bluuebunny/crossref_metadata_2025_split huggingface dataset:
Decision Trees Versus Decision Tables for Audit Test Data Design: An Experimental Study*
Authors: Ip Andrew , Weber Ron 
Published: February 2009

Abstract:Use of test data is an important evidence collection method that auditors can employ to evaluate the authenticity, accuracy, and completeness of program processing. Nevertheless, test data design is a time‐consuming and error‐prone process. To facilitate design, two approaches advocated are the decision‐tree approach and the decision‐table approach. An experiment conducted to examine the quality of test data designs produced using both approaches showed some support for the superiority of the decision‐table approach over the decision‐tree approach. Insofar as the results obtained are problematical, however, the research needs to be replicated and extended.
Accountants' Personality Typology and Perceptions of Job‐Related Stress: An Empirical Study
Authors: Choo Freddie 
Published: February 2009

Abstract:This study attempts to relate accountants' perceptions of job‐related stress with their personality variables. Based on the conceptual framework of C.G. Jung's psychological personality typology, it was found that judging, thinking and sensing personality profile satisfactorily discriminates among accountants' perceptions of job‐related stress. Neither introverted nor extroverted accountants differ in their perceptions of stress.
Determinants of Financial Information Published by Private Not‐For‐Profit Organisations
Authors: Simnett Roger 
Published: February 2009

Abstract:This is a descriptive study examining the determinants of disclosure for Not‐for‐Profit Organisations (NFPOs). The hypothesised determinants were identified by a review of the determinants identified in other studies and by reference to agency theory. These were analysed for significance using as dependent variables accounting policies and items of financial disclosure which have been suggested for adoption or disclosure by NFPOs. It was found that six of the hypothesised determinants (gross income, number of members, the presence of a professional administrator, geographic dispersion of members, and auditing of the financial statements) were significant factors influencing disclosure. Nature of the organisation, accounting experience of the person preparing the financial statements, and use of outside credit facilities were found not to be significant determinants.
The Effect of Analysts' Adjustments in the Context of Loan Assessment
Authors: Bradbury M.E. 
Published: February 2009

Abstract:This paper demonstrates that improvements in the classification of loan default can arise through making simple accounting adjustments to the financial statements of small firms prior to calculation of ratios. However, the improvement in loan default classification exists only on a univariate basis. The adjustments do not increase default classification when a multivariate linear discriminant model is employed. The data base comprises commonly used financial ratios extracted from the financial statements of 40 small New Zealand businesses with manufacturing or distribution activities.
PREDICTING PRIVATE COMPANY FAILURE
Authors: McNamara Raymond P. , Cocks Neil J. , Hamilton David F. 
Published: February 2009

AbstractPrivate company failure is a significant problem that is not fully addressed by existing research. This study develops a discriminant model from data on 107 private companies. The model predicts success and failure, based on six ratios obtained from the two immediately prior years' publicly available accounting reports. Based on a hold‐out sample of 40 companies a prediction with 85% accuracy was achieved. This prediction was made one year ahead. The model indicates that the retained earnings/total assets, total liabilities/total assets, and shareholders funds/total liabilities ratios are the three major predictors of bankruptcy. Overall the model's coefficients are, as expected, substantially different to those of public company models.
Performance in Accountancy Courses
Authors: Keef Stephen P. 
Published: February 2009

AbstractThis paper seeks to determine whether student performance differs in what can be termed ‘academic’ and ‘professional’ undergraduate courses. The results indicate that student performance is lower in courses that are required to meet the academic requirements of the Accountancy profession than in other courses offered by the Department. Whilst this result was to be expected, the surprising result of the study was that ACA Accountancy courses experienced higher failure rates ACA Commercial Law courses.
FINANCIAL STATEMENT USERS‘ PERCEPTIONS OF FACTORS AFFECTING THE ABILITY OF AUDITORS TO RESIST CLIENT PRESSURE IN A CONFLICT SITUATION
Authors: Lindsay Daryl 
Published: February 2009

Abstract:This study investigates the perceived effects of four factors on the likelihood that an auditor will acquiesce to the demands of a client when a dispute arises over a significant financial reporting issue. A repeated measures experiment was conducted using 49 security analysts and 69 bankers as subjects. Analysis of Variance results indicate that an auditor is perceived as being more likely to acquiesce to his client's demands when the accounting issue in dispute is not dealt with clearly by an accounting standard. Auditors also are viewed as being more likely to acquiesce when: (1) competition in the audit environment is aggressive; (2) the audit firm is small; and (3) the audit firm provides management consulting services to its audit client.
COVENANTS IN U.S. PUBLIC DEBT AGREEMENTS
Authors: Francis Jennifer 
Published: February 2009

