Unintended consequences of changes in the regulatory landscape on the statutory audit processNie

We examine the effect of changes in the regulatory environment on the conduct of financial statement audits in a European setting. These changes include the adoption of risk-based auditing, new Audit Risk Standards and increased scrutiny of audit quality by a new, co-ordinated oversight body in each Member State. We investigate this by analysing the audit hours and fees and their determinants for clients of Big N audit firms in Finland in 1996 and 2010. Our results show that audit fees and audit effort by senior auditors were generally higher for high risk clients in 2010 than in 1996. Second, we find that the relationship in 1996 between the client being owner-managed and lower audit hours for both senior and junior auditors is absent in 2010. This supports our argument that the increased auditor scepticism has increased audit effort for owner-managed firms. Third, we find that the average number of junior staff hours increased between 1996 and 2010, but the variance across engagements declined. In contrast, senior auditor hours (and total audit hours) decreased, but the variance across engagements increased. This supports the view that risk-based auditing has increased the efficiency of audits. However, it suggests that the general increase in regulation and the tightening of audit standards, reinforced by the new quality inspections, have led to less emphasis on processes requiring professional judgment and more emphasis on compliance with rules. These unintended consequences should be of interest to the auditing profession and policy makers

Facial expression of affect in children with Cornelia de Lange Syndrome

Background: Individuals with Cornelia de Lange syndrome (CdLS) have been reported to show comparatively high levels of flat and negative affect but there have been no empirical evaluations. In this study, we use an objective measure of facial expression to compare affect in CdLS with that seen in Cri du Chat syndrome (CDC) and a group of individuals with a mixed aetiology of intellectual disabilities (ID). Method: Observations of three groups of 14 children with CdLS, CDC and mixed aetiology of ID were undertaken when a one-to-one interaction was ongoing. Results: There was no significant difference between the groups in the duration of positive, negative or flat affect. However, the CdLS group displayed a significantly lower ratio of positive to negative affect than children in the other groups. Discussion: This difference partially confirms anecdotal observations and could be due to the expression of pain caused by health problems associated with CdLS or neurological expression of the CdLS gene in facial muscles related to expression of positive affect. However, further research is needed to directly test these possible associations. </p

The role and current status of IFRS in the completion of national accounting rules: Evidence from the UK

Drawing on secondary data, we examine the transposition of the Accounting Directive 2013 into UK GAAP, with a specific focus on references to IFRS. The process involved consultation and regulatory impact assessment on the options in the Accounting Directive and proposed changes to accounting standards for non-publically accountable entities. This led to an IFRS-based approach from 2016 with three tiers: EU-adopted IFRS for group listed companies and other publicly accountable entities, an adaptation of IFRS for SMEs for non-publicly accountable entities, and a simplified version for micro-entities incorporating the requirements of the Accounting Directive. This outcome is not surprising since the UK was one of the founding members of the original IASC and a strong proponent of little GAAP. Indeed, the UK’s former Financial Reporting Standard for Smaller Entities provided a model for the IFRS for SMEs. In the past, there were few references to IFRS by the UK’s enforcement and interpretation bodies. Today, guidance is taken from IFRIC. We contribute to the literature by describing the main processes involved in implementing the Accounting Directive and the move to an IFRS-based approach in UK GAAP. Our analysis should be of interest to researchers and policy makers alike

Maximising Social Interactions and Effectiveness within Distance Learning Courses: Cases from Construction

Advanced Internet technologies have revolutionised the delivery of distance learning education. As a result, the physical proximity between learners and the learning providers has become less important. However, whilst the pervasiveness of these technological developments has reached unprecedented levels, critics argue that the student learning experience is still not as effective as conventional face-to-face delivery. In this regard, surveys of distance learning courses reveal that there is often a lack of social interaction attributed to this method of delivery, which tends to leave learners feeling isolated due to a lack of engagement, direction, guidance and support by the tutor. This paper defines and conceptualises this phenomenon by investigating the extent to which distance-learning programmes provide the social interactions of an equivalent traditional classroom setting. In this respect, two distance learning case studies were investigated, covering the UK and Slovenian markets respectively. Research findings identified that delivery success is strongly dependent on the particular context to which the specific distance learning course is designed, structured and augmented. It is therefore recommended that designers of distance learning courses should balance the tensions and nuances associated with commercial viability and pedagogic effectiveness

