Pub Date : 2020-09-30DOI: 10.33094/8.2017.2021.91.8.18
Jemal Abagissa
Growing urban population due to migration and natural population growth resulted in unemployment and poverty in most urban centres in Ethiopia. Prompted by these challenges, the government has taken initiatives to mitigate the problems. One of these initiatives is the MSE development strategy adopted in 1997. The Policy envisages not only reducing poverty in urban areas but also nurturing entrepreneurship and laying the foundation for industrial development. The strategy was revised in 2011 with renewed interests and more ambitious targets on employment and number of entrepreneurs transiting to medium level. The purpose of this study is to assess the implementation of the strategy and the challenges encountered in Addis Ababa with particular reference to Lideta sub-city. Data were collected from both primary and secondary sources. The primary sources were collected from the MSE operators in the sub-city. Whereas secondary data were collected from Lideta sub city MSEs Development Agency’s annual reports and the performance report of the Growth and Transformation Plan. The study shows that positive results were achieved in terms of employment creation, saving, enterprise growth and business ownership. The survey reveals that government supports have been provided in different forms to help MSEs grow. However, a range of problems persist including poor management skills of MSE operators, lack of capital, lack of land and high competition due to overcrowded market. When seen in terms of business types, trade dominates the MSE with little involvement in the manufacturing sector which is the priority area of the national MSE development strategy. The researcher observed that the growth of the MSE requires concerted effort of the stakeholders mainly the government and MSE owners and operators. The city government should identify growth-oriented MSEs based on their potential for job creation, poverty reduction, local raw material utilization and ease of transformation to medium and large-scale businesses in a short period. Then relevant training must be provided and to this effect, TVET colleges need to be enhanced to play the role.
{"title":"The Assessment of Micro and Small Enterprises Performance and Challenges in Addis Ababa, Ethiopia","authors":"Jemal Abagissa","doi":"10.33094/8.2017.2021.91.8.18","DOIUrl":"https://doi.org/10.33094/8.2017.2021.91.8.18","url":null,"abstract":"Growing urban population due to migration and natural population growth resulted in unemployment and poverty in most urban centres in Ethiopia. Prompted by these challenges, the government has taken initiatives to mitigate the problems. One of these initiatives is the MSE development strategy adopted in 1997. The Policy envisages not only reducing poverty in urban areas but also nurturing entrepreneurship and laying the foundation for industrial development. The strategy was revised in 2011 with renewed interests and more ambitious targets on employment and number of entrepreneurs transiting to medium level. The purpose of this study is to assess the implementation of the strategy and the challenges encountered in Addis Ababa with particular reference to Lideta sub-city. Data were collected from both primary and secondary sources. The primary sources were collected from the MSE operators in the sub-city. Whereas secondary data were collected from Lideta sub city MSEs Development Agency’s annual reports and the performance report of the Growth and Transformation Plan. The study shows that positive results were achieved in terms of employment creation, saving, enterprise growth and business ownership. The survey reveals that government supports have been provided in different forms to help MSEs grow. However, a range of problems persist including poor management skills of MSE operators, lack of capital, lack of land and high competition due to overcrowded market. When seen in terms of business types, trade dominates the MSE with little involvement in the manufacturing sector which is the priority area of the national MSE development strategy. The researcher observed that the growth of the MSE requires concerted effort of the stakeholders mainly the government and MSE owners and operators. The city government should identify growth-oriented MSEs based on their potential for job creation, poverty reduction, local raw material utilization and ease of transformation to medium and large-scale businesses in a short period. Then relevant training must be provided and to this effect, TVET colleges need to be enhanced to play the role.","PeriodicalId":40064,"journal":{"name":"Journal of Applied Business Research","volume":"8 1","pages":""},"PeriodicalIF":0.0,"publicationDate":"2020-09-30","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"43511259","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Pub Date : 2020-07-01DOI: 10.19030/jabr.v36i4.10352
Magali Valero, J. Valero-Gil
We study the impact of violent events on the Mexican stock market, by using an event study approach. Our results show that the Mexican stock market reacts negatively to news of violent events. This news, however, have no spillover effects into other Latin American and emerging markets, nor to the U.S. market, where their occurrence was inconsequential.
