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The purpose of this paper is to examine how the concentration of a specific customer type – governmental customer, affects the pricing of audit services in the USA.

This paper applies a standard audit pricing model by regressing audit fees on governmental customer concentration and other common determinants of audit fees. This paper also adopts an instrumental variable approach and performs propensity-score matched sample analyzes to mitigate the potential endogeneity problem.

Using data from major customer disclosures of US publicly listed firms from 2000 to 2014, this paper finds that governmental customer concentration is positively associated with audit fees, suggesting that a higher level of governmental customer concentration increases a firm’s audit risks and audit effort. In addition, this paper performs cross-sectional analyzes and show that the association between governmental customer concentration and audit fees is more pronounced for firms with weak internal governance, weak external monitoring and high financial risks.

This paper furthers the understanding of the interactive relationships in supply chain systems and adds new evidence to the literature on customer concentration. Prior studies on customer concentration typically treat all customer types in a uniform manner. To the knowledge, this is the first study that separates governmental customers from other types of customers in an audit pricing setting. The findings highlight the importance of examining governmental customer concentration when assessing a firm’s audit risks and audit fees.

The purpose of this paper is to investigate whether and how auditors’ pricing decisions are affected by their clients’ offshore trading activities, which are comprehensively measured through a textual analysis technique.

The authors identified a sample of 32,264 firm-year observations from publicly listed firms in the US during 2004 to 2015. The authors then used multivariate regressions to examine the effect of offshore trading activities on audit fees. In the regression models, the authors also control for a series of factors that are documented to influence audit pricing.

The authors find that offshore trading activities are positively associated with audit fees, suggesting that offshore activities are likely to increase a client firm’s business risk and/or the extent of client complexity. The authors also find that auditors charge higher audit fees only to firms purchasing inputs produced by their own assets overseas but not to firms buying inputs produced by local firms overseas. Moreover, the association between offshore trading activities and audit fees is more pronounced for offshore activities that are in countries with high trading centrality, for Big 4 auditors, or for auditors with industry expertise.

This paper extends the literature on the consequences of offshore activities by providing evidence on how auditors react to offshore activities. Moreover, it contributes to the audit fee literature. Prior studies largely focus on client-level determinants, while this study complements this line of literature by identifying firm’s offshore activities as an important risk indicator, which is perceived by auditors in their pricing decisions. A firm’s offshore activity is unique because the risk implication of the offshore activities depends not only on factors within the firm, but also on factors outside the firm in foreign nations.

This paper studies whether individual stocks provide higher returns than government bond in the Chinese market.

The authors compare individual stock returns and government bond returns in the Chinese market.

The authors find that more than half of individual stocks underperform government bonds over the same period in China, which highlights the important role of positive skewness in the distribution of individual stock returns. The high return of a few stocks is the reason why the stock market return is higher than that of government bond in China.

The results of this paper emphasize that portfolio diversification plays an important role in the Chinese market.

The authors examine the role of CEO political ideology in the credit rating process.

This study adopts a quantitative method with panel data regressions using a sample of 5,211 observations from S&P 500 firms from 2001 to 2012.

The authors find that firms run by Republican-leaning CEOs, who tend to have conservative political ideologies, enjoy more favorable credit ratings than firms run by Democratic-leaning CEOs. In addition, the association between CEO political ideology and credit ratings is more pronounced for firms with high operating uncertainty, low capital intensity, high growth potential, weak corporate governance and low financial reporting quality. Finally, the authors find that CEO political ideology affects a firm's cost of debt incremental to credit ratings, consistent with debt investors incorporating CEO political ideology in their pricing decisions.

Leveraging CEO political ideology, the authors document that credit rating agencies incorporate managerial conservatism in their credit rating decisions. This finding suggests that CEO political ideology serves as a meaningful signal for managerial conservatism.

The study suggests that credit rating agencies incorporate CEO political ideology in their credit rating process. Other capital market participants such as auditors and retail investors can also use CEO political ideology as a proxy for managerial conservatism when evaluating firms.

