Accounting Horizons

Articles

Vol. 18, No. 1, March

The Information Content of Royalty Income
SYNOPSIS: The rise of intangible assets in size and contribution to corporate growth over the past quarter century was accompanied by a steep increase in the rate and scope of patenting. Consequently, many patent-rich companies, particularly in the...
Read preview Overview
Designing Cost-Competitive Technology Products through Cost Management
SYNOPSIS: As manufacturing innovations spread throughout leading organizations, product development becomes a more important source of competitive advantage. Within product development, cost management receives increasing attention. To date, cost management...
Read preview Overview
Empirical Evidence on Recent Trends in Pro Forma Reporting
SYNOPSIS: This study provides descriptive evidence on the controversial trend adopted by many firms in recent years of reporting earnings figures on a pro forma basis, pro forma earnings exclude normal income statement items that managers deem to be...
Read preview Overview
Accounting Professionalism-They Just Don't Get It!
INTRODUCTION I realize that my title contains two ambiguous pronouns--"they" and "it." After reading this commentary, I hope you will be able to identify who is "they" and what it is that they don't get. The accounting profession has been beaten...
Read preview Overview
Commentary on the IASB's Exposure Draft on Business Combinations
INTRODUCTION The Financial Accounting Standards Committee of the American Accounting Association (the Committee) is charged with responding to requests for comment from standard setters on issues related to financial reporting. The Committee is...
Read preview Overview
Evaluation of the IASB's Proposed Accounting and Disclosure Requirements for Share-Based Payment
INTRODUCTION The November 2002 International Accounting Standards Board (IASB) Exposure Draft, Share-Based Payment (hereafter the ED), addresses accounting and disclosure requirements for share-based payments. The Financial Accounting Standards...
Read preview Overview
Frequently Asked Questions of a New Editor
INTRODUCTION Human nature leads us all to be curious about change. As the incoming editor of Accounting Horizons, this natural curiosity results in constituents asking numerous questions regarding the changes that may be in store for the journal....
Read preview Overview

Vol. 17, No. 4, December

How the U.S. Accounting Profession Got Where It Is Today: Part II
A Gradual Degeneration of Professional Values By 1980, a deterioration in professional values appears to have set in. At the Institute's annual meeting in October, outgoing Board Chairman Wm. R. Gregory, a practitioner from Tacoma, Washington, vividly...
Read preview Overview
Conservatism in Accounting Part II: Evidence and Research Opportunities
SYNOPSIS: This paper is Part II in a two-part series on conservatism in accounting. Part I examined alternative explanations for conservatism in accounting and their implications for accounting regulators (SEC and FASB). Part II summarizes the empirical...
Read preview Overview
The Impact and Valuation of Off-Balance-Sheet Activities Concealed by Equity Method Accounting
SYNOPSIS: This paper reports the results of a study of the financial reporting effects of off-balance-sheet activities concealed by the equity method of accounting. The study examines footnote disclosures relating to equity method investees, offers...
Read preview Overview
The Effects of Internal Audit Structure on Perceived Financial Statement Fraud Prevention
SYNOPSIS: This study examines whether internal audit reporting structure and internal audit sourcing arrangement affect financial statement users' perceptions of ability of the internal audit function to prevent financial statement fraud. A survey...
Read preview Overview
Likely Effects of Stock Exchange Governance Proposals and Sarbanes-Oxley on Corporate Boards and Financial Reporting
SYNOPSIS: One of the primary aims of the Sarbanes-Oxley Act of 2002, the New York Stock Exchange, and the NASDAQ corporate governance proposals is to improve the reporting systems for publicly traded companies. Many of the exchange proposals redefine...
Read preview Overview
CEO and CFO Certifications of Financial Information
INTRODUCTION New certification requirements arrived at the corporate suite in the summer of 2002 in the form of a one-time SEC Order and the watershed Sarbanes-Oxley Act (SOA). CEOs and CFOs of public companies must personally certify to disclosure/internal...
Read preview Overview
Firm Value and Employee Attitudes on Workplace Quality
SYNOPSIS: This paper investigates the relation between the value of a firm and employee attitudes on the firm's workplace quality--workplace attitudes. Workplace attitude refers to recognition of those organizational characteristics that enhance employee...
Read preview Overview