{"title":"The Effects Of Violent Events On The Mexican Stock Market","authors":"Magali Valero, J. Valero-Gil","doi":"10.19030/jabr.v36i4.10352","DOIUrl":"https://doi.org/10.19030/jabr.v36i4.10352","url":null,"abstract":"We study the impact of violent events on the Mexican stock market, by using an event study approach. Our results show that the Mexican stock market reacts negatively to news of violent events. This news, however, have no spillover effects into other Latin American and emerging markets, nor to the U.S. market, where their occurrence was inconsequential.","PeriodicalId":40064,"journal":{"name":"Journal of Applied Business Research","volume":"36 1","pages":"171-180"},"PeriodicalIF":0.0,"publicationDate":"2020-07-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"46134401","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Pub Date : 2020-07-01DOI: 10.19030/jabr.v36i4.10349
A. Saeedi, Reza Daghani, N. Hajian
This paper studies the relationship between the disclosure level and firm-specific characteristics of firms listed on the Tehran Stock Exchange (TSE). Our study contributes to the firm financial disclosure literature by documenting the empirical evidence on the relationship between CEO tenure and firm disclosure. We use firms’ disclosure scores released by the Iranian Securities and Exchange Organization (SEO) that measure the disclosure level of listed companies. The research data consists of 2,719 firm-year observations from 404 Iranian listed firms on the TSE for 2003-2014. Using regression analyses, we find that longer CEO tenure improves the level of disclosure. Also, we document that firm profitability, liquidity, and asset-in-place have a positive effect on the disclosure level. Moreover, we report that leverage, age, and market share have an inverse effect on the disclosure level.
{"title":"Firm-Specific Characteristics And The Disclosure Level: Evidence From The Tehran Stock Exchange","authors":"A. Saeedi, Reza Daghani, N. Hajian","doi":"10.19030/jabr.v36i4.10349","DOIUrl":"https://doi.org/10.19030/jabr.v36i4.10349","url":null,"abstract":"This paper studies the relationship between the disclosure level and firm-specific characteristics of firms listed on the Tehran Stock Exchange (TSE). Our study contributes to the firm financial disclosure literature by documenting the empirical evidence on the relationship between CEO tenure and firm disclosure. We use firms’ disclosure scores released by the Iranian Securities and Exchange Organization (SEO) that measure the disclosure level of listed companies. The research data consists of 2,719 firm-year observations from 404 Iranian listed firms on the TSE for 2003-2014. Using regression analyses, we find that longer CEO tenure improves the level of disclosure. Also, we document that firm profitability, liquidity, and asset-in-place have a positive effect on the disclosure level. Moreover, we report that leverage, age, and market share have an inverse effect on the disclosure level.","PeriodicalId":40064,"journal":{"name":"Journal of Applied Business Research","volume":"36 1","pages":"129-152"},"PeriodicalIF":0.0,"publicationDate":"2020-07-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"42475771","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Pub Date : 2020-07-01DOI: 10.19030/jabr.v36i4.10353
K. Yoon, M. Sedaghat
Major professional sports teams are nowadays complex businesses, intrinsically concerned with matters of economics and finance. Performances of each teams and each franchises vary greatly. This paper makes comparative performance analyses for four profession franchises in North America. Four financial measures are chosen to represent team performances: attendance, revenue, payroll, and profit. First, the box-plot was utilized to measure the spread of the power (wealth) of each league with respect to each measures. Second, the rank-power distribution was used to visualize the team’s relative standings in each measures and in each franchises. Most team performances were observed to follow the Pareto principle: few teams scored very high (significant few); large numbers of teams scored very low (trivial many). These qualitative findings can be a useful guide for franchise owners and commissioners for the future strategic planning.
