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1 – 10 of 297The purpose of this paper is to analyze how “New Deal” regulatory initiatives, primarily the Securities Acts and the Securities and Exchange Commission (SEC), changed US auditors’…
Abstract
Purpose
The purpose of this paper is to analyze how “New Deal” regulatory initiatives, primarily the Securities Acts and the Securities and Exchange Commission (SEC), changed US auditors’ professional knowledge conception, culminating in the 1938 expansion of the Committee on Accounting Procedure (CAP), the first US body to set accounting principles.
Design/methodology/approach
The paper combines Halliday’s (1985) knowledge mandates with Hancher and Moran’s (1989) regulatory space to attain a theory-based understanding of auditors’ changing knowledge conceptions amid regulatory pressure. It draws on a range of primary and secondary sources to examine the period from 1929 to 1938.
Findings
Following the stock market crash, the newly created SEC aimed to engage auditors as a means to regulate companies’ accounting practices based on a set of codified principles. While entailing increased status, this new role conflicted with the auditors’ knowledge conception, which was based on professional judgment and personal integrity. Pressure from the SEC and academics eventually made auditors agree to a codification of their professional knowledge and create the CAP as a cooperative regulatory solution.
Originality/value
The paper explores the role of auditors’ knowledge conceptions in the emergence of today’s standard setting. It is suggested that auditors’ incomplete control of their professional knowledge made standard setting a form of co-regulation, located between the actors occupying the regulatory space of accounting.
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Maya Puspa Rahman, Mohamed Asmy Mohd Thas Thaker and Jarita Duasa
Crowdfunding has become one of the preferred mechanisms to raise funds by startups and small entrepreneurs. As such, this paper aims to develop an appropriate framework for…
Abstract
Purpose
Crowdfunding has become one of the preferred mechanisms to raise funds by startups and small entrepreneurs. As such, this paper aims to develop an appropriate framework for Sharīʿah-compliant equity-based crowdfunding (SEC) for entrepreneurship development in Malaysia.
Design/methodology/approach
The research begins by analyzing the intention of 200 entrepreneurs in Kuala Lumpur and Selangor regarding the use of crowdfunding to raise capital. The analysis is based on the theory of reasoned action (TRA), which is also associated with the technology acceptance model (TAM) and is effected by using structural equation modeling (SEM).
Findings
The entrepreneurs agree on the ease of use of crowdfunding in raising capital, although it appeared that they are quite reluctant to share their business ideas online. Subsequently, an SEC framework is proposed, to further enhance entrepreneurship development in Malaysia particularly in meeting the need for raising funds in line with Sharīʿah (Islamic law) principles.
Practical implications
This paper aims to contribute more to the development of a blueprint for an SEC platform for market players and regulators in Malaysia.
Social implications
This paper also aims to highlight the growing needs of entrepreneurs, particularly in Malaysia to have a Sharīʿah-compliant alternative to raise funds via crowdfunding.
Originality/value
This paper makes two main contributions. First, it provides evidence on Malaysian entrepreneurs’ intention to use crowdfunding for fundraising through TAM and SEM analysis. Second, it proposes an SEC framework for the development of entrepreneurs in Malaysia.
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Domenico Campa, Alberto Quagli and Paola Ramassa
This study reviews and discusses the accounting literature that analyzes the role of auditors and enforcers in the context of fraud.
Abstract
Purpose
This study reviews and discusses the accounting literature that analyzes the role of auditors and enforcers in the context of fraud.
Design/methodology/approach
This literature review includes both qualitative and quantitative studies, based on the idea that the findings from different research paradigms can shed light on the complex interactions between different financial reporting controls. The authors use a mixed-methods research synthesis and select 64 accounting journal articles to analyze the main proxies for fraud, the stages of the fraud process under investigation and the roles played by auditors and enforcers.
Findings
The study highlights heterogeneity with respect to the terms and concepts used to capture the fraud phenomenon, a fragmentation in terms of the measures used in quantitative studies and a low level of detail in the fraud analysis. The review also shows a limited number of case studies and a lack of focus on the interaction and interplay between enforcers and auditors.
Research limitations/implications
This study outlines directions for future accounting research on fraud.
Practical implications
The analysis underscores the need for the academic community, policymakers and practitioners to work together to prevent the destructive economic and social consequences of fraud in an increasingly complex and interconnected environment.
Originality/value
This study differs from previous literature reviews that focus on a single monitoring mechanism or deal with fraud in a broadly manner by discussing how the accounting literature addresses the roles and the complex interplay between enforcers and auditors in the context of accounting fraud.
