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1 – 10 of 304Manuel Castelo Castelo Branco, Delfina Gomes and Adelaide Martins
The purpose of this study is to contribute to the discussion surrounding the definition of accounting proposed by Carnegie et al. (2021a, 2021b) and further elaborated by Carnegie…
Abstract
Purpose
The purpose of this study is to contribute to the discussion surrounding the definition of accounting proposed by Carnegie et al. (2021a, 2021b) and further elaborated by Carnegie et al. (2023) from/under an institutionalist political-economy (IPE) based foundation and to specifically extend this approach to the arena of social and environmental accounting (SEA).
Design/methodology/approach
By adopting an IPE approach to SEA, this study offers a critique of the use of the notion of capital to refer to nature and people in SEA frameworks and standards.
Findings
A SEA framework based on the capabilities approach is proposed based on the concepts of human capabilities and global commons for the purpose of preserving the commons and enabling the flourishing of present and future generations.
Practical implications
The proposed framework allows the engagement of accounting community, in particular SEA researchers, with and contribution to such well-established initiatives as the Planetary Boundaries framework and the human development reports initiative of the United Nations Development Programme.
Originality/value
Based on the capability approach, this study applies Carnegie et al.’s (2023) framework to SEA. This new approach more attuned to the pursuit of sustainable human development and the sustainable development goals, may contribute to turning accounting into a major positive force through its impacts on the world, expressly upon organisations, people and nature.
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James Guthrie, Francesca Manes-Rossi, Rebecca Levy Orelli and Vincenzo Sforza
This paper undertakes a structured literature review to analyse the literature on performance management and measurement (PMM) in universities over the last four decades. Over…
Abstract
Purpose
This paper undertakes a structured literature review to analyse the literature on performance management and measurement (PMM) in universities over the last four decades. Over that time, PMM has emerged as an influential force in universities that impacts their operations and redefines their identity.
Design/methodology/approach
A structured literature review approach was used to analyse a sample of articles on PMM research from a broad range of disciplines over four decades. This was undertaken to understand the impacts of PMM practices on universities, highlight changes over time and point to avenues for future research.
Findings
The analysis highlights the fact that research on PMM in universities has grown significantly over the 40 years studied. We provide an overview of published articles over four decades regarding content, themes, theories, methods and impacts. We provide an empirical basis for discussing past, present and future university PMM research. The future research avenues offer multiple provocations for scholars and policymakers, for instance, PMM implementation strategies and relationships with various government programs and external evaluation and the role of different actors, particularly academics, in shaping PMM systems.
Originality/value
Unlike a traditional literature review, the structured literature review method can develop insights into how the field has changed over time and highlight possible future research. The sample for this literature review differs from previous reviews in covering a broad range of disciplines, including accounting.
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Simon Lundh, Karin Seger, Magnus Frostenson and Sven Helin
The purpose of this study is to identify the norms that underlie and condition the decisions made by preparers of financial reports.
Abstract
Purpose
The purpose of this study is to identify the norms that underlie and condition the decisions made by preparers of financial reports.
Design/methodology/approach
This interview-based study illustrates how financial report preparers engage in behaviors linked to the perception of recognition and measurement of internally generated intangible assets by important stakeholders. All of the companies included in the study adhere to International Financial Reporting Standards when creating their consolidated financial statements. The participants selected for the study are involved in accounting decisions related to research and development in accordance with International Accounting Standard (IAS) 38.
Findings
The authors identify the normative assumptions underlying the recognition and measurement of internally generated intangibles, which are based on concerns of consistency, credibility and reasonableness. The authors find that the normative basis for legitimacy in financial accounting is primarily related to cognitive legitimacy and is not of a moral or pragmatic nature.
Originality/value
The study reveals that recognition and measurement of internally generated intangibles in financial accounting relate to legitimacy. The authors identify specific norms that form the basis of this legitimacy, namely, consistency, credibility and reasonableness. These identified norms serve as constraints, mitigating the risk of judgment misuse within the IAS 38 framework for earnings management.
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Manpreet K. Arora and Sukhpreet Kaur
Employee Stock Options [ESOs] have been used widely as a component of employees' compensation. To maximise the incentive effect of these options it is very important to understand…
Abstract
Purpose
Employee Stock Options [ESOs] have been used widely as a component of employees' compensation. To maximise the incentive effect of these options it is very important to understand the exercise decision of the employees. This is an important financial decision that is dependent on both rational and psychological factors. This paper aims to study the mediating role of Herding Bias on Personality Traits and the employees' decision to exercise ESOs.
Design/methodology/approach
The data were collected through a self-structured questionnaire from 210 employees of Banks and NBFCs [Non-Banking Financial Companies] who have received and exercised the ESOs. SPSS MACRO version 25 was used to understand the mediational effect of Herding Bias on Personality Traits and Employees' decision to exercise their ESOs.