{"title":"Rank Power Analysis For Comparative Strength Of Professional Sports Franchises","authors":"K. Yoon, M. Sedaghat","doi":"10.19030/jabr.v36i4.10353","DOIUrl":"https://doi.org/10.19030/jabr.v36i4.10353","url":null,"abstract":"Major professional sports teams are nowadays complex businesses, intrinsically concerned with matters of economics and finance. Performances of each teams and each franchises vary greatly. This paper makes comparative performance analyses for four profession franchises in North America. Four financial measures are chosen to represent team performances: attendance, revenue, payroll, and profit. First, the box-plot was utilized to measure the spread of the power (wealth) of each league with respect to each measures. Second, the rank-power distribution was used to visualize the team’s relative standings in each measures and in each franchises. Most team performances were observed to follow the Pareto principle: few teams scored very high (significant few); large numbers of teams scored very low (trivial many). These qualitative findings can be a useful guide for franchise owners and commissioners for the future strategic planning.","PeriodicalId":40064,"journal":{"name":"Journal of Applied Business Research","volume":"36 1","pages":"181-196"},"PeriodicalIF":0.0,"publicationDate":"2020-07-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"43530155","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Pub Date : 2020-07-01DOI: 10.19030/jabr.v36i4.10351
M. Alarcon, Joseph Ha
Over a century of research and empirical findings have linked advertising with consumer choice based on affective information processing, which many researchers emphasized as unconscious brain processing. This paper examines a variety of empirical findings and historical data on psychological or affective processing which provides evidence that psychological advertising affects consumer behavior and choice. Thereafter, building on existing research and literature, we analyze the legal implications of psychological advertising to stimulate affective or unconscious decisions that impairs rational choice and thus harmful. Based on this argument, we analyze the current federal consumer protection law regulating advertising under Section 5 of the Federal Trade Commission Act (“FTC Act”) which bans unfair and deceptive practices, then present rationales for change followed by a framework for revision. The objectives of such change is to ensure that this regulation upholds consumer rights and provide a consumercentric process that respects free choice. One outcome of this proposal will be a ban on advertising practices that utilize psychological stimuli. The framework will focus on expanding the “unfairness” doctrine of the FTC Act. The Federal Trade Commission (“FTC”) states that “unfair acts or practices injure both consumers and competitors because consumers who would otherwise have selected a competitor’s product are wrongly diverted by the unfair act or practice,” thus an effective customer-centric regulation could postulate a healthier economy.
{"title":"Assessment Of Psychological Advertising Along Consumer Rights And The Rule On Section 5 Of The Federal Trade Commission, Part 1 Of 2: Unfairness Doctrine","authors":"M. Alarcon, Joseph Ha","doi":"10.19030/jabr.v36i4.10351","DOIUrl":"https://doi.org/10.19030/jabr.v36i4.10351","url":null,"abstract":"Over a century of research and empirical findings have linked advertising with consumer choice based on affective information processing, which many researchers emphasized as unconscious brain processing. This paper examines a variety of empirical findings and historical data on psychological or affective processing which provides evidence that psychological advertising affects consumer behavior and choice. Thereafter, building on existing research and literature, we analyze the legal implications of psychological advertising to stimulate affective or unconscious decisions that impairs rational choice and thus harmful. Based on this argument, we analyze the current federal consumer protection law regulating advertising under Section 5 of the Federal Trade Commission Act (“FTC Act”) which bans unfair and deceptive practices, then present rationales for change followed by a framework for revision. The objectives of such change is to ensure that this regulation upholds consumer rights and provide a consumercentric process that respects free choice. One outcome of this proposal will be a ban on advertising practices that utilize psychological stimuli. The framework will focus on expanding the “unfairness” doctrine of the FTC Act. The Federal Trade Commission (“FTC”) states that “unfair acts or practices injure both consumers and competitors because consumers who would otherwise have selected a competitor’s product are wrongly diverted by the unfair act or practice,” thus an effective customer-centric regulation could postulate a healthier economy.","PeriodicalId":40064,"journal":{"name":"Journal of Applied Business Research","volume":"36 1","pages":"153-170"},"PeriodicalIF":0.0,"publicationDate":"2020-07-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"48132282","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Pub Date : 2020-05-01DOI: 10.19030/jabr.v36i3.10348
Faleh Alshameri, Nathan David Green
Mission and vision statements are critical to a company’s success both from a company’s long-term goals and appearance to potential customers. We analyze a collection of 772 mission and vision statements from companies via natural language processing. This data is hand annotated into 15 industry types. We show the distinctiveness and connectiveness of each industry via text processing and machine learning techniques. The extracted features of each industry are a telling and guiding indicator of what that industry embraces. We show high predictive power via machine learning to determine an industry by looking only at the mission and vision statements.