The paper carries practical implications for practitioners, firm executives and regulators. The results on the association between CEO political ideology and credit ratings suggest that other financial institutions could also incorporate CEO political ideology in their evaluation in their evaluation of firms. For example, when evaluating audit risk and determining audit pricing, auditors may add CEO political ideology as a risk factor. For firms, especially those that have Democratic-leaning CEOs, the authors suggest that they could reduce the unfavorable effect of CEO political ideology on credit ratings by improving their corporate governance and financial reporting quality, as demonstrated in the cross-sectional analyses. Finally, this study shows that CEO political ideology, as measured by CEOs' political contributions, is closely related to a firm's credit ratings. This finding may inform regulators that greater transparency for CEOs' political contributions is needed as information on contributions could help capital market participants perform risk analyses for firms.

Credit rating agencies release their research methodologies for determining corporate credit ratings and identify managerial conservatism as an important factor that affects their risk assessments. The extant literature, however, has not empirically investigated the relation between credit ratings and managerial conservatism, which, according to behavioral consistency theory, can be proxied by CEO political ideology. This study provides novel empirical evidence that identifies CEO political ideology as an important input factor in the credit rating process.

Regarding the global development of the wine industry, China has gained a notable share in terms of wine consumption, and its domestic wine production has increased steadily since 2000. The wine production process requires close coordination between growers and processors to avoid disruption and instability in the supply chain of the wine grapes. However, vertical coordination in the Chinese wine regions has received little attention. Based on the existing theoretical background on vertical coordination, this study aims to detect the evolution processes of vertical coordination in the Chinese grape market.

Exploratory qualitative research fits with the aim of this study. From December 2018 to January 2019, interviews with grape growers and wine processors of various Chinese wine-producing areas took place. After transcribing all recorded files into text, a qualitative data analysis following the approach of Mayring (2015) was used to analyse and interpret the data.

The models of vertical coordination in the grape supply in China vary between the producer's requirements on grape quality/quantity and the arrangements of grape supply chains, which are diverse depending on regional strategies of the local government.

However, in this research, the authors did not get into details on the organization of the contractual coordination, and due to the limited access to grape growers, the relationship between farmers and processors cannot be analysed in detail. With a better understanding of the coordination relationship and enhanced contract enforcement, the vineyard management and grape supply chain management can be better performed, inducing a steady industrial development.

Regarding the global development of the wine industry, China has gained a notable share in terms of wine consumption, and its domestic wine production has increased steadily since 2000. However, vertical coordination in the Chinese wine regions has received little attention. The study provides a first insight into the grape market structures, as very little is known.

The purpose of this paper is to investigate whether the anti-corruption campaign, “Hunting the Tigers,” incurs a significant short-term loss of shareholders’ returns.

A sophisticated event study approach is employed.

The results show that the “Hunting the Tigers” has incurred a significant short-term loss of investment returns for shareholders in China’s main stock market board. In addition, the beginning of a new assault on China’s official mogul corruption in another round of political anti-corruption cycle after the 18th National Congress of the CPC has reduced this price significantly.

This finding should be perceived as the price of the corruption of official-business collusion within capital markets in contemporary China.

This chapter offers a case study of the distinctive political activism in Taiwanese metal by analysing the intertextuality of Just Not Meant to Be (還君明珠) (2015) by Crescent Lament (恆月三途). From the perspective of a cultural insider, the author examine the socio-cultural dynamics underlying this activism and explain how Taiwanese metal attempts to tackle the troubled past of Taiwan. The author brings attention to Just Not Meant to Be's commentary about the activism it takes part in, and reflect on problematics inherent to political activism in Taiwanese metal. Finally, the author explicates the problematics in the context of metal subculture in general. Pivotal throughout this chapter are the questions: Why does Taiwanese metal replicate forms of domination it seeks to counter? What can metal subculture in general learn from Taiwanese metal and its political activism?

