bluuebunny/crossref_metadata_2025 huggingface dataset:
The Value-Relevance Of Stock-Based Employee Compensation Disclosures
Authors: Rees Lynn , Stott David M.
Published: February 2016

This study employs pro-forma company footnote disclosures to assess the value-relevance of employee stock option compensation expense using the fair value method as stipulated by Statement of Financial Accounting Standard No. 123.  The study is motivated by the controversy surrounding the issue of accounting for employee stock options and the countervailing effects of issuing stock options on firm value.  Although accounting regulators and the business community agree that employee stock options have value and therefore, are a form of compensation, critics of the FASB’s proposed fair value method of accounting for employee stock options argue that measuring the compensation expense using contemporary models will result in unreliable and meaningless measures.  Moreover, the expected future benefits from granting stock options suggest that this form of employee compensation is not a typical expense.  We find a significant association between the disclosed compensation expense using the fair value method and firm value that is in the opposite direction from other income statement expenses.  This result implies that the disclosed employee stock option expense is a value-relevant measure and the incentives derived from employee stock option plans provide value-increasing benefits to the firm.  In addition, we find the positive association between the employee stock option expense and firm value is greater for firms with more growth opportunities.
Integration And New Product Development Success: The Role Of Formal And Informal Controls
Authors: Ayers Douglas J. , Gordon Geoffrey L. , Schoenbachler Denise D.
Published: February 2016

The authors test a model that suggests that new product success is a function of the relational norms and integration between marketing and R&D.  Integration and norms are influenced by formal controls such as centralization and formalization.  The findings from a survey of 152 product managers demonstrate the importance of promoting collaborative relationships between R&D and marketing. The study found positive relationships between collaborative relationships and the creation of successful new products.  The study also found that such relationships can be fostered by decentralizing decision making and clarifying the roles of new product development personnel.
A Depth-First Search Technique For The Valuation Of American Path-Dependent Derivatives*
Authors: Dennis Patrick
Published: February 2016

Pricing path-dependent American options is difficult since the number of paths through a binomial tree grow exponentially with the number of binomial periods.  In practice even moderately sized trees of 20 to 25 periods can quickly exhaust available memory on most computer systems.  This paper describes a method that can be used to price path dependent American style derivatives where the amount of memory grows linearly, not exponentially, in the number of binomial periods.  The method is applied to pricing Asian options, fixed income derivatives based on the Heath-Jarrow-Morton model, and corporate bonds.
Empirical Evidence On The Motivation For Dutch Auction Versus Fixed Price Tender Offers
Authors: Erwin Gayle R. , Miller James M.
Published: February 2016

Persons (1994) presents a model in which firms choose between the Dutch auction and fixed price repurchase methods.  We examine the empirical implications of the model and document a number of findings that are consistent with the model. For instance, takeover activity prior to repurchase announcements is significantly higher for firms announcing Dutch auctions.  However, takeover activity significantly declines after Dutch auctions but is not significantly different after fixed price offers.  Moreover, using a logistic regression analysis, we find that Dutch auctions are more likely to be adopted by large firms with low Tobin’s q ratios, low inside ownership, and that were subject to prior takeover pressure.  When we split the sample between repurchases with and without prior takeover activity, we find that repurchases without prior takeover activity result in a permanent increase in value while those with prior takeover activity result in only a temporary increase in value.  We also find that the higher incidence of takeover battles following defensive fixed price repurchases results in lower post-repurchase returns relative to defensive Dutch auctions.  These findings indicate that if the repurchase is used as a takeover deterrent, Dutch auctions are the more effective repurchase method.
Predicting Cash Flow From Operations: Evidence On The Comparative Abilities For A Continuum Of Measures
Authors: Jordan Charles E. , Waldron Marilyn A.
Published: February 2016

Prior studies have attempted to confirm or reject the FASB's assertion in its Conceptual Framework that accrual accounting measures provide better information for predicting cash flows than do cash basis measures.  However, their results proved largely inconclusive and contradictory.  The current study identifies research constructs that may be driven these inconsistent findings and makes adjustments to mitigate their effects.  Univariate cash flow prediction models are developed for companies in the petroleum industry using a continuum of predictor variables.  In predicting operating cash flows, one variable, net earnings plus depreciation and amortization, consistently achieves superior results.
Elite Attitudes Toward Multinational Firms: The Korean Experience
Authors: Jeon Bang Nam , Ahn Se Young
Published: February 2016

This paper reports the survey results of the recently changing attitudes of the government and business elite groups toward multinational firms in Korea and investigates the major individual attribute determinants of these attitude changes. The elite groups of the public and private sectors in Korea, such as government officials and business leaders, were shown to have favorable attitudes toward multinational firms, in general for varying reasons. The estimation results based on the linear probability (OLS) model and the probit model showed that the most significant changes in attitudes toward multinational corporations in Korea are expected among the young business leaders working for small firms and the government officials at the low hierarchical level. This paper also discusses several policy implications of this study on the enhancement of the receptivity toward multinational firms and the host-country policies of foreign investment in Korea.
Developing Curricula With A Major Emphasis In Entrepreneurship - An Accounting Perspective
Authors: Nunn Leslie E. , Ehlen Craig R.
Published: February 2016