Abstract:This study examines the covenants contained in a sample of 45 public debentures issued by U.S. corporations. A survey identified six covenants among the debt agreements. Interestingly, none of the sample debt issues included constraints on working capital, net worth or current ratios. Without exception, the covenants noted in the agreements were identical to those reported in Moody's Industrial Manual. Descriptive information on selected characteristics of the debt issues is also provided.
QUALIFIED AUDIT REPORTS, FIELD DEPENDENCE COGNITIVE STYLE, AND THEIR EFFECTS ON DECISION MAKING
Authors: Gul Ferdinand A. 
Published: February 2009

Abstract:This paper reports the findings of an experiment designed to investigate the effects of an unqualified versus an “except for” qualified audit report on subjects' share price estimates and the moderating role of cognitive style in this relationship. Using ANOVA experimental design, 34 subjects were administered identical financial information on a hypothetical company except that 17 subjects received a qualified auditors' opinion and the other 17 received an unqualified auditors' opinion. In addition, the subjects in each group were classified as either field dependent or field independent on the basis of their scores in the Embedded Figures Test. Results showed that the “except for” audit qualification affected share price estimates and field dependence cognitive style interacted with qualified/unqualified audit opinion to also affect subjects' share price estimates.
THE INFORMATION CONTENT AND USEFULNESS OF THE TERM STRUCTURE OF THE NEW ZEALAND BANK BILL MARKET
Authors: Yip Ying K. 
Published: February 2009

Abstract:This paper applies the rationality concept and expectations hypothesis to test the information efficiency of the term structure of the New Zealand bank bill market. Weekly data is collected from June 1986 to November 1988. The sample period is partitioned into two subperiods by the sharemarket crash in October 1987.The empirical results suggest the presence of a time varying risk premium. This is reflected by the significantly positive volatility measure in the first subperiod and the significant interest rate level variable in both subperiods. The forecast errors correlate significantly with the growth in money supply and overseas interest rate variables. Factors other than market information inefficiency could be responsible for the significant correlation; namely the impact of the sharemarket crash on market perceptions about inflation expectations and the non‐simultaneous data problem in calculating the differential costs of borrowing.Despite the rejection of the joint hypothesis, forward rates are found to have information about future spot rates beyond that contained in past spot rates, and are able to predict interest rates at least 30 days ahead.
VALUING CONTRIBUTING SHARES
Authors: Brown Robert L. , Hathaway Neville J. 
Published: February 2009

Abstract:Contributing shares, which are only partly paid initially, entitle the holder to a pro‐rata call on the firm's assets. Subsequent payments, if and when made, convert the contributing share into a full ordinary share. This right to convert effectively may reside with different players in various cases. The valuation of contributing shares is developed in the three cases of a fixed obligation to convert, the option to convert is held by the firm and the option to convert is under the control of the contributing shareholders themselves, such as possibly when the contributing shares are held by board members. The valuation is given in closed form solutions for an indefinite life of the contributing share.
SEASONALITY IN AUSTRALIAN SHARE PRICE INDICES BETWEEN 1936 AND 1957
Authors: Brailsford Tim , Easton Stephen 
Published: February 2009

Abstract:There have been a number of Australian studies which have investigated monthly equity return seasonality from 1958 to the mid‐1980s. This paper extends the Australian evidence on seasonality by examining equity returns between 1936 and 1957. The major finding of the study is that returns in January are consistently higher than returns in any other month, and that returns in February and June are consistently lower than returns in other months. There is also evidence that returns in July are higher, and in March are lower, than returns in other months. However, it is the January, February and June seasonals which are significant and these remain after taking account of seasonality in ex‐dividend days.
FURTHER EVIDENCE ON EMPIRICAL RELATIONSHIPS BETWEEN EARNINGS AND CASH FLOWS
Authors: Percy Majella , Stokes Donald J. 
Published: February 2009

Abstract:Recently in Australia, regulations have been proclaimed requiring companies to make cashflow disclosures in addition to earnings disclosures from 30 June 1992. This paper provides evidence on relationships between earnings and cash flow measures and in so doing examines the external validity of a U.S.A. study of these relationships by Bowen, Burgstahler and Daley [1986]. We also extend their study through an industry analysis of the relationships. Evidence is presented first that shows low correlations between traditional cash flow measures (i.e., net income plus depreciation and amortisation; and working capital from operations) and a more refined cash flow measure (with additional adjustments for changes in non‐cash current assets and current liabilities). Second, traditional cash flow measures exhibit high correlations with earnings, while the more refined cash flow measure has a lower correlation with earnings. Finally, traditional cash flow measures better predict future cash flows than models based on earnings or a more refined cash flow measure. The industry evidence, albeit on small sample sizes, shows that the results on the first two issues, but not the latter issue, are generalisable across industry categories.
THE ROLE OF TIME SERIES ANALYSIS IN STUDIES OF ACCOUNTING POLICY CHOICE: A COMMENT
Authors: Taylor Stephen 
Published: February 2009

