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This paper, based on case-studies with five universal banks from Europe and North America, aims to investigate which types of comprehensive risk measure (CRM) models are being used in the industry, the challenges being faced in implementation and how they are being currently rectified. Undoubtedly, CRM remains the most challenging and ambiguous measure applied to the correlation trading book. The turmoil surrounding the new regulatory framework boils down to the Basel Committee implementing a range of capital charges for market risk to promote “safer” banking in times of financial crisis. This report discusses current issues faced by global banks when complying with the complex set of financial rules imposed by Basel 2.5.

The current research project is based on in-depth, semi-structured interviews with five universal banks to explore the strides major banks are taking to introduce CRM modelling while complying with the new regulatory requirements.

There are three measures introduced by the Basel Committee to serve as capital charges for market risk: incremental risk charge; stressed value at risk and CRM. All of these regulatory-driven measures have met with strong criticism for their cumbersome nature and extremely high capital charges. Furthermore, with banks facing imminent implementation deadlines, all challenges surrounding CRM must be rectified. This paper provides some practical insights into how banks are finalising the new methodologies to comply with Basel 2.5.

The introduction of CRM and regulatory approval of new internal market risk models under Basel 2.5 has exerted strong pressure on global banks. The issues and computational challenges surrounding the implementation of CRM methodologies are currently fiercely debated among the affected banks. With little guidance from regulators, it remains very unclear how to implement, calculate and validate CRM in practice. To this end, a need for a study that sheds some light on practices with developing and computing CRM emerged. On submitting this paper to the journal, we have received news that JP Morgan is to pay four regulators $920 million as a result of a CRM-related scandal.

The purpose of this paper is to investigate the relationship between liquidity and credit risk, and employ the findings to estimate the Incremental Risk Charge (IRC), the new credit risk capital add‐on introduced by the Basel Committee for banks' trading books. The IRC estimates are compared with stressed market risk measures, derived from a sample of corporate bond indices encompassing the recent financial crisis. This can determine the extent to which trading book capital would change in stress conditions, under newly proposed rules.

The Basel II and the proposed Basel III capital requirements for banks' trading books, with a sample of bond portfolios, are implemented.

The findings show that, although the (incremental) credit risk in the trading book may be considerable, the capital needed to absorb market risk‐related losses in stressed scenarios can be more than ten times larger.

The data, methodology and purpose are all original.

The purpose of this paper is to outline how banks are coping with the new regulatory challenges posed by stressed value at risk (SVaR). The Basel Committee has introduced three measures of capital charges for market risk: incremental risk charge (IRC), SVaR and comprehensive risk measure (CRM). This paper is designed to analyse the methodologies for SVaR deployed at different banks to highlight the SVaR-related challenges stemming from complying with Basel 2.5. This revised market risk framework comes into force in Europe in 2012. Among the wide range of changes is the requirement for banks to calculate SVaR at a 99 per cent confidence interval over a period of significant stress.

The current research project is based on in-depth, semi-structured interviews with nine universal banks and one financial services company to explore the strides major banks are taking to implement SVaR methodologies while complying with Basel 2.5.

This paper focuses on strengths and weaknesses of the SVaR approach while reviewing peer practices of implementing SVaR modelling. Interestingly, the surveyed banks have not indicated significant challenges associated with implementation of SVaR, and the reported problems boil down to dealing with the poor quality of market data and, as in cases of IRC and CRM, the lack of regulatory guidance. As far as peer practices of implementing SVaR modelling are concerned, the majority of the surveyed banks utilise historical simulations and apply both the absolute and relative measures of volatility for different risk factors.

The academic studies that explicitly analyse challenges associated with implementing the stressed version of VaR are scarce. Filling in the gap in the existing academic literature, this paper aims to shed some explanatory light on the issues major banks are facing when calculating SVaR. In doing so, this study adequately bridges theory and practice by contributing to the fierce debate on compliance with Basel 2.5.