{"title":"Analyzing The Strength Between Mission And Vision Statements And Industry Via Machine Learning","authors":"Faleh Alshameri, Nathan David Green","doi":"10.19030/jabr.v36i3.10348","DOIUrl":"https://doi.org/10.19030/jabr.v36i3.10348","url":null,"abstract":"Mission and vision statements are critical to a company’s success both from a company’s long-term goals and appearance to potential customers. We analyze a collection of 772 mission and vision statements from companies via natural language processing. This data is hand annotated into 15 industry types. We show the distinctiveness and connectiveness of each industry via text processing and machine learning techniques. The extracted features of each industry are a telling and guiding indicator of what that industry embraces. We show high predictive power via machine learning to determine an industry by looking only at the mission and vision statements.","PeriodicalId":40064,"journal":{"name":"Journal of Applied Business Research","volume":"36 1","pages":"121-128"},"PeriodicalIF":0.0,"publicationDate":"2020-05-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"44756933","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Pub Date : 2020-03-01DOI: 10.19030/jabr.v36i2.10343
M. Talha, A. Salim, A. Jalil, N. Yatim
This paper examines the moderating effect of experience and size of fund towards socially responsible investment (SRI).A survey was conducted to get the responses of fund managers, and data were analysed using a multi-group approach of Structural Equation Modelling (SEM).At intentional level, there was a significant moderating effect on the relationship between attitudes and caring ethical climate towards an intention to SRI among less experienced fund managers. There was a significant moderating effect on the relationship between subjective norms and perceived behavioural control towards an intention to SRI among more experienced fund managers. There was also a significant moderating effect on the relationship between subjective norms and caring ethical climate towards an intention to SRI among small-sized fund managers. At behavioural level, there was a significant moderating effect on the relationship between moral intensity and SRI behaviour among less experienced fund managers. There was also a significant moderating effect on the relationship between moral intensity and caring ethical climate on SRI behaviour among bigger-sized fund managers. This paper conduits the literature gap by expanding the understanding on the moderating impact of experience and size of fund towards SRI, provides insights to policy makers in carrying out appropriate talent development strategies in accumulating the support of fund managers towards SRI-related initiatives in the capital market, and reveals the potential contribution of fund manager talent management in sustainable development through SRI. The paper offers vision on fund manager talent management to forefront the progress of SRI in emerging economies.
