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This paper uses financial report information to analyze the accounting results of the COVID-19 vaccine development for Johnson & Johnson (J&J). This paper also uses stock price information to analyze the market reactions to the COVID-19 vaccine development and the state of clinical trials for J&J.

This instructional case investigates the interaction between J&J and the COVID-19 vaccine. This paper uses information from financial reports to analyze the accounting results of the COVID-19 vaccine development for J&J. This paper also uses stock price information to analyze the market’s reactions to the COVID-19 vaccine development and the state of clinical trials for J&J.

This case has been used in both undergraduate and graduate levels to highlight the application of accounting theories to practice and improve the understanding of financial statements, especially when Covid-19 has affected the global economy. Under this new context, students could explore new ideas from accounting aspect.

The case aims to investigate the interaction between J&J as a pharmaceutical company and COVID-19. It provides a context in which to discuss the consequences of COVID-19 vaccines from several financial perspectives, such as stock prices, accounting policies, earnings and cash flows:

LO1: Understand the responses of stakeholders to J&J’s COVID-19 vaccines.

LO2: Understand the accounting policies that J&J and its competitors follow regarding COVID-19 vaccines related to revenues, R&D expenditures and government funds.

LO3: Apply Ball and Brown’s theory to the impact of COVID-19 vaccine development on earnings quality of J&J and its competitors.

LO4: Assess the importance of COVID-19 vaccines in management decision-making through dividend policy and management compensation structure.

The purpose of this paper is to investigate whether and how banks’ financial constraints affect their cash tax avoidance. The authors hypothesize that banks engage in more tax planning to generate additional cash to mitigate their financial constraints.

The authors use a sample of US banks to conduct the panel regression analysis. The authors measure the bank tax avoidance using the cash effective tax rate and measure the bank financial constraints using the Z-score and annual payout ratio. The authors further use the implementation of the Dodd–Frank Act as a quasi-natural experiment to conduct the difference-in-difference analysis.

The authors document that financially constrained banks exhibit lower cash effective tax rates. The authors further show that banks facing greater financial constraints are less likely to pursue tax-saving activities following the Dodd–Frank Act. Moreover, the authors find that non-performing loans increase the influence of financial constraints on tax avoidance, while a financial crisis amplifies the impact of financial constraints on bank cash tax savings.

By extending previous research on financial constraints and tax planning, this paper is the first study to recognize financial constraints, along with the Dodd–Frank Act, as determinants of banks’ tax avoidance. This study informs policymakers about the regulation of tax avoidance in the banking industry and sheds light on possible future research on banks’ tax-planning strategies.

This paper empirically investigates whether trade openness (TO) in Brazil, Russia, India, China and South Africa (BRICS) countries affects how banks might employ loan loss provisions (LLPs) to smooth out their earnings and how adopting the International Financial Reporting Standards (IFRS) can mitigate it.

The analysis includes 78 commercial banks from five BRICS nations and spans 2014 through 2020. To test these hypotheses, the authors utilized a fixed-effect and two-step system panel generalized methods of moments (GMM) estimator.

TO positively affects income smoothing (earnings management) across BRICS commercial banks. The effect is clearer in banks that make financial reports under the IFRS. Path analysis reveals that the effect of TO is driven by nonperforming loans (NPLs). Additionally, the IFRS restricts earnings management in the BRICS banking sector when a better institutional environment is present. The authors found that accounting rules (IFRS) and enforcement (better institutional settings) interact to enhance earnings’ quality.

The relationship between TO and bank earnings management practices is important for understanding the complex interplay between trade and finance and ensuring financial stability, investor confidence and regulatory compliance. This study recommends better regulations and governance mechanisms for financial reports in emerging nations like BRICS. Additionally, macro-prudential regulators and banking supervisors should work closely to ensure transparent TO decisions with improved discipline, institutional quality and regulatory support to enhance bank stability.

The study finds evidence of bank income smoothing in the BRICS and introduces TO as a determinant. It also identifies the evolving role of IFRS in the presence of higher institutional quality and TO, thereby expanding the financial reporting literature.

This study aims to examine declines in audit quality after the COVID-19 travel restrictions/stay-at-home orders were issued in the USA in early 2020.

Taking advantage of variation in the dates of stay-at-home orders issued by different US states, this study identifies engagements that were significantly affected by the lock down orders.

The results suggest that engagements affected by the restrictions produced lower audit quality, as measured through restatements and discretionary accruals, relative to those completed before COVID-19 travel restrictions/stay-at-home orders. Further analysis reveals that this decrease in audit quality was attributable to firms with high inventory relative to assets, high R&D expenses relative to assets and non-Big 4 auditors.

This study finds that the restrictions on physical and on-site interaction caused auditors to universally struggle with resource/judgment-intensive accounts such as inventory and R&D expenditures. The results suggest that while Big 4 auditors managed to maintain their status quo level of audit quality following COVID-19 restrictions, non-Big 4 auditors were unable to overcome the challenges of an online work environment and their audit quality declined.