Findings
The results showed that Personality Traits affect the employees' decision to exercise their ESOs. The study also shows a partial negative mediating effect of Herding Bias on Personality Traits and employees' decision to exercise ESOs.
Originality/value
Limited study has been conducted on how the employees make their decision to exercise ESOs. Although extant studies have touched upon the importance of including behavioural biases in ascertaining the exercise decision of the employees, the predictors of the behavioural biases have not been studied under this context. To the best of the author's knowledge, this study is the first in itself to study the inter-linkage between Personality Traits, Herding Bias and employees' decision to exercise ESOs.
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Agus Fredy Maradona, Parmod Chand and Sumit Lodhia
The purpose of this study is to identify the professional skills and competencies of accountants that support a successful implementation of International Financial Reporting…
Abstract
Purpose
The purpose of this study is to identify the professional skills and competencies of accountants that support a successful implementation of International Financial Reporting Standards (IFRS). The authors further investigate the extent to which professional accountants have developed these skills through professional training.
Design/methodology/approach
In the survey, Indonesian accountants were provided with a list of 47 skill items under nine categories of professional skills and were asked to rate the importance of each skill item and to indicate the level of priority given to the development of the skill items in the professional training they have undertaken. Their responses provide insights into the skills needed for applying IFRS and the adequacy of professional training in providing these skills.
Findings
The authors find that accounting judgement is considered to be the most necessary skill for applying IFRS. Likewise, the findings show that ethical skills and certain generic skills are also perceived to be necessary for adequate application of IFRS, while skills relating to cultural sensitivity are viewed as least important. The findings further demonstrate that professional training programmes need to emphasise the development of judgement and other relevant skills that are important skill categories for applying IFRS.
Research limitations/implications
This study extends the literature on IFRS implementation through a specific focus on the professional skills required by accountants.
Practical implications
These findings have important policy implications for the standard-setters, regulators, auditors and to professional training providers across the world, such as professional accounting associations, accounting firms and educational institutions, for evaluating the content of the training and education programmes being delivered to accountants to prepare them with the relevant skills for applying IFRS.
Originality/value
This study is one of the first to examine the importance of various types of skills necessary for accountants in applying IFRS and the extent to which these skills have been developed through the professional accounting training provided.
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Valerie Li and Yan Luo
The authors investigate how managers adapt their financial reporting and disclosure practices in response to the COVID-19 pandemic through changes in accounting estimates (CAEs).
Abstract
Purpose
The authors investigate how managers adapt their financial reporting and disclosure practices in response to the COVID-19 pandemic through changes in accounting estimates (CAEs).
Design/methodology/approach
The authors define the pandemic period as starting on March 1, 2020. The sample consists of 9,575 CAEs disclosed in quarterly (10-Qs) and annual (10-Ks) financial reports by US firms between January 1, 2004 and May 31, 2022. The authors perform multivariate analyses of the impact of the COVID-19 pandemic on the incidence of CAEs and on whether the impact of CAEs on firms' financial performance and reporting quality changes during the pandemic.
Findings
In the examination of the CAE footnote disclosures in the quarterly (10-Qs) and annual (10-Ks) reports of US companies, the authors find no evidence that the incidence of CAEs in 10-Ks or the number of firms reporting CAEs are significantly different in the pre-pandemic and pandemic periods, but the incidence of CAEs in 10-Qs is significantly higher in the pandemic period than in the pre-pandemic period. The authors also find that the number of CAEs related to revenue recognition increase significantly in the pandemic period, but CAEs in other categories decrease, with the sharpest drop seen in the liabilities category. Further investigation suggests that although the dollar impact of 10-K CAEs on current financial statements is higher during the pandemic period, firms with CAEs, especially positive CAEs, in either 10-Ks or 10-Qs are less likely to use CAEs to boost earnings in the pandemic period. However, the authors find evidence that firms tend to use CAEs to “big bath” current earnings and create reserve for future period. The authors have not observed any significant differences in how the various phases of the pandemic affect the reporting of CAEs. Additionally, there is no evidence to suggest that financially distressed firms report more or fewer CAEs during the pandemic.
Practical implications
The results are consistent with the notion that, during the pandemic, firms exercise greater caution in their CAE disclosures, refraining from using CAEs as a means of boosting earnings but as a strategy to create reserve for future period. The paper highlights the challenges that various stakeholders face when assessing a company's current and future financial performance based on management's accounting estimates.
Originality/value
This study captures the impact of the COVID-19 pandemic on the incidence of CAEs and CAEs' impact on the financial performance and financial reporting quality of firms during the pandemic.