Using the modified theory of planned behavior, this study aims to understand residents’ supporting or rejecting mindsets toward legalizing gambling in Kinmen, Taiwan, where exists a complex and somewhat contradictory relationships between economic growth and the preservation of the natural environment in the context of tourism specifically to small island destinations. This study develops a convenience sampling procedure in which 365 questionnaires are collected. A series of hypotheses tests are conducted via structural equation modeling. This study notices that perceived behavioral control is the most important attribute affecting behavioral intention. However, behavioral intention does not necessarily lead to actual behavior. Attitude is considered as a more reliable predictor of actual action. Attitude relied heavily on positive perceived behavioral control. Further, the respondents are concerned more about how legalizing gambling affects their current lifestyle.

The purpose of this paper is to make a theoretical comprehensive efficiency evaluation of a nonlinear analysis method based on the Woodbury formula from the efficiency of the solution of linear equations in each incremental step and the selected iterative algorithms.

First, this study employs the time complexity theory to quantitatively compare the efficiency of the Woodbury formula and the LDLT factorization method which is a commonly used method to solve linear equations. Moreover, the performance of iterative algorithms also significantly effects the efficiency of the analysis. Thus, the three-point method with a convergence order of eight is employed to solve the equilibrium equations of the nonlinear analysis method based on the Woodbury formula, aiming to improve the iterative performance of the Newton–Raphson (N–R) method.

First, the result shows that the asymptotic time complexity of the Woodbury formula is much lower than that of the LDLT factorization method when the number of inelastic degrees of freedom (IDOFs) is much less than that of DOFs, indicating that the Woodbury formula is more efficient for local nonlinear problems. Moreover, the time complexity comparison of the N–R method and the three-point method indicates that the three-point method is more efficient than the N–R method for local nonlinear problems with large-scale structures or a larger ratio of IDOFs number to the DOFs number.

This study theoretically evaluates the efficiency of nonlinear analysis method based on the Woodbury formula, and quantitatively shows the application condition of the comparative methods. The comparison result provides a theoretical basis for the selection of algorithms for different nonlinear problems.

The rich financial knowledge of small and micro business owners helps to enhance the formal credit demand of small and micro enterprises and change the credit channel preference of small and micro enterprises. The purpose of this paper is to explore the relationship between financial knowledge and the credit practices of 290 small and micro enterprises in China’s Jiangsu and Shandong provinces based on their formal credit needs and preferred channels of credit.

To measure the degree of the credit constraints of small and micro enterprises, this study applied questionnaire surveys to obtain information on the credit demand and supply of 363 small and micro enterprises in the Jiangsu and Shandong provinces. Firstly, a probit model is used to study the influence of financial knowledge on the formal credit demand and credit acquisition possibility of small and micro enterprises, and tool variables and a biprobit model are used to deal with the possible errors of endogenesis and sample selection. Secondly, a tobit model is used to study the influence of financial knowledge on the credit access of small and micro enterprises in different channels, and tool variables and a Heckman two-stage model are used to deal with endogenesis and possible errors in sample selection. Finally, this study carried out a series of robustness tests to make the conclusions more reliable.

This study is based on the perspective of the knowledge-based view to explore the impact of financial knowledge on the credit behaviour of small and micro enterprises. This study found that financial knowledge can increase a small and micro enterprise’s formal credit needs and drive the small and micro enterprise to actively apply for loans. Furthermore, financial knowledge has a significant and positive influence on the acquisition of formal credit and approved lines of formal credit and a significant and negative influence on the acquisition of informal credit and approved lines of informal credit.

The results indicated that increased financial knowledge can increase the likelihood of a small and micro enterprise to prefer formal credit and reduce the likelihood of it to prefer informal credit channels.

Financial knowledge is the ability to master basic economic knowledge and financial concepts as well as the ability to use knowledge to manage and allocate financial resources. The rich financial knowledge of small and micro business owners helps to enhance the formal credit demand of small and micro enterprises and change their credit channel preference. This paper offers a new perspective on the problems of credit constraint, low participation in formal credit markets and high participation in private credit markets among China’s small and micro enterprises and valuably supplements the research literature.