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Eileen Taylor and Jennifer Riley
The purpose of this paper is to explore how non-professional investors (NPIs) with varying levels of financial sophistication interpret and perceive corporate disclosures and…
Abstract
Purpose
The purpose of this paper is to explore how non-professional investors (NPIs) with varying levels of financial sophistication interpret and perceive corporate disclosures and management credibility, specifically risk factors, when those disclosures are presented in readable and less-readable formats.
Design/methodology/approach
The paper uses an online experiment to test hypotheses related to the effects of financial sophistication (measured) and readability (manipulated) on NPIs’ equity valuations and perceptions of management credibility (competence and trustworthiness).
Findings
Increased readability appears to counteract less-sophisticated NPIs’ conservatism in equity valuations, such that they are not statistically significantly different from more-sophisticated NPIs’ equity valuations. Further, less-sophisticated NPIs judge management as less competent when disclosures are less readable, while more-sophisticated NPIs judge management as more competent when disclosures are less readable.
Research limitations/implications
The paper has important implications for the SEC’s regulations related to plain English requirements for risk factor and other corporate disclosures. Financial sophistication varies among NPIs, and readability appears to influence these individuals in different ways.
Practical implications
The SEC’s Concept Release (April 13, 2016) acknowledges the need to update and improve risk factor disclosure regulations. This study provides evidence that contributes to those decisions.
Originality/value
The paper extends the research on processing fluency, by examining readability of disclosures with a consistent tone (negative). The NPIs surveyed are directly representative of the population of interest for risk factor disclosure regulations.
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Siraj Uddin, Ion Mihai and Adela Mihai
Chen (2001) initiated the study of CR-warped product submanifolds in Kaehler manifolds and established a general inequality between an intrinsic invariant (the warping function…
Abstract
Chen (2001) initiated the study of CR-warped product submanifolds in Kaehler manifolds and established a general inequality between an intrinsic invariant (the warping function) and an extrinsic invariant (second fundamental form).
In this paper, we establish a relationship for the squared norm of the second fundamental form (an extrinsic invariant) of warped product bi-slant submanifolds of Kenmotsu manifolds in terms of the warping function (an intrinsic invariant) and bi-slant angles. The equality case is also considered. Some applications of derived inequality are given.
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The purpose of this paper is to present an overview of the flash crash, and explain why and how it happened.
Abstract
Purpose
The purpose of this paper is to present an overview of the flash crash, and explain why and how it happened.
Design/methodology/approach
The author summarizes several studies suggesting various perspectives on the flash crash and its causes. Furthermore, the author highlights recently proposed and introduced improvements and regulations to reduce the risk of having similar market collapses in the future.
Findings
It is an overview paper that highlights the state of the art on the subject.
Research limitations/implications
Paper does not report any research findings of the author.
Practical implications
High-frequency trading (HFT) along with its pros and cons is the new normal for most of the current electronic trading activity in the markets. It is well recognized by the experts that HFT may have its important shortcomings whenever the rules and regulations are not up to date to match the technological progress offering faster computational and execution capabilities.
Social implications
HFT has created a societal discussion about its benefits and potential deficiencies as the common practice for trading due to potentially unequal access to market data by various categories of participants. Such arguments help the regulators to develop improvements to reduce the market risk and nurture more robust and fair markets for all.
Originality/value
The paper has a tutorial value and summarizes the current state of HFT. The readers of more interest are guided to the most relevant literature for further reading.
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Kinga Zdunek, Michael Rigby, Shalmali Deshpande and Denise Alexander
The child is at the centre of all Models of Child Health Appraised research and indeed all primary care delivery for children. Appraising models of primary care for children is…
Abstract
The child is at the centre of all Models of Child Health Appraised research and indeed all primary care delivery for children. Appraising models of primary care for children is incomplete without ensuring that experiences of primary care, design, treatment, management and outcomes are optimal for the child. However, the principle of child centricity is not implicit in many healthcare systems and in many aspects of life, yet it is extremely important for optimal child health service design and child health. By exploring the changing concept of ‘childhood’, we understand better the emergence of the current attitude towards children and their role in today’s Europe and the evolution of child rights. Understanding child centricity, and the role of agents acting on behalf of the child, allows us to identify features of children’s primary care systems that uphold the rights of a child to optimum health. This is placed against the legal commitments made by the countries of the European Union and European Economic Area to ensure that children’s rights are respected.