To the best of the authors’ knowledge, this paper is the first to empirically examine changes in audit quality as a response to a substantial change in auditors’ working environment due to the global health crisis. As work-from-home becomes more prevalent in audit firms, the results suggest that, on average, this move does diminish audit quality.

This paper aims to investigate whether the level of social capital of the region in which a firm is headquartered affects its tax avoidance activities. Social capital can be defined as the mutual trust in society and literature shows that firms headquartered in high social capital regions exhibit higher level of corporate social responsibility. Recent research suggests that some stakeholders consider tax avoidance as a socially irresponsible and illegitimate activity, whereas others deem corporate tax payments as detrimental to social welfare because they hurt economic development. Building on this debate, the relationship between social capital and tax avoidance is empirically investigated.

A sample of 52,962 firm-year observations over the period 1990-2014 was used to empirically investigate the relationship between social capital and tax avoidance.

Consistent with the idea that managers consider corporate tax payments as a socially responsible action, evidence was found that firms headquartered in areas with high social capital engage significantly less in tax avoidance activities. It was also documented that the negative impact of social capital on tax avoidance is stronger in the presence of high religiosity, high corporate performance and lower sensitivity of CEO’s compensation to stock volatility.

This paper extends research on social capital and improves the understanding of the effect of the social environment on managerial decision. Importantly, by studying the relationship between social capital and tax avoidance, the authors add to the recent debate on companies’ perception of the desirability of tax avoidance activities from a social viewpoint.

This study seeks to investigate the influence of the theory of planned behavior (TPB), of the conscious consumption intention and of the consumer ethical considerations, on Slow Fashion Consumption in the region known as Agreste Pernambucano, in Brazil, which is known for being an apparel manufacturing area.

To achieve this purpose, descriptive quantitative research using non-probabilistic sampling was conducted. Data were collected through an online survey and distributed through the snowball technique. The sample consists of 486 respondents and relies on structural equation modeling for data analysis.

The results highlight that the Slow Fashion Consumption, in the scope of Local Productive Arrangement (LPA) of clothing manufacturing in the Agreste region, is influenced by the intention of conscious consumption, the ethical considerations in consumer behavior and the perceived behavioral control. Moreover, the results highlight the role of the influence of subjective norms both in the attitudes of consumers and the intention of conscious consumption.

The primary contribution of this study is to demonstrate that perceived behavioral control is positively associated with Slow Fashion Consumption, which, in turn, shows that respondents believe they have control over their sustainable actions.

Bike-sharing is popular worldwide, and it has led to a new development direction in green transportation. However, the collapse of many bike-sharing startups and residual social problems has brought about contradictions and challenges to the development of the industry. The purpose of this paper is to determine how internal factors affect the survival of bike-sharing startups.

The authors used binary logit regression as the measurement model to conduct an empirical analysis based on 137 bike-sharing startups in China. The study focuses on using traditional theoretical evidence and considers the uniqueness of the industry to jointly explore the survival factors that influence the emerging business model of bike-sharing.

The results show that entrepreneurial team size and differentiation strategy positively influence survival. Founder-CEOs have a negative impact on survival. Founders' entrepreneurial experience and venture capital have no significant influence on survival.

The results verify the role of traditional survival factors in the new business model of sharing economy and fill the research gap on the survival strategy of startups. This study offers a unique perspective for researchers to better understand the sharing economy industry and provides practical guidance for entrepreneurs and investors to enter the market.

The entry of multinational firms is likely to increase competition and provide better deals to consumers in emerging markets such as India, China and Brazil. In this context, this paper aims to examine the factors determining the consumers’ preferences for shopping at large malls in an emerging market as compared to small outlets (in particular, young consumers’ preferences).

The present study is based on a survey of 200 consumers at large retail malls in India, the second-fastest growing emerging market.

The findings suggest that mostly young consumers prefer to shop in large malls because of the availability of the latest, well-known brands and discounted prices, which implies that service quality is not a primary factor.

The author posits theoretical propositions to stimulate further research. The insights from the study would be useful for strategic marketing for retailers.

This paper aims to investigate investors' willingness to use robo-advisors from customers' perspectives and analyzes the factors that drive them to use robo-advisors, including perceived usefulness and emotional response.

The authors extend the Cognition-Affect-Conation (CAC) framework to the behavioral domain of robo-advisor users on financial technology platforms and conduct an empirical study based on 248 valid questionnaires.

The authors find two types of factors driving the willingness to use robo-advisors: perceived usefulness, trust and perceived risk as external driving forces and investor sentiment as an internal driving force. Trust has a significant positive effect on willingness to use, and arousal in emotional response plays a mediating role between perceived usefulness and willingness to use.

This research provides valuable insights for financial institutions to engage in robo-advisor innovation from customers' perspectives.