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Article
Publication date: 1 January 2002

Marian Yew Jen Wu Tong, Gladie Lui and Albert Lew

This paper seeks to provide empirical evidence showing how bank users of audited financial statements perceive and interpret various dimensions associated with financial…

Abstract

This paper seeks to provide empirical evidence showing how bank users of audited financial statements perceive and interpret various dimensions associated with financial reporting in Hong Kong. Employing a survey instrument, we asked bank loan officers to rank the importance of thirty‐five reporting dimensions for lending decisions and to ascertain their expected level of information on each exploratory dimension, as well as their perceptions of the level of information actually provided by audited financial statements. Reliance on principal‐component analysis to extract a set of important dimensions shows that nine reporting dimensions are significantly associated with lending decisions. When bank loan officers' levels of expectations on important reporting dimensions were compared with the corresponding levels of perceived reporting performance, the statistical results reflect the existence of an expectations‐performance gap. Finally, when bank loan officers' perceived levels of reporting performance were hierarchically positioned, audited financial statements were found to provide the most information on a firm's liquidity and profitability, moderate information on reliability‐related dimensions, and the least information on relevance‐related dimensions pertaining to the future prospects of a firm. This empirical evidence signifies the need for future corrective actions in closing the expectations‐performance gap.

Details

Pacific Accounting Review, vol. 14 no. 1
Type: Research Article
ISSN: 0114-0582

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Article
Publication date: 1 February 1996

Connie Shum, Wing‐Hung Tam and Gladie Lui

This study examines accounting academics' perceptions of practical experience. Although such experience is perceived as important for student learning and school image, it…

Abstract

This study examines accounting academics' perceptions of practical experience. Although such experience is perceived as important for student learning and school image, it is not a relevant factor in hiring, tenure and promotion decisions in their schools. As a result, even though faculty would like to gain/refresh their practical experience, they do not find much opportunity provided by their schools. In addition, faculty members, especially those who have not obtained tenure status, find it more important to have publications in order to succeed. Consequently, they find no incentive to gain such experience.

Details

Asian Review of Accounting, vol. 4 no. 2
Type: Research Article
ISSN: 1321-7348

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Book part
Publication date: 23 August 2014

Lan Guo, Bernard Wong-On-Wing and Gladie Lui

We examine how input- (vs. output-) based performance evaluation and incentive intensity impact employees’ autonomous motivation, thereby influence their proactive work behaviors.

Abstract

Purpose

We examine how input- (vs. output-) based performance evaluation and incentive intensity impact employees’ autonomous motivation, thereby influence their proactive work behaviors.

Methodology

We collected survey responses from 309 employees of different firms. Multi-group Structural Equation Modeling analyses were used to analyze the data.

Findings

Input-based evaluation had a positive effect on autonomous motivation and proactive work behaviors when task uncertainty was high, but a negative effect when it was low. Autonomous motivation had a positive effect on proactive work behaviors.

Research implications

Our results on the moderating effect of task uncertainty provide insights into inconsistencies in earlier studies. Moreover, applying self-determination theory of motivation to incentive research can provide some insights into why sometimes, incentives can negatively affect performance.

Practical implications

The study of proactive work behaviors is important because despite their necessity in the fast-changing business environment, they are relatively unexplored in the incentive literature. Proactivity is especially important for tasks that are high in uncertainty because the exact tasks to achieve those goals are hard to specify.

Originality/value of paper

We investigate the effect of performance management system on proactive work behaviors, mediated by autonomous motivation and moderated by task uncertainty.

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Book part
Publication date: 26 October 2016

Lei Dong, Bernard Wong-On-Wing and Gladie Lui

Management has considerable discretion over how to present and announce earnings components that are either unusual or infrequent, but not both (hereafter referred to as…

Abstract

Purpose

Management has considerable discretion over how to present and announce earnings components that are either unusual or infrequent, but not both (hereafter referred to as special items). In this study, we study the independent and joint effects of the accounting presentation format of, and the level of announcement prominence given to income-decreasing special items on investors’ judgments about the persistence of declining earnings.

Methodology/approach

Our study uses a 3 (format) × 2 (prominence) between-subjects design. In the experiment, participants act as proxies for nonprofessional investors to assess the persistence of a hypothetical firm’s declining earnings and make investment decisions.

Findings

Our results suggest that investors’ judgments are influenced by accounting presentation format and the level of announcement prominence. With respect to format, both classification and disaggregation affect investors’ assessment of earnings persistence. In addition, the degree of prominence given to an income-decreasing special item, albeit self-serving and not audited, introduces additional influence beyond that of accounting presentation format. In particular, we find that announcement prominence has a greater effect when the special item is aggregated with other operating expenses than when the special item is presented under the two other alternatives.

Research implications

Our study contributes to the literature by demonstrating that presentation format and announcement prominence both have significant impact on investors’ judgments and decisions, and that their effects are interactive. Our results also indicate that future research can possibly gain better insight if it considers the accounting attributes of the special items in addition to their economic attributes.

Details

Advances in Accounting Behavioral Research
Type: Book
ISBN: 978-1-78560-977-0

Keywords

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Book part
Publication date: 3 May 2012

Lan Guo, Bernard Wong-On-Wing and Gladie Lui

The present research examines the effect of incentivizing both outcome and driver measures of SPMS on middle managers' proactivity in influencing the strategy formulation…

Abstract

The present research examines the effect of incentivizing both outcome and driver measures of SPMS on middle managers' proactivity in influencing the strategy formulation process. A case-based experiment was conducted among 74 full-time employees. The results suggest that when incentives are linked to both outcome and driver measures of SPMS, compared with when they are outcome-based and not linked to the SPMS, managers are more proactive in communicating strategy-related issues to top management. In addition, this effect of SPMS-based incentives on middle managers' proactivity is mediated by their autonomous extrinsic motivation to achieve strategic goals. The results are in general consistent with postulates of the self-determination theory of motivation. This chapter also has practical implication. Specifically, recent evidence suggests that most SPMS adopters fail to validate causal business models underlying their formulated strategies (Ittner, 2008; Ittner & Larcker, 2003, 2005). Middle managers' proactive strategic behavior may be one means to prompt top management to inspect formulated strategies and their underlying business models.

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Book part
Publication date: 3 May 2012

Abstract

Details

Advances in Management Accounting
Type: Book
ISBN: 978-1-78052-754-3

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Book part
Publication date: 26 June 2013

Abstract

Details

Advances in Management Accounting
Type: Book
ISBN: 978-1-78190-842-6

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Book part
Publication date: 26 October 2016

Abstract

Details

Advances in Accounting Behavioral Research
Type: Book
ISBN: 978-1-78560-977-0

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