Vol. 17, No. 3, September

How the U.S. Accounting Profession Got Where It Is Today: Part I
Synopsis: Few would deny that the U.S. accounting profession is in a very troubled state. The aim of this two-part article is to explain how and why the profession evolved and changed during the 20th century, with particular emphasis on the last three...
Read preview Overview
Conservatism in Accounting Part I: Explanations and Implications
SYNOPSIS: This paper is the first in a two-part series on conservatism in accounting. Part I examines alternative explanations for conservatism in accounting and their implications for accounting regulators. Part II summarizes the empirical evidence...
Read preview Overview
Initial Evidence on the Association between Nonaudit Fees and Restated Financial Statements
SYNOPSIS. An increasing number of firms have restated previously issued financial statements in recent years. Legislators, regulators, and others speculate that restatements are associated with fees received by auditors for nonaudit services (nonaudit...
Read preview Overview
Analysis of Corporate Disclosures on Relative Performance Evaluation
SYNOPSIS: The relative performance evaluation (RPE) hypothesis states that firms benefit from comparing their own performance to that of a peer group when evaluating the CEO's performance. Although in theory firms should be employing relative performance...
Read preview Overview
A Year of Challenge and Change for the FASB
There was once a time, not so many years ago when accounting could be thought of as an essentially nonpolitical subject. So wrote Professor David Solomons in a 1978 Journal of Accountancy article entitled "The Politicization of Accounting." In that...
Read preview Overview
A Proposed Framework Emphasizing Auditor Reliability over Auditor Independence
This paper introduces an auditor reliability framework that repositions the role of auditor independence in the accounting profession. The framework is motivated in part by widespread confusion about independence and the auditing profession's continuing...
Read preview Overview

Vol. 17, No. 2, June

How Chevron, Texaco, and the Indonesian Government Structured Transactions to Avoid Billions in U.S. Income Taxes
SYNOPSIS: This paper explains the transactions, agreements, and accounting that Chevron, Texaco, and the Government of Indonesia used to structure transactions that avoided billions in U.S. income taxes. Although ChevronTexaco became a merged entity...
Read preview Overview
Decision Usefulness of Alternative Joint Venture Reporting Methods
SYNOPSIS: Depending on the country and circumstances, reporting rules for intercorporate investments may require the cost method, the equity method, proportionate consolidation, or full consolidation, and may yield dramatically different accounting...
Read preview Overview
An Examination of Alternative Work Arrangements in Private Accounting Practice
SYNOPSIS: Employees are requesting more flexibility in their work schedules to be able to integrate work with other aspects of their family and personal lives. While alternative work arrangements are being offered at progressively more companies, it...
Read preview Overview
Could $51 Million Be Immaterial When Enron Reports Income of $105 Million?
The collapse of Enron raises a number of questions about the adequacy of financial statement audits. A primary factor generating these questions was Enron's need to correct its books going back to 1997, thereby reducing its audited profits by $591...
Read preview Overview
Comments on the FASB's Proposals on Consolidating Special-Purpose Entities and Related Standard-Setting Issues
AAA Financial Accounting Standards Committee INTRODUCTION The June 28, 2002 Financial Accounting Standards Board Exposure Draft (ED), Proposed Interpretation: Consolidation of Certain Special-Purpose Entities--an interpretation of ARB No. 51,...
Read preview Overview
Implications of Accounting Research for the FASB's Initiatives on Disclosure of Information about Intangible Assets
AAA Financial Accounting Standards Committee INTRODUCTION On January 9, 2002, the Financial Accounting Standards Board (FASB) added a project to its technical agenda titled Disclosure of Information about Intangible Assets Not Recognized in Financial...
Read preview Overview