What turns the taxman on? Audit opinion and tax return adjustments in a voluntary audit environment

Using a large proprietary data set obtained from the Finnish Tax Administration, we examine the factors that trigger adjustments by the tax authority to the taxable income reported by around 25,000 small private companies in their tax returns. After controlling for tax aggressiveness and other relevant factors, we find that having a voluntary audit with an unqualified audit opinion decreases the likelihood of the tax authority not accepting taxable income as reported. At the same time, it moderates the otherwise significant positive effect of tax aggressiveness on the likelihood of tax authority making adjustments

Long-distance hormone transport via the phloem

Several key plant hormones are synthesised in the shoot and are advected within the phloem to the root tip. In the root tip, these hormones regulate growth and developmental processes, and responses to environmental cues. However, we lack understanding of how environmental factors and biological parameters affect the delivery of hormones to the root tip. In this study, we build on existing models of phloem flow to develop a mathematical model of sugar transport alongside the transport of a generic hormone. We derive the equations for osmotically driven flow in a long, thin pipe with spatially varying membrane properties to capture the phloem loading and unloading zones. Motivated by experimental findings, we formulate solute membrane transport in terms of passive and active components, and incorporate solute unloading via bulk flow (i.e. advection with the water efflux) by including the Staverman reflection coefficient. We use the model to investigate the coupling between the sugar and hormone dynamics. The model predicts that environmental cues that lead to an increase in active sugar loading, an increase in bulk flow sugar unloading or a decrease in the relative root sugar concentration result in an increase in phloem transport velocity. Furthermore, the model reveals that such increases in phloem transport velocity result in an increase in hormone delivery to the root tip for passively loaded hormones

Identification of clouds and aurorae in optical data images

In this paper we present an automatic image recognition technique used to identify clouds and aurorae in digital images, taken with a CCD all-sky imager. The image recognition algorithm uses image segmentation to generate a binary block object image. Object analysis is then performed on the binary block image, the results of which are used to assess whether clouds, aurorae and stars are present in the original image. The need for such an algorithm arises because the optical study of particle precipitation into the Earth's atmosphere by the Ionosphere and Radio Propagation Group at Lancaster generates vast data-sets, over 25 000 images/year, making manual classification of all the images impractical

Post-Disaster Housing Reconstruction in Sri Lanka: What Methodology?

Research methodology is the procedural framework within which the research is conducted. This includes the overall approach to a problem that could be put into practice in a research process, from the theoretical underpinning to the collection and analysis of data. Choice of methodology depends on the primary drivers: topic to be researched and the specific research questions. Hence, methodological perspectives of managing stakeholder expectations of PDHR context are composed of research philosophies, research strategy, research design, and research techniques. This research belonged to social constructivism or interpretivism within a philosophical continuum. The nature of the study was more toward subjectivism where human behavior favored voluntary stance. Ontological, methodological, epistemological, and axiological positioning carried the characteristics of idealism, ideographic, anti-positivism, and value laden, respectively. Data collection comprises two phases, preliminary and secondary. Exploratory interviews with construction experts in the United Kingdom and Sri Lanka were carried out to refine the interview questions and identify the case studies. Case study interviews during the secondary phase took place in Sri Lanka. Data collected at the preliminary stage were used to assess the attributes of power, legitimacy/proximity, and urgency of stakeholders to the project using Stakeholder Circle™ software. Moreover, the data collected at secondary phase via case studies will be analyzed with NVivo 8. This article aims to discuss these methodological underpinnings in detail applied in a post-disaster housing reconstruction context in Sri Lanka