Defrauding the Public Interest: A Critical Examination of Reengineered Audit Processes and the Likelihood of Detecting Fraud

In the past few years, most of the major international public accounting firms have reengineered their audit processes to improve the cost effectiveness of completing an audit and to focus on value-added services for clients. The reengineered audit processes generally focus on a client’s business processes and the information systems used by the client to generate financial information. In essence, the new audit approaches deemphasize direct testing of the underlying transactions and account balances. Such an approach emphasizes analytical procedures as the main source of substantive evidence. During this same time period, however, the profession (through the AICPA) explicitly acknowledged the profession’s responsibility for fraud detection. The main premise of this paper is that the increased emphasis on systems assessments is at odds with the profession’s position regarding fraud detection because most material frauds originate at the top levels of the organization, where controls and systems are least prevalent and effective. As such, the profession may be paying lip service to fraud detection, while at the same time changing the audit process in a manner that is less effective at detecting the most common frauds

Client Selectivity Among Mid-Sized Auditing Firms: Evidence From The Post-Sox Audit Market Realignment

Considerable realignment in the audit market occurred in the wake of the Sarbanes-Oxley Act of 2002, with many clients switching from a Big 4 to a non-Big 4 auditor. We examine a sample of 212 former Big 4 clients who switched to either a mid-sized auditing firm (i.e., BDO Siedman, Crowe Horwath, Grant Thornton and McGladrey) or a small auditing firm. We consider reasons why clients may prefer a mid-sized firm rather than a small firm (called “client demand” characteristics) and reasons why auditors may be willing to accept an audit engagement (called “auditor supply” characteristics). Among client demand characteristics, we find that clients are more likely to engage a mid-sized auditing firm when the client is larger, has higher asset turnover, and has foreign operations. From an auditor supply perspective, we find that a mid-sized auditing firm is more likely to accept the client if the client is willing to pay higher audit fees and uses the auditor for non-audit services. Higher financial leverage could be seen from either a client demand or auditor supply perspective. From a client demand perspective, higher financial leverage would make clients prefer mid-sized auditors, as these clients’ needs for financing could lead them to seek a more “brand-name” auditor to enhance their credibility with banks and other creditors. From an auditor supply perspective, auditors may prefer to avoid clients with higher leverage, which reflects financial riskiness. These financially risky clients may result in adverse reputational and/or legal costs for the auditing firm. We find that clients with higher leverage are less likely to engage a mid-sized CPA firm. These results suggest that mid-sized auditors are somewhat selective in the clients they are willing to accept

The Effect of High Dose Total Body Irradiation on ACTH, Corticosterone, and Catecholamines in the Rat

Total body irradiation (TBI) or partial body irradiation is a distinct risk of accidental, wartime, or terrorist events. Total body irradiation is also used as conditioning therapy before hematopoietic stem cell transplantation. This therapy can result in injury to multiple tissues and might result in death as a result of multiorgan failure. The hypothalamic–pituitary–adrenal (HPA) axis could play a causative role in those injuries, in addition to being activated under conditions of stress. In a rat model of TBI, we have established that radiation nephropathy is a significant lethal complication, which is caused by hypertension and uremia. The current study assessed HPA axis function in rats undergoing TBI. Using a head-shielded model of TBI, we found an enhanced response to corticotropin-releasing hormone (CRH) in vitro in pituitaries from irradiated compared with nonirradiated rats at both 8 and 70 days after 10-Gy single fraction TBI. At 70, but not 8 days, plasma adrenocorticotrophic hormone (ACTH) and corticosterone levels were increased significantly in irradiated compared with nonirradiated rats. Plasma aldosterone was not affected by TBI at either time point, whereas plasma renin activity was decreased in irradiated rats at 8 days. Basal and stimulated adrenal steroid synthesis in vitro was not affected by TBI. In addition, plasma epinephrine was decreased at 70 days after TBI. The hypothalamic expression of CRH messenger RNA (mRNA) and hippocampal expression of glucocorticoid receptor mRNA were unchanged by irradiation. We conclude that the hypertension of radiation nephropathy is not aldosterone or catecholamine-dependent but that there is an abscopal activation of the HPA axis after 10 Gy TBI. This activation was attributable at least partially to enhanced pituitary ACTH production

Forebrain Origins of Glutamatergic Innervation to the Rat Paraventricular Nucleus of the Hypothalamus: Differential Inputs to the Anterior Versus Posterior Subregions

The hypothalamic paraventricular nucleus (PVN) regulates numerous homeostatic systems and functions largely under the influence of forebrain inputs. Glutamate is a major neurotransmitter in forebrain, and glutamate neurosignaling in the PVN is known to mediate many of its functions. Previous work showed that vesicular glutamate transporters (VGluTs; specific markers for glutamatergic neurons) are expressed in forebrain sites that project to the PVN; however, the extent of this presumed glutamatergic innervation to the PVN is not clear. In the present study retrograde FluoroGold (FG) labeling of PVN-projecting neurons was combined with in situ hybridization for VGluT1 and VGluT2 mRNAs to identify forebrain regions that provide glutamatergic innervation to the PVN and its immediate surround in rats, with special consideration for the sources to the anterior versus posterior PVN. VGluT1 mRNA colocalization with retrogradely labeled FG neurons was sparse. VGluT2 mRNA colocalization with FG neurons was most abundant in the ventromedial hypothalamus after anterior PVN FG injections, and in the lateral, posterior, dorsomedial, and ventromedial hypothalamic nuclei after posterior PVN injections. Anterograde tract tracing combined with VGluT2 immunolabeling showed that 1) ventromedial nucleus-derived glutamatergic inputs occur in both the anterior and posterior PVN; 2) posterior nucleus-derived glutamatergic inputs occur predominantly in the posterior PVN; and 3) medial preoptic nucleus-derived inputs to the PVN are not glutamatergic, thereby corroborating the innervation pattern seen with retrograde tracing. The results suggest that PVN subregions are influenced by varying amounts and sources of forebrain glutamatergic regulation, consistent with functional differentiation of glutamate projections. J. Comp. Neurol. 519:1301–1319, 2011. © 2010 Wiley-Liss, Inc