Vol. 17, No. 1, March

Tax Practitioner Credentials and the Incidence of IRS Audit Adjustments
SYNOPSIS: This study analyzes a random selection of Internal Revenue Service (IRS) office audits from October 1997 to July 1998, the type of audit that concerns most taxpayers. Taxpayers engage paid preparers in order to avoid this type of audit and...
Read preview Overview
Regulation Fair Disclosure, Analyst Following, and Analyst Forecast Dispersion
SYNOPSIS: This paper presents preliminary evidence of the effect of Regulation Fair Disclosure (FD) on the quantity and quality of firm-specific information released to the market by comparing analyst forecast data from pre-FD to post-FD time periods....
Read preview Overview
Managing Pro Forma Stock Option Expense under SFAS No. 123
SYNOPSIS: We investigate whether footnote disclosures under Statement of Financial Accounting Standards (SFAS) No. 123 are managed in 1996, the first year that the disclosure was required. The 1996 phase-in of SFAS No. 123 provided firms with a unique...
Read preview Overview
A Fresh Look at Accounting Ethics (or Dr. Smith Goes to Washington). (Guest Editorial)
In the history of the world, there has never been a country like the United States of America. Compared to other nations, America has more freedom, more wealth (more evenly distributed), and more opportunity. The accounting profession has played its...
Read preview Overview
Evaluation of the FASB's Proposed Accounting and Disclosure Requirements for Guarantors. (Commentary)
INTRODUCTION The May 22, 2002 FASB Exposure Draft, Guarantor's Accounting and Disclosure Requirements, Including Indirect Guarantees of Indebtedness of Others (hereafter ED), addresses initial recognition, initial measurement, and disclosure issues...
Read preview Overview
Commentaries on Principles- vs. Rules-Based Standards. (Commentary)
The following three commentaries examine different facets of the escalating debate over the degree of specificity or "rules" appropriate in financial accounting standards, prompted to some extent by the Sarbanes-Qxley Act of 2002 and the fraudulent...
Read preview Overview
Principles-Based Accounting Standards. (Commentary)
INTRODUCTION Some recent discussions of U.S. financial reporting include implicit or explicit recommendations that the U.S. abandon the current allegedly "rules-based" system in favor of a "principles-based" system, with the implication that some...
Read preview Overview
Evaluating Concepts-Based vs. Rules-Based Approaches to Standard Setting. (Commentary)
INTRODUCTION In its new project on Codification and Simplification, the FASB indicates its intent to evaluate the feasibility of issuing concepts-based standards rather than issuing detailed, rule-based standards with exceptions and alternatives.'...
Read preview Overview
Behavioral Evidence on the Effects of Principles- and Rules-Based Standards. (Commentary)
INTRODUCTION The Sarbanes-Oxley Act requires the SEC to study the feasibility of shifting to a more "principles-based" financial reporting system, and the FASB has proposed changes designed to create a more principles-based approach to standard...
Read preview Overview

Vol. 17, Annual

Does Big 6 Auditor Industry Expertise Constrain Earnings Management?
SYNOPSIS: Earnings management remains a popular topic of debate and discussion among investors, regulators, analysts, and the public. One mechanism that might mitigate earnings management is auditors' industry expertise. Using a large sample of clients...
Read preview Overview
How Are Earnings Managed? Examples from Auditors
SYNOPSIS: This paper reports descriptive evidence about how managers attempt to manage earnings, based on a sample of 515 earnings-management attempts obtained from a survey of 253 experienced auditors (and also analyzed by Nelson et al. 2002). We...
Read preview Overview
Investors' Perceptions of Earnings Quality, Auditor Independence, and the Usefulness of Audited Financial Information
SYNOPSIS: In this paper I investigate whether nonprofessional investors' beliefs mirror the Securities and Exchange Commission's (SEC) concerns that earnings quality and auditor independence have declined over time. I also examine whether lower perceptions...
Read preview Overview
Earnings Quality and Short Sellers
SYNOPSIS: A key measure of earnings quality is the deviation of net income from operating cash flows. Sloan (1996) finds that firms with high accruals (or a large gap between net income and operating cash flow) experience a decline in earnings performance...
Read preview Overview
Measuring Stockholder Materiality
SYNOPSIS: The Securities and Exchange Commission (SEC) has recently expressed concern that auditors' use of materiality allows misstatements to go uncorrected. Auditors do not require their clients to correct the financial statements for immaterial...
Read preview Overview
The Quality of Financial Statements: Perspectives from the Recent Stock Market Bubble
SYNOPSIS: During the recent stock market bubble, the traditional financial reporting model was assailed as a backward-looking system, out of date in the Information Age. With the bursting of the bubble, the quality of financial reporting is again under...
Read preview Overview
Earnings Quality
INTRODUCTION This commentary discusses empirical measures used in academic research to assess earnings quality and relates these measures both to decision usefulness, from the Financial Accounting Standards Board's (FASB) Conceptual Framework, and...
Read preview Overview
Are Unmanaged Earnings Always Better for Shareholders?
SYNOPSIS: The push for increased transparency in financial reporting and corporate governance serves shareholders only up to a point. The problem of assessing the value of transparency to shareholders is subtle because both the level and pattern of...
Read preview Overview
Accounting Quality, Auditing, and Corporate Governance
SYNOPSIS: To achieve orderly capital markets around the world, corporations must provide investors and creditors with relevant, reliable, and timely information. Accounting, auditing, and the structure of corporate governance that they operate within...
Read preview Overview