Abstract:The study by Anderson and Zimmer [1992] of goodwill accounting policies uses a pooled time series experimental design. This approach can add substantially to our understanding of accounting policy choices, but not in the manner used by Anderson and Zimmer. Where accounting policy choices are believed to be independent from one period to the next, then a time series approach can greatly enhance our ability to capture the influence on such policy choices of changing circumstances, more so than a simple cross‐sectional test. Conversely, if accounting policy choices are not independent between periods, pooling over time can overstate significance levels of statistical tests. The nature of Anderson and Zimmer's data makes the impact indeterminate. However, even under an extreme assumption, pre‐regulation evidence remains significant at conventional levels.
AN INVESTIGATION OF AUDITOR JUDGMENTS OF THE EFFECT OF PRELIMINARY ANALYTICAL PROCEDURES ON THE EXTENT OF SUBSTANTIVE TESTING
Authors: Pasewark William R. , Strawser Jerry R. 
Published: February 2009

Abstract:A major type of substantive testing procedure performed during the audit examination are analytical procedures. The use of analytical procedures (APs) in the preliminary stages of the audit examination is required for both United States (U.S.) and international audits. Despite this requirement, neither international (International Auditing Guideline 12 and Australian Statement of Auditing Practice 17) nor U.S. (Statement on Auditing Standards No. 56) auditing standards provide guidance concerning the use of preliminary APs for specific account balances or in specific circumstances. This research represents a descriptive examination of auditor judgments concerning the use of preliminary APs in the audit engagement. Our results indicate that auditors believe that performing preliminary APs generally results in a significant reduction in the need for substantive tests of details; however, the reduction in substantive testing varied according to which APs were performed. The high levels of judgment consensus noted in this research indicate that, while specific guidance for preliminary APs has not been provided by U.S. auditing standards, it appears that firms examined in this study have developed structured approaches with respect to the use of preliminary APs. Finally, the higher level of consensus noted for the judgments of senior accountants and staff accountants compared to those of audit managers may reflect either the structured nature of the task examined in this study or the greater degree of senior and staff accountant familiarity with the use of preliminary APs.
THE EFFECT OF EDUCATION ON THE AUDIT EXPECTATION GAP
Authors: Monroe Gary S. , Woodliff David R. 
Published: February 2009

Abstract:This paper examines the effect of education on students' perceptions of the meaning of audit reports and the responsibilities and duties of auditors. A research instrument, utilising semantic differential scales designed to measure the messages communicated through audit reports, was administered to two groups of undergraduate students at the beginning and end of a semester and to auditors. The experimental group consisted of final year undergraduate accounting students enrolled in their first auditing unit. The control group consisted of final year undergraduate marketing students not enrolled in the auditing unit. The results of the study suggest that education may be an effective approach to narrowing or eliminating the audit expectation gap.
PREDICTING UNCERTAINTY AUDIT QUALIFICATIONS IN AUSTRALIA USING PUBLICLY AVAILABLE INFORMATION
Authors: Monroe Gary S. , Teh Seng Thiam 
Published: February 2009

Abstract:This research project constructed a logit model to predict “subject to” qualified audit opinions using financial statement and market variables for 1,848 audit reports for Australian companies issued from 1984 to 1988. The model provided a better goodness of fit and was more efficient than two naive strategies for predicting “subject to” audit qualifications. The model explicitly incorporated the relative costs of Type II to Type I errors to account for the auditor's asymmetrical loss function. The model was reasonably accurate when a sensitivity analysis for the relative costs of Type II and Type I errors was considered. The accuracy rates for the estimation sample ranged from 70% to 95%. An inter‐temporal holdout sample of 293 audit opinions for Australian firms issued during 1989 indicated that the model was useful for predicting “subject to” audit opinions. The accuracy rates for the holdout sample ranged from 72% to 90% over a range of relative Type II and Type I costs.
DETERMINANTS OF ACCOUNTING POLICY CHOICE IN THE AUSTRALIAN PROPERTY INDUSTRY: A PORTFOLIO APPROACH
Authors: Aitken Michael J. , Loftus Janice A. 
Published: February 2009

Abstract:The objective of this research is to explain accounting policy choice in the Australian property industry by reference to costly contracting theory. This paper makes three departures from the predominant literature. First, instead of focusing on a single policy choice, it focuses on a portfolio of 15 choices. Second, instead of measuring each policy choice dichotomously, it measures the dollar effect of each policy choice. Finally, the research focuses on the impact of policy choices on owners' equity as well as income. The results confirm the importance of compensation arrangements as a determinant of accounting policy choice but fail to provide evidence that debt constraints or political costs are significant determinants of accounting policy choice. These results suggest that including property firms in a more heterogeneous sample may reduce the power of tests on the debt constraints and political costs hypotheses. More generally (when compared to previous research) the results suggest that the determinants of policy choice are likely to be industry specific.
THE VALUATION OF NEW ZEALAND UNDERWRITING AGREEMENTS
Authors: MacCulloch R. J. , Emanuel D. M. 
Published: February 2009

