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1 – 10 of over 7000The purpose of this study is to examine the impact of service-related independence impairments on perceptions of local and regional non-Big 4 Firms’ financial reporting…
Abstract
Purpose
The purpose of this study is to examine the impact of service-related independence impairments on perceptions of local and regional non-Big 4 Firms’ financial reporting reliability. This study is motivated by recent public policy, which proposes that service-related independence impairments may improve financial reporting reliability.
Design/methodology/approach
Commercial lending officers respond to a within-subjects experiment. The variables of interest are client importance, expertise and their related interaction. These variables are regressed on the perceived reporting reliability of local and regional firms.
Findings
Client importance is positively and significantly associated with the lenders’ selection of non-Big 4 firms, which supports Taylor et al.’s (2003) assertions that service-related independence violations improve financial reporting reliability. However, client importance is negatively associated with regional firms.
Practical implications
Client importance is significantly associated with regional firms only, which suggests that cross-sectional differences exist among non-Big 4 firms. The negative association between regional firms and client importance confirms Goldman and Barlev’s (1974) concerns that large firms are not exempt from client pressure. Client importance is also significantly (and positively) associated with lenders’ selection of the type of non-Big 4 firm to perform the engagement, which supports recent public policy’s proposal for joint attest and non-attest services (Exposure Draft for Statement for Accounting and Review Services No. 18).
Originality/value
The study overcomes within-subjects design limitations to provide a natural environment to understand lending officers’ perceptions of non-Big 4 firms. The results continue to fill the void in the literature which examines cross-sectional differences in non-Big 4 firm quality.
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Outlines the role of the Uniform Accountancy Act published jointly by the National Association of Accountancy and the American Institute of Certified Public Accountancy, showing…
Abstract
Outlines the role of the Uniform Accountancy Act published jointly by the National Association of Accountancy and the American Institute of Certified Public Accountancy, showing it is a vehicle to align state accountancy laws. Discusses the need to do this as travel and communication makes clients easily accessible from any area. Covers the perceived benefits and looks at the barriers to implementation. Reports the results of a survey of State Board of Accountancy Members and the State Society of CPA officers about the proposals. Looks at the concerns expressed and concludes that the main principles are supported but there are areas which need to be addressed before these regulations would be adopted by all states.
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Dawn Anderson and Donald (Don) Wengler
Auditing textbooks include summary level coverage of the American Institute of Certified Public Accountants (AICPA) Code of Professional Conduct, but textbook coverage is too…
Abstract
Auditing textbooks include summary level coverage of the American Institute of Certified Public Accountants (AICPA) Code of Professional Conduct, but textbook coverage is too brief to support a strong understanding of auditor independence. Independence rules have the force of professional law for the independent auditor (PCAOB, 2015). Threats to firm independence can arise from events and circumstances such as investments in the client, loans from the client, past-due fees, contingent fees, deposits in the client, gifts and job offers. Student test results from a five-year rotation of alternative auditor independence lecture support materials demonstrate that using the actual AICPA Code of Professional Conduct reduces student performance. However, this drag on student performance was mostly offset by the positive impacts of simultaneous use of an independence decision tree developed for this chapter and tested as a teaching material for classrooms use.
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Hamed Khiabani, Norbik Bashah Idris and Jamalul-lail Ab Manan
Ambient service provisioning with the least human participation in a pervasive computing environment, which is composed of interconnected devices and sensors, raises several trust…
Abstract
Purpose
Ambient service provisioning with the least human participation in a pervasive computing environment, which is composed of interconnected devices and sensors, raises several trust and security issues. Accurate measuring of the integrity of the nodes that are willing to interact in this intimate environment can boost the trust evolution process, particularly in the uncertainty state and initiation phase. The paper aims to discuss these issues.
Design/methodology/approach
The paper presents a unified approach in calculating the trust value among the nodes by leveraging some trusted computing functionalities. The approach aggregates different trust metrics like context, recommendation, and history to compute the trust index of each party more accurately. The paper also describes several existing remote attestation techniques including the chosen attestation technique for the model. The paper simulated the behaviour of the model in different scenarios and evaluates its responsiveness when the trustworthiness among peer nodes can be attested.
Findings
The results obtained from different simulated scenarios demonstrate the usefulness of the proposed model. It is shown that trust evaluation process in the proposed model is very granular and also can be fine-tuned according to the application and context. The model strength in solving the uncertain situations and assigning appropriate initial trust values is shown, as well. Finally, the paper describes the future research plan to evaluate the accuracy of the model.
Originality/value
The novel idea of applying remote attestation in trust determination may open up new avenues of research in the study of trust management and trust models.
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Magdy S. Farag and Rafik Z. Elias
The purpose of this study is to examine the impact of public accounting firms' mix of service revenue on their average productivity measured by total revenue per partner.
Abstract
Purpose
The purpose of this study is to examine the impact of public accounting firms' mix of service revenue on their average productivity measured by total revenue per partner.
Design/methodology/approach
Using data from Public Accounting Report on top public accounting firms by revenue, an OLS regression model is applied by regressing revenue per partner on the percentage of revenue generated from auditing and attest, tax, management consulting, and other services independently.
