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Part V analyzes the details of how to assess materiality. It first tackles qualitative versus quantitative criteria and the role of professional judgment. It then analyzes the selection of quantitative threshold, to expand to the choice of benchmarks. It contrasts the whole financial statements with subaggregates, line items, and components.

Specific sections contrast IASB, FASB, SEC, and other guidance on materiality applied to comparative information, interim reporting, and segment reporting.

The section on estimates mingles complex guidance coming from accounting, auditing, and internal control over financial reporting to explain how the management can improve its assessment of materiality concerning estimates.

After explaining the techniques to move from individual to cumulative misstatements, the part tackles verification ex post, and finally summarizes the intricacies of whether immaterial misstatements are permissible and their consequences.

The literature on executive options has burgeoned over the past decade. While early literature tended to expound the benefits associated with the adoption of options plans, more recent literature has taken on a more cautionary tone. Recent empirical research has suggested a range of conditions under which the adoption of options plans might result in unanticipated outcomes. This paper adds to the literature by discussing options holding concentration, which we define as the proportion of options outstanding under a firm's executive options plan held by a firm's board and the top five non-board executives. We examine previous empirical literature on executive options plans and some of the incentive problems associated with the implementation of such plans, which have been reported in the literature. On the basis of these discussions, we discuss why it might plausibly be expected that options holding concentration could represent a variable with the power to explain the degree to which incentive problems are encountered by organisations, which employ executive options schemes. We report observed options holding concentration for a sample of Australian listed corporations between 1997 and 2002, but demonstrate that while significantly inversely associated with firm size, holdings concentration does not appear to be associated with factors which point towards organisational risk taking and cash payment policy choices. We discuss possible reasons for our findings and suggest potential future research extensions flowing from our work.

This paper aims to discuss relationship management in business-to-business (B2B) ecosystem of electronic media. The goal of this research is twofold. First, the goal is to understand and model the impact of customer relationship management technology adoption on B2B relationships. Second, the authors investigated how trends in e-business and partner relationship management (PRM) affect partner relationship quality in public broadcasting.

This study deals with the impact that relationship capability, relationship fulfillment, operational PRM, analytical PRM, social PRM and readiness to adopt new e-business models produce on relationship quality of a public broadcaster. The research was conducted on a testing sample of 78 participants. All the participants were representatives of the Serbian public broadcaster’s business partners.

Results revealed that relationship capability, analytical and social PRM have a significant impact on relationship quality. In addition to this, the survey suggested that activities such as organizing social events, developing new services, personalization and tailoring of services could improve PRM outcomes.

The results aim to help practitioners to enhance their relationships with stakeholders and maximize the total outcomes of those relationships. Specifically, managers and practitioners doing business in the field of electronic media could benefit from the presented results.

Significance of the paper is reflected in the fact that it analyzes innovative concepts and technologies. Conclusions and recommendations put forward in the paper could serve as a good basis and framework for other public broadcasters, particularly for those from the developing countries.

The purpose of this paper is to examine the contribution of network competence to radical innovation.

Technological change associated with human body disposal acts as the form of radical innovation in which network competence is examined. Interviews, observations at industry conferences and secondary data are used for the case studies featured and in which network competence is investigated.

The paper establishes the importance of network competence at the regime and landscape level and the contribution of actors within commercial innovation niches to bringing cremation alternatives to market.

Some of the results are particular to the challenges of network entry and product introduction facing business start-ups and the context of body disposal is unique. Further research should examine network competence and radical innovation in other business fields.

Firstly, the context of human body disposal highlights the importance of institutional actors and social systems in bringing cremation alternatives to market. Secondly, focusing on human disposal encourages exchange amongst readers on a subject which is fundamental to man’s existence, yet the discussion of which many might normally choose to avoid.

The paper connects two areas of academic interest, namely, niche management for sustainability and radical innovation in business markets in which networking and network competence are key to the commercialisation of innovation.