The purpose of this paper is to aid understanding of the changes in Basel Committee on Banking Supervision (BCBS) regulatory strategies after the global financial crisis.

The author uses the credit valuation adjustment (CVA) charge reform as a test case for inquiring whether BCBS has departed from its pre-crisis facilitative regulatory strategy path. The regulatory strategy of the CVA charge is discussed.

The charge exhibits a new regulatory strategy that BCBS has adopted. It seeks to manipulate market structures by imposing risk-insensitive capital charge methodologies.

The paper offers a new heuristic to analyse regulatory initiatives and their significance. The CVA charge has not been subject to a regulatory theory-based analysis in prior literature.

Decades of innovation in designing usable (and unusable) interfaces have resulted in a plethora of guidelines, usability methods, and other design tools. The purpose of this research is to develop ways for novice developers to effectively leverage and contribute to the large and growing body of usability knowledge and methods.

This work presents the first extensive usage evaluation of an integrated design environment and knowledge management system, LINK‐UP. Key to this effort is the central design record (CDR), a design representation meant to prevent breakdowns occurring between design and evaluation phases.

The case study results show that a design knowledge IDE centered on the CDR can help novices make connections between requirements data, design representations and evaluation data and better understand how to leverage that information to improve designs.

Future efforts are focusing on exploring the utility of this approach for practitioners—especially agile developers.

A useful process and toolset for teaching usability design to novice developers and students.

The CDR makes designs coherent and understandable, thus supporting a principled, guided development process critical for student developers.

The purpose of this paper is to examine the trend of integrated reporting (IR) practice following the introduction of an “apply or explain” IR requirement in South Africa. In particular, the authors examine whether the IR practice is ceremonial or substantive in the context of a soft regulatory environment.

By way of content analyses, the authors examine the extent and quality of IR practice using an IR checklist developed based on normative understanding of existing IR guidelines. The evidence is drawn from 246 integrated reports of large South African companies over a three-year period (2011-2013), following the introduction of IR requirement in South Africa.

The results show a significant increase in the extent and quality of IR practice. The findings also reveal significant improvements in individual IR categories such as connectivity of information, materiality determination process and reliability and completeness of the integrated reports. However, despite the increasing trend and evidence of both symbolic and substantive IR practice, the authors conclude that the current IR practice is largely ceremonial in nature, produced to acquire organisational legitimacy.

For academics, the authors argue that there is a need to move away from the “what” and “why” aspects of the IR agenda to “how” IR should work inside organisations. In particular, academics should engage with firms through interventionist research to help firms implement integrated thinking and substantive reporting practices. For organisations, the findings draw attention to specific aspects of IR that require improvement. For policymakers, the study provides evidence based on the developmental stage of IR practice and draws attention to certain areas that need clarification. In particular, the International Integrated Reporting Council and Integrated Reporting Committee of South Africa should provide detailed guidelines on connectivity of information, material issues and disclosure of multiple capitals and their trade-offs. Finally, for educators, in line with the ACCA’s embedment of IR in its accounting courses, there is a need to incorporate IR in the curriculum; in particular, the authors argue that the best way to advance IR is in a “ubiquitous” spread in accounting and management courses.

This study provides empirical account of IR practice over time in the context of a regulatory IR environment. The construction of an IR checklist developed based on normative understanding of local and international IR guidelines is another novel approach of this study.

This study aims to summarise the findings of the perceptions of Chief Executive Officers (CEOs), Chief Financial Officers (CFOs) and senior executives of South African listed companies on the perceived benefits and implementation challenges as a result of implementing integrated reporting (IR) requirements, as well as motives for preparing an integrated report; it is performed two years into the South African IR regime,. South African-listed companies are among the first in the world to be subject to compliance with IR requirements in terms of stock exchange listing requirements. IR, as a novel and evolutionary step in corporate reporting, along with the influence that integrated thinking and IR principles will have on companies, has been the subject of global debate in recent years.

The research instrument used in the study comprised a self-administered Web-based survey aimed at CEOs and CFOs of all South African listed companies. The survey was validated by a pre-trail and data analysed by a statistician to ensure reliability.

