Financial reporting standards: Global or international?

Purpose - This paper studies quantitative, monetary information about differences between IFRS and US GAAP in the three principal financial statements. Design/methods/approach - Comparative data from the same company are compared. The explanations of differences are found in lengthy footnotes. The sample is from civil law countries with reputations for high integrity, reducing possible confounding effects of legal systems or earnings management. Sample countries are highly economically developed, reducing distortions that would result from different fair value conditions. Findings - A few key standards account for most of the monetary differences between the accounting standards. In some cases large differences in one direction offset large differences in the other direction, reducing the insights from comparing only income. Research limitations/implications - The window of data availability for single--company reporting under both standards was narrow. However, because of convergence activities, these differences are likely slowly to decline. Originality/value - The only paper to examine the footnote disclosure in sufficient detail to accurately measure differences. The only paper to analyze the cash flow statement. It is valuable for financial analysts, and to academic researchers who study accounting quality and make international comparisons.</p

Are legal families related to financial reporting quality?

A large body of financial accounting research explores the quality of accounting in different countries. An important assumption in most of that research is that common law provides a firmer foundation for good accounting transparency than civil law. Researchers usually regress their proxy for accounting quality on an indicator variable that designates the firm's country as a common or civil law jurisdiction (along with other regressors). But what is the support for that nearly universal assumption? This study addresses that question. It traces the distinctions made by legal scholars that characterize the two ‘families’. It analyzes La Porta et al. (1998), which is the nearly universal citation to support the civil/common dummy, and assesses the design and development of research designs that use law in accounting studies. It concludes that the use of the civil/common distinction as applied in accounting studies cannot be supported, and offers suggestions for how to better investigate the ways in which the law interacts with financial reporting.</p

Accounting Quality in Eastern Europe after Communism

Research Question/Issue: This study, in the taxonomy of Schiehll and Martins (2016 Schiehll, E. and H. C. Martins. 2016. Cross-national governance research: A systematic review and assessment. Corporate Governance: An International Review 24 (3):181–99. doi:10.1111/corg.12158.[Crossref], [Web of Science ®], [Google Scholar]), examines cross-national corporate governance, within their “legal” category. It rests on the understanding that to fully grasp corporate governance it is essential to understand the embedded institutions. The research question is: Does an increase in legal quality cause an associated increase in the quality of corporate governance in the form of financial reports to investors? If so, this supports the fundamental importance of legal systems to earnings quality. Reliable evidence on whether there is an association between legal quality and financial reporting quality would be an empirical association showing that where legal quality is higher, earnings quality is also higher, and conversely.Research Findings/Insights: The results show clearly that in 2005 and 2010, when adequate data are available for testing, earnings quality is poor: far more companies show small gains than small losses. A great deal of managerial discretion is exercised in arriving at accounting figures, since many amounts depend on forecasts of future events. A significant number of firms use that latitude to show positive earnings. As to patterns of earnings management among three clusters of countries, the small number of firms generally precludes strong statistically supported evidence of management within the clusters. Nevertheless, the whole is the sum of the parts, and the parts (clusters) indicate the clusters most responsible for the overall result. There is little evidence of small gains exceeding small losses in the Baltics, greater differences in the Visegrád countries, and big differences in southern Europe.Theoretical/Academic Implications: Based on both (a) the historical background of legal systems and (b) attitudes concerning legal quality measured at the same time as the earnings measures, the accounting results are consistent with the prediction of a strong legal culture driving effective corporate governance.Practitioner/Policy Implications: The results show that eastern firms, on aggregate, have yet to reach the level of their western counterparts. However, the differences do not seem highly significant, and indicate that convergence is close in this area. This, in turn, should guide and encourage legislators in their work.</p

Money and mental wellbeing : a longitudinal study of medium-sized lottery wins

One of the famous questions in social science is whether money makes people happy. We offer new evidence by using longitudinal data on a random sample of Britons who receive medium-sized lottery wins of between £1000 and £120,000 (that is, up to approximately US$ 200,000). When compared to two control groups – one with no wins and the other with small wins – these individuals go on eventually to exhibit significantly better psychological health. Two years after a lottery win, the average measured improvement in mental wellbeing is 1.4 GHQ points

System study concerning an antenna suitable for a spinning-goniometer direction-finding system

http://deepblue.lib.umich.edu/bitstream/2027.42/6316/5/bad0301.0001.001.pdfhttp://deepblue.lib.umich.edu/bitstream/2027.42/6316/4/bad0301.0001.001.tx

The development of financial reporting quality in Eastern European Union countries in the aftermath of communism (Conference abstract)

This is a study of the progress of eastern European Union countries with respect to the effective functioning of a financial reporting system, a foundation of efficient capital markets. Since efficient capital markets enhance capital allocation and give citizens opportunities to benefit from economic growth, financial reporting has effects that go beyond protection of investors. The eastern EU countries were until the fall of communism starting in 1989 planned socialist economies, which lacked not just the private ownership of firms, but also the system of law that would support a system of dispersed ownership. If one wishes to go beyond measuring earnings quality to understanding the reasons for it, one must understand the law that underlies it. The question in this study is how complete has been the transition from socialism to capitalism, as measured by the quality of financial reporting; that is, the extent of "earnings management." The paper starts by analyzing the evolution of the legal system as the supporting structure for good corporate governance, of which financial reporting is a part. On the basis of that analysis it proposes hypotheses about the level of earnings management compared with western EU firms, and it also develops hypotheses about the time series of earnings management. It uses the "small gain small loss" test that measures discontinuities around zero earnings to measure accounting manipulation. It uses a method that overcomes some of the limitations of the original methods of Burgstahler and Dichev (1997).</p

2,4,6-Trinitrotoluene Reduction by Carbon Monoxide Dehydrogenase from Clostridium thermoaceticum

Purified CO dehydrogenase (CODH) from Clostridium thermoaceticum catalyzed the transformation of 2,4,6-trinitrotoluene (TNT). The intermediates and reduced products of TNT transformation were separated and appear to be identical to the compounds formed by C. acetobutylicum, namely, 2-hydroxylamino-4,6-dinitrotoluene (2HA46DNT), 4-hydroxylamino-2,6-dinitrotoluene (4HA26DNT), 2,4-dihydroxylamino-6-nitrotoluene (24DHANT), and the Bamberger rearrangement product of 2,4-dihydroxylamino-6-nitrotoluene. In the presence of saturating CO, CODH catalyzed the conversion of TNT to two monohydroxylamino derivatives (2HA46DNT and 4HA26DNT), with 4HA26DNT as the dominant isomer. These derivatives were then converted to 24DHANT, which slowly converted to the Bamberger rearrangement product. Apparent K(m) and k(cat) values of TNT reduction were 165 ± 43 μM for TNT and 400 ± 94 s(−1), respectively. Cyanide, an inhibitor for the CO/CO(2) oxidation/reduction activity of CODH, inhibited the TNT degradation activity of CODH