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Article
Publication date: 1 June 2012

Andrew Holt, Timothy Eccles and Peter Bond

The paper examines how accounting practice changes, which forces generate change, and the role of a best practice benchmark within this. It examines this process of change within…

Abstract

Purpose

The paper examines how accounting practice changes, which forces generate change, and the role of a best practice benchmark within this. It examines this process of change within service charge accounting in commercial property. The purpose of this paper is to establish that “best” practice is of a low standard and poorly implemented, and then explain this.

Design/methodology/approach

Data are hand‐collected from the original accounting source documents that are routinely provided to commercial leaseholders as part of the service charge management and accountability process. Evidence is generated by directly examining actual service charge budgets and periodic certificates of expenditure incurred to reduce bias, create complete data and ensure authenticity. The findings are then fleshed out and reinterpreted by utilising models created using Laughlin's middle‐range thinking methodology.

Findings

“Best” practice is neither onerous nor “best” when compared with normal accounting practices in other occupations. Whilst the 2006 Code of Practice has improved service charge management, the majority of certificates do not conform to best practice. This suggests that “best” practice is rather less a statement of current good practice and rather more an idealised view of the industry enacted due to wider issues, such as tenant resentment attracting government interest, ideas diffusing into the sector from elsewhere or a profession seeking to improve its occupational control.

Research limitations/implications

The sample of service charge budgets and certificates used in this work represents approximately 6.2 per cent of the total estimated multi‐let office space in England and Wales and covers the period 1998‐2009, with the majority of the buildings being tenanted by organisations within the financial services sector. Content analysis is utilised in order to interpret the data and to test actual practice with that required in the Code of Practice. In certain instances such analysis requires some subjective judgement and interpretation by the researchers.

Originality/value

Data are original and the paper offers a unique benchmarking test. The area of service charge management is unpublished and offers an interesting contrast to the better studied regions of the profession. By shedding light into this backwater, it provides the opportunity for academics and professionals to engage in a discourse that will improve practice, perhaps opening up the discipline to new and better practices. It also illuminates the previously technical literature on the concept of best practice with an original conceptual framework in which to review the construct.

Details

Journal of Accounting & Organizational Change, vol. 8 no. 2
Type: Research Article
ISSN: 1832-5912

Keywords

Article
Publication date: 22 November 2011

Timothy Eccles, Andrew Holt and Anastasia Zatolokina

The paper benchmarks compliance for 2010‐2011 with the RICS Code of Practice for Commercial Service Charges 2006.

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Abstract

Purpose

The paper benchmarks compliance for 2010‐2011 with the RICS Code of Practice for Commercial Service Charges 2006.

Design/methodology/approach

Whether the proxy adopted is measured by floorspace or number of commercial office buildings, the sample size conforms to Kreycie and Morgan's determination for representative sample size. Data are generated directly from the original documents provided to commercial leaseholders to ensure authenticity and remove the need for third party reporting of said data. This guarantees the data are valid.

Findings

The research discovers that compliance with the RICS Code of Practice for commercial service charges is poorly, if variably, implemented. This contrasts with claims by the professional body.

Research limitations/implications

The work only concerns 17 corporate tenants operating principally in the financial services sector and data are drawn from the clients of one property services company. Content analysis is utilised in order to interpret the data and requires some subjective judgement by the researchers. The work only refers to multi‐let office space in England and Wales.

Originality/value

Data are original and the paper offers a unique benchmarking test. This contrasts markedly with the anecdotal evidence offered by the profession in defending their standards of practice and whilst the paper has limitations, it is the largest and most accurate study yet carried out in the field.

Details

Journal of Corporate Real Estate, vol. 13 no. 4
Type: Research Article
ISSN: 1463-001X

Keywords

Article
Publication date: 1 June 1982

J.F. Pickering and D.C. Cousins

Claims use of legislation and government regulations as a means of protecting consumers has been subject to considerable controversy in many countries over recent years. Examines…

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Abstract

Claims use of legislation and government regulations as a means of protecting consumers has been subject to considerable controversy in many countries over recent years. Examines the UK's efforts to encourage voluntary self‐regulation by business — the most important manifestation of this has been the adoption of codes of practice in numerous trades — a code of practice being a statement of desirable trading practices. Says that data for analysis here is based on monitoring studies and other reports produced by the Office of Fair Trading and Consumers' Association and also direct interviews with trade associations and companies, supplemented by a postal questionnaire survey. Further discusses the rationale and lists and examines the most likely criteria to be used. Concludes that, overall, codes of practice are likely to have been beneficial, this does not necessarily imply that they are the best means of attaining the consumer policy objectives they embody.

