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This study aims to examine the impact of Financial Accounting Standard Board’s Accounting Standard Update (ASU) 2014–15 on auditors’ going concern reporting. ASU 2014–15 provides accounting guidance for managers related to going concern issues, but there is evidence that regulatory changes affect auditor behavior. The authors examine if auditors’ propensity to issue going concern opinions (GCOs) for non-bankrupt, financially distressed firms changes after ASU 2014–15 became effective, and if the proportion of client bankruptcies with prior GCOs changes after ASU 2014–15 became effective.

The authors examine audit reports for non-bankrupt, financially stressed firms three years before and after the effective date of ASU 2014–15 to see if the propensity to issue a GCO differs in the pre- vs post-period. The authors then examine bankrupt, financially stressed firms to determine if the proportion of bankruptcies preceded by a GCO differs in the pre- vs post-period.

The authors find a significant increase in GCO reporting for non-bankrupt, financially stressed firms in the post-ASU 2014–15 period, suggesting auditor conservatism increased. The propensity for auditors to issue a GCO to bankrupt firms also increased significantly in the post-ASU period, providing evidence that auditors became more accurate, as more bankruptcies were preceded by a GCO than in the pre-ASU period.

This study uses new legislation which creates an exogenous shock to going concern reporting. Models and techniques are combined from prior literature and extended to investigate auditors’ reporting behaviors using two important and distinct samples.

This study aims to examine whether banks are compliant with the Financial Accounting Standards Board’s standard Accounting Standards Update (ASU) 2010-06 requiring disaggregated fair value hierarchy information. It also identifies institutional and firm-specific factors that are associated with compliance or non-compliance.

Using quarterly reports of banks for the first quarters of 2009 (pre- ASU 2010-06) and 2010 (post- ASU 2010-06), we hand-collect information on disclosures about fair values from the footnotes. Using a logistic regression with compliance/non-compliance as the dependent variable, we examine factors associated with compliance/non-compliance.

Results show that 23 per cent of banks do not comply with ASU 2010-06 and that the non-compliant banks tend to be small, lack effective internal controls and are more likely to be audited by non-specialist auditors.

This study only considers one type of non-compliance with ASU 2010-06, i.e. whether or not firms provide disaggregated fair value hierarchy information. There may be other forms of non-compliance that the authors do not examine because of the difficulties involved in objectively defining non-compliance.

The findings suggest firms may need to increase training for internal personnel and hire high-quality auditors for ensuring compliance with fair value accounting rules. The authors also suggest that smaller firms may find compliance to be onerous and recommend additional research to examine whether smaller firms should be exempted from some or all of the fair value rules.

This study provides some of the first evidence on the level of compliance with mandated fair value disclosures.

The purpose of this study is to evaluate the impact of ASU 2016–01 on the predictive value, the confirmatory value and the value relevance of earnings. One of the key provisions of ASU 2016–01 is the requirement that all changes in unrealized gains and losses on all equity securities are recognized in income instead of other comprehensive income (OCI) as under prior guidance (SFAS 115). Because many companies in the insurance industry are large holders of equity securities, the sample for this study consists of firms from the insurance industry.

The author compares the change in earnings volatility and analysts’ forecast error for the periods before and after adoption of ASU 2016–01, and the relationship between the percentages of assets invested in equity securities for both earnings volatility and analysts’ forecast error. Further, the author tests the price reaction at the time of the release of earnings using an event study. The author also tests the value reliance of earnings measured by the correlation of earnings and stock prices, as well as the change in earnings and stock returns. The association between investment gain/loss components of earnings, and OCI, with stock prices and returns is tested for value relevance.

The findings of this study show that earnings volatility and analysts’ forecast errors increased in the period after adopting ASU 2016–01 and an initial overreaction to earnings releases. Further, the investment gain/loss components of earnings and OCI are not value-relevant in this study and including unrealized gains/losses on equity securities in income decreased value relevance of earnings in the post-adoption period, particularly for firms with large equity investment portfolios.

This study is limited to one industry and only represents the impact of ASU 2016–01 on that industry. Thus, there are opportunities to extend the research to other industries. Furthermore, the time-period of study since adopting ASU 2016–01 is limited to only two years and with the passage of time, a greater sample of post-ASU 2016–01 will be available for testing.

Standard setters considering recognizing fair value changes on all investment securities in income should consider the findings of this study. Further, industry participants affected by ASU 2016–01 should consider improving explanation of earnings to mitigate the initial misunderstanding of earning announcements found in this study.

To the best of the author’s knowledge, this is the first study on the effects of ASU 2016–01 on volatility of earnings, earnings forecast errors, market reactions to earnings releases and the value relevance of earnings. This paper fills a gap in prior research by studying the effects of fair value on reported earnings, which is limited in prior research. This study contributes to the growing field of research on fair value accounting.