Vol. 16, No. 4, December

The Impact of Split Adjusting and Rounding on Analysts' Forecast Error Calculations
SYNOPSIS: This study finds that analysts' forecast data files, commonly used by accountants and financial analysts to estimate market expectations about earnings announcements, contain inaccurate historical data for companies that split their common...
Read preview Overview
Disclosures in Audit Committee Charters and Reports
SYNOPSIS: In response to recent criticisms of audit committee performance, new SEC and stock exchange rules require companies to prepare an audit committee charter and to publish the charter in their proxy statement at feast once every three years....
Read preview Overview
Knowing What Others Know: Common Knowledge, Accounting, and Capital Markets
SYNOPSIS: The concept of common knowledge concerning higher orders of knowledge has seen exciting new developments in the fields of philosophy, game theory, statistics, economics, and cognitive science in the recent decades. Even though information...
Read preview Overview
Financial Reporting at a Crossroads. (Commentary)
INTRODUCTION Today, the institutions responsible for financial reporting in our capital markets are reeling from the fall-out of financial-reporting scandals of colossal proportions. Reports on the collapse of Enron, the bankruptcy of WorldCom,...
Read preview Overview
A Pathology of the Independence Standards Board's Conceptual Framework Project. (Commentary)
ISB to cease operations after making major contributions to the resolution of difficult and longstanding auditor independence issues. (AICPA 2001b) With that headline, the Independence Standards Board (ISB or Board) announced that it was closing...
Read preview Overview
Recommendations on Disclosure of Nonfinancial Performance Measures. (Commentary)
INTRODUCTION This article summarizes comments of the Financial Accounting Standards Committee of the American Accounting Association (hereafter the Committee) on issues related to disclosure of nonfinancial performance measures. At the Committee's...
Read preview Overview

Vol. 16, No. 3, September

Evidence from China on Whether Harmonized Accounting Standards Harmonize Accounting Practices
SYNOPSIS: While international harmonization of accounting is gaining momentum in recent years, there is little empirical evidence on whether the harmonization of accounting standards leads to harmonized accounting practices and comparable financial...
Read preview Overview
Viewing the 1996 FAF Restructuring as Policy Making without a Formal Due Process
SYNOPSIS: In 1996, a major financial reporting controversy emerged, escalated, and was resolved without substantial exposure or a formal due process. Specifically, a committee of the Financial Executives Institute (FEI) sent a letter to the chair...
Read preview Overview
Large Firms Envision Worldwide Convergence of Standards
Currently, the largest accounting firms' are working diligently in conjunction with their partners in the International Forum on Accountancy Development (IFAD) to achieve their vision of raising national accounting and auditing standards worldwide...
Read preview Overview
Using Laboratory Experiments to Evaluate Accounting Policy Issues. (Commentary)
INTRODUCTION Accounting scholars have long been challenged to demonstrate the relevance and timeliness of their research to the issues faced by accounting policymakers. Among others, Schipper (1994), Swieringa (1998), and Barth et al. (2001)...
Read preview Overview
The "Incomplete Revelation Hypothesis" and Financial Reporting. (Commentary)
INTRODUCTION The most common form of the Efficient Markets Hypothesis (EMH) states that market prices fully reflect all publicly available information (Fama 1970). The EMH has been highly influential among academics, but practitioners and regulators...
Read preview Overview
The Evolving Accounting Standards for Special Purpose Entities and Consolidations. (Commentary)
INTRODUCTION This paper reviews the major actions taken by the accounting standard setters--the Financial Accounting Standards Board (FASB) and its Emerging Issues Task Force (EITF)--in connection with special purpose entities (SPEs) and traces...
Read preview Overview
Reporting Fair Value Interest and Value Changes on Financial Instruments. (Commentary)
AAA Financial Accounting Standards Committee INTRODUCTION The Joint Working Group of Standard Setters' (JWG 2000) Recommendations on Accounting for Financial Instruments and Similar Items (hereafter the Proposal) requires that all changes in...
Read preview Overview

