Baily\u27s paradox

The following question appeared in Francis Baily\u27s celebrated 1808 text on interest and annuities: If a penny had been put out at 5 percent compound interest at the birth of Christ; to what sum would it amount at the end of the year 1810? . A discussion of various solutions follows

Hicks on accounting

Whenever income and capital maintenance concepts are discussed at the conceptual level, a reference to Hicks is likely to be found. These references are misleading since Hicks himself believed that the proper basis of valuation in the financial statements of a firm is historical cost. He also argued that accountants should not make price-level adjustments. Hicks\u27 views on accounting, which are scattered in his writings over a period of 35 years, are reviewed in this paper

Accountant\u27s responsibility for disclosing bribery: An historical note

In the late nineteenth century The Accountant reported on a case where the auditors looked at the mattery of bribery straight in the face and disclosed the illegal payments in the audit certificate. However, subsequent discussion of the accountant\u27s responsibility for disclosing bribery in an 1899 lecture, Secret Profits, showed that there was no unanimity of opinion on the accountant\u27s responsibility in this area. The problem is obviously a continuing one

The Value Relevance of Dividends, Book Value and Earnings

This paper compares the value relevance of book value and dividends versus book value and reported earnings. Our work is motivated by recent research including Ohlson (1995), Feltham and Ohlson (1995), Bernard (1995), Burgstahler and Dichev (1997), Collins, Maydew and Weiss (1997), Barth, Beaver and Landsman (1998) and Hand and Landsman (1999). We justify modeling price in terms of book value and dividends in two ways. First, using Modigliani and Miller's (1959) argument, dividends may have a stronger correlation with permanent earnings than reported earnings. Second, we derive a model of price in terms of book value and dividends from basic analytical relationships. Three sets of findings are reported. First, overall, the variables, book value and dividends, have almost the same explanatory power as book value and reported earnings. Second, for firms with transitory earnings, dividends have greater explanatory power than earnings but book value and earnings have about the same explanatory power as book value and dividends. Most important, when earnings are transitory and book value is a poor indicator of value, dividends have the greatest explanatory power of the three variables. The value relevance of dividends is confirmed further in statistical tests using holdout samples

The Value Relevance of Dividends, Book Value and Earnings

This paper compares the value relevance of book value and dividends versus book value and reported earnings. Our work is motivated by recent research including Ohlson (1995), Feltham and Ohlson (1995), Bernard (1995), Burgstahler and Dichev (1997), Collins, Maydew and Weiss (1997), Barth, Beaver and Landsman (1998) and Hand and Landsman (1999). We justify modeling price in terms of book value and dividends in two ways. First, using Modigliani and Miller's (1959) argument, dividends may have a stronger correlation with permanent earnings than reported earnings. Second, we derive a model of price in terms of book value and dividends from basic analytical relationships. Three sets of findings are reported. First, overall, the variables, book value and dividends, have almost the same explanatory power as book value and reported earnings. Second, for firms with transitory earnings, dividends have greater explanatory power than earnings but book value and earnings have about the same explanatory power as book value and dividends. Most important, when earnings are transitory and book value is a poor indicator of value, dividends have the greatest explanatory power of the three variables. The value relevance of dividends is confirmed further in statistical tests using holdout samples

Portraying the nature of corruption: Using an explorative case-study design

What is the nature of corruption in Western democracies? To answer this research question, the authors study 10 Dutch corruption cases in depth, looking at confidential criminal files. The cases allow them to sketch a general profile of a corruption case. The authors offer nine propositions to portray the nature of corruption. They conclude that corruption usually takes place within enduring relationships, that the process of becoming corrupt can be characterized as a slippery slope, and that important motives for corruption, aside from material gain, include friendship or love, status, and the desire to impress others. The explorative multiple case study methodology helps to expand our understanding of the way in which officials become corrupt. © 2008 The American Society for Public Administration