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The International Financial Reporting Standards (IFRS) are playing an increasingly important role in global financial reporting. As a result, colleges are incorporating the IFRS into their business curricula. This chapter presents an interactive team project that will help students become familiar with the IFRS by critically examining IFRS adoption in the United States. Examining adoption of the IFRS from different perspectives allows students to explore the views of the various participants in the regulatory process, including investors, auditors, public, and private companies. This project encourages active collaborative learning and develops fundamental skills, including critical thinking and information literacy.

Part IV provides readers with the extant requirements for the application of materiality to recognition, measurement, presentation, and disclosure in the financial statements. This part also includes a detailed critical review of the recent Practice Statement on materiality, the FASB’s proposed ASU on the notes and the amendments to the Conceptual Framework proposed by the IASB and the FASB.

The part expands to issues that are typical of Management Commentary, including the SEC guidance on materiality in Management Discussion and Analysis.

It informs about the complexities and subtle differences between financial statements and bookkeeping and the different standards of reasonableness versus materiality.

A section moves from materiality to material misstatements and covers the application of materiality in auditing.

Another section goes in depth on internal control over financial reporting, showing the linkages between materiality and risk appetite and risk tolerance and the related application guidance.

This chapter explores how network bricolage, as a form of collective entrepreneurship, develops over time and influences the shape and form of an organization. Using a historical organization study of SEUR, a Spanish courier company founded in 1942, the authors show how network bricolage is implemented as a dynamic process of collaborative efforts between bricoleurs who draw on their historical experience to build and develop an organization. Our study offers two main contributions. In combining network bricolage with ideas of collective entrepreneurship, the authors first extend knowledge about the practice of bricolage and the role of the bricoleur in the entrepreneurial context beyond start-up. Second, the authors show that, while entrepreneurs’ decisions are historically contingent, it is how entrepreneurs wed past experience with current context which informs their actions in the present, shaping the enterprise for the future.

Extant research posits that host country investors value geographical proximity and familiarity. American investors are likely to be more familiar with business, legal and economic conditions of Latin America compared to distant emerging market countries. Furthermore, the trading time of Latin American stock markets overlap significantly with that of U.S. markets. Therefore, we expect Latin American ADRs to enjoy better liquidity than ADRs from other emerging markets. Consistent with our expectations, we find weak evidence that ADRs from Latin America have lower effective spreads and adverse selection component of spreads compared to ADRs from other emerging markets.

This experimental study examined whether sustainability performance measures matter in managerial appraisal and bonus decisions. Participants received financial and non-financial information about four branch managers of a commercial bank, with different combinations of sustainability and financial performance. Participants perceived sustainability measures as being less important than financial ones; still, the experiment revealed that sustainability performance had some impact on appraisal and bonus decisions (albeit it mattered less than financial performance). Evaluators seemed to penalize inferior sustainability performance less than they penalized inferior financial performance. They also seemed to reward sustainability success less than financial success. These findings have practical implications for the implementation of sustainability measures in managerial evaluation systems. The experimental results indicated that incorporating these measures in evaluations does not necessarily mean they will have a sizable effect in decision-making. Results from a companion experiment suggested that organizations using a sustainability balanced scorecard for appraisal and bonus purposes might benefit from an increased emphasis on communication and evaluator training, with a focus on how sustainability performance impacts the attainment of strategic objectives.

The Fordist wage compromise may resemble an attempt to macroeconomically establish ethico-political rules governing the conflicting cooperation between capitalists and employees (Aglietta, 1998; Boyer, 1993). The question of the relationship between ethics and economics is, thus, not contemporaneous with the CSR movement. It is particularly misleading to see this recent movement as a fundamental break with the era of relationships between capital and labour, or even, as a definitive and modern break with the old ‘conflicting’ form of productive relations. The Fordist compromise represents a very subtle and substantial means of linking ethics and efficiency, but it is situated at the macro-social level, in contrast to the CSR movement.

Relationships are socially constructed by companies in interaction. This study explains the dynamic character of business-to-business relationships with the aid of rules theory, a theory borrowed from the communications field. Two forms of rules are identified: constitutive rules guide the interpretation of the other's acts, and regulative rules guide the appropriate response to the interpreted act. Rules theory asserts that companies act as if applying these rules. Relationships provide not only the context in which the parties’ acts are performed but are also the result of such acts. Thus, relationships are potentially reshaped each time one party performs an act and the other party gives meaning to that act and reacts.