Vol. 16, No. 2, June

Alternative Approaches to Testing Hedge Effectiveness under SFAS No. 133
INTRODUCTION Statement of Financial Accounting Standards (SFAS) No. 133, Accounting for Derivative Instruments and Hedging Activities, as amended by SFAS No. 138, Accounting for Certain Derivative Instruments and Certain Hedging Activities--An...
Read preview Overview
The Effects of Corporate Ownership on Public Accountants' Professionalism and Ethics
SYNOPSIS: The current trend toward corporate acquisitions of CPA firms poses potential threats to the autonomy and ethical standards of public accounting professionals. This recent consolidation movement suggests that for the first time a significant...
Read preview Overview
Sampling Practices of Auditors in Public Accounting, Industry, and Government
SYNOPSIS: Although audit sampling is a common procedure, relatively little is known about the sampling practices of auditors in public accounting, industry, and government. This study surveyed practicing auditors to determine how they: (1) planned...
Read preview Overview
Characteristics Influencing Perceptions of Accounting Pronouncement Quality
SYNOPSIS: Effective capital markets rely on financial information mandated by high-quality accounting pronouncements. This study identifies characteristics associated with the quality of pronouncements issued by the Financial Accounting Standards...
Read preview Overview
Lessons from Enron
Some of you know that I have been the Arthur Andersen & Co. Alumni Professor of Accounting at Lehigh University since 1982. A few will know that my relationship with Andersen goes back to 1963, when, as an undergraduate, I was recruited by Fred...
Read preview Overview
Some Thoughts on the Intellectual Foundations of Accounting. (Commentary)
Introduction and Concluding Remarks by Jonathan C. Glover and Pierre Jinghong Liang SYNOPSIS: We report on a panel discussion at the 2001 CMU Accounting Mini-Conference under the title "Intellectual Foundations of Accounting." We provide a background...
Read preview Overview
Fair Valuing Debt Turns Deteriorating Credit Quality into Positive Signals for Boston Chicken. (Commentary)
SYNOPSIS: This article analyzes proposed accounting for financial instruments using Boston Chicken's financial report from 1997. The example shows how the proposal would cause Boston Chicken to reduce the carrying value of debt and to recognize...
Read preview Overview

Vol. 16, No. 1, March

Accounting for Tax Benefits of Employee Stock Options and Implications for Research
SYNOPSIS: This paper examines how firms account for and report the tax benefits of employee stock options (ESOs). The tax benefits of ESOs reduce taxes actually owed but enter stockholders' equity directly without reducing reported income tax expense....
Read preview Overview
Going-Concern Opinions in the "New" Legal Environment
SYNOPSIS: The Securities and Exchange Commission (SEC 2000) recently asserted that the litigation environment facing auditors has changed significantly since 1994, and that the reduced threat of litigation can influence auditor behavior. This study...
Read preview Overview
The Use of Target Prices to Justify Sell-Side Analysts' Stock Recommendations
SYNOPSIS: This study examines a sample of 103 sell-side analysts' reports to document the frequency with which analysts disclose target prices as justifications for their stock recommendations. In addition, I investigate whether the degree of assessed...
Read preview Overview
"Political" Lobbying on Proposed Standards: A Challenge to the IASB. (Commentary)
INTRODUCTION Now that the International Accounting Standards Board (IASB) has emerged from the restructuring of the International Accounting Standards Committee's (IASC) board, it seeks to establish high-quality International Financial Reporting...
Read preview Overview
Blending Information and Communication Technology with Accounting Research. (Commentary)
INTRODUCTION The purpose of this commentary is to explore how information and communication technologies (ICT) have forever changed many aspects of business and accounting practice and, as a result, offer new and exciting research opportunities...
Read preview Overview
The Evolution of the Knowledge Professional. (Commentary)
INTRODUCTION Wealth creation depends on knowledge work as never before, a change full of implications for those who provide information services. We argue that a new economic model has created a need for a new type of information professional. ...
Read preview Overview
Recommendations on Hedge Accounting and Accounting for Transfers of Financial Instruments: AAA Financial Accounting Standards Committee. (Commentary)
Vincent, Linda INTRODUCTION This article summarizes some of the comments of the Financial Accounting Standards Committee of the American Accounting Association (hereafter the Committee) on the Joint Working Group of Standard Setters (JWG 2000)...
Read preview Overview

