Auditor choice in Italian non-listed firms

© Emerald Group Publishing Limited. Purpose – This paper aims to investigate auditor choice in those Italian non-listed firms adopting the “traditional” model of corporate governance. In Italy, non-listed firms can choose between two types of auditor: the Board of Statutory Auditors (BSA), that is the statutory auditors, or an “external” auditor. At the same time, a BSA conducts the administrative auditing for all companies with equity exceeding €120,000. Design/methodology/approach – The paper estimates a logistic regression model of firm auditor choice between an external auditor and the BSA, which incorporates variables proxying for both agency conflict and organizational complexity effects. Findings – The results show that of the potential agency factors, only board independence drives auditor choice, whereas organizational complexity and risk factors including firm size, investment in inventories, subsidiary status and complexity drive auditor choice. These results may be explained in the administrative audit role of the BSA, which monitors both day-by-day firm operations and the financial statements preparation “project”. Stakeholders as a result are reassured that, in general, their interests are protected. Finally, it was found that legal form and voluntary International Financial Reporting Standards compliance exert an impact on auditor choice. Originality/value – The paper provides support for an internal yet independent auditing body such as the Italian BSA as a wider model for corporate governance in European non-listed firms (OECD, 2004 and 2015). The BSA as an administrative and financial auditing body made up solely of independent highly qualified professionals can work within the firm on an operational basis, and in so doing can increase stakeholder protection

MtB versus VAIC in measuring intellectual capital: Empirical evidence from Italian listed companies

The purpose of this paper is to compare two of the most commonly employed methods employed to measure the Intellectual Capital (IC) value: Market to Book (MtB) ratio and the VAIC, in order to determine the most suitable in the context of Italian listed firms and their respective relationships with some key IC determinants. The study is conducted for a sample of Italian listed firms over the period 2009-2014. Different tests are employed to compare VAIC and MtB, while, two linear panel regression models with fixed effects models are performed in order to test the relationship between IC value and selected determinants. Results suggest that the MtB ratio is a better estimator of IC value than VAIC. For MtB, IA and profitability-are significant positive drivers, while leverage and size are significant negative drivers. For VAIC, only profitability and leverage are significant determinants, both having a positive effect. Recognised limitations in measuring IC value through MtB are partially mitigated because the sample is composed of listed companies preparing financial statements according to IFRS since 2005. Managers should try to avoid rigidity in their organisational structure and to focus on an IC investment strategy. Results could be beneficial for financial analysts and investors in selecting the best method for IC measurement. The paper makes an innovative comparison between two alternative IC metrics, to determine which is the more effective in capturing IC value in an Italian listed firms' context. Further, it identifies some key determinants of IC value

The impact of financial difficulties on earnings management strategies: The case of Italian non-listed firms

This study investigates the impact of the degree of financial distress on the earnings management activities of Italian non-listed firms. The extant literature provides mixed evidence on this relationship for listed firms. We find a positive (negative) relationship between financial distress risk and income-decreasing (income-increasing) earnings management, suggesting that firms tend to manage earnings downward as financial distress risk (proxied by Altman's Z-Score) increases. Consistent with the Jensen control hypothesis, stressed firms are more likely to reveal their weak financial performance to stakeholders in order to renegotiate their debt on better terms and to signal the manager's willingness to deal with these problems to stakeholders (e.g. lenders and auditors). In two robustness tests, we test the power of the Kothari et al. (2005) model for decomposing total accruals and we also analyse a reduced firm sample representing over 80% of the population. We employ a linear regression model controlling for heteroschedasticity and autocorrelation using the Petersen method. The dependent variable is continuous and proxies negative discretionary accruals (DA) by setting positive (DA) to zero since we hypothesise that managers of distressed firms are more likely to manage earnings downward than healthy firms. Distress is proxied by the Altman Z-score measure for non-listed firms. Our research has several implications for academics, practitioners, lenders, and national standard setters, showing that, i

MtB versus VAIC in measuring intellectual capital: Empirical evidence from Italian listed companies

The purpose of this paper is to compare two of the most commonly utilized methods employed to measure the Intellectual Capital (IC) value: Market to Book (MtB) ratio and the Value Added Intellectual Coefficient (VAIC), in order to determine the most suitable in the context of Italian listed firms and their respective relationships with some key IC determinants. The study is conducted for a sample of Italian listed firms over the period 2009-2014. Different tests are employed to compare VAIC and MtB, while two linear panel regression models with fixed effects models are performed in order to test the relationship between IC value and selected determinants. The results suggest that the MtB ratio is a better estimator of IC value than VAIC. MtB, IA and profitability – are significant positive drivers, while leverage and size are significant negative drivers. For VAIC, only profitability and leverage are significant determinants, both having a positive effect. Recognised limitations in measuring IC value through MtB are partially mitigated because the sample is composed of listed companies preparing financial statements according to IFRS since 2005. Managers should try to avoid rigidity in their organisational structure and to focus on an IC investment strategy. The results could be beneficial for financial analysts and investors in selecting the best method for IC measurement. The paper makes an innovative comparison between two alternative IC metrics, to determine which is more effective in capturing IC value in an Italian listed firms' context. Further, it identifies some key determinants of IC value. Key words: Intellectual capital, intangible assets, market-to-book ratio, value added intellectual coefficient (VAIC), Italian listed firms

Earnings management techniques in the context of Italian unlisted firms

n/

I DEBITI TRIBUTARI E IL FONDO IMPOSTE

AI fini dell'attribuzione del risultato economico all'esercizio in chiusura, le imposte sul reddito devono esser imputate secondo il principio della competenza economica anche s epoi le stesse verranno liquidate nel periodo o nei periodi successivi. A tal fine, quindi, si procede alla elaborazione di una diversa grandezza denominata "reddito imponibile o fiscale" ottenuta apportando al reddito di bilancio ante imposte le variazioni conseguenti ai diversi criteri di valutazione fiscali.Il paragrafo illustra le differenti tipologie di sfasamenti tra reddito civilistico e reddito imponibile proponendo una modalità di rilevazione e rappresentazione in bilancio coerente con i principi contabili nazionali

L'ASSISTENZA SANITARIA DISTRETTUALE: UN SET DI MISURE PER PROGRAMMARE E CONTROLLARE LA GESTIONE

Il paper proposto si pone diversi obiettivi: innanzitutto, partendo dallo schema generale, quello di delineare la struttura della Balanced Scorecard per una realtà distrettuale, in secondo luogo, l’identificazione di parametri di tipo organizzativo (prospettiva, crescita e apprendimento) ed erogativi (prospettivi dei processi) che tengano conto anche della recente evoluzione dell’assistenza distrettuale , dall’integrazione socio-sanitaria e dell’introduzione dei percorsi diagnostici-terapeutici, nonché la definizione di modalità di determinazione dei driver per ciascuna delle prospettive

CONSIDERAZIONI SUL SISTEMA FINANZIARIO DELLE PREVISIONI NELL'OPERA DI BENEDETTO LORUSSO

Il paragrafo si propone di illustrare il passaggio tra la teoria del sistema patrimoniale a quella del sistema del reddito attraverso la ricostruzione delle opere di Benedetto Lo Russo, Allievo di Fabio Besta ma precursore delle nuove correnti di pensiero il cui fautore è il Prof. Gino Zappa

Gli impieghi economici: i fattori pluriennali

Il capitolo illustra le modalità di acquisizione e di contabilizzazioni dei fattori pluriennali. Particolare enfasi è posta sulla modalità di contabilizzazione del leasing finanziario (principi contabili nazionali e internazionali)