The impact of institutional stock ownership on a firm\u27s earnings management practice: an empirical investigation

This study examines whether institutional investor shareholdings inhibit firm managers from engaging in earnings management practice. It investigates the empirical association between discretion/flexibility available to managers in managing abnormal non-cash working capital accruals and institutional stock ownership for a sample of 386 New York Stock Exchange firms over a period of 8 years, from 1991 through 1998. The differential institutional influence on the level of accrual management of firms having different information environment, S&P 500 versus non S&P 500, is also examined to see whether the difference in information environment of these two sets of firms has any effect on this empirical relationship. By performing various multivariate statistical analyses, I find significant evidence that institutional stockholders reduce management flexibility in generating abnormal accounting accruals. Further, concentrated institutional shareholdings in some cases are found to diminish managerial propensity to manage abnormal accruals. A separate analysis for the S&P 500 and the non S&P 500 firms reveals that institutional monitoring effect on accrual management is different for these two sets of firms. I observe that institutions do not have mitigating influence in the S&P 500 firms but have significant mitigating effects on accrual management level in the non S&P 500 firms. The study makes two-fold contributions to the existing earnings management literature. First, it is generally assumed in prior studies that firms have uniform abilities to generate abnormal accruals to manage earnings. This study provides evidence that management’s ability to manage earnings is not constant across firms but varies according to the level and concentration of institutional stock ownership. Institutional investors are found to improve the quality of corporate governance in financial reporting in cases where other important governance factors exist. Consequently, this study also extends prior research that examined the effects of other influential governance factors such as external audit, independence of boards or audit committees on the level of accrual management. Second, I develop a unique and powerful accrual model, which represents an improvement over the traditional models typically used in previous research and provides more robustness to the tests of earnings management

Who Will Empower The Better Half? Social Dynamics in Operation

In a game theoretic framework it can be argued that a gender sensitive institution is an offshoot of certain social conditions, which in most cases need to be acted upon by some anti-establishment catalytic agent. Given the fact that among about half of the population there is a need for such an institution, the main function of a catalytic agent is to engineer a conversion of that need into an active demand. In a society characterized by gender exploitation, catalytic agent can only come exogenously. For a sub-society it is easier to come across such an exogenous catalytic agent. The specific community conditions prevailing in such a sub-society may also prove to be congenial for a catalytic agent to act upon, or even to emerge from. In a larger canvas, however, as the exogenous force transforms into mere endogenous entity, and the society takes on the general character of male-dominance, the space for exogenous agency shrinks. A democratic Government, insofar as it represents the society, cannot be looked upon as a prospective catalytic agent for the country as a whole. There are, however, three possible escape routes from this closure. Firstly, external effects of women’s empowerment in one subsociety on another may snowball. Secondly, the awareness campaign presently underway on a global scale is itself a potent exogenous catalytic agent. Thirdly, general development programs undertaken within a patriarchal order may unwittingly create conditions conducive to feminist struggle

Statistical isotropy violation in WMAP CMB maps resulting from non-circular beams

Statistical isotropy (SI) of Cosmic Microwave Background (CMB) fluctuations is a key observational test to validate the cosmological principle underlying the standard model of cosmology. While a detection of SI violation would have immense cosmological ramification, it is important to recognise their possible origin in systematic effects of observations. WMAP seven year (WMAP-7) release claimed significant deviation from SI in the bipolar spherical harmonic (BipoSH) coefficients $A_{ll}^{20}$ and $A_{l-2l}^{20}$. Here we present the first explicit reproduction of the measurements reported in WMAP-7, confirming that beam systematics alone can completely account for the measured SI violation. The possibility of such a systematic origin was alluded to in WMAP-7 paper itself and other authors but not as explicitly so as to account for it accurately. We simulate CMB maps using the actual WMAP non-circular beams and scanning strategy. Our estimated BipoSH spectra from these maps match the WMAP-7 results very well. It is also evident that only a very careful and adequately detailed modelling, as carried out here, can conclusively establish that the entire signal arises from non-circular beam effect. This is important since cosmic SI violation signals are expected to be subtle and dismissing a large SI violation signal as observational artefact based on simplistic plausibility arguments run the serious risk of "throwing the baby out with the bathwater".Comment: 4 pages, 3 figures. Published version. Includes major revision in the text and one important figure. No change in the result