Vol. 15, No. 4, December

Stock Option Expense: The Sword of Damocles Revealed
SYNOPSIS: Statement of Financial Accounting Standards (SFAS) No. 123 is one of the most controversial accounting standards ever issued by the Financial Accounting Standards Board (FASB 1995) (SFAS No. 123, para. 376). More than five years have passed...
Read preview Overview
Charitable Organizations' Strategies and Program-Spending Ratios
SYNOPSIS: Analysis in this study demonstrates how differences in strategy can be incorporated into evaluations and comparisons of financial statements of charitable organizations. The ratio of program spending to total spending, a metric commonly used...
Read preview Overview
Auditors' and Investors' Perceptions of the "Expectation Gap"
SYNOPSIS: The auditing "expectation gap" refers to the difference between (1) what the public and other financial statement users perceive auditors' responsibilities to be and (2) what auditors believe their responsibilities entail. The notion of this...
Read preview Overview
A Perspective on the Proposed Global Professional Credential. (Commentary)
You have no doubt heard of the proposed global professional credential, under such placeholder names as XYZ or Cognitor, that would supplement the CPA. At this writing, the AICPA and state societies are in the midst of a program to inform AICPA members...
Read preview Overview
SEC Auditor Independence Requirements: AAA Financial Accounting Standards Committee. (Commentary)
INTRODUCTION In June 2000, the SEC issued Proposed Rule S7-13-00, Revision of the Commission's Auditor Independence Requirements (hereafter the Proposed Rule). The Proposed Rule primarily deals with five areas related to auditor independence: ...
Read preview Overview
Evaluation of the FASB's Proposed Accounting for Financial Instruments with Characteristics of Liabilities, Equity, or Both: AAA Financial Accounting Standards Committee. (Commentary)
INTRODUCTION The October 27, 2000 FASB Exposure Draft, Accounting for Financial Instruments with Characteristics of Liabilities, Equity, or Both, (hereafter the ED) provides criteria for classifying financing instruments--financial instruments used...
Read preview Overview
Research Implications of the Auditing Standard Board's Current Agenda. (Commentary)
This commentary provides insights into auditing standards issues derived from our work with the Auditing Standards Board (ASB) over the last six years. Our roles as the academic members of the ASB included bringing to the ASB's attention research bearing...
Read preview Overview

Vol. 15, No. 3, September

Application of the Business Risk Audit Model: A Field Study
SYNOPSIS: After confronting unprecedented challenges in the last decade, accounting firms have undertaken extensive effort to improve the basic financial statement audit and to expand external assurance beyond the traditional audit. The reexamination...
Read preview Overview
Customized Financial Reporting, Networked Databases, and Distributed File Sharing
SYNOPSIS: We analyze the relation between customization and standardization in corporate financial reporting. We argue that "Customization Around a Standard Report" (CASR) is a promising approach to financial reporting. Under this approach. the prevailing...
Read preview Overview
Recognition: An Information Content Perspective
SYNOPSIS: This essay offers a synthesis of the varied accounting literature on recognition. First, in a review of the historical evolution of accounting thoughts, two debates on accounting measurements stand out: historical cost as the basis for asset...
Read preview Overview
How Informative Are Earnings Numbers That Exclude Goodwill Amortization?
SYNOPSIS: In the original exposure draft, Business Combinations and Intangible Assets, the Financial Accounting Standards Board (FASB) proposed that companies be allowed to report a second per share earnings number that excludes goodwill amortization....
Read preview Overview
Why Not Allow FASB and IASB Standards to Compete in the U.S.?
SYNOPSIS: This paper discusses arguments for and against introducing competition into the accounting standard-setting process in the U.S. by allowing individual corporations to issue financial reports prepared in accordance with either FASB or IASB...
Read preview Overview
The Conceptual Framework and Accounting for Leases
SYNOPSIS: For years, users of financial statements, academics, and standards setters alike have criticized the lease accounting standards as unnecessarily complex and ineffective in portraying liabilities arising from lease contracts in the balance...
Read preview Overview
Evaluation of the Lease Accounting Proposed in G4+1 Special Report
AAA Financial Accounting Standards Committee CHARACTERISTICS OF A CONCEPTUALLY SOUND LEASING STANDARD The Committee supports development of a single, conceptually sound approach to accounting for all types of leases and believes that such an...
Read preview Overview
Lease Accounting Research and the G4+1 Proposal
INTRODUCTION The Group of Four Plus One, or G4+1 for short, is a cooperative effort by national accounting standard setters from Australia, Canada, New Zealand, the United Kingdom, and the United States plus the International Accounting Standards...
Read preview Overview

