Familiarity Bias and the Propensity to Issue Going Concern Opinions

This study examines the association between familiarity bias and audit firm judgements using going concern opinion modifications. We conjecture that familiarity bias is highest when an audit firm is least familiar with its clients. We measure familiarity bias using auditor changes because familiarity bias is likely to be the highest on the initial year of an audit relationship. We find the propensity to issue a going concern modification to be much higher during this initial period, even after controlling for a multitude of factors known to be determinants of going concern modifications. Our findings also suggest the phenomenon appears to slowly dissipate over a five-year auditor client tenure. Supporting our theoretical prediction, further results find that as the auditor is more familiar with the client’s industry (e.g. industry expertise) the main effect is moderated. Our results are also strongest when the successor auditor is located in a different locale than the previous auditor, situations leading an even more pronounced lack of familiarity. We also examine SOX 404 internal controls impact, finding auditors are more likely to deem internal controls ineffective when they are unfamiliar with clients

Workload Leverage and the Effect on Audit Quality

Practitioners and regulators suggests audit quality is negatively associated with auditor workloads (PCAOB 2015). We examine the association between office-level workload leverage and an office’s audit quality from 2004-2015 for all accelerated filers. The increase in workloads during busy season can instigate cognitive fatigue (Cohen 1980) if not appropriately mitigated by adequately preparing audit professional’s expectations (Glass and Singer 1972). Our findings indicate that increased busy-season workloads are associated with lower audit quality for accelerated clients of Non-Big 4 audit firms, whereas Big 4 auditors with higher workload leverage provide lower audit quality for non-accelerated filers. These results provide support for cognitive fatigue for all audit firm sizes; however, different sized audit firms experience cognitive fatigue at different points during busy season. Our findings contribute to the literature examining workload leverage and auditor burnout by providing empirical evidence of office workload influencing the audit process differently for different office sizes

An Interdisciplinary Approach to Experiential Learning in Cyberbiosecurity and Agriculture Through Workforce Development

Cyberbiosecurity and workforce development in agriculture and the life sciences (ALS) is a growing area of need in the curriculum in higher education. Students that pursue majors related to ALS often do not include training in cyber-related concepts or expose the ‘hidden curriculum’ of seeking internships and jobs. Exposing students through workforce development training and hands-on engagement with industry professionals can provide learning opportunities to bridge the two and is an area of growth and demand as the workforce evolves. The objectives of this work were 1) to learn key concepts in cybersecurity, including data security, visualization, and analysis, to name a few, through class activities and engagement with professional partners and 2) to understand what knowledge students gained from participating in the course could transfer over for when they enter the workforce. Three themes emerged from the study where students, through direct engagement with industry partners, gained more insight about the industry applicable to their studies; they established work environment expectations for entering internships and official job placements and established ways in which the workforce development training informed their future careers

Socializing One Health: an innovative strategy to investigate social and behavioral risks of emerging viral threats

In an effort to strengthen global capacity to prevent, detect, and control infectious diseases in animals and people, the United States Agency for International Development’s (USAID) Emerging Pandemic Threats (EPT) PREDICT project funded development of regional, national, and local One Health capacities for early disease detection, rapid response, disease control, and risk reduction. From the outset, the EPT approach was inclusive of social science research methods designed to understand the contexts and behaviors of communities living and working at human-animal-environment interfaces considered high-risk for virus emergence. Using qualitative and quantitative approaches, PREDICT behavioral research aimed to identify and assess a range of socio-cultural behaviors that could be influential in zoonotic disease emergence, amplification, and transmission. This broad approach to behavioral risk characterization enabled us to identify and characterize human activities that could be linked to the transmission dynamics of new and emerging viruses. This paper provides a discussion of implementation of a social science approach within a zoonotic surveillance framework. We conducted in-depth ethnographic interviews and focus groups to better understand the individual- and community-level knowledge, attitudes, and practices that potentially put participants at risk for zoonotic disease transmission from the animals they live and work with, across 6 interface domains. When we asked highly-exposed individuals (ie. bushmeat hunters, wildlife or guano farmers) about the risk they perceived in their occupational activities, most did not perceive it to be risky, whether because it was normalized by years (or generations) of doing such an activity, or due to lack of information about potential risks. Integrating the social sciences allows investigations of the specific human activities that are hypothesized to drive disease emergence, amplification, and transmission, in order to better substantiate behavioral disease drivers, along with the social dimensions of infection and transmission dynamics. Understanding these dynamics is critical to achieving health security--the protection from threats to health-- which requires investments in both collective and individual health security. Involving behavioral sciences into zoonotic disease surveillance allowed us to push toward fuller community integration and engagement and toward dialogue and implementation of recommendations for disease prevention and improved health security