This paper examines how managerial discretion and judgment in revenue recognition affect earnings and revenue value relevance. Specifically, the purpose of this paper is to assess the impact of lifting the objective-price constraint in revenue recognition on the value relevance of earnings and revenue by examining firms’ contemporaneous returns-earnings/revenue relation before and after the implementation of Accounting Standards Update (ASU) 2009-13. In addition, this paper examines how the change in earnings value relevance is conditioned by agency costs, corporate governance, information environment, and audit quality. This paper further examines whether earnings, revenue, and accruals quality change after the objective-price constraint is lifted.

This paper employs a difference-in-differences research design to examine whether earnings and revenue value relevance are enhanced or lowered more for a list of 107 US firms that applied selling price estimates in revenue recognition under ASU 2009-13 than for a list of 107 matched US firms that did not apply selling price estimates. Sub-sample analyses are employed to examine how agency costs, corporate governance, information environment, and audit quality condition the change in value relevance. Additional analyses examine the changes in earnings, revenue, and accruals quality using accruals, revenue accruals, discretionary revenue, absolute abnormal accruals, earnings/revenue predictability, and smoothness.

The empirical results suggest that lifting the objective-price constraint in revenue recognition improves earnings and revenue value relevance for positive earnings and that the effect of information usefulness dominates that of managerial opportunism. Change in the earnings value relevance is conditioned by the level of corporate governance, information environment, and audit quality. Evidence of no significant reduction in the earnings/revenue/accruals quality corroborates the main findings.

The findings lend support to the new revenue standard (ASU 2014-09) that continues the use of the estimates of selling price in revenue recognition.

This study provides some of the first evidence that managerial judgment exercised in revenue recognition through the use of selling price estimates (i.e. lifting the objective-price constraint in revenue recognition) enhances earnings and revenue value relevance while such benefit does not come at a cost of reduced earnings/revenue/accruals quality.

Creating value through service innovation requires new processes and ways of communicating to multiple stakeholders. Institutions and stakeholders within the service ecosystem, however, often resist change. Adopting a new service strategy entails two distinct costs – monetary and psychological. The tensions between an organization’s need to generate incremental revenue and the challenges of balancing business as usual and the costs associated with service innovation are explored. Specifically, this paper aims to explore the adoption of a customer relationship management (CRM) technology solution in a bureaucratic setting, and the sequence of events needed for successful implementation, with emphasis on overcoming various barriers and hurdles.

A case study methodology is used to gather and analyze data on how the Arizona State University (ASU) athletic department responded to the changing competitive environment via adopting a CRM technology solution. Data collection consisted of ten semi-structured interviews.

The experience of ASU illustrates that the primary benefits of a CRM technology solution include the generation of incremental revenue, capturing data and personalized marketing. The main challenges are coordinating adoption, obtaining commitment, developing competency, estimating costs and creating content.

A conceptual framework emerged from the data that describes the likelihood of a service technology’s successful implementation based upon the interaction of the strength of key actors, organizational situation perception and organizational commitment. The model extends the proposed duality of service innovation outcomes as either success or failure to acknowledge the likelihood of a partial implementation where marginal success is achieved.

The sequence of events needed for successful implementation of a service technology is highlighted, with emphasis on overcoming various barriers and hurdles. Implementation steps are provided, as well as a model to help pinpoint issues.

The case study provides insight for overcoming pitfalls and barriers to adopting a new service technology in a traditionally bureaucratic organization where resistance to change is the norm, and innovation is not.

This study aims to examine and compare faculty perceptions of the process of institutionalizing sustainability, developing sustainability pedagogy and activating key sustainability competencies between the University of Oklahoma (OU) and Arizona State University (ASU).

Semi-structured interviews were conducted with 17 professors in the Department of Geography and Environmental Sustainability at OU and 10 professors in the School of Sustainability at ASU.

The results highlight the complexity of teaching sustainability in an interdisciplinary manner in both programs. Professors are incorporating many of the key competencies of sustainability teaching, but in a patchwork manner that does not necessary follow the comprehensive frameworks from the literature.

The comparative analysis leads to recommendations for teaching sustainability in higher education.

This study contributes to theories of sustainability teaching by identifying gaps between what professors are actually doing and experiencing and a set of best practices from the literature.

The purpose of this paper is to examine the impact of greater reporting prominence of translation results following Accounting Standard Update (ASU) 2011-05 on net investment (NI) hedging practice. The authors investigate the role of increased transparency on the decision to engage in NI hedging (participation), the degree of NI hedging (level) and the hedging vehicle choice.

This paper uses the Heckman two-stage procedure (Heckman, 1979) in the hedging choice analysis. In the first stage, the authors model the participation decision as a function of reporting transparency, translation results and other control variables. In the second stage, the authors include the Inverse Mills ratio from the first stage Probit to examine both the level and vehicle choice decisions.