Vol. 15, No. 2, June

Audit Committee Composition, "Gray Directors," and Interaction with Internal Auditing
K. Raghunandan and Dasaratha V. Rama are Professors both at Texas A&M International University, and William J. Read is a Professor at Bentley College. SYNOPSIS: The functioning of corporate audit committees was criticized in recent years by...
Read preview Overview
Minority Interest in the Consolidated Retained Earnings Statement
Hugo Nurnberg is a Professor at Baruch College-CUNY. SYNOPSIS: Consolidated financial statements purport to report income, financial position, and cash flows of a parent company and its subsidiaries as if the group were a single company with one...
Read preview Overview
Transforming the Balanced Scorecard from Performance Measurement to Strategic Management: Part II
Robert S. Kaplan is a Professor at Harvard University and David P. Norton is founder and president of the Balanced Scorecard Collaborative in Lincoln, Massachusetts. In a previous paper (Kaplan and Norton 2001b), we described the role for strategy...
Read preview Overview
Equity Valuation Models and Measuring Goodwill Impairment
AAA Financial Accounting Standards Committee INTRODUCTION The FASB faces two main issues in its project on business combinations. The first involves determining whether two separate methods of accounting for business combinations--purchase and...
Read preview Overview
International Harmonization: Cautions from the Australian Experience
SYNOPSIS: Global harmonization of accounting is a challenging and controversial issue currently confronting accounting standard setters and market regulators internationally. To date, Australia is further along in its international harmonization program...
Read preview Overview
Sunset Review of Public Accountancy Laws: The Colorado Experience
Sunset reviews are periodic examinations by state legislatures to assess the necessity, effectiveness, and efficiency of various state functions, including regulatory boards and commissions. The outcome of a sunset review can range from a minor change...
Read preview Overview

Vol. 15, No. 1, March

Antecedents and Consequences of Independence Risk: Framework for Analysis
SYNOPSIS: This paper presents a framework that explains how certain incentives affecting independence risk interact with situational factors to affect actual or perceived audit quality. We articulate the combined effects of direct incentives, indirect...
Read preview Overview
Auditing Firms' Fraud Risk Assessment Practices
SYNOPSIS: The effectiveness of audits in detecting fraudulent misstatements in financial statements is of major concern to the auditing profession. This concern led to the issuance of Statement on Auditing Standards (SAS) No. 82, which made several...
Read preview Overview
CPAs' Perceptions of the Emerging Multidisciplinary Accounting/Legal Practice
SYNOPSIS: This paper reports the results of a survey of 219 American institute of Certified Public Accountant members about legal services their public accounting firms currently offer and plan to offer in the future, and how they would organize their...
Read preview Overview
SEC Market Risk Disclosures: Implications for Judgment and Decision Making
SYNOPSIS: In this paper, we draw on Judgment and decision-making research to examine the behavioral implications of the SEC's Financial Reporting Release No. 48 on market risk disclosures. While these disclosures have been examined using archival data,...
Read preview Overview
Three Rs and Four Ws
The Editorial Policy printed in this issue is largely a product of the AAA Publications Committee. My influence came toward the end of the deliberations. Although the spirit of the current Editorial Policy is similar to previous editorial policies...
Read preview Overview
Congress Looks at Accounting for Business Combinations
"Accounting standards are too important to be left to accountants." This statement, made a few years ago by a member of Congress, reflects the increasing interest of politicians in the work of the Financial Accounting Standards Board (FASB). Congressional...
Read preview Overview
Transforming the Balanced Scorecard from Performance Measurement to Strategic Management: Part I
Several years ago we introduced the Balanced Scorecard (Kaplan and Norton 1992). We began with the premise that an exclusive reliance on financial measures in a management system is insufficient. Financial measures are lag indicators that report on...
Read preview Overview
Search by... Author
Show... All Results Primary Sources Peer-reviewed

Oops!

An unknown error has occurred. Please click the button below to reload the page. If the problem persists, please try again in a little while.