Australian Accounting Review最新文献

This research adds to the audit quality literature by examining inspection findings generated by an independent regulator in an African setting. The study is concerned with the nature of weaknesses identified at both firm and engagement level, categorising inspection findings according to their possible impact on audit quality and identifying those aspects of audit practice which result in inspection findings. An exploratory research design is used. Inspection findings are reviewed and categorised with results presented graphically. Several audit quality weaknesses at the firm and engagement level are revealed. The number of audit practice deficiencies move in tandem with incidences of poor documentation standards. In addition, the frequency and impact of inspection findings are affected by: (1) the subjectivity of processes used to test balances and transactions; (2) the extent to which applicable standards are principles-based rather than procedural; and (3) the need to develop tailored test procedures to address relevant risks. At the practical level, the findings are important for engagement leaders, regulators, audit committees and investors interested in understanding better those aspects of audit practice which are likely to result in lower-quality audits and less reliable audit reports. At the empirical level, the study provides an original review of audit quality inspection findings from a novel setting. An exploratory design complements the largely positivist-inspired research on audit quality and examines a practice-focused perspective on audit quality which moves away from inferential testing of quality surrogates.

Based on the acceptance of the importance of clear definitions and concepts, we explore conventional definitions of accounting and chart their change and development. While accounting's definitions have evolved, they do not, in our view, adequately reflect accounting as social and moral practice but rather continue to position accounting as a technical practice, despite the valuable work of key accounting scholars particularly over the last four decades. We highlight the social and moral aspects of accounting and propose a new definition of accounting for the 2020s to stimulate discussion, debate and improvement. In our opinion, accounting has a way to go to reach its true potential.

One motivation for the adoption of International Financial Reporting Standards (IFRS) is to improve the comparability of financial information presented by listed companies and thereby to contribute to improving transparency, accountability and efficiency in financial markets around the world. Beginning from the perspective of the International Accounting Standards Board (IASB) and academic researchers, I describe what is meant by comparability and then I list four areas of research where academics have investigated comparability of IFRS financial statements. Within each area I present examples of studies, usually around the time of adoption of IFRS, and discuss the implications of the research findings for the work of the IASB and the activities of other bodies supporting the implementation of IFRS. Finally, I identify areas of future research that could contribute to public policy deliberations.

In recent years, organisational sustainability has become a topical issue in many institutional fields and a number of calls have been made to improve the disclosure of carbon information as part of sustainability efforts. This paper responds to these calls, chiefly examining the determinants of (CED) in the annual reports of UK higher education institutions (HEIs). It also aims to predict the relationship between the extent of CED and UN Sustainable Development Goals (SDGs) reporting by UK universities. We construct a disclosure index to capture the extent and type of CED in the annual reports of UK HEIs, finding that carbon reduction targets imposed by the Government, environmental audit, and the amount of actual carbon emissions are significant and positively associated with CED. However, we find no relationship between CED and the disclosure of SDGs. We argue that HEIs'. CED can be useful in developing relevant regulatory policies given the targets are carefully set. Our research has important implications for policymakers regarding carbon reduction targets and related non?mandatory guidance, as these can be utilised as an effective mechanism in increasing carbon emission disclosure voluntary CED that are integrated into SDG disclosures.

In this paper I describe how the New Zealand External Reporting Board (XRB) and its sub-boards, the New Zealand Accounting Standards Board (NZASB) and the New Zealand Auditing and Assurance Standards Board (NZAuASB), use research in setting accounting and assurance standards. The XRB came into existence on 1 July 2011. In the early years (2011–2014) the focus was on getting the Accounting Standards Framework in place. Research into (financial statement) user-needs became a major strategy in 2014 and continues to be a key component of the boards’ due process.

We survey the use of financial performance measures in determining executive pay among significant Australian financial institutions. We document evidence of the pervasiveness with which externally disclosed non-GAAP (non-Generally Accepted Accounting Principles) financial measures are also used internally to determine variable remuneration, with the apparent popularity of cash profit after tax in short-term incentives plans. Our evidence also highlights the increasing use of peer group-adjusted measures (e.g., relative cash earnings per share and return on equity ranking against a peer group) in determining longer-run incentives, despite the fact that members of the peer group do not measure financial performance in a directly comparable manner. Detailed analysis of the four major trading banks (Australia and New Zealand Banking Group, Commonwealth Bank, National Australia Bank and Westpac) reveals differences in the way non-GAAP earnings measures are calculated across the major banks, as well as some variation over time in the way individual banks measure performance. We also document evidence of non-GAAP earnings restatements, with around 25% of non-GAAP results subsequently being restated. These restatements are more likely to result in a downward revision of the initially reported non-GAAP result than an upward revision. We therefore conclude that existing measures of financial performance used to determine senior executive compensation are not as ‘objective’, as might be assumed.

IFRS 9 and ASC 326 were developed after the 2008–2009 financial crisis, and both accounting standards include an expected loss model as a means of providing for credit losses. As a result of the COVID-19 worldwide pandemic, however, banks face considerable uncertainty about the potential scale of the bad debts for which they will need to provide. Banks need to reassess their loan assets, by updating their risk models with expectations about potential default rates and future macro-economic and financial developments. However, we see several interventions worldwide. The European Securities and Markets Authority addresses a position paper on the prudential application of IFRS 9. The Coronavirus Aid, Relief, and Economic Security Act in the US has given banks an optional deferral of implementation of the CECL model until 31 December 2020. This paper addresses the challenges banks face when applying the expected losses model during the current crisis. More importantly, it discusses the impact of supervisor and regulators’ intervention on future financial reporting comparability, transparency and whether there is a level playing field.

While a significant body of literature exists on local government efficiency, much less is known about its effectiveness, especially financial performance and resident satisfaction. To address this gap in the empirical literature, the present paper uses system-wide official annual data on resident satisfaction in the Victorian state local government system in Australia to investigate the relationship between annual net operating results and overall citizen satisfaction. In addition, in order to garner a deeper understanding of this relationship, we evaluated the assumption in the ‘near-to-zero balance’ public accounting literature that local residents prefer an insignificant annual balance in operating performance compared to substantial annual losses or surpluses. We found that there is a significant negative association between overall satisfaction and its components and financial performance for Victorian local government as a whole. However, this association is largely restricted to rural councils with surpluses. By contrast, we find no relationship between satisfaction and near-to-zero balances. We conclude by considering the implications of our findings for both the public accounting literature and local government policymaking.