key point of this research is the seeming discontinuity between presents, recent pasts and near futures. The traditions of HR probably make it more difficult to assess the effects of strategic decisions on the recent. If more convergence is wanted, the gap should be filled somehow. On the other hand, the core of FR research seems to concentrate more on strategic and visionary horizons while perhaps neglecting the operational horizon of the near future.     

中国投资者进军美国市场将获新途径

中国股市从不久前的辉煌之巅急转直下，而与此同时，这个全球第一人口大国的投资者们又将获得新的渠道进军包括美国在内的海外股市。     

Generalized piecewise linear histograms

We extend the concept of piecewise linear histogram introduced recently by Beirlant, Berlinet and Györfi. The disadvantage of that histogram is that in many models it takes on negative values with probability close to 1. We show that for a wide set of models, the extended class of estimates contains a bona fide density with probability tending to 1 as the sample size n increases to infinity. The mean integrated absolute error in the extended class of estimators decreases with the same rate n^–2/5 as in the original narrower class.     

Ex ante assessment of the returns to livestock disease control in Indonesia

Agriculture's importance in the process of economic growth highlights the role of sustained advances in farm production practices by improving the quantity and quality of farm products. In this context, investment in improved agricultural technology continues to be an important avenue of assistance to the developing countries. However, the increased resource pressures facing both aid donors and recipients have emphasised the need for the prior assessment of the potential benefits of aid projects to assist effective aid planning and management. Here, the main requirements are to establish viable project goals for translation into effective programmes, to predict the likely project impacts, and to evaluate the potential benefits and costs of adopting the project's outcomes. An ex ante assessment of assistance in controlling a major livestock disease in Indonesia's eastern islands is described in this paper. The annual net benefits from controlling this disease ranged between $A0.45 and $A2.5 million according to the mortality rate reduction achieved. The benefits were shared between beef producers and consumers according to the market elasticity conditions assumed.