Details

European Journal of Marketing, vol. 16 no. 6
Type: Research Article
ISSN: 0309-0566

Keywords

Article
Publication date: 14 September 2015

Andrew Derek Holt

This research aims to continue previous work by the author in the field of commercial service charge management in the UK, offering a unique cross-sectoral comparison in this…

Abstract

Purpose

This research aims to continue previous work by the author in the field of commercial service charge management in the UK, offering a unique cross-sectoral comparison in this paper. While prior studies have approached only one sector, this study analyzes both retail and office sectors in the UK. It examines the financial reporting and administrative practices of managing agents and the overall quality of commercial service charge documents, through which it offers commentary on the standard of professional service in service charge provision. It achieves this by benchmarking performance achieved against the accounting requirements of the UK RICS Code of Practice, Service Charges in Commercial Property.

Design/methodology/approach

Data were hand collected from analysis of actual service charge documents supplied to commercial retail occupiers at 100 UK office buildings and 100 UK shopping centres during the period of 2010-2013. This process ensures authenticity by removing reliance upon third-party reporting of the said data and offers a uniquely detailed longitudinal sample.

Findings

Overall levels of compliance with the financial reporting requirements of the RICS Code of Practice for Commercial Service Charges were poor in both sectors over the period of 2010-2013. Of specific concern was the widespread failure to disclose the accounting policies used during the preparation of the service charge accounts; knowing whether the accounts are prepared using an accruals or cash basis is essential for occupier decision-making purposes. Overall, the results from this study contrast with claims by the professional body that levels of “best practice” are increasing across the service charge industry.

Research limitations/implications

The work analyzes service charge documents prepared during 2010-2013 for 100 office buildings and 100 retail shopping centres located in the UK. While the sample sizes utilized are relatively small, the paper provides a unique in-depth longitudinal analysis of commercial service charge documents that produces findings with high levels of generalizability. Content analysis was utilized to interpret the data and required some subjective judgement by the researcher.

Originality/value

The study provides a comprehensive longitudinal study of accounting and financial reporting practices for commercial service charges in the UK retail and office sectors. Sector data are original, and the paper provides a unique benchmarking approach for assessing Code compliance at each building. This structured longitudinal approach to benchmarking differs markedly from the largely anecdotal evidence offered by the profession when defending current levels of Code compliance. In addition, the paper also provides individual compliance scorecards for 695 service charge documents in order to assess compliance with nine “core” financial reporting requirements of the RICS Code. Its chief value lies in establishing actual practice standards that can be taken up as a driver for improvement – by tenants, agents, landlords and the wider profession.

Details

Journal of Corporate Real Estate, vol. 17 no. 3
Type: Research Article
ISSN: 1463-001X

Keywords

Article
Publication date: 6 March 2009

Maria Aluchna

The purpose of this paper is to present the best practice initiative in Poland, presenting codes formulated in 2002 and 2005 and focusing on the recent document known asBest

Abstract

Purpose

The purpose of this paper is to present the best practice initiative in Poland, presenting codes formulated in 2002 and 2005 and focusing on the recent document known asBest Practice of WSE Listed Companies. Moreover, the paper aims to present practical aspects of implementation of new code between January and April 2008.

Design/methodology/approach

The paper identifies the guidelines recommended in three versions of the Warsaw Stock Exchange code of best practice. Additionally it discusses companies' doubts and questions addressed to the Warsaw Stock Exchange, analyzes technical challenges referring to new system of reporting on companies compliance as well as raises some concerns regarding the content of the new code.

Findings

The paper shows that the codes of best practice attempted to address the most problematic issues of transitional Polish corporate governance. The recommendations content was adopted during the last eight years as the response to the changes in market environment and governance challenges. However, the new code addresses mostly the strategic plans of the Warsaw Stock Exchange rather than the corporate needs and its implementation and communication with listed companies leaves a lot of room for improvement.

Practical implications

The analysis addresses the needs for coherence between the crucial moments of development of corporate governance and the code of best practice. Moreover, it points out potential shortcomings in the process of the code implementation.

Originality/value

The paper is based on the documents prepared by the Warsaw Stock Exchange, companies remarks as well as author's experience of working at the Stock Exchange during the first three months of 2008 code implementation.

Details

Social Responsibility Journal, vol. 5 no. 1
Type: Research Article
ISSN: 1747-1117

Keywords

Article
Publication date: 20 April 2015

Andrew Holt and Timothy Eccles

The purpose of this paper is to assess whether financial reporting practices for commercial service charges in the UK retail sector match the best practice requirements of the…

Abstract

Purpose

The purpose of this paper is to assess whether financial reporting practices for commercial service charges in the UK retail sector match the best practice requirements of the Royal Institution of Chartered Surveyors (RICS) Code of practice for commercial service charges. This assessment was performed by benchmarking commercial service charge documents provided to retail occupiers at UK shopping centres against the RICS Code’s financial reporting requirements.

Design/methodology/approach

Data were generated from direct analysis of actual service charge documents supplied to commercial retail occupiers. This ensures authenticity by removing reliance upon third party reporting of said data. The paper uses a sample size that is representative of the financial reporting practices for commercial service charges at UK shopping centres.

Findings

Levels of compliance with the financial reporting requirements of the RICS Code of Practice for commercial service charges are found to be poor, especially in terms of the disclosure of the accounting policies used during the preparation of the service charge accounts. These results contrast with claims by the professional body.