Until recently, large corporations produced most new jobs.  Therefore, curricula and courses taught in university business schools in the United States were tailored primarily for graduates likely to be employed in large corporations.  Today, however, the majority of newly created jobs are generated by small businesses.  With the increasing economic importance of smaller businesses, universities should adjust their curricula to include classes designated specifically for entrepreneurs of small businesses.  This can be accomplished in a variety of ways:  by emphasizing factors applicable to small businesses while teaching standard business school courses; by introducing new courses directed solely at entrepreneurship; or by altering existing courses and combining them with new courses.  This paper examines this process at one public university from an accounting perspective.
Organizational Form, Performance And Information Costs In Small Businesses
Authors: Bento Alberto M. , White Lourdes F.
Published: February 2016

This extends agency theory to introduce organizational form as a decision variable that directly influences risk bearing and the costs of control in small businesses.  Based on information cost and organization design theories, we propose a relationship between organizational form and information costs.  Our empirical results reveal that organizational form is the first or second most important decision variable related to performance and information costs in small businesses.
The Potential Of The APEC Grouping To Promote Intra-Regional Trade In The Asia-Pacific Region
Authors: Tang Donny
Published: February 2016

This study examines whether the proposed APEC free trade area would promote a high level of intra-APEC trade after its completion.  To achieve this goal, a modified gravity model is estimated for the thirteen APEC countries based on annual trade data from 1989 to 1998.  The results indicate that a high level of trade interdependence already exists to help promote the intra-APEC trade flows after its FTA completion.  The results also suggest that the APEC countries are more likely to trade with other member countries than with non-member countries
Inflation, Output, And Stock Prices: Evidence From Brazil
Authors: Adrangi Bahram , Chatrath Arjun , Sanvicente Antonio Z.
Published: February 2016

Research in economics and finance documents a puzzling negative relationship between stock returns and inflation rates in markets of industrialized economies.  The present study investigates this relationship for Brazil. We show that the negative relationship between the real stock returns and unexpected inflation persists after purging inflation of the effects of the real economic activity.  The Johansen and Juselius cointegration tests verify a long-run equilibrium between stock prices, general price levels, and the real economic activity. Furthermore, stock prices and general price levels also show a strong long-run equilibrium with the real economic activity and each other.   The findings lend support to Fama’s proxy hypothesis in the long-run.
Dimensions Of Competitive Priorities: Are They Clear, Communicated, And Consistent?
Authors: Ahmad Sohel , Schroeder Roger G.
Published: February 2016

In spite of convincing theoretical arguments in the literature, very little attention is paid to empirically identifying the dimensions of competitive priorities. The present study identifies these dimensions and relates them to Porter’s cost-differentiation strategy framework. Although the majority of the manufacturing plants ranked quality as the most important competitive priority, it could not foster differentiation by itself. Subsequent analyses show that while plants pursuing differentiation strategy were proactive in two administrative activities (communication of manufacturing strategy and establishment of formal strategic planning), plants pursuing low-cost strategy were not, suggesting that the managers of these plants pay close attention to these administrative activities.
The Management Of Research And Development And The Relevance Of Financial Accounting
Authors: Nix Paul E. , De Magalhaes Roberto , Wilcox William
Published: February 2016

This study investigates alternatives to current financial accounting treatment of research and development expenditures in United States public corporations.  A questionnaire survey was sent to members of the Financial Directors Network of the Industrial Research Institute of America, representing over forty percent of private research and development in the United States.   Background research and the survey indicate that if the financial reporting of research and development is modified, research and development will increase and a shift from short?term to long?term projects will occur; and finally United States public corporations will more effectively compete in the international markets.
Comprehensive Income: How Is It Being Reported And What Are Its Effects?
Authors: Jordan Charles E. , Clark Stanley J.
Published: February 2016

SFAS No. 130 allows three format choices for reporting comprehensive income (CI); two involve reporting CI in a performance-based financial statement, while the third option incorporates it into a statement of changes in stockholders' equity (SCSE).  Prior research suggests that reporting CI in the latter option results in less useful information for investors.  This study examines CI reporting for a sample of financial service firms and demonstrates that a majority (63%) of them chose a SCSE format.  In addition, a significant association existed between both the direction and size of the components of other comprehensive income and the format chosen. 
Gender Differences In Job Attribute Preferences And Job Choice Of University Students In China
Authors: Chow Irene Hau Siu , Ngo Hang-yue
Published: February 2016

