AICPA (American Institute of Certified Public Accountants) National Conference on Federal Taxes

AICPA (American Institute of Certified Public Accountants) National Conference on Federal Taxe

Information and Accountants in the Role of Strategic Planning

This article on strategic planning practices is based upon a field study of five world-class companies. The strategic planning practices discussed in this article were extracted from the corporate environment. The information contained in this article, however, is of value alike to CPAs assisting with the enhancement of strategic planning practices in corporations and public accounting firms

Value relevance of troubled debt restructurings and policy implications

This paper investigates the beneficial economic consequences and market and accounting based valuation effects of troubled debt restructurings (TDR) in financially distressed debtor firms. Relying on the implications of prior research and extant valuation theories, some empirical evidence on the beneficial outcomes and informativeness of TDR is first provided: significantly positive restructuring interval excess returns and higher excess returns to subsequently consummated restructurings and subsequent survivors. The market reaction to “full-settlement” and “modification of terms” types of TDR are also measured to evaluate the consistency of the FASB's binary classification and recognition criteria with the market participants' assessments. Finally, a valuation model conditional on book values and earnings is used to test the value relevance of the reported financial statement bottom lines and TDR related disclosure. The findings suggest that modifications are at least as beneficial and informative as full settlements. Hence, the recognition of the reduction in the liability and the related gain in the financial statements of firms that undertake modifications would be more congruent with the valuation effects assessed by market participants. Key words: Private workouts, Financial distress, Debt restructuring, Valuation, Capital markets, SFAS No.15. JEL: G14, G33, G38, M4

An Analysis of the Incidence of Fraud in Cameroon and Prospects

The Cameroonian public and private sectors of the economy have experienced considerable growth, changes and challenges since independence in 1960 for Francophone Cameroon, and 1961 for Anglophone Cameroon. The state institutions are both regulators and controllers of both sectors of the economy but the country still faces endless challenges such as corruption, bribery and fraud, causing adverse economic, social and political consequences. Since independence to date, fraud remains a major problem that is ever increasing both in its frequency and severity. Meanwhile, research evidence has shown that growing number of frauds have undermined the integrity of public / private sector financial reports, contributed to substantial economic losses, and even eroded investors’ confidence regardless the usefulness and reliability of financial statements – indeed, the absence of accountability and transparency, increased waves of white-collar crimes in both public and private sectors demand stiff penalties, exemplary punishment , and effective enforcement of the law with the right spirit. An attempt is made to examine and analyze in-depth the fraud challenges and environment using a comparative analysis of its incidence in the cities of Yaoundé and Douala in Cameroon. To achieve the objectives of the study, primary and secondary data were used. Five hundred questionnaires were administered to the study respondents that were purposively selected from the two cities. Going by the findings, the incidence of fraud in the cities vary very significantly with adverse economic, social and political consequences. Keywords: Analysis, incidence of fraud, Douala, Yaoundé and Cameroon

INTERNAL CONTROL MECHANISMS IN THE CONTEXT OF THE CHALENGE FINANCIAL CRISIS

Prevention and earlier detection of fraudulent financial reporting must start with the entity that prepares financial reports. Thus the first focus of the Sarbannes-Oxley Actâ€(tm)s recommendations is the public company. These recommendations, taken together, will improve a company's overall financial reporting process and increase the likelihood of preventing fraudulent financial reporting and detecting it earlier when it occurs. For some companies, implementing these recommendations will require little or even no change from current practices; for other companies, it will mean adding or improving a recommended practice. Whether it means adding or improving a practice, the benefits justify the costs. The Sarbanes-Oxley Act is a direct response to the recent scandals in the US corporate world. Governance, compliance, risks and internal controls are mounting concerns for almost all organizations. As the numbers of rules, regulations and contractual obligations steadily rise, management is growing more and more concerned about their exposure on day-to-day operational decisions!fraud, internal control, COSO, risks based audit

IT fit on auditors’ performance in Yemen

The alignment between the importance and utilisation of IT (IT fit), and the impact of IT fit on organisational performance has been an issue of concern for many researchers. Therefore, this study examined the effect of organisational, social, individual, and environmental factors on IT fit and on auditors’ performance as well as the influence of IT fit on auditors’ performance. It also examined the mediating effect of IT fit on the relationship between these independent variables and auditors’ performance. Data from 274 auditors were analyzed using the PLS-SEM. The results indicate that auditors perceived their utilisation of IT utilisation to be less than the importance of IT, hence providing important insights into the importance and the utilisation of technologies in the context of audit work in Yemen. The findings suggest that information systems audit in Yemen is still at the minimum level. Further analyses on the effect of the independent variables, namely IT knowledge, facilitating resources, IT trust, competitive pressure, management support, client’s complexity of the IT system, internalisation and cognitive style, on IT fit show them to be positive and significant. Interestingly, IT fit is found to be a mediator between these eight variables and auditors’ performance. This study also finds that management support, IT knowledge, IT trust, internalisation, IT training, client’s complexity of the IT System, cognitive style and IT fit have positive and significant effects on auditors’ performance. The three most important variables are IT knowledge, facilitating resources, and management support. The findings suggest the important role of IT fit in increasing the effect of these variables on auditors’ performance. Therefore, audit firms and professional bodies need to focus on the issue of IT fit to increase the performance of their auditors

Communication apprehension and communication self-efficacy in accounting students

Purpose – The purpose of this paper is to establish a link between communication apprehension and communication self-efficacy in accounting students. Design/methodology/approach – This is achieved by the use of two questionnaires jointly distributed to the students involved. The Personal Report of Communication Apprehension (PRCA-24)developed by McCroskey to measure oral communication apprehension[1] (OCA) and the instrument for written communication apprehension (WCA) developed by Daly and Miller and a questionnaire to measure communication self-efficacy. This had been developed using the guidelines set out by Bandura and was designed to measure two constructs: oral communication self-efficacy, and written communication self-efficacy. Findings – The two separate statistical tests to identify the connection between the two concepts both indicated the existence of a strong relationship between the two. This was shown not only in the overall relationship between communication apprehension and self-efficacy but also equally strongly in their constituent components. Practical implications – The existence of this relationship is important because it provides a possible development in terms of understanding the barrier to the development of communication skills and also indicates a possible redirection to alleviate and remove the barrier. In order for accountants to meet future challenges, there is substantial evidence that the development of communication skills will be vital. Originality/value – This paper draws the conclusion that in the future consideration needs to be given to incorporating into the pedagogy of accounting education, especially in those areas involving the development of communication skills, approaches that increase self-efficacy. Keywords Communication skills, Communication apprehension, Communication self-efficacy, Accounting, Communication Paper type Research pape