Successful commercialization is crucial to innovative firms, but further investigation is needed on how diverse stakeholders can contribute to the commercialization of a radical innovation that requires particular market creation support. This paper aims to, therefore, analyze the key stakeholders and their contributive activities in commercialization and market creation, particularly in the case of radical innovations.

This study relies on qualitative research design including interviews with key stakeholders, such as regulators, scientists, experts, licensing partners, core company representatives and extensive secondary data. This single-case study concerns a functional food product, which is a radical innovation requiring the development of a novel product category positioned between the food and medicine categories in global market settings. Since its market launch in 1995, the involvement of multiple stakeholders was needed for its successful commercialization in over 30 countries.

Results uncover the contributions of diverse stakeholders to commercialization and market creation, particularly of radical innovation. Stakeholders performed market creation activities such as regulating the marketing and labeling of food products, conducting safety assessments, revealing and validating the positive health effects of the novelty and raising awareness of healthy living and cardiovascular health. The commercialization activities included distributing the products overseas, applying the ingredient to different food products and making the products available for users.

This single-case study provides an overview of the positive stakeholder activities with contributions to market creation and commercialization of functional food innovations. Although the user perspective was not included in the empirical part of this study because of our focus on B2B actors, users of the innovation can contribute to R&D activities to a great extent.

The developed framework of stakeholders’ contributive activities in radical innovation commercialization and market creation contributes to literature discussing market creation as well as commercialization within the marketing and innovation management research fields. This work also generates practical advice for managers who commercialize (radical) innovations.

Under given environmental uncertainties, the purpose of this paper is to examine the effect of brokers on the networking behaviour of small- and medium-sized enterprise (SMEs) and the subsequent impact on the performance of SMEs. The following five different types of brokers were tested, namely, coordinator, representative, cosmopolitan, liaison and gatekeeper brokers.

Data were collected through an online survey and analyzed by using the hierarchical regression method.

The results from the hierarchical regression analysis of 198 Czech firms showed that coordinator and representative brokers moderate the relationship between environmental uncertainty and networking behaviour. However, under high environmental uncertainty, the coordinator broker worked best, whereas in the host country, under low environmental uncertainty, the representative broker worked best.

The findings of this study have useful implications for SMEs in selecting an appropriate broker for strengthening their networking behaviour in the international market. This study aimed to explore the effectiveness of various types of brokers on networking behaviour during their internationalization of SMEs. More specifically, this study examined if and how, given the uncertainties in the international market, multiple brokers help SME executives develop networking behaviour.

The authors investigate the relation between employee treatment and the likelihood of discontinuing business operations.

The authors use regression analysis to investigate the relation between employee treatment and the likelihood of discontinuing business operations.

The authors find a significant negative relation between employee treatment and the likelihood of discontinuing business operations, suggesting that firms with better employee treatment are less likely to discontinue operations.

This study contributes to two distinctive steams of research: discontinued operations in accounting literature and employee welfare in human resources management literature.

This paper aims to investigate the dynamics of the organizational buying process of radical software innovations. Acquisition of technology innovations by early adopting organizations has been studied previously with scant attention being given to the actual buying process and the risk mitigation mechanism. This paper addresses these gaps in the literature and this paper finds evidence to support that the organizational buying process of radical software innovations is different from the general models of organizational buying.

Methods from the grounded theory approach were used to conduct 20 in-depth interviews with senior industry practitioners. Purposive sampling was used to identify the participants.

A theoretical model of the organizational buying process of radical software innovations emerged with themes and concepts that explain the dynamics of the buying and adoption processes. The paper challenges the fundamental tenet of organizational buying that needs recognition triggers the buying process. An interesting nuance was found that risk is mitigated within the buying action itself.

An understanding of the buyer behaviour process will help marketers of radical software innovations to formulate the appropriate marketing response. Sales personnel can attune their customer interactions when helping customers to acquire a radical software innovation. Firms that want to be early adopters and innovate can tune their buying process in line with the findings.