This study investigates the gender differences in job attribute preferences and job choice among a group of university students in China.  Due to the shortage of well-trained professionals and managers in China, both foreign and Chinese organizations compete for highly trained candidates.  Correlation and regression analysis on data from 1,231 university students in China were used to test three hypotheses. Similarities between how men and women view the importance of advancement, compensation, and learning and overseas opportunities, in employment by foreign and national enterprises, were observed.  But, on issues of job security, firm size, and nationality of supervisor, gender differences were present.  Implications on employee recruitment for Chinese and foreign enterprises are discussed and suggestions for future research are provided.
Profit Margin And Capital Structure: An Empirical Relationship
Authors: Eriotis Nikolaos P. , Frangouli Zoe , Ventoura-Neokosmides Zoe
Published: February 2016

This study constitutes an attempt to investigate the relationship between debt-to equity ratio and firm’s profitability, taking into consideration the level of firms’ investment and the degree of market power.  The study uses panel data for various industries, covering the period 1995-96.  The main conclusions of our study are: a) firms which prefer to finance their investment activities through self-finance are more profitable than firms which finance investment through borrowed capital; b) firms prefer competing with each other than cooperating; c) firms use their investment in fixed assets as a strategic variable to affect profitability.
Friendly-Contention Ads Using Multiple Endorsers: Assessing Source Effects On Attribute Perceptions And Brand Attitudes
Authors: Pettit-O'Malley Kathy L. , Bozman Carl S.
Published: February 2016

Our study is a preliminary investigation of multiple-source friendly-contention ads in which various endorsers argue about the brand's main benefit(s).  The results demonstrate that such an ad convinced viewers that originally seemingly inconsistent attributes and benefits could both be found in the advertised brand.  Further, the tested advertising format produced more favorable brand attitudes than did an equivalently informative single-source ad version.  The argumentative ad appears entirely appropriate in industries where a company wishes to target heavy product users.
A Multivariate Analysis Of Evoked Sets As A Marketing Universal
Authors: LeBlanc Ronald P. , Herndon, Jr. Neil C.
Published: February 2016

This research explores evoked sets in two cultures.  The purpose is to determine if evoked sets are used in both to the extent that they could be considered a marketing universal.  Previous studies have examined marketing universals in terms of price and product quality signals.  Our findings support the status of evoked sets as a marketing universal.  We found, via multivariate analysis, that evoked set sizes are statistically equal for matched samples when using two operational definitions of an evoked set.
The Impact Of Information Technology Investments On Managerial Decision Making: Evidence From Dividend Payout
Authors: Ellis T. Selwyn , Casey K. Michael , Mesak Hani I.
Published: February 2016

Investments in Information Technology (IT) are an increasing part of organizational expenditures in spite of the fact that there is little evidence in the existing literature that suggests these investments are related to the organization’s performance. The uncertainty of IT investment payoff should be reflected in other managerial decisions. This research examines Rozeff's (1982) agency cost/transaction cost tradeoff model to determine if IT investments are related to dividend payout ratios for an organization. A dividend payout model including an IT investment variable is estimated. The estimation results suggest that a significant positive relationship exists between dividend payout and a firm’s IT investments.
Toward Student Development Of A Better Understanding Of The Cash Flow Statement
Authors: Mills John R. , Bible Lynn
Published: February 2016

FASB Statement No. 95, Statement of Cash Flows has now been in existence for more than ten years (since 1988) and yet, there still has not been any consensus about how to effectively evaluate information provided from this statement. Accounting educators should be the primary personnel for disseminating the necessary information for understanding the cash flow statement as well as for providing the analytical tools for evaluating the cash flow information.  Carslaw and Mills (1992) provided a preliminary study that examined the intermediate textbooks to determine what the authors were providing in terms of analytical tools for evaluating cash flow information. The study concluded that while all the textbook authors point out that the cash flow statement should be used to evaluate liquidity and financial flexibility, none provided analytical tools for evaluation. The Carslaw and Mills article then provided a series of suggested ratios that they felt might provide a foundation for analyzing cash flow information.  This paper is a follow-up of the prior study. We reviewed the information in the current intermediate accounting texts that provides a basis for the evaluation of the cash flow statement. Our conclusion is that, while some authors have attempted to provide better measures of cash flow information, ten years later, there is still no common consensus among authors on providing the necessary tools for properly analyzing cash flow information.
The Independent Rep As A Source Of Competitive Advantage: An Actionable Scale For Rep Selection
Authors: Gruben Kathleen H. , Coe Barbara J.
Published: February 2016