When translation is reported more prominently, the authors find an increase in the level of NI hedging and a greater likelihood of debt as the hedging vehicle, but no evidence firms are more likely to hedge. Regardless of where translation results are reported, firms facing ongoing translation losses are more likely to hedge.

This paper examines S&P 500 firms in the years surrounding the effective date of ASU 2011-05. The findings suggest managers respond to the increase in reporting transparency by increasing hedging for long-term risk management purposes, supporting accounting authorities’ efforts to promote other comprehensive income information transparency. The results should hold for comparable firms with similar currency exposure, size and visibility, but may not apply to smaller firms with limited translation exposure. As only about a quarter of firms with translation exposure engage in NI hedging, the primary results are based on a relatively limited number of firms.

To the best of the authors’ knowledge, this is the first study that examines NI hedging behavior changes following ASU-2011-05. Second, the authors are the first to explore why firms are almost equally split between derivatives and debt as their exclusive hedging vehicle.

This paper seeks to understand how software systems and organisations co‐evolve in practice during an IS engagement. Seeks also to argue that complex adaptive system theory (CAS) provides an excellent lens to study the motor of co‐evolution due to its ability to frame the strategies and reinforcement models of actors and to illustrate this by recounting four narratives of the interaction, selection and adaptation of actors arising from a longitudinal case study of an IS engagement. Then sets out to consider how the complexity of the engagement emerges from the interrelationship of these narratives and how the adaptive behaviour of the various actors is both a response to and a driver of co‐evolution within the engagement.

An interpretive case study was undertaken to examine the implementation of a novel academic scheduling and resource allocation system at a research‐intensive Australian university. The research was conducted over ten months, employing ethnographic methods and semi‐structured interviews. This analysis is conducted within the theoretical framework of CAS.

By analysing this case study it is demonstrated how CAS can help designers and managers of IS engagements conceptualise the attendant complexities that they encounter. It is also demonstrated how complexity within IS engagements emerges through the interactions and goal‐seeking behaviour of actors employing a variety of context‐bound strategies within neighbourhoods, and how the adaptive behaviour of the various actors is both a response to and a driver of co‐evolution within the engagement.

This work builds on Organization Science, Vol. 10 Nos 3 and 5, by applying CAS theory to organisational and IS research on co‐evolution, where the findings are grounded in a longitudinal case study and not computational models.

This paper aims to investigate student experiences and the potential impact of experience-based learning (EBL) in the early phase of graduate sustainability programs through the lens of key competencies. The goal is to provide evidence for the improvement of existing and the thorough design of new EBL formats in sustainability programs.

This comparative case study focuses on the first semester of three graduate sustainability programs at Leuphana University of Lüneburg, Germany and Arizona State University, USA, for two of which EBL was a core feature. The study compares the curricula, the teaching and learning environments and the reported experiences of one student cohort from each of three programs and synthesizes the resulting insights. Student interviews were combined with student self-assessments and supported by in-vivo observations, curriculum designer input, instructor interviews and course materials. MAXQDA was used for data analysis following a grounded theory approach.

EBL influences students’ reflective capacity, which impacts the development of key competencies in sustainability. Qualitative analysis found four key themes in relation to the students’ learning in EBL settings, namely, discomfort, time-attention relationship, student expectations of instructors and exchange. The intersection of these themes with curricular structure, student dispositions and differing instructor approaches shows how curriculum can either support or interrupt the reflective cycle and thus, holistic learning.

With the focus on the first semester only, the students’ competence development over the course of the entire program cannot be demonstrated. Learning processes within EBL settings are complex and include aspects outside the control of instructors and curriculum designers. This study addresses only a select number of factors influencing students’ learning in EBL settings.

Early engagement with EBL activities can push students to leave their comfort zones and question previous assumptions. Designing curricula to include EBL while encouraging strong intra-cohort connections and creating space for reflection seems to be an effective approach to enable the development of key competencies in sustainability.

This paper investigates the experiences of students in EBL through a key competence lens. The study combines student self-perceptions, instructor reflections and in-vivo observations. Data collection and analysis were conducted by a researcher not affiliated with the programs. These factors make for a unique study design and with data-driven insights on the seldom researched competence-pedagogy-curriculum connection.

The ‘automated management system’ ASU‐PECHAT' is the first of its kind to be applied to the publishing industry of an entire country. The first subsystems began operation in 1975. It is designed to supply information for the management of publishing, printing and the book trade throughout the USSR, with the intention of easing the tasks of a highly‐centralized administrative apparatus and of facilitating the supervision of the content of publications. Three subsystems are to handle finance, accounting and personnel records for the entire publishing‐printing‐bookselling sector, and three more will assist the internal planning of each subsector and the monitoring of its operations. They will be complemented by a further sub‐system to handle bibliographical data, and another to provide information services to staff working in the sector.