This paper develops a typological buying model. It unravels the dynamics of the adoption process by discussing how early adopting organizations buy radical software innovations. New concepts with rich explanatory powers are discussed.

Systematic research examining the mechanisms that mediate the dynamic capability–performance relationship remains scarce. So too is research on the conditions under which these mechanisms might be influential. Accordingly, this study aims to build upon business network research to examine how a firm’s dynamic network capability (DNC) impacts firm performance, mediated by the speed of product reconfiguration (i.e. new product development [NPD] speed) and bounded by firm age.

The authors conduct moderated mediation analysis on survey data from small- and medium-sized manufacturing and technology firms in the USA. This study uses an initial survey and then a follow-up survey.

The findings support the general view that DNC is instrumental to firm performance, regardless of firm age. However, DNC operates differently for younger vs older firms. That is, DNC’s impact on the performance of younger firms is enabled by speeding up NPD, while much of the performance impact for older firms appears to be through alternative resource reconfiguration route(s). This study identifies the need to include a mediating variable such as resource reconfiguration to detect how DNC impacts performance.

The model could include different dimensions of mediating resource reconfigurations, alternative boundary conditions and longer-term data.

This study provides managers with insight on how speed of product reconfiguration (in terms of NPD) operates in the DNC–performance relationship. It also helps them understand how this relationship changes in younger vs older firms.

To the best of the authors’ knowledge, this study is the first to provide empirical evidence on how DNC operates to influence performance in firms that are younger vs older.

The purpose of this paper is to scrutinize the existing literature and provide a comprehensive overview by compiling and synthesizing the dispersed body of knowledge in the networking capability (NC) literature stream. Therefore, this review study contributes to the research by presenting a summary of the NC complex construct.

The authors have tried to cover the literature gap in the NC area through a systematic review.

The theoretical contributions of this study to the NC literature stream are fourfold. First, while critically reviewing existing definitions, the authors present an integrated definition of NC. Second, the authors delineate the conceptual boundary between NC and other similar capabilities. Third, the authors found that the focal firms’ NC consists of two key dimensions: network development capability (NDC) and network management capability (NMC). Fourth, they contribute to the literature by providing a set of suggestions for further research in the NC literature stream.

This study has some limitations, like other review studies. First, although the authors have tried their best to conduct a comprehensive literature search, they may have missed a study. Second, it should be noted that this study has confined itself to a particular stream of literature. Undoubtedly, in other streams, there will be issues similar to the concepts discussed in this study. The main purpose of this study is to integrate a series of studies that have a common theoretical foundation and fall within a particular literature stream. Although the focus of this study may be positive, it can be said that the deprivation of achievements from other similar streams is one of the limitations of this study. Third, another limitation of this study is the lack of verification of the conceptual framework derived from the literature that needs to be addressed in future research.

This study suggests a set of practical implications for industrial managers. First, the authors summarize the firms’ capabilities needed to develop and manage networks in one single source. Based on the conceptual framework of this study, firms can develop managerial tools, technological options, checklists and questionnaires and monitor the status of NC in their surrounding network on an ongoing basis. Second, the present research shows that some NCs are more repetitive than others, and therefore, it can be said that managers should pay more attention to them. The critical NCs, such as determining network position, determining network size, partner selection and attraction, coordination, inter-firm knowledge sharing and conflict resolution, are included in this study. Third, the argument of this study that both NDC and NMC should be considered simultaneously can be thought of as an important practical implication. Although in terms of the network life cycle, NDC is required earlier than NMC, these two capabilities should be used in parallel. Managers should not expect network development to be perfect and then network management to begin; therefore, NMCs should be used during network development.

Research shows that most network studies focus more on network antecedents and outputs and less on processes and related capabilities. Some researchers have made few efforts to identify and scrutinize capabilities related to business relationships. In this context, IMP scholars have introduced NC to emphasize the network perspective. Despite the considerable conceptual and empirical richness, the existence of different nomenclatures and theoretical diversity in NC literature has led to conceptual ambiguity and a lack of consensus on this crucial complex construct.