This study develops a scale that offers an actionable approach for suppliers’ use in selecting their reps.  Rep selection is the critical first step suppliers take in developing profitable, long-term relationships with retailers.  Retailers’ loyalties are often bestowed on the rep, rather than the supplier.  As identified in the study, the rep needs to be professional, accommodating, ethical, sensitive, and compassionate to satisfy the retailer.  The scale provides suppliers a technique for measuring these characteristics.  Prior to this scale, no instrument was available to measure these characteristics, which increase the retailer’s likelihood of developing loyalty.
Impact Of Changes In Strategic Investments On Shareholder Returns: The Role Of Growth Opportunities
Authors: Desai Ashay , Wright Peter , Chung Kee H. , Charoenwong Charlie
Published: February 2016

We argue that a firm’s growth opportunity may provide us with guidelines on whether increases or decreases in capital investments may contribute to that firm’s returns to shareholders.  We find consistent empirical support for “good” managerial decisions.  That is, we find that increases in capital investments by firms with growth opportunities enhance their returns to shareholders.  The results indicate that decreases in strategic investments increase the returns to shareholders of those firms lacking in growth opportunities.  The findings, however, are not consonantally significant for “bad” managerial investment decisions - - decreases in investments by firms with growth opportunities or increases in investments by firms lacking in growth opportunities.
Audit Sampling Methods And Juror Negligence Awards: An Expectation Gap?
Authors: Gilbertson David L. , Herron Terri L.
Published: February 2016

Generally accepted auditing standards permit auditors to apply both statistical and nonstatistical sampling techniques in obtaining sufficient, competent evidential matter.  However, several recent studies have shown that statistical sampling procedures have nearly disappeared from practice. Despite this trend and the heightened anxiety about professional liability, no studies to date have directly tested the potential implications of sampling method on jurors verdicts, damage awards, or sample size expectations.  In this study we investigate the effect of sampling method on jurors’ judgments in auditor negligence trials.  Overall, in a case where auditors were alleged to have used an insufficient sample size, the sampling method did not affect the likelihood of a “guilty of negligence” verdict.  However, as predicted, damage awards were significantly higher when nonstatistical sampling was used compared with statistical sampling.  Exploratory analysis revealed that subjects voting “guilty of negligence” would require the auditors to examine over 17% of the population (compared with the 1% examined) in order to change their verdict to “not guilty of negligence.”  These findings have troubling implications for auditors employing sampling techniques.
The Impact Of Cash Flow Information On The Forecasts Provided By Financial Analysts, Considering The Quality Of Earnings
Authors: Deslauriers Sylvie
Published: February 2016

In the present study, the impact of publishing more precise and better-structured cash flow information on financial analysts’ forecast will be examined.  Even though the change in standards presently under study may be principally deemed to be cosmetic, it does appear to have allowed financial analysts to generate more accurate forecasts of future earnings. An increase in the dispersion of these forecasts, more especially when dealing with enterprises providing a high quality of earnings, is also noted.
Card-Contingent Discounts As Sources Of Customer Satisfaction And Dissatisfaction: An Exploratory Inquiry
Authors: Valentin Erhard K. , Allred Anthony
Published: February 2016

The reported exploratory study was undertaken to illuminate the effects of card-contingent discounts (CCDs) on customer satisfaction and dissatisfaction.  CCDs are price reductions on certain items that are given only to customers who present a card issued by the seller.  Results from our survey of 953 grocery store patrons indicate that shoppers tend to frame CCDs as price reductions to which they are entitled; denying discounts is judged unfair.  Typical customers are content, rather than delighted, when CCDs are granted and are disappointed or annoyed when CCDs are withheld.  CCDs, therefore, seem more likely to engender dissatisfaction than enhance satisfaction.
Assessing Progress In Advertising-Related Scale Development & Usage
Authors: Bruner II Gordon C. , King Maryon F.
Published: February 2016

An awareness in the advertising industry of the inadequacy of current practices in copy testing led to the development of  PACT (Positioning Advertising Copy Testing), a statement of fundamental copy testing principles developed by  twenty-one of the world's leading advertising agencies.  A primary concern of this coalition was that too much reliance had been placed on single-item measures to assess the performance of ads, with a concurrent lack of validation of the measures being used.  Subsequently, few studies have followed up on the PACT recommendations, resulting in little in the way of objective data to assess the progress made in the development and use of multi-item scales.  This study offers an initial examination of the progress made in response to the PACT recommendations by developing an inventory and evaluation of advertising-related scales.  Insights from this analysis lead to specific observations regarding the state of the art in advertising research as well as recommendations for future scale research.
Effect Of Legal Counsel Activity On The Cost Of Municipal Bond Offerings
Authors: Roden Peyton Foster , Poe Stephen L. , Braswell Mike
Published: February 2016