AbstractAlmost all cash issues by New Zealand listed public companies are by way of a rights issue. This paper examines the terms of 143 issues between 1976 and 1984. Of those issues 86 were underwritten and 57 were not. The paper is concerned with two questions. The first question examines whether there are fundamental differences in the terms of the issues that explain why some issues were underwritten and some were not. The second question examines the extent to which the underwriters' fee corresponds to the value of a put option, where that value is given by an adaptation of the Black Scholes formula. The conclusions are that there are differences in the terms of issues that are underwritten, compared with those that are not, and that the underwriters' fee is substantially in excess of the Black Scholes put value.
AN EMPIRICAL ASSESSMENT OF THE “FIT”BETWEEN STRATEGY AND MANAGEMENT INFORMATION SYSTEM DESIGN
Authors: Abernethy Margaret A. , Guthrie Cameron H. 
Published: February 2009

AbstractThis paper was motivated by the limited understanding of the role of accounting vis a vis other information in supporting the needs of management. The paper reports the findings of a study which examined differences in the design parameters of management information systems in firms adopting different strategic priorities. Based on a sample of 49 business unit general managers, the findings indicate that the effectiveness of business units is dependent on a match between the design of the information system and the firm's strategic posture. Information systems which have the characteristics of a broad scope system were found to be more effective in firms employing a strategy of continuous product/market development and innovation (Prospectors) than in firms which were protecting a comparatively narrow and stable product‐market (Defenders). The results have important implications for management accountants involved in the design and implementation of management information systems, especially in firms adopting a more innovative strategic posture. In particular, the study sheds light on the role of accounting as part of the “mosaic” of information provided to managers for decision making.
THE UNDERPRICING OF INITIAL PUBLIC OFFERINGS, EX ANTE UNCERTAINTY, AND PROXY SELECTION
Authors: Clarkson Peter M. 
Published: February 2009

Abstract:This paper reconsiders the prediction that the underpricing of IPOs is increasing in ex ante uncertainty by objectively establishing proxies for ex ante uncertainty on definitional grounds rather than by appealing to intuitive arguments. Based on a sample of 420 U.S. IPOs from the period 1976–1985, the results suggest that there is a hierarchy of proxies. The results also support the prediction of a positive relation between underpricing and ex ante uncertainty. Finally, the results suggest that as the effectiveness of a selected proxy as a measure of ex ante uncertainty increases, so does the strength of the relation between the degree of underpricing and ex ante uncertainty as measured by that proxy.
DIFFERENTIAL INFORMATION AND THE UNDERPRICING OF INITIAL PUBLIC OFFERINGS: AUSTRALIAN EVIDENCE
Authors: How Janice C.Y. , Izan H.Y. , Monroe Gary S. 
Published: February 2009

AbstractThis paper provides evidence on underpricing in Australia using 340 industrial initial public offerings over the period 1980 to 1990. It aims to explain why underpricing is consistent with rational behaviour by focusing on differential information across IPO firms. We measure differential information along two dimensions, the quality and the quantity of information. We propose that the quality of information is reflected in the reputation of independent advisers to the preparation of the issuing firm's prospectus. Three such independent external advisers are examined: the investigating accountant, the underwriter, and the expert. The results provide strong support for the reputation effect of the underwriter on underpricing. Although there is evidence showing a negative relation between underpricing and the reputation of the investigating accountant and the expert, it is not significant. Our results also support the differential quantity of information hypothesis. Firms with more information available are, on average, less underpriced.
A DISCRETE‐VALUED RISK FUNCTION FOR MODELLING FINANCIAL DISTRESS IN PRIVATE AUSTRALIAN COMPANIES
Authors: Cybinski Patti J. 
Published: February 2009

AbstractThis paper emphasises the inappropriateness of continuous measure predictors for both the logit and MDA models when dealing with the measurement errors that exist in much of the private company data used to model financial distress in that sector. Also, it is argued that the step function logit model that we get as a consequence of the necessity to categorise the predictors, may be more appropriate in explaining underlying nonlinear behaviour of firms at risk than the usual continuous response linear function. Within this context, the two models are compared using data from 140 private Australian companies. A logit model based on only three discrete‐valued ratios gave an overall accuracy rate comparable to that of an existing continuous‐valued multiple discriminant analysis (MDA) model based on six ratios. Of interest is the very different order of significance of the predictor ratios in the two models although neither model remains trustworthy for predictive purposes.