Thermo-hydraulic performance enhancement of a solar air heater using rotating cylindrical turbulators

A novel concept of rotating cylindrical ribs as artificial roughness in a solar air heater to enhance its thermo-hydraulic performance factor has been investigated using 3D computational fluid dynamics. The rotational speed is varied from 2000 RPM to 10,000 RPM on the static ribs optimised for height (e), diameter (d), longitudinal pitch (P), and transverse pitch (S) at Reynolds number (Re) ranging from 5000 to 24000. The optimised static ribs configuration having e = 3.5 mm, d = 3 mm, S = 20 mm, and P/e = 10 is experimentally validated to establish the accuracy of rotating ribs performance computed using computational fluid dynamics. The maximum thermo-hydraulic performance factor of 1.89 is achieved—32 % higher than the best performance for static ribs—using rotational ribs for the rotational speed of 10,000 RPM at Re = 5000. A comparison between parallel and perpendicular orientations of rotating ribs with respect to the absorber plate establishes that perpendicular ribs configuration is highly desirable to reduce the pressure drop penalty, in turn, enhancing the thermo-hydraulic performance. The performances of the proposed perpendicularly oriented rotating cylindrical ribs are also compared with the performances reported in the literature for static ribs of different shapes having the same orientation with respect to absorber plate and it is observed that rotational ribs outperforms all the other static ribs

Thermo-hydraulic performance enhancement of a solar air heater using rotating cylindrical turbulators

A novel concept of rotating cylindrical ribs as artificial roughness in a solar air heater to enhance its thermo-hydraulic performance factor has been investigated using 3D computational fluid dynamics. The rotational speed is varied from 2000 RPM to 10,000 RPM on the static ribs optimised for height (e), diameter (d), longitudinal pitch (P), and transverse pitch (S) at Reynolds number (Re) ranging from 5000 to 24000. The optimised static ribs configuration having e = 3.5 mm, d = 3 mm, S = 20 mm, and P/e = 10 is experimentally validated to establish the accuracy of rotating ribs performance computed using computational fluid dynamics. The maximum thermo-hydraulic performance factor of 1.89 is achieved—32 % higher than the best performance for static ribs—using rotational ribs for the rotational speed of 10,000 RPM at Re = 5000. A comparison between parallel and perpendicular orientations of rotating ribs with respect to the absorber plate establishes that perpendicular ribs configuration is highly desirable to reduce the pressure drop penalty, in turn, enhancing the thermo-hydraulic performance. The performances of the proposed perpendicularly oriented rotating cylindrical ribs are also compared with the performances reported in the literature for static ribs of different shapes having the same orientation with respect to absorber plate and it is observed that rotational ribs outperforms all the other static ribs

Contributions for a Community Good: Results from a Field Experiment in India

This paper presents the results of a field experiment on voluntary contribution for a proposed community good. The experiment was conducted at village Sundarika, District South 24 parganas, in West Bengal, India. The proposed community good was a community medicinal plant garden. Solicitation letters, on behalf of a local Community Based Organization (CBO), were delivered to one hundred households by the experimenters with the request to contribute generously for the proposed garden. Sixty-five households contributed and a strong positive association is found between contributions and CBO membership on the one hand and landholding on the other

Is the outcrop topology of dolerite dikes of the Precambrian Singhbhum Craton fractal?

In the Precambrian Singhbhum Craton of eastern India, newer dolerite dikes occur profusely with varying outcrop lengths. We have analysed the nature of their length-size and orientation distributions in relation to the theory of fractals. Two orientational sets of dikes (NW-SE and NE-SW) are present. Both the sets show strongly non-power-law size distributions, as reflected in non-linear variations in logarithmic space. We analyzed thousands of data, revealing that polynomial functions with a degree of 3 to 4 are the best representatives of the non-linear variations. Orientation analysis shows that the degree of dispersions from the mean trend tends to decrease with increasing dike length. The length-size distributions were studied by simulating fractures in physical models. Experimental fractures also show a non-power-law distribution, which grossly conforms to those of the dolerite dikes. This type of complex size distributions results from the combined effects of nucleation, propagation and coalescence of fractures