The authors examine the relationship between interest cost to the issuer of municipal bonds and legal counsel associated with the offering. Modeling interest cost with explanatory variables reflecting legal counsel, issue characteristics, and conditions in the financial markets, the authors conclude that offerings in which an active bond counsel participated had average interest costs statistically significantly lower than those without such counsel. Offerings involving issuer<span style="font-style: normal; font-family: "WP TypographicSymbols"; mso-bidi-font-style: italic; mso-ascii-font-family: 'Times New Roman'; mso-hansi-font-family: 'Times New Roman'; mso-char-type: symbol; mso-symbol-font-family: 'WP TypographicSymbols';">=s counsel and activity of underwriter<span style="font-style: normal; font-family: "WP TypographicSymbols"; mso-bidi-font-style: italic; mso-ascii-font-family: 'Times New Roman'; mso-hansi-font-family: 'Times New Roman'; mso-char-type: symbol; mso-symbol-font-family: 'WP TypographicSymbols';">=s counsel experienced statistically higher average interest costs than otherwise. The authors note that their results are consistent with the certification hypothesis.
Valuation Ratios As Stock Market Predictors
Authors: Shirvani Hassan , Wilbratte Barry
Published: February 2016

Using bivariate causality tests, this paper examines price-earnings (PE) and dividend yield (DY) ratios and finds that they do not predict future stock returns but that they do predict future earnings and dividends, lending support to the efficient markets hypothesis.  (JEL: G12, G14)
Evidence Of Social Desirability Response Bias In Ethics Research: An International Study
Authors: Bernardi Richard A. , Delorey Erin L. , LaCross Catherine C. , Waite Rebecca A.
Published: February 2016

This paper analyzes the association between ethical perceptions of questionable business practices and Hofstede’s Individualism, Transparency International’s Corruption Index, and social desirability response bias.  The sample consists of 1,048 business students from ten countries: Canada, Colombia, Ecuador, Hong Kong, Ireland, Japan, Nepal, South Africa, Spain, and the United States.  The results of our analysis indicate that, while Hofstede’s (1980) cultural construct of Individualism was significant for two of the questions, social desirability response bias was the most consistent variable in modeling subjects’ responses.  Our data indicate that social desirability response bias should be controlled for when using self-reported data in ethics and/or international studies. 
A Note On Earnings Forecast Source Superiority
Authors: Pagach Donald P. , Chaney Barbara A. , Branson Bruce C.
Published: February 2016

We examine the forecast accuracy of Value Line analysts relative to the Brown-Rozeff (100)X(011)4 ARIMA model.  We find that for a surprising percentage (35-41%) of our sample of small firms that time series-based earnings per share predictions are more accurate than those obtained from The Value Line Investment Survey.  Further, we document exploitable characteristics of each subgroup that are associated with forecast origin.  In those instances where the seasonal, univariate earnings forecast model identified by Brown and Rozeff (1979) produces more accurate forecasts than Value Line, we find significant differences in firm size, degree of diversification, magnitudes of the autoregressive and seasonal moving-average parameters, residual standard errors, and magnitude of the Ljung-Box Q-statistic.  We use probit regressions to identify ex ante those firms likely to be accurately forecast by each source.  We achieve a marginal improvement in forecast accuracy, which suggests there is potential for using ex ante decision rules to improve forecast accuracy. 
Enron: An In-Depth Analysis Of The Hedging Schemes
Authors: Wilson Arlette C. , Key Kimberly G. , Clark Ronald L.
Published: February 2016

N/A
The Pricing Of Thrift Conversions
Authors: Kashian Russ , Monaco Kristen
Published: February 2016

This paper aims to explore the conversion of Mutual Thrifts to publicly traded savings institutions.  Equity and fairness are important in the mutual thrift conversion process since these firms leave the general community control and placed in specific investor control.  As a result, an examination of issue size choice (are there variables that show some thrifts were priced low) and underpricing (are there market results that show a thrift was underpriced) are crucial.  We find evidence that the price was chosen in a way to benefit insiders and mutual holding companies.
Searching, Matching, And Unemployment Compensation In Search Equilibrium
Authors: Park Chuhwan
Published: February 2016

In search equilibrium model, this paper demonstrates and characterizes the properties of steady state equilibrium of wage, unemployment compensation, entry fee, and taxes. Our research is based on the behavior of a job seeking, unemployed worker with the probability of contact rate of both sides, which may affect the entry of unfilled vacancies and the level of unemployment (U). The steady-state shows that a reduction in the severity of search friction, m0<span style="font-family: Symbol; font-size: 10pt; mso-bidi-font-size: 11.0pt; mso-bidi-font-style: italic; mso-ascii-font-family: 'Times New Roman'; mso-hansi-font-family: 'Times New Roman'; mso-char-type: symbol; mso-symbol-font-family: Symbol;">­, raises the equilibrium values of the probability of contact rates(μ*and <span style="font-family: Symbol; font-size: 10pt; mso-bidi-font-size: 12.0pt; mso-bidi-font-style: italic; mso-ascii-font-family: 'Times New Roman'; mso-hansi-font-family: 'Times New Roman'; mso-char-type: symbol; mso-symbol-font-family: Symbol;">h* ) and lower the level of unemployment (U) and the number of vacancies(V). An increase in either in the level of output, Y, or decrease in unemployment compensation, entry fee, and tax rate, increase in the number of unfilled vacancies, V*, makes it easier for workers to find jobs (μ* rises and U falls) and more difficult for vacancies to find workers(<span style="font-family: Symbol; font-size: 10pt; mso-bidi-font-size: 12.0pt; mso-bidi-font-style: italic; mso-ascii-font-family: 'Times New Roman'; mso-hansi-font-family: 'Times New Roman'; mso-char-type: symbol; mso-symbol-font-family: Symbol;">h* falls).
Sales Tax And Consumer Purchase Decisions
Authors: Key Kimberly G. , Scribner Lisa L.
Published: February 2016

