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1 – 10 of 13Jan Svanberg, Peter Öhman and Presha E. Neidermeyer
The purpose of this paper is to investigate whether transformational leadership affects auditor objectivity.
Abstract
Purpose
The purpose of this paper is to investigate whether transformational leadership affects auditor objectivity.
Design/methodology/approach
The investigation is based on a field survey of 198 practicing auditors employed by audit firms operating in Sweden.
Findings
This study finds that transformational client leadership negatively affects auditor objectivity and that the effect is only partially mediated by client identification. Given these results, suggesting that auditors are susceptible to influence by their clients’ perceived exercise of transformational leadership, leadership theory appears relevant to the discussion of auditor objectivity in the accounting literature.
Originality/value
Previous accounting research has applied the social identity theory framework and found that client identification impairs auditor objectivity. However, the effect of transformational client leadership on auditor objectivity, which reflects an intense auditor-client relationship, has been neglected before this study.
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Jan Svanberg, Tohid Ardeshiri, Isak Samsten, Peter Öhman, Presha E. Neidermeyer, Tarek Rana, Frank Maisano and Mats Danielson
The purpose of this study is to develop a method to assess social performance. Traditionally, environment, social and governance (ESG) rating providers use subjectively weighted…
Abstract
Purpose
The purpose of this study is to develop a method to assess social performance. Traditionally, environment, social and governance (ESG) rating providers use subjectively weighted arithmetic averages to combine a set of social performance (SP) indicators into one single rating. To overcome this problem, this study investigates the preconditions for a new methodology for rating the SP component of the ESG by applying machine learning (ML) and artificial intelligence (AI) anchored to social controversies.
Design/methodology/approach
This study proposes the use of a data-driven rating methodology that derives the relative importance of SP features from their contribution to the prediction of social controversies. The authors use the proposed methodology to solve the weighting problem with overall ESG ratings and further investigate whether prediction is possible.
Findings
The authors find that ML models are able to predict controversies with high predictive performance and validity. The findings indicate that the weighting problem with the ESG ratings can be addressed with a data-driven approach. The decisive prerequisite, however, for the proposed rating methodology is that social controversies are predicted by a broad set of SP indicators. The results also suggest that predictively valid ratings can be developed with this ML-based AI method.
Practical implications
This study offers practical solutions to ESG rating problems that have implications for investors, ESG raters and socially responsible investments.
Social implications
The proposed ML-based AI method can help to achieve better ESG ratings, which will in turn help to improve SP, which has implications for organizations and societies through sustainable development.
Originality/value
To the best of the authors’ knowledge, this research is one of the first studies that offers a unique method to address the ESG rating problem and improve sustainability by focusing on SP indicators.
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Jan Svanberg, Peter Öhman and Presha E. Neidermeyer
The purpose of this paper is to investigate the connection between the type of negotiation tactics auditors use when they ask their clients to make adjustments to their financial…
Abstract
Purpose
The purpose of this paper is to investigate the connection between the type of negotiation tactics auditors use when they ask their clients to make adjustments to their financial reports, focusing on three distributive and two integrative negotiation tactics, and whether the auditors identify with their clients.
Design/methodology/approach
A survey was used to capture 152 experienced Swedish audit partners’ perspectives on what type of negotiation technique they would use thinking about their largest client in a hypothetical situation.
Findings
The results show that the more auditors identify with their clients, the more likely they are to adopt two of the distributive negotiation tactics, conceding and compromising.
Originality/value
Building on the findings in the accounting literature that auditors’ identification with clients constrains their judgments, this study finds that auditors’ identification with clients also has an impact on the auditors’ initial selection of negotiation tactics.
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Theresa Hilliard and Presha E. Neidermeyer
Changing workplace demographics reflect a rising number of women in the traditionally male-dominated field of business. The purpose of this study is to investigate how upwardly…
Abstract
Purpose
Changing workplace demographics reflect a rising number of women in the traditionally male-dominated field of business. The purpose of this study is to investigate how upwardly mobile women may impact the commission and type of white-collar crime, contributing to the scarce literature on gender distinctions in criminal behavior while comparing criminal trends globally. Women’s increased representation in positions of power in business provides them with increased fraud opportunities prompting the authors to ask: in their areas of opportunity, do women and men commit the same types of white-collar crime and at the same rates, and how does this phenomena vary globally?