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Mark Taylor and Richard Kirkham
A policy of surveillance which interferes with the fundamental right to a private life requires credible justification and a supportive evidence base. The authority for such…
Abstract
A policy of surveillance which interferes with the fundamental right to a private life requires credible justification and a supportive evidence base. The authority for such interference should be clearly detailed in law, overseen by a transparent process and not left to the vagaries of administrative discretion. If a state surveils those it governs and claims the interference to be in the public interest, then the evidence base on which that claim stands and the operative conception of public interest should be subject to critical examination. Unfortunately, there is an inconsistency in the regulatory burden associated with access to confidential patient information for non-health-related surveillance purposes and access for health-related surveillance or research purposes. This inconsistency represents a systemic weakness to inform or challenge an evidence-based policy of non-health-related surveillance. This inconsistency is unjustified and undermines the qualities recognised to be necessary to maintain a trustworthy confidential public health service. Taking the withdrawn Memorandum of Understanding (MoU) between NHS Digital and the Home Office as a worked example, this chapter demonstrates how the capacity of the law to constrain the arbitrary or unwarranted exercise of power through judicial review is not sufficient to level the playing field. The authors recommend ‘levelling up’ in procedural oversight, and adopting independent mechanisms equivalent to those adopted for establishing the operative conceptions of public interest in the context of health research to non-health-related surveillance purposes.
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Vera Blazevic and Karim Sidaoui
Service providers increasingly use conversational agents (CAs), such as chatbots, to effectively communicate with customers while managing interaction costs and providing…
Abstract
Purpose
Service providers increasingly use conversational agents (CAs), such as chatbots, to effectively communicate with customers while managing interaction costs and providing round-the-clock customer service. Yet, the adoption and implementation of such agents in service contexts remains a hit-and-miss, and firms often struggle to balance their CAs implementation complexities and costs with relation to their service objectives, technology design and customer experiences. The purpose of this paper is to provide guidance on optimizing CA design, therefore, the authors develop a conceptual framework, TRISEC, that integrates service logic, technology design and customer experience to examine the implementation of CA solutions in search, experience and credence (SEC) contexts.
Design/methodology/approach
The paper draws on service marketing and communications research, combining the service context classification scheme of search, experience and credence and the technology infused service marketing triangle foci (service, technology and customer) in its conceptual development.
Findings
The authors find that an opportunity exists in recognizing the importance of context when designing CAs and aiming to achieve a balance between service objectives, technology design and customer experiences.
Originality/value
This study contributes to service management and communications research literature by providing interactive service marketing researchers with the highly generalizable TRISEC framework to aid in optimizing CA design and implementation in interactive customer communication technologies. Furthermore, the study provides an array of future research avenues. From a practical perspective, this study aims at providing managers with a means to optimize CA technology design while maintaining a balance between customer centricity and implementation complexity and costs in different service contexts.
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Noel Murray, Ajay K. Manrai and Lalita Ajay Manrai
This paper aims to present an analysis of the role of financial incentives, moral hazard and conflicts of interests leading up to the 2008 financial crisis.
Abstract
Purpose
This paper aims to present an analysis of the role of financial incentives, moral hazard and conflicts of interests leading up to the 2008 financial crisis.
Design/methodology/approach
The study’s analysis has identified common structural flaws throughout the securitization food chain. These structural flaws include inappropriate incentives, the absence of punishment, moral hazard and conflicts of interest. This research sees the full impact of these structural flaws when considering their co-occurrence throughout the financial system. The authors address systemic defects in the securitization food chain and examine the inter-relationships among homeowners, mortgage originators, investment banks and investors. The authors also address the role of exogenous factors, including the SEC, AIG, the credit rating agencies, Congress, business academia and the business media.
Findings
The study argues that the lack of criminal prosecutions of key financial executives has been a key factor in creating moral hazard. Eight years after the Great Recession ended in the USA, the financial services industry continues to suffer from a crisis of trust with society.
Practical implications
An overwhelming majority of Americans, 89 per cent, believe that the federal government does a poor job of regulating the financial services industry (Puzzanghera, 2014). A study argues that the current corporate lobbying framework undermines societal expectations of political equality and consent (Alzola, 2013). The authors believe the Singapore model may be a useful starting point to restructure regulatory agencies so that they are more responsive to societal concerns and less responsive to special interests. Finally, the widespread perception is that the financial services sector, in particular, is ethically challenged (Ferguson, 2012); perhaps there would be some benefit from the implementation of ethical climate monitoring in firms that have been subject to deferred prosecution agreements for serious ethical violations (Arnaud, 2010).
Originality/value
The authors believe the paper makes a truly original contribution. They provide new insights via their analysis of the role of financial incentives, moral hazard and conflicts of interests leading up to the 2008 financial crisis.
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