This study uses an experimental design to investigate the effect of sales tax on consumer mail order purchase intentions.  Economic- and psychology-based theories generate alternative predictions for purchase intentions.  Overall the results show that no conclusion can be made that sales tax affects consumer purchase intentions.
Rent-To-Own Agreements: Purchases Or Rentals?
Authors: Anderson Michael H. , Jackson Raymond
Published: February 2016

The rent-to-own (RTO) business has emerged as an important component of the retailing sector. By offering immediate access to household goods for a small periodic fee without a credit check or down payment, RTO has strong appeal to low income and financially distressed consumers.  A common perception of RTO is that they are disguised, high-interest installment agreements as most consumers eventually acquire the contracted merchandise by making all scheduled payments. We examine the nature of these agreements by using a unique data set of more than 350 thousand transactions drawn from 100 RTO stores in 46 states. Our main result, derived from an analysis of disposition and duration, is that RTO agreements are more frequently used for short-term needs rather than as a method of acquisition.  Legislative and legal efforts to classify RTO agreements as primarily installment contracts cannot be justified by their pattern of use in the marketplace. 
Did You Not Understand The Question Or Not? An Investigation Of Negatively Worded Questions In Survey Research
Authors: Johnson Jill M. , Bristow Dennis N. , Schneider Kenneth C.
Published: February 2016

This study compared participant responses to negatively versus positively worded questionnaire statements.  The literature suggested that one could expect the wording of questionnaire items (i.e., negatively worded vs. positively worded) to influence participant responses to those scale items.  The study consisted of one control group and two experimental groups.   The Fashion Consciousness scale (Wilkes 1992;  Lumpkin and Darden 1982), a uni-dimensional, all-positive seven-item instrument was adapted for use in the study.  Three hypotheses regarding the factor structure and internal reliability of the scale were empirically investigated.  Results showed statistically significant differences in the psychometrics of the scale when negative or double negative wording was added to scale items.  Managerial implications are discussed.
Are Preliminary Data Of Output Growth And Inflation Reliable Predictors?
Authors: Baghestani Hamid
Published: February 2016

The hypothesis that the preliminary announcements of output growth and inflation are reliable predictors of the revised data is tested for 1969.1-1991.4 and 1969.1-2000.4. Our test results indicate that these preliminary announcements are unbiased predictors. The output growth revision is orthogonal to the past revisions of both output growth and inflation available at the time of announcement. The inflation revision, however, fails to be orthogonal to such past revisions.  While unbiased, the lack of orthogonality of the inflation announcement suggests room for improvement.
Rational Prediction Of Future Pension Expense: A Simulation Approach
Authors: Blankley Alan I. , Cottell Jr. Philip G. , McClure Richard H.
Published: February 2016

Because future pension expense can have a material influence on a firm’s future earnings, financial analysts are faced with the difficult task of forecasting its impact.  The purpose of this paper is to demonstrate a model that can be used with a simulation approach to predict future pension expense and its associated uncertainties.  Because of the importance and complexity of the pension expense component in the estimate of future earnings, a simulation model acts as a powerful analytical tool that can give the analyst greater confidence as to the magnitude and variability of future pension expense.
Guidance For The Audit Committee: Acquiring Professional Services
Authors: Colbert Janet L.
Published: February 2016

Outside firms are often called upon to provide an entity with professional services.  Such services might include external audit, systems, accounting, appraisal and valuation, actuarial, consulting, tax, or agreed-upon procedures work.  The audit committee of the Board of Directors is typically the party within the entity responsible for hiring and overseeing these outside professional service providers. 

 

The Sarbanes-Oxley Act of 2002 mandates that certain professional services, which may have previously been performed by the firm engaged to do the external audit, cannot be performed by that public accounting firm.  Thus, audit committees may be forced to contract with other professionals for services previously provided by the external auditors.  The task of locating, contracting with, and overseeing the work of qualified firms for these professional services may seem daunting to the audit committee. 