Findings
Results show that the proportion of auditing and attest service revenue is negatively associated with public accounting firms' productivity. However, the proportion of other services revenue, other than tax and management consulting services, is positively associated with productivity. Additional investigation shows that if public accounting firms provide other services in their mix of services, then tax and management consulting services do not contribute to these public accounting firms' productivity.
Research limitations/implications
Results of this study cannot be generalized beyond the top 100 public accounting firms, and the measurement of revenue per partner ignores the exact number of partners within different service areas.
Practical implications
Although auditing and attest services are considered core services of public accounting firms, they do not increase the productivity of the firm.
Originality/value
This study helps in assessing whether average productivity of public accounting firms is affected by the proportion of a specific type of service in the post‐SOX era.
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The new cattle movement regulations of 1st March, 1960, mark the final stages of the plan to eradicate tuberculosis from cattle in this country. The last “ specified area ” under…
Abstract
The new cattle movement regulations of 1st March, 1960, mark the final stages of the plan to eradicate tuberculosis from cattle in this country. The last “ specified area ” under the Tuberculosis (Area Eradication) Order, 1950, it is hoped to declare about the same date. It comprises districts in the northeast and north midlands ; Scotland and Wales are already fully attested areas. Because of the need to prevent the re‐introduction of infection to the national herd now that the Scheme of eradicating bovine tuberculosis is moving towards completion—(it is estimated that 300,000 cattle remain to be tuberculin tested and that the eradication scheme costing about £130 millions will be finally completed by October 1st next)—cattle imported for immediate slaughter, unless “ accredited ” (attested) or of the “ once tested ” status, will be licensed from the landing places at ports only to a limited number of slaughter‐houses, mainly public, named in the regulations. Accredited or “ once tested ” cattle accompanied by the requisite veterinary certificate will be licensed to any slaughterhouse, subject to the provisions of the Tuberculosis (Area Eradication) Order, 1950, as amended, which means there will be no market in this country for untested store cattle after 1st March. This class of cattle will therefore go to swell the number of fat cattle imported from Eire for slaughter. Last year (1959) the latter numbered 72,000.
James C. Lampe, Andy Garcia and Kerri L. Tassin
This article is the third in a trilogy of articles that discuss the professionalism (or deprofessionalism) of the accounting profession. The first examines the slow uphill climb…
Abstract
This article is the third in a trilogy of articles that discuss the professionalism (or deprofessionalism) of the accounting profession. The first examines the slow uphill climb of accounting and auditing practice to the level of being recognized as a highly trusted profession. The second examines the stagnation in professionalism leading to deprofessionalization of the accounting profession. This third article looks at the resulting directionless efforts of accounting and auditing firms in the wake of major deprofessionalization events. The interest in this study is the time period immediately following the passage of the Sarbanes–Oxley Act (SOX) of 2002 which is described in this paper as the “Post-SOX” history of public accountancy in the United States. During this time period, nearly equally mixed activities of professionalism and deprofessionalism have resulted in a status quo with directionless efforts doing little if anything to reverse decline in professionalism. Public accountants continued to experience conflict with the Securities and Exchange Commission (SEC) over independence rules. The large Certified Public Accountant firms generated controversies and squabbles concerning “auditing and consulting,” while at the same time they faced questions regarding the marketing and selling of aggressive tax shelters. In addition, most of the self-regulating aspects of the profession declined dramatically following passage of SOX. While initially both tax fees and audit fees of CPA firms increased during this time period, concerns are again arising as the large CPA firms more recently have renewed the emphasis on advisory services. While revenues have both increased and changed in composition during the post-SOX era, public opinion has maintained a status quo. The post-SOX era has also seen a weakening in the Code of Conduct, providing more liberties for CPAs to maximize self-interest. Meanwhile, the PCAOB faced constitutional challenges, while at the same time the AICPA experienced strong divisions in its membership. To provide some sense to these directionless efforts, this study, similar to the prior two articles in this trilogy, concludes with a summary analysis based on the nine SOCRECELIST criteria, and the question whether public accountants have learned their history lesson.
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The attest function of the professional accountant does not include an obligation to interpret the significance that the account data may have for various users. As auditor, he…
Abstract
The attest function of the professional accountant does not include an obligation to interpret the significance that the account data may have for various users. As auditor, he cannot attest the effect price-level changes will have on the certified statements. However, he can assist the client to prepare supplementary disclosures of the resulting changes if the historical accounting figures were modified by systematic application of a price-level index series.
This chapter deals with the development of banking in the Crown of Aragon from the end of the thirteenth century through the establishment of money changers, which followed…
Abstract
This chapter deals with the development of banking in the Crown of Aragon from the end of the thirteenth century through the establishment of money changers, which followed similar patterns as in other Western European territories. It starts with a review of existing literature and follows with an explanation on the different banking services provided by money changers and the specific legal framework that supported such activities. It then examines the geographical distribution of private banks in cities and towns within the domains of the kings of Aragon, as well as their evolution throughout the fourteenth century. After that, it offers an analysis of the most common professional profiles among these bankers and financers. Finally, drawing on a heterogeneous pool of unpublished data, it seeks to shed light on the diversity of investors and clients of these establishments, a crucial proof of their role in integrated financial markets.
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