Earnings management and audit quality:stakeholders’ perceptions

This paper examines the perceptions of Libyan Commercial Banks’ (LCBs) stakeholders regarding the role of the external auditor in relation to earnings management (EM). A total of 28 semi-structured interviews were carried out with a range of LCB stakeholders comprising preparers of financial statements, users, regulators and academics. A questionnaire survey of stakeholders which yielded 102 Responses (response rate 53%) was also carried out. A variety of views were held which varied to some extent according to stakeholder group. A widely held perception amongst interviewees was that the auditor has the ability to detect EM practices but may not be able to prevent it. However questionnaire respondents were, in aggregate, more confident of the auditor’s ability to deter EM due to the influence of the audit report. The paper provides insights into stakeholders’ perceptions of the quality of bank audits. The findings are of particular relevance to regulators, and specifically, the Central Bank of Libya. Perceptions of audit quality raise questions about its guidance and regulations especially in connection with audit firm rotation. Perceptions of audit quality, and therefore, of the credibility of financial statements should be of interest to all stakeholders. The importance of the banking sector for society has been amply demonstrated in recent years. A well-functioning audit function is a key component of its regulation. To the best of our knowledge, this paper is the first to examine issues related to banks’ audit quality and audit firm rotation in Libya

Value Added Accounting in Germany and France

Cahier de Recherche du Groupe HEC Paris, n° 54

Accounting for Brands, a Comparison between IASC, Fance and Germany

Cahier de Recherche du Groupe HEC Paris, n° 57

Une illustration des difficultés de l´harmonisation internationale: La comptabilisation des marques en France, en Allemagne et selon les règles de l`IASC

Cahier de Recherche du Groupe HEC Paris, n° 675It is often stressed that the process of IASC standard setting and its output are very much influenced by the Anglo-American accounting approach. This is considered to be one of the major reasons for the obvious reluctance of countries to adopt the international accounting standards. The importance given to the two accounting characteristics of " reliability " and " relevance " and their mutual relationship is one of the dominant reasons for the differences between the Continental- European and the Anglo-American accounting philosophy. An area where this competing relationship between relevance and reliability becomes highly obvious is in accounting for intangible assets, and namely for brands. It is then highly interesting to study whether the treatment developed by the IASC differs from the accounting practice in Continental European countries and to consider if it could be adopted easily by enterprises in those countries. That is the main objective of this article, which compares the positions adopted in IAS 38 concerning brands and the related practices in France and Germany. Despite the existence of numerous points of convergence, the article shows some major differences between two countries supposed to follow relatively similar rules. It tends then to draw our attention on the difficulty of international harmonization.Il est souvent noté que le processus de normalisation comptable internationale est influencé par l'approche anglo-américaine, ce qui explique en partie la réticence de certains pays à adopter les normes comptables internationales. La différence entre les philosophies anglo-américaines et européennes continentales peut s'expliquer par l'importance accordée à deux caractéristiques essentielles de la comptabilité : fiabilité et pertinence. Le domaine des actifs incorporels, et notamment des marques, fait particulièrement ressortir l'opposition existant entre ces deux concepts. Il est alors intéressant de voir si le traitement proposé par l'IASC est différent des pratiques des pays d'Europe continentale et s'il pourrait être adopté facilement par les entreprises de ces pays. Tel est le principal objectif de cet article qui compare les positions retenues dans la norme IAS 38 en matière de marques avec celles de la France et de l'Allemagne. Malgré l'existence de nombreux points de convergence, cette recherche fait ressortir plusieurs différences majeures entre deux pays supposés suivre des règles relativement similaires. Ceci tend donc à attirer notre attention sur la difficulté de l'harmonisation internationale

Non-financial information: State of the art and research perspectives based on a bibliometric study

We conduct a bibliometric analysis of academic articles published on the topic of non-financial information (NFI). This analysis covers 787 articles published in 53 journals over the timespan 1973 to 2013. We examine several important questions about the state of the art of academic research on NFI: How is NFI defined in the literature? Can NFI be precisely defined? How has interest in NFI evolved over time in the academic literature? What are the main topics covered by NFI research? What are the main methodologies used by researchers? To what extent are studies country-specific? We find that many articles do not define the concept of NFI but refer to underlying concepts such as social, environmental, human capital or corporate social responsibility (CSR) reporting. We document that academic research on NFI reached a certain degree of maturity around the late 1990s / early 2000s, a time when several new specialized journals were created that now capture an important share of the market. We identify 10 topics covered by research on NFI and show that the most frequently-studied topic in NFI research is CSR reporting. We also discover that the volume of research concerning auditing of NFI is growing, whereas management accounting/control research on NFI is limited. We find that the growth in NFI research is fueled mainly by articles using archival data (quantitative or qualitative) and essay methodologies. Finally, we suggest directions for future research