 

This article presents steps the audit committee should take in selecting a professional service provider and overseeing that firm’s work.  Also given are ways in which the entity’s internal audit activity can provide significant assistance to the audit committee undertaking its tasks.
The Impact Of Communication On The Accounting Firm/Client Relationship
Authors: Koski Timothy R. , Ehlen Craig R. , Saxby Carl L.
Published: February 2016

This paper presents the results of a study designed to gather information on communication between an accounting firm and its clients.  We first provide descriptive information on clients’ perceptions regarding the frequency, method, and importance of communication with their accounting firm.  We then provide evidence on the relationship between effective communication and both client satisfaction and accounting firm/client conflict.  We find that that the use of effective communication techniques by an accounting firm is positively related to client satisfaction and negatively related to firm/client conflict.  The overall results of this study suggest that accounting firms can effectively use collaborative communication, which focuses on using communication to build better relationships between firms, to manage client relations.
Co-Branding Internationally: Everyone Wins?
Authors: Ueltschy Linda C. , Laroche Michel
Published: February 2016

Co-branding is an increasingly popular technique used primarily in domestic markets to transfer the positive associations of the partner brands to a newly formed co-brand.  This exploratory study investigates the relative impact of the brand equity of the constituent brands on co-branding efforts internationally using a sample of 1,203 Philippine housewives.  Findings indicate the co-branding of two high-equity brands was mutually beneficial, but the co-branding of high-equity and low-equity brands can be potentially dangerous for the high equity partner.
Deployment Issues And Security Concerns With Wireless Local Area Networks: The Deployment Experience At A University
Authors: Kahai Paramjit S. , Kahai Simran K.
Published: February 2016

This paper presents and discusses various issues pertaining to the deployment of Wireless Local Area Networks (WLANs).  The popularity of WLANs has steadily increased in the last two years and has led to their deployment in a variety of organizations.  Yet, making a business case for WLANs is an important step in their deployment.  In addition to highlighting the need for a business case for WLAN deployment, the paper outlines the reasons for, benefits of, and security problems associated with, their deployment.  The latter part of this paper presents a case study about the deployment of a WLAN at the University of Akron.  Therein, it discusses the context for the deployment, the process that was used to justify the deployment, and the efforts made to protect users’ information from security deficiencies of wireless networks.
Issuance Of Subsidiary Stock As An Earnings Management Strategy
Authors: Williams Susan Perry , Williams Thomas H.
Published: February 2016

Arthur Levitt, chairman of the Securities and Exchange Commission, expressed concern that the pervasiveness of earnings management in American corporate financial statements threatens the integrity of financial reporting.  Levitt referred to the “cookie jar” phenomenon wherein U.S. firms have earmarked opportunities to “find gains” when earnings are less than anticipated.  The academic research literature includes a large number of studies on earnings management strategies.  One relatively unexplored strategy is the use of stock issuances by subsidiaries to generate gains under the provisions of SEC Staff Accounting Bulletin No. 51.  Based upon a sample of 125 observations of this accounting choice over the period 1985 through 1997, our study provides compelling evidence that recognition of gains on the issuance of subsidiary stock coincides with periods when earnings fail to meet expectations (as measured by analysts’ forecasts), and that the recognition of these gains in the income statement is effective in achieving earnings expectations. Further, the amounts of these gains are large relative to pre-gain net income
The Effects Of Experience And Data Presentation Format On An Auditing Judgment
Authors: Anderson John C. , Mueller Jennifer M.
Published: February 2016

Prior research has examined the effects of information presentation format on decision outcomes in various settings, but has led to inconclusive results as to whether a tabular or graphical format is superior for decision making.  An important methodological difference in these studies is the use of inexperienced versus experienced participants.  This study examines the interaction of experience with presentation format in the application of auditing judgments (specifically, analytical review judgments) and finds that participant experience does matter.  In particular, where tabular information was most extensively used (i.e., in the task of correlation assessment), the performance advantage from using graphs was not as great for practitioners as for students, perhaps because of the experience practitioners possess with the use of tables.  Implications of this study for the interpretation of prior findings are discussed as well as directions for future research.
Disclosure Of EVA Use In Corporate Financial Reports: A Descriptive Analysis
Authors: Ghani WaQar I. , Tezel Ahmet , Ragan Joseph M. , Stagliano A. J.
Published: February 2016

This descriptive study examines a sample of 269 firms that mentioned EVA in their public disclosures.  The key findings of our study are: (1) the use of EVA is found in a cross-section of the industries; (2) the most commonly used source of disclosure is the proxy statement; (3) a majority of the firms use only EVA rather than EVA in combination with other traditional measures; (4) a majority of the sample firms apply EVA at the corporate level alone; (5) three-fourths of the sample firms use EVA as an incentive compensation tool; (6) most firms apply EVA and other metrics only at the executive level for compensation and performance evaluation; and (7) two common modes of compensation using EVA determination are bonus plans and stock options.  The results of our study indicate that firms are steadily adopting EVA as one component of their value management system.  In a related decision context, investors estimate the cost of equity capital to arrive at the intrinsic value of the firm.  Firms can help investors reduce this estimation error by reporting their own estimate of the cost of equity capital, in turn, reducing the valuation error. Our findings have implications for the Securities and Exchange Commission and the Financial Accounting Standards Board in that they should recognize the need to address this issue thereby enhancing the decision usefulness of public reporting.
A Spousal Joint Decision Making Exercise: Do Couples Perceive Differences In Influence Tactics Used In Decisions Involving Differing Product Categories And Levels Of Product Disagreement?
Authors: Ward Cheryl B.
Published: February 2016