Voluntary Internal Control Weakness Disclosures in Initial Public Offerings: Determinants and Subsequent Financial Reporting Quality

This study examines registrants’ incentives to disclose internal control weaknesses (ICWs) voluntarily in IPO registration statements and their post-IPO financial reporting quality. Using a sample of initial public offering (IPO) registrants from 2005-2013, I find that increasing management’s disclosure credibility, by hiring a new CEO in the IPO, is an incentive to include ICWs in IPO registration statements. I find that management does build credibility with underwriters evidenced by IPO registrants that disclose ICWs voluntarily are associated with higher IPO offer prices. The results suggest that registrants including voluntary ICW disclosures are more likely to receive an adverse SOX 404 auditor opinion. I find that registrants\u27 voluntary ICW disclosures are informative and are associated with negative cumulative abnormal returns only when an auditor issues an adverse SOX 404 auditor opinion after the disclosure. IPO registrants that voluntarily disclose ICWs and receive unqualified SOX 404 auditor opinions appear to be successful in mitigating negative cumulative abnormal returns. My findings provide evidence that misstatements appear to outpace material weakness disclosures for the sample of IPO registrants. Overall, the findings suggest that managers seek to build credibility through voluntary disclosure of ICWs at the IPO, allowing managers to maximize the rewards at the IPO date (i.e., IPO offer price). However, managers suffer punishment from investors if subsequent events (i.e., SOX 404 material weaknesses) call into question the credibility of the disclosure. The post-IPO financial reporting quality results are timely and relevant to regulators because the relationship between misstatements and unqualified audit opinions is puzzling. Additionally, the JOBS Act allows IPO registrants to delay SOX 404 compliance for up to five years. Finally, this study’s results are important to investors because the purpose of SOX 404 is to provide an advanced warning of financial reporting weaknesses. Advisor: Thomas C. Ome

PypeIt: The Python Spectroscopic Data Reduction Pipeline

PypeIt is a Python package for semi-automated reduction of astronomical, spectroscopic data. Its algorithms build on decades-long development of previous data reduction pipelines by the developers (Bernstein, Burles, & Prochaska, 2015; Bochanski et al., 2009). The reduction procedure -- including a complete list of the input parameters and available functionality -- is provided as online documentation hosted by Read the Docs, which is regularly updated. (https://pypeit.readthedocs.io/en/latest/). Release v1.0.3 serves the following spectrographs: Gemini/GNIRS, Gemini/GMOS, Gemini/FLAMINGOS 2, Lick/Kast, Magellan/MagE, Magellan/Fire, MDM/OSMOS, Keck/DEIMOS (600ZD, 830G, 1200G), Keck/LRIS, Keck/MOSFIRE (J and Y gratings tested), Keck/NIRES, Keck/NIRSPEC (low-dispersion), LBT/Luci-I, Luci-II, LBT/MODS (beta), NOT/ALFOSC (grism4), VLT/X-Shooter (VIS, NIR), VLT/FORS2 (300I, 300V), WHT/ISIS.Comment: To be submitted to JOSS (once they return to accepting submissions). Find PypeIt at: https://github.com/pypeit/PypeI