The study revealed that listed companies, in a mandated regulatory regime implemented in a short period with reference to a highly prescriptive draft framework, attach value to the IR process primarily from the perspective of their corporate reputation, investor needs and stakeholder engagement and relations. This strengthens the business case for voluntary IR as a reporting regime. Advancement of corporate reputation appears to be a key motive to compile an integrated report, secondary to compliance as a primary motive. This indicates the perceived corporate legitimising effect of producing an integrated report. Furthermore, managers are more motivated by the legitimising aspect of advancing corporate reputation and stakeholder needs in compiling the integrated report than satisfying investor needs. This results in a disconnect between the perceived audience of the report by managers and the intended audience of the report as providers of capital as envisioned by the IIRC, which should be a matter for future consideration. Better resource allocation decisions and cost reductions are not indicated as an outcome of IR in the study. Furthermore, substantial changes to management information systems, with associated costs, would be required by companies to satisfy the requirements of the report content. The study revealed that the anticipated benefit of a company reconsidering its business model and encouraging sustainable product development is not perceived to be a material outcome in companies that implement IR, nor is assessing economic value creation and strategy considered a key motive for companies to compile an integrated report.

Further validation of the survey by statistical methods in addition to the pre-trial of the survey was not considered viable by the statistician in view of the limited amount of data. This may be viewed as a potential limitation of the study. Statistical analysis must also be interpreted with caution given the limited amount of data available for analysis. Other limitations include the fact that certain industries are too heavily represented instead of there being a mix of industries representing the entire market listed on the JSE, and that a substantial proportion of the companies are large listed companies and Socially Responsible Investment (SRI) Constituents. As a result, the results may not be representative of the overall market listed on the JSE.

Managers are more motivated by the legitimising aspect of advancing corporate reputation and stakeholder needs in compiling the integrated report than satisfying investor needs, while the intended audience of the report in the framework is the providers of financial capital. This needs to be considered in the future development of regulations and frameworks. Furthermore, policymakers and regulators should exercise caution in the early stages of IR, when there is still a lack of evidence to support significant short-term changes in reconsidering the business model as well as sustainable product development that could be convincingly attributed to mandatory IR. It is, therefore, critical that policymakers, government and regulators strive towards creating a wider enabling environment to advance sustainable product development and sustainable business models. This can include establishing incentives to encourage the development of sustainable products, or other incentives that serve to align business objectives with national and global objectives and frameworks. Industry bodies can play a significant role in developing universal industry standards in this regard. Consideration should further be given to implementing regulatory mechanisms for advancing and possibly enforcing responsible investment practices as a measure to fully engage business in the critical shift towards sustainable business practices.

The study is significant from a global perspective because IR and integrated thinking form a new and globally developing concept and the potential benefits and expected outcomes from an organisational perspective thereof for companies are currently the subject of continued global debate. This study aims to provide valuable insights into and understanding of the perceived organisational benefits of implementing IR requirements, as well as serves to highlight the challenge areas experienced in South African companies by compliance with IR requirements. The study also contributes towards the debate of motives of managers for producing an integrated report and how this will affect future directions.

The purpose of this paper is to examine the use of Section 1031 of the Internal Revenue Code (IRC), a piece of US tax law that allows for tax‐deferred exchanges of like‐kind property.

The paper derives a theoretical premium value for exchanges and presents the first national level analysis of Federal tax data on the use of like‐kind exchanges involving farmland between 1999 and 2005.

There is significant interest in Section 1031 from stakeholders in rural communities because there is widespread belief that the recent growth in farmland values may have, in part, been stimulated by Section 1031 exchanges of farmland. Despite these concerns, little is known about the extent of such exchanges.

This paper provides insight into the value and use of the IRC's Section 1031 provision. Based on simulations of a theoretical model using plausible assumptions about asset growth, the paper shows how proposed tax changes will affect the tax value of the deferral.