Past research has indicated that husbands and wives often employ influence tactics to attempt to sway their spouses toward making a final purchase decision (Kirchler 1993, 1995; Nelson 1988; Spiro 1983).  This study explores whether those influence tactics differ based on whether couples face product choices in across or within product categories.  Also of interest is whether the initial level of disagreement (high or low) experienced by the couple regarding the likelihood of product purchase impacts use of influence tactics in the final joint decision.  Given the increased possibility of conflict between spouses when faced with purchase decisions involving different product categories, it is expected that couples will employ a greater level of influence tactics in an effort to persuade their partners in the decision making process and, at the same time, minimize the likelihood of open conflict.  It is also thought that higher initial disagreement will be more likely to result in the use of influence tactics in the final joint product decision than lower levels of disagreement.  This study found support for these predictions.
Specialized International Equity Investment With Forward Foreign Exchange Trading: A U. S. Viewpoint
Authors: Akhbari Marlena , Gressis Nicolas , Ainina Fall
Published: February 2016

Assuming risk-neutrality and the random walk model we derive a rule-of-thumb that periodically selects the appropriate foreign stock index and is either long or short foreign currency contracts.  The empirical results of testing the rule-of-thumb with an investment universe of six major foreign equity markets show that our rule-of-thumb provides performance superior to investing in foreign stock indices alone.  In addition, we test and reject the Unbiased Forward Rate Hypothesis (UFRH) in favor of the Random Walk Hypothesis (RWH).
The Market For Audit Services In Germany
Authors: Simon Daniel T.
Published: February 2016

Many studies have been conducted on the market for audit services in the United States, the United Kingdom, Australia and other countries, but many countries, including Germany, have not been studied.  Since the German accounting environment differs significantly from most of the countries previously studied, this paper studies the audit services market in Germany to ascertain whether the determinants of audit fees differ in Germany.  The findings indicate broad similarities with some differences in the market for audit services in Germany and countries previously studied.  In particular, as in a majority of countries previously studied, there is a fee premium paid to large auditors.
Service Encounters: The Missing Link Between Service Quality Perceptions And Satisfaction
Authors: Durvasula Srinivas , Lysonski Steven , Mehta Subhash C.
Published: February 2016

Relationship marketing emphasizes that for a firm to be profitable, it must be attentive to those factors that affect service satisfaction. Extant research in the service sector reveals two important determinants of service satisfaction. One is service quality, and the other is the service encounter, representing the interaction between the customer and the service provider. Further, it has been demonstrated that service quality is also related to customer perceptions of the service encounter. However, a question that a remains unanswered is about the precise nature of the relationship between service quality and service encounter on one hand, and service satisfaction on the other. Is the relationship direct or indirect? Does one of the factors instead serve as a mediator? This study provides an answer by examining a sample of industrial customers in Singapore who evaluated the service dimensions of ocean freight shipping lines. Results reveal that the relationship between service quality and service satisfaction is not direct, but it is defined or mediated by customer perceptions of service encounters. Implications of the results are discussed.
Assessing Country-Of-Origin Effects: The Impact Of An International Event
Authors: Cho Yoon C. , Ha Joseph
Published: February 2016

This study is to investigate how consumers’ attitudes toward brands/products manufactured by a country are affected by an international event. Authors explored that consumers’ attitudes toward brand “made in ___” are affected by various constructs, such as prior beliefs about the products’ attributes, the country’s image along with the brand name, and attitudes toward the advertising during an international event.
How Does Bankruptcy Risk Affect Stock Values?
Authors: Neill John D. , Pfeiffer Glenn M.
Published: February 2016

Research in corporate restructuring argues that the risk of bankruptcy reduces firm value by the present value of both the direct and indirect costs of bankruptcy.  Additionally, the potential for bankruptcy affects both the investment horizon of investors and the discount rate implicit in equity values.  This paper empirically examines the effect of cross-sectional differences in the probability of bankruptcy on the determinants of firm value.  We estimate bankruptcy probabilities for an extensive sample of more than 38,000 firm-year observations over a twelve-year period.  Using a valuation model that employs both book value and earnings, we provide empirical evidence that earnings multiples decrease as the estimated probability of bankruptcy increases.  These results imply that investors and analysts rely less on current earnings and more on book value (which proxies for the firm’s liquidation value) as a firm’s probability of bankruptcy increases.