Design/methodology/approach
Using a database from the Institute for Fraud Prevention, 5,441 fraud cases are examined from 93 nations for the annual periods from 2002 until 2011. Ordinal logistic regression methods are used to test for differences in gendered criminal behavior by fraud offense type controlling for age, position, education, compensation level and country context.
Findings
Internationally, results from the study indicate that female fraudsters are three times more likely than male fraudsters to commission crimes of asset misappropriation in the workplace. Upon further investigation, stratifying the data by geographical region, findings from the study demonstrate that female fraudsters are more likely than male fraudsters to commit asset misappropriation in the following geographical regions: Africa (three times as likely), Asia (twice as likely), Canada (three times as likely), China (five times as likely), Europe (twice as likely), the Middle East (four times as likely), Oceania (four times as likely), the United Kingdom (eight times as likely) and the United States of America (twice as likely).
Originality/value
Evidence from this study should be of importance to multinational enterprises, auditors and fraud examiners, as asset misappropriation constitutes 87 per cent of all fraud cases globally. Further, these findings prompt the need for researchers to develop this area of research.
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Naomi E. Boyd, Davide P. Cervone, Presha E. Neidermeyer and Adolph Neidermeyer
– The purpose of this paper is to evaluate the continued adherence to “standing” rules of thumb for the percentage of pre-retirement income which should be available to retirees.
Abstract
Purpose
The purpose of this paper is to evaluate the continued adherence to “standing” rules of thumb for the percentage of pre-retirement income which should be available to retirees.
Design/methodology/approach
An analysis of census data to determine both the cause and magnitude of the debt load which retirees are carrying into their post-working years.
Findings
The “standing” rules of thumb appear to provide less than adequate levels of income for retirees to service their continuing debt load which they have chosen to carry into their retirement years.
Research limitations/implications
Census data are subject to the accuracy of “captured information” provided by the surveyed individuals. In this case, the information captured is consistent with generally reported data on the sufficiency of retirement income.
Practical implications
Financial planners need to “get the word out early” that individuals need to consider earlier/greater funding of their anticipated retirement income.
Social implications
Rising retirees may be “precluded” from retiring as anticipated because of the insufficiency of the replacement income they will have during their retirement years.
Originality/value
Detailed census data have not been reviewed in detail with a focus on “individual debt load” as we have performed in this research study.
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Adolph A. Neidermeyer and Presha E. Neidermeyer
To determine if the anticipation of an initial audit affects an individual's accuracy in preparing vouchers – an accounting task – in a business environment.
Abstract
Purpose
To determine if the anticipation of an initial audit affects an individual's accuracy in preparing vouchers – an accounting task – in a business environment.
Design/methodology/approach
A laboratory setting was chosen to maintain greater control over the variables influencing an individual's performance of a typical accounting activity.
Findings
The results of the analyses indicated that anticipation of the audit does influence accuracy of performance of the participants, who made a statistically significant smaller number of errors than their counterparts not anticipating an audit. The research design involved varying the content and source of the communications which subjects received describing the purpose and conduct of the audit. The subjects chosen for the experiment were 90 College of Business and Economics students.
Research limitations/implications
The study uses students to surrogate for internal audit personnel and it is based in the USA, which may limit its usefulness elsewhere.
Practical implications
The results of this study indicate that management should continue or consider using an audit as a component of its overall control system. Further, they should be as forthcoming as possible concerning the scope of the audit since study results indicate that employees are inclined to focus on management‐provided measurement points.
Originality/value
This paper helps fill a void in the literature as to whether audits improve performance.
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Presha E. Neidermeyer, Tracy L. Tuten and Adolph A. Neidermeyer
While much of the accounting literature that addresses gender issues has focused on womens' desires for more familial benefits such as flexible working hours and child care, this…
Abstract
While much of the accounting literature that addresses gender issues has focused on womens' desires for more familial benefits such as flexible working hours and child care, this study documents results illustrating fundamental differences between women and men on issues of value. In it, female and male auditors were asked to respond to their perceptions of the practice of lowballing. Women felt that the practice was less acceptable than men did and also agreed significantly more often that lowballing is a violation of the independence in appearance clause of the Code of Professional Conduct.