{"title":"Sensitivity Of Socially Responsible Investment Behaviour To Experience And Size Of Funds","authors":"M. Talha, A. Salim, A. Jalil, N. Yatim","doi":"10.19030/jabr.v36i2.10343","DOIUrl":"https://doi.org/10.19030/jabr.v36i2.10343","url":null,"abstract":"This paper examines the moderating effect of experience and size of fund towards socially responsible investment (SRI).A survey was conducted to get the responses of fund managers, and data were analysed using a multi-group approach of Structural Equation Modelling (SEM).At intentional level, there was a significant moderating effect on the relationship between attitudes and caring ethical climate towards an intention to SRI among less experienced fund managers. There was a significant moderating effect on the relationship between subjective norms and perceived behavioural control towards an intention to SRI among more experienced fund managers. There was also a significant moderating effect on the relationship between subjective norms and caring ethical climate towards an intention to SRI among small-sized fund managers. At behavioural level, there was a significant moderating effect on the relationship between moral intensity and SRI behaviour among less experienced fund managers. There was also a significant moderating effect on the relationship between moral intensity and caring ethical climate on SRI behaviour among bigger-sized fund managers. This paper conduits the literature gap by expanding the understanding on the moderating impact of experience and size of fund towards SRI, provides insights to policy makers in carrying out appropriate talent development strategies in accumulating the support of fund managers towards SRI-related initiatives in the capital market, and reveals the potential contribution of fund manager talent management in sustainable development through SRI. The paper offers vision on fund manager talent management to forefront the progress of SRI in emerging economies.","PeriodicalId":40064,"journal":{"name":"Journal of Applied Business Research","volume":"36 1","pages":"77-90"},"PeriodicalIF":0.0,"publicationDate":"2020-03-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"48582572","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Pub Date : 2020-03-01DOI: 10.19030/jabr.v36i2.10344
C. Callahan, Stephanie Hairston
This study examines the differential impact of bank holding companies (BHCs) that consistently report trading gains (successful speculators) and those that consistently report no gain or trading losses (unsuccessful speculators) on earnings volatility and firm value. Under Accounting Standards Codification (ASC) 815 (previously SFAS 133Accounting for Derivative Instruments and Hedging Activities), all gains/losses related to trading derivatives are recognized in current earnings; whereas, gains/losses on hedging derivatives are netted with changes in the fair value of the underlying asset/liability with only the ineffective portion of the hedge being reported in current earnings. Given differential accounting recognition and underlying risk factors, we expect and find that current period trading gains/losses lead to greater earnings volatility; however, the relationship becomes insignificant when BHCs consistently report trading gains (successful speculators) or no gains and trading losses (unsuccessful speculation). Further we find that successful speculation is significantly negatively associated with firm value, which implies that market participants perceive trading positions held by BHCs as high-risk investments regardless of the outcome of the trading exposure. The findings of this study should be useful to business professionals, bank regulators, and accounting standard setters in determining the economic impact of current accounting standards on bank performance, investors in evaluating the costs and benefits of bank’s derivative risk management policies, and accounting academics in evaluating the impact of current accounting regulation on bank derivative use.
{"title":"Do Trading Derivatives Classification Affect Bank Holding Company’s Earnings Volatility And Firm Value?","authors":"C. Callahan, Stephanie Hairston","doi":"10.19030/jabr.v36i2.10344","DOIUrl":"https://doi.org/10.19030/jabr.v36i2.10344","url":null,"abstract":"This study examines the differential impact of bank holding companies (BHCs) that consistently report trading gains (successful speculators) and those that consistently report no gain or trading losses (unsuccessful speculators) on earnings volatility and firm value. Under Accounting Standards Codification (ASC) 815 (previously SFAS 133Accounting for Derivative Instruments and Hedging Activities), all gains/losses related to trading derivatives are recognized in current earnings; whereas, gains/losses on hedging derivatives are netted with changes in the fair value of the underlying asset/liability with only the ineffective portion of the hedge being reported in current earnings. Given differential accounting recognition and underlying risk factors, we expect and find that current period trading gains/losses lead to greater earnings