Research limitations/implications

The work analyses service charge documents prepared during 2010-2012 by 44 managing agents and 87 landlords at 126 UK retail shopping centres located in Great Britain. Content analysis was utilised to interpret the data and required some subjective judgement by the researchers.

Originality/value

Data are original and the paper provides a unique benchmarking test for assessing Code compliance. This contrasts markedly with the anecdotal evidence offered by the profession in defending current standards of practice and whilst the paper has limitations, it is the largest and most in-depth study of commercial service charge practices at UK retail shopping centres.

Details

Property Management, vol. 33 no. 2
Type: Research Article
ISSN: 0263-7472

Keywords

Article
Publication date: 17 August 2012

Timothy Eccles and Andrew Holt

The paper seeks to measure compliance by owners and their managing agents with the RICS Code of Practice Service Charges in Commercial Property, emphasising the financial…

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Abstract

Purpose

The paper seeks to measure compliance by owners and their managing agents with the RICS Code of Practice Service Charges in Commercial Property, emphasising the financial reporting to tenants in multi‐let financial services buildings.

Design/methodology/approach

Data were hand collected by examining original source documents provided to commercial leaseholders as part of the service charge management process. This removes bias from relying on secondary respondents to provide data.

Findings

The paper finds that requirements of the Code of Practice are not onerous, and whilst service charge management has improved, the majority of landlords still fail to achieve its requirements.

Research limitations/implications

The sample represents approximately 6.2 per cent of multi‐let office space in England and Wales 1998‐2009. The content analysis method used requires some subjective interpretation by the researchers.

Originality/value

Data are original to this research and the paper offers an analysis on the current standards of accounting practice by service charge managers.

Details

Facilities, vol. 30 no. 11/12
Type: Research Article
ISSN: 0263-2772

Keywords

Book part
Publication date: 1 July 2004

John L. Peterman

A study of the price discounts granted by Morton Salt Company and other producers of table salt in the U.S. on their sales of table salt to grocery wholesalers and retailers. The…

Abstract

A study of the price discounts granted by Morton Salt Company and other producers of table salt in the U.S. on their sales of table salt to grocery wholesalers and retailers. The discounts were found to be illegal under the Robinson-Patman Act by the Federal Trade Commission and the Supreme Court. The Commission and the Court believed that the discounts were unjustified price concessions granted to “large” buyers, consistent with the concerns of the Robinson-Patman Act. However, the evidence indicates that the most common discount – the “carload discount” – was received by virtually all buyers, regardless of the buyer’s size; the other discounts – “annual volume” discounts – though received primarily by “large” buyers, were likely cost based. The history of the discounts and likely reasons why they were granted are explored in detail.

Details

Antitrust Law and Economics
Type: Book
ISBN: 978-0-76231-115-6

Article
Publication date: 1 June 2010

Mohd Nazali Mohd Noor, Michael Pitt, George Hunter and Matthew Tucker

The RICS code of practice “Service Charges in Commercial Property” was introduced in 2007 with the intention to promote best practice guidelines in the provision and management of

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Abstract

Purpose

The RICS code of practice “Service Charges in Commercial Property” was introduced in 2007 with the intention to promote best practice guidelines in the provision and management of commercial service charges. The paper seeks to review the compliance of the code after two years from its inception.

Design/methodology/approach

The research employs comprehensive literature reviews and documental analysis through a number of publications retrieved from electronic databases, reports, journals, books, and other relevant secondary information. A critical review of the materials gathered is carried out in understanding the key recommendations as set within the RICS code against the current practice.

Findings

Huge gaps are identified between the RICS against existing practice involving several key headings such as transparency, value for money, communication, and responsiveness.

Research limitations/implications

Since the code was only introduced in 2006, limited sources of data available prevents comprehensive results, underlining further discussions on the effectiveness of the code in resolving the critical commercial service charges aspects within the real estate industry.

Practical implications

While the paper intends to raise awareness among the commercial properties stakeholders, recommendations that are made in the paper can be utilised to minimise the gap that exists between the guidelines and the actual implementation by harnessing concerted efforts among the stakeholders in commercial property industry.

Originality/value

This paper provides an in‐depth snapshot of the RICS code of practice to commercial service charges and the progress that has been made towards the application of the guidelines since it was introduced in 2006.

Details

Journal of Corporate Real Estate, vol. 12 no. 2
Type: Research Article
ISSN: 1463-001X

Keywords

Article
Publication date: 1 January 1975

Knight's Industrial Law Reports goes into a new style and format as Managerial Law This issue of KILR is restyled Managerial Law and it now appears on a continuous updating basis…

Abstract

Knight's Industrial Law Reports goes into a new style and format as Managerial Law This issue of KILR is restyled Managerial Law and it now appears on a continuous updating basis rather than as a monthly routine affair.

Details

Managerial Law, vol. 18 no. 1
Type: Research Article
ISSN: 0309-0558

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