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An understanding of the role of decision-making has been emphasised since the seminal works on human information processing and professional judgements by accountants. The…
Abstract
Purpose
An understanding of the role of decision-making has been emphasised since the seminal works on human information processing and professional judgements by accountants. The interest in these topics has been reignited by the increasing digitisation of the financial reporting and auditing processes. Whilst the behavioural research on accounting is well-established, the application of seminal works in cognitive psychology and behavioural finance is lacking, especially from recent research endeavours. The purpose of this paper is to provide a synthesis of theories relating to accounting behavioural research by evaluating them against the theories of cognitive psychology.
Design/methodology/approach
Using theory synthesis, this research draws seemingly isolated strands of research into a coherent framework, underpinned by cognitive psychology.
Findings
Evidence from accounting and auditing behavioural research is largely consistent with the psychology and finance research on cognitive limitations and errors. There remains a lacuna in accounting behavioural research on debiasing techniques. Such research, if underpinned by a single, cohesive theoretical framework, is likely to have practical relevance.
Research limitations/implications
The current research has theoretical implications for the accounting decision-making and uncertainty research. Areas for future research, based on identified gaps in the current accounting behavioural research, are also proposed.
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This study aims to evaluate the advantages and disadvantages of auditor mandatory suspicious activity reporting versus the exercise of professional judgement in the anti-money…
Abstract
Purpose
This study aims to evaluate the advantages and disadvantages of auditor mandatory suspicious activity reporting versus the exercise of professional judgement in the anti-money laundering regimes of the UK and the USA.
Design/methodology/approach
The research draws upon the following sources. Firstly, statistics provided by the UK National Crime Agency, 2019 (NCA) regarding suspicious activity report (SAR) filing rates. Secondly, anti-money laundering legislation in the USA and UK. Thirdly, statements made in the political domain in the USA, particularly those which raised constitutional concerns during the progress of the Patriot Act 2001. Finally, statements and recommendations by a UK Parliamentary Commission enquiring into the effectiveness of the suspicious activity reporting regime.
Findings
The UK reporting regime does not accommodate professional judgement, resulting in the filing of SARs with limited intelligence value. This contrasts with discretionary reporting in the USA: voluntary reporting guides and influences auditor behaviour rather than mandating it. Defensive filing by UK auditors (defence to anti-money launderings [DAMLs]) has increased in recent years but the number of SARs filed has declined.
Originality/value
The study evaluates auditor behavioural responses to legislative regimes which mandate or alternatively accommodate discretion in the reporting suspicion of money laundering. Consideration of constitutional and judicial activism in this context is a novel contribution to the literature. For its theoretical framework the study uses Foucault’s concept of discipline of the self to evaluate auditor behaviour under both regimes.
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Ziwen Gao, Steven F. Lehrer, Tian Xie and Xinyu Zhang
Motivated by empirical features that characterize cryptocurrency volatility data, the authors develop a forecasting strategy that can account for both model uncertainty and…
Abstract
Motivated by empirical features that characterize cryptocurrency volatility data, the authors develop a forecasting strategy that can account for both model uncertainty and heteroskedasticity of unknown form. The theoretical investigation establishes the asymptotic optimality of the proposed heteroskedastic model averaging heterogeneous autoregressive (H-MAHAR) estimator under mild conditions. The authors additionally examine the convergence rate of the estimated weights of the proposed H-MAHAR estimator. This analysis sheds new light on the asymptotic properties of the least squares model averaging estimator under alternative complicated data generating processes (DGPs). To examine the performance of the H-MAHAR estimator, the authors conduct an out-of-sample forecasting application involving 22 different cryptocurrency assets. The results emphasize the importance of accounting for both model uncertainty and heteroskedasticity in practice.
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Bronwyn Eager, Craig Deegan and Terese Fiedler
The purpose of this study is to provide a detailed demonstration of how artificial intelligence (AI) can be used to potentially generate valuable insights and recommendations…
Abstract
Purpose
The purpose of this study is to provide a detailed demonstration of how artificial intelligence (AI) can be used to potentially generate valuable insights and recommendations regarding the role of accounting in addressing key sustainability-related issues.
Design/methodology/approach
The study offers a novel method for leveraging AI tools to augment traditional scoping study techniques. The method was used to show how the authors can produce recommendations for potentially enhancing organisational accountability pertaining to seasonal workers.
Findings
Through the use of AI and informed by the knowledge base that the authors created, the authors have developed prescriptions that have the potential to advance the interests of seasonal workers. In doing so, the authors have focussed on developing a useful and detailed guide to assist their colleagues to apply AI to various research questions.
Originality/value
This study demonstrates the ability of AI to assist researchers in efficiently finding solutions to social problems. By augmenting traditional scoping study techniques with AI tools, the authors present a framework to assist future research in such areas as accounting and accountability.
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