volatility; however, the relationship becomes insignificant when BHCs consistently report trading gains (successful speculators) or no gains and trading losses (unsuccessful speculation). Further we find that successful speculation is significantly negatively associated with firm value, which implies that market participants perceive trading positions held by BHCs as high-risk investments regardless of the outcome of the trading exposure. The findings of this study should be useful to business professionals, bank regulators, and accounting standard setters in determining the economic impact of current accounting standards on bank performance, investors in evaluating the costs and benefits of bank’s derivative risk management policies, and accounting academics in evaluating the impact of current accounting regulation on bank derivative use.","PeriodicalId":40064,"journal":{"name":"Journal of Applied Business Research","volume":"36 1","pages":"91-106"},"PeriodicalIF":0.0,"publicationDate":"2020-03-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"46468174","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Pub Date : 2020-03-01DOI: 10.19030/jabr.v36i2.10342
George Dierberger, M. Isaacson, Cory Erickson, Thomas P. Dierberger
“Kissing Frogs: The challenges of becoming a successful entrepreneur” explores the difficulties of creating, sustaining and succeeding as a business owner. This research is supplemented with data from a national survey to entrepreneurs (355) through QualtricsTM, a global research organization. The respondents represented 42 states from a diverse group of self-identified entrepreneurs from a variety of industries. To summarize, the paper will analyze the following topics in detail: 1) The importance of the mission and vision for the organization 2) The motivation for starting the business 3) The inspiration for the business idea 4) The importance of perseverance
{"title":"Kissing Frogs: The Challenges Of Becoming A Successful Entrepreneur","authors":"George Dierberger, M. Isaacson, Cory Erickson, Thomas P. Dierberger","doi":"10.19030/jabr.v36i2.10342","DOIUrl":"https://doi.org/10.19030/jabr.v36i2.10342","url":null,"abstract":"“Kissing Frogs: The challenges of becoming a successful entrepreneur” explores the difficulties of creating, sustaining and succeeding as a business owner. This research is supplemented with data from a national survey to entrepreneurs (355) through QualtricsTM, a global research organization. The respondents represented 42 states from a diverse group of self-identified entrepreneurs from a variety of industries. To summarize, the paper will analyze the following topics in detail: 1) The importance of the mission and vision for the organization 2) The motivation for starting the business 3) The inspiration for the business idea 4) The importance of perseverance","PeriodicalId":40064,"journal":{"name":"Journal of Applied Business Research","volume":"36 1","pages":"59-76"},"PeriodicalIF":0.0,"publicationDate":"2020-03-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"45251573","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Pub Date : 2020-01-01DOI: 10.19030/jabr.v36i1.10321
Dongliang Lei, Yu Zhou, Yakun Wang
This paper investigates the effects of auditor-client disagreement disclosure on auditor resignations and audit fee charged by successor auditors. Using a matched sample of auditor changes over the period 2003-2016, we find that auditor resignations are more often accompanied by auditor-client disagreements. We also find that Big 4 auditors are more likely to resign from their engagements when they disagree with their clients. Further, we document that successor auditors charge higher audit fees for firms that have disagreements with their predecessor auditors. Relative to non-Big 4 auditors, Big 4 successor auditors charge even higher audit fee for disagreement firms.
{"title":"Auditor-Client Disagreements, Auditor Resignations, And Audit Fees Charged By Successor Auditors","authors":"Dongliang Lei, Yu Zhou, Yakun Wang","doi":"10.19030/jabr.v36i1.10321","DOIUrl":"https://doi.org/10.19030/jabr.v36i1.10321","url":null,"abstract":"This paper investigates the effects of auditor-client disagreement disclosure on auditor resignations and audit fee charged by successor auditors. Using a matched sample of auditor changes over the period 2003-2016, we find that auditor resignations are more often accompanied by auditor-client disagreements. We also find that Big 4 auditors are more likely to resign from their engagements when they disagree with their clients. Further, we document that successor auditors charge higher audit fees for firms that have disagreements with their predecessor auditors. Relative to non-Big 4 auditors, Big 4 successor auditors charge even higher audit fee for disagreement firms.","PeriodicalId":40064,"journal":{"name":"Journal of Applied Business Research","volume":"36 1","pages":"15-28"},"PeriodicalIF":0.0,"publicationDate":"2020-01-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"68219792","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
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