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Donald F. Arnold, Jack W. Dorminey, A.A. Neidermeyer and Presha E. Neidermeyer
The aim of this exploratory research is to compare three sectors of the auditing profession – internal auditors, external auditors from larger international firms, and external…
Abstract
Purpose
The aim of this exploratory research is to compare three sectors of the auditing profession – internal auditors, external auditors from larger international firms, and external auditors from smaller/regional firms – in regard to the influence of situational context on their ethically‐related decision‐making and judgment evaluations.
Design/methodology/approach
Against the backdrop of five vignettes applied with a survey, the paper examines the potential influence of social consensus and magnitude of consequence on the ethical decision path of these three auditor groups.
Findings
The paper finds that, in all cases, social consensus and magnitude of consequences exert influence on the ethical decision path. In the case of social consensus, however the paper finds that the ethical decision path is fully mediated for large firm auditors but is only partial mediated for the other two groups of auditors.
Originality/value
This research examines responses from both internal and external auditors. Comparison between such groups is unique because these groups have not been well researched in the past literature.
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Theresa Hilliard and Presha Neidermeyer
This study examines how International Financial Reporting Standards (IFRS) are applied, disaggregates the cumulative effect of the IFRS transition into magnitude measurements of…
Abstract
Purpose
This study examines how International Financial Reporting Standards (IFRS) are applied, disaggregates the cumulative effect of the IFRS transition into magnitude measurements of the standard-to-standard differences (by standard) and management discretionary choices (by choice) and tests which transitory effects at every level of disaggregation alter investor behavior.
Design/methodology/approach
Using hand-collected data from the IFRS 1 disclosures, the research design consists of eight regression models which test fluctuations in investment behavior as a function of varying measures of IFRS adjustments at aggregated and disaggregated levels including magnitude measurements of pronouncements and management choices.
Findings
Findings from the study identify specific standards and management discretionary choices associated with market reaction. Evidence from this study demonstrates the value of disaggregated measures to obtain a more comprehensive understanding of market reaction and associations with transitory effects of IFRS. Findings from the study suggest that the market favors management discretionary choices that decrease retained earnings and potentially increase future net income. Overall, model results suggest that a more comprehensive understanding of the specific standards is obtained that alters market behavior and how the market responds to positive and negative equity adjustments.
Originality/value
This study contributes to the literature examining the capital market effects of IFRS by decomposing the generally accepted accounting principle (GAAP) transition into magnitude measurements of specific standard-to-standard differences (by standard) and management discretionary choices (by choice) to understand how the market responds to the transitory effects of a GAAP change. This is important because it puts regulators, standard setters, investors and researchers on notice that the way in which the authors analyze and measure equity components could be consequential to the authors ability to assess a GAAP change. This study informs all jurisdictions which have adopted or are deliberating the adoption of IFRS how IFRS is being implemented and which areas of application are relevant to investors. Further, market reactions to accounting information pertaining to a GAAP change may only be revealed at the disaggregated and decomposed levels of the retrospective application of the GAAP implementation.
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Jonathan T. Fluharty-Jaidee, Theresa DiPonio-Hilliard, Presha Neidermeyer and Mackenzie Festa
The purpose of this study is to investigate gender-based punishment bias in the type and severity of punishments imposed on a male-dominated profession using the accounting…
Abstract
Purpose
The purpose of this study is to investigate gender-based punishment bias in the type and severity of punishments imposed on a male-dominated profession using the accounting profession as a proxy.
Design/methodology/approach
Data were hand-collected from the population of certified public accountants disciplined for violations of the Code of Professional Conduct. Disciplinary actions were obtained from the American Institute of Certified Public Accountant’s website. A total of 404 observations were obtained for the study over a five-year period from January 2009 through June 2015, comprising the population of the captured infractions committed during this time frame.
Findings
Women are punished more harshly than men for equivalent infractions; the disparity in punishment between women and men increases with the severity of the infraction.
Originality/value
This paper answers the call by Wren (2006) for an increased examination of workplace punishment’s relationship to gender using real-world scenarios and data. This study provides empirical evidence of the gender-based punishment bias, which calls into question the neutrality of workplace punishment as executed by a male-dominated profession.
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