Contemporary Prevalence of Byssinosis in Low- and Middle-Income Countries: A Systematic Review

We aimed to identify the contemporary prevalence of byssinosis through a systematic review. Medline, Web of Science, Embase, and Global Health databases were used to identify studies published in any language between 2000 and 2019, reporting primary data on byssinosis among adults. We used the Joanna Briggs Institute checklist to estimate the risk of bias in studies and undertook a qualitative, narrative data analysis. The review considered the prevalence of byssinosis, chest tightness, and airflow obstruction in textile workers in low- and middle-income countries (LMICs). We found 26 relevant studies that included 6930 workers across 12 countries. Most of the studies (n = 19) were from Asia, and seven from African countries. Twenty-five studies were cross-sectional surveys while one was a cohort study. The prevalence of byssinosis was reported by 18 studies, and ranged from 8% to 38%, without any clear associations, at the group level, between the prevalence of byssinosis and durations of workers’ exposures. Prevalence of chest tightness ranged between 4% and 58% and that of airflow obstruction between 10% and 30%. A strong correlation (r = 0.72) was found between prevalence of byssinosis and cotton dust levels. Our findings indicate that byssinosis remains a significant, contemporary problem in some parts of the textile sector in LMICs

Free Cash Flow, Growth Opportunities, And Dividends: Does Cross-Listing Of Shares Matter?

Corporate dividend policy should strike a balance between paying cash to shareholders when there are excess resources and retaining sufficient resources in the company to fund worthwhile projects. Using excess resources to pay dividends can help to avoid overinvestment by the company in inappropriate projects and/or other potential misuse of funds by managers for their own benefit. However, companies also need to avoid paying too much in dividends to ensure that adequate resources are available within the company to fund projects that could increase shareholder wealth (i.e., to avoid underinvestment). Cross-listing of company shares can improve governance and oversight, which may make the dividend policies of cross-listed companies more likely to avoid both over and underinvestment. Using a sample of Chinese listed companies from 2003 to 2011, we find that cross-listed companies pay higher dividends than non-cross-listed companies when there are excess resources (measured by free cash flow), thereby reducing the potential for overinvestment/misuse of the resources by cross-listed companies. We also find that the dividends of cross-listed companies are lower than those of non-cross-listed companies when there are greater growth opportunities (measure by the market-to-book ratio), reflecting the reduced potential for underinvestment by cross-listed companies. We find more limited evidence that cross-listings may influence the relationship between dividend volatility and free cash flow and growth opportunities. Overall, our results suggest that companies cross-listing their shares have dividend policies that are more responsive than those of non-cross-listed companies to potential shareholder concerns about over and underinvestment

Survey research and local government

Thesis (M.C.P.)--Massachusetts Institute of Technology, Dept. of Urban Studies and Planning, 1983.MICROFICHE COPY AVAILABLE IN ARCHIVES AND ROTCH.Bibliography: last three leaves, unnumbered.by Mark P. Cullinan.M.C.P

Use of low-cost particle counters for cotton dust exposure assessment in textile mills in low- and middle-income countries

OBJECTIVE: There is a lack of consensus on methods for cotton dust measurement in the textile industry, and techniques vary between countries-relying mostly on cumbersome, traditional approaches. We undertook comparisons of standard, gravimetric methods with low-cost optical particle counters for personal and area dust measurements in textile mills in Pakistan. METHODS: We included male textile workers from the weaving sections of seven cotton mills in Karachi. We used the Institute of Occupational Medicine (IOM) sampler with a Casella Apex 2 standard pump and the Purple Air (PA-II-SD) for measuring personal exposures to inhalable airborne particles (n = 31). We used the Dylos DC1700 particle counter, in addition to the two above, for area-level measurements (n = 29). RESULTS: There were no significant correlations between the IOM and PA for personal dust measurements using the original (r = -0.15, P = 0.4) or log-transformed data (r = -0.32, P = 0.07). Similarly, there were no significant correlations when comparing the IOM with either of the particle counters (PA and Dylos) for area dust measurements, using the original (r = -0.07, P = 0.7; r = 0.10, P = 0.6) or log-transformed data (r = -0.09, P = 0.6; r = 0.07, P = 0.7). CONCLUSION: Our findings show a lack of correlation between the gravimetric method and the use of particle counters in both personal and area measurements of cotton dust, precluding their use for measuring occupational exposures to airborne dust in textile mills. There continues to be a need to develop low-cost instruments to help textile industries in low- and middle-income countries to perform cotton dust exposure assessment