Impacts of the timing of the discovery of a subsequent event on the auditors’ approach to subsequent events

This study investigates the underlying causes affecting auditors’ approaches to subsequent events. As auditors are required to perform the majority of subsequent events procedures near the due date of the audit report, I examine whether auditors are less likely to make adjustments or disclosures regarding subsequent events that occur after the audit completion, but before issuing the audit report. Results indicate that auditors were less likely to adjust Type I events that occurred after audit completion when the risk was low, but not when the risk was high. This was not the case for Type II events, which only require disclosure.     

Dependent on one but vulnerable to another: opportunism threats and control solutions for customization providers

While economic theory suggests that identifying alternate customers is costlier than identifying alternate specialized employees for customization providers, substantial field research evidence indicates the opposite, where providers are reportedly more dependent on employees than customers. We inquire into this contrasting picture between theory and practice through an in‐depth case study that suggests that what begins as customer dependence transforms into vulnerability to employees. While perceived vulnerability to customers is efficiently removed through ex ante controls, the physical asset specificity in each customer order generates task uncertainty, specialization and teamwork, which become the new sources of opportunism threat for the customization providers. Compounded layers of ex ante and ex post controls with frequent iterations suggest a need for continuous management (as against removal) of vulnerability to employees.     

Goal‐efficacy framework: an examination of domestic and international accounting students' academic performance

This study considers the psychological influences on academic performance using a goal‐efficacy framework. Data were gathered using a survey questionnaire (N = 375). The paper is motivated by a repeated high failure rate for a second‐year core accounting unit and anecdotal evidence that international students perform poorly in comparison with domestic students. The results demonstrate the role of self‐regulated learning strategy as a mediating variable for goal orientation and academic performance. While the analyses suggest no significant differences between domestic and international students with respect to the main psychological variables and academic performance, further analyses reveal that four specific factors of the main psychological variables are significantly different between domestic and international students.     

Rational early exercise of call options: Australian evidence

Alpert (2010) develops a detailed analysis of the conditions for rational early exercise of call options in the presence of taxes. Using Alpert’s analysis as the theoretical framework, we examine the early exercise of call options in Australia over the period from 1 January 2001 to 30 June 2008. We find that exercises occurring on the last cum‐dividend trading day can be fully explained by non‐tax reasons, whilst taxation is a potential explanation for a large proportion of the early exercises that occur at other times.     

CEO/CFO turnover and subsequent remediation of information technology material weaknesses

Adding to prior research on internal control material weaknesses (ICMW), our study investigates whether information technology material weaknesses (ITMWs) are associated with CEO/CFO turnover, and whether their turnover will promote subsequent remediation. We find that disclosures of ITMW are positively associated with CEO/CFO turnover; however, only CEO turnover promotes subsequent remediation. Our findings on ITMW are different from the prior findings on ICMW – aligned with prior research on ICMW, ITMWs are associated with CEO/CFO turnover; however, unlike prior research on ICMW suggests, dismissals of CFOs do not promote subsequent remediation of ITMW. Thus, future research should consider ICMW and ITMW separately in the examination of their consequences and remediation.     

Singapore''s experience with car quotas: Issues and policy processes

This paper examines the policy processes behind Singapore's car quotas. The policy, when filtered through the market mechanism, had a number of unintended consequences. The public's unhappiness with certain features and ‘loopholes’ of the system resulted in many changes to the rules. The effects of recent measures to curb speculation on quota premiums are evaluated. Problems with Singapore's Weekend Car Scheme are also discussed. The lesson for transport policy makers elsewhere is that in attempting to deal with the road congestion problem through car ownership policies, an asset market for vehicles should be taken into account.     

Bank lending and real estate in Asia: market optimism and asset bubbles

This paper investigates the Asian real estate price run-up and collapse in the 1990s. We identify financial intermediaries’ underpricing of the put option imbedded in non-recourse mortgage loans as a potential cause for the observed price behavior. This underpricing is due to behavioral causes (lender optimism and disaster myopia) and/or rational response of lenders to market incentives (agency conflicts, deposit insurance, or limited liability of bank shareholders). The empirical evidence suggests that underpricing occurred in Thailand, Malaysia, and Indonesia. Consequently, these countries experienced a more severe market crash than Hong Kong and Singapore, where underpricing was kept under control by strong government intervention and/or more appropriate incentive mechanisms.