We analyze the financial statements of 58,653 firm-years from 34 countries for the period 1985-1998 to construct a panel data set measuring three dimensions of reported accounting earnings for each country – earnings aggressiveness, loss avoidance, and earnings smoothing. We hypothesize that these three dimensions are associated with uninformative or opaque earnings, and so we combine these thr...

From the last decade of the twentieth century, professional football has become a transnational global business in which financial profits are as important as sports successes (1). Being a full occupational category, professional football relies on a diversity of stakeholders including among others players, clubs, (inter)national governing bodies, sponsors and sport ministries (1). Despite the ...

The monetary unit assumption of financial accounting assumes a stable currency i.e., constant purchasing power over time . Yet, even during periods of low inflation or deflation, nominal financial statements violate this assumption. I posit that, while the effects of inflation are not recognized in nominal statements, such effects may have economic consequences. I find that unrecognized inflati...

Behavioral accounting research deals with a complex set of phenomenon including the broad domain of human decision making under uncertainty. Two aspects of decision making of particular relevance to accounting and auditing research are two constructs that are inexorably interrelated: uncertainty and information (evidence). This paper introduces a theoretical perspective that enriches the knowle...

Management-prepared financial statement projections are an important component of the income approach to business valuation, specifically the discounted cash flow valuation method. And, the discounted cash flow valuation method is frequently used and assigned material weighting in the business valuation performed for gift tax, estate tax, and generation-skipping tax purposes. This discussion co...

We introduce a new methodology that incorporates advanced higher moments evaluation in a new approach of the Portfolio Selection problem, supported by effective Computational Intelligence models. The Evolutional Portfolio Optimization System (EPOS) extracts hidden patterns out of the numerous accounting data and financial statements filtering misguiding effects such as noise or fraud, offering ...

This paper uses Baudrillard’s orders-of-simulacra theories to investigate the use of inspections at the Hudson’s Bay Company. These inspections were comparable to “modern” internal audits. They were being conducted in 1871, 50 years prior to the accepted date of the arrival of modern internal auditing. Inspections were started as the Hudson’s Bay Company was getting easier to manage, which was ...

This paper studies voluntary disclosure when (a) there is uncertainty about managerial propensity to report truthfully, (b) some components of the firm’s value may be certified for a cost (“hard”), (c) other components may be disclosed but not certified free of misstatements (“soft”). We establish that untruthful managers are more likely to certify hard information and that, among truthful mana...

We study the impact that financial intermediation can have on productivity through the alleviation of credit constraints in occupation choice and/or an improved allocation of risk, using both static and dynamic structural models as well as reduced form OLS and IV regressions. Our goal in this paper is to bring these two strands of the literature together. Even though, under certain assumptions,...

External auditors are very important for third partite because they add credibility to financial statements and third party can make decision in accord of financial statement audited. In recent years, the auditing and accounting profession faced scrutiny because of auditing scandals. Recent high profile accounting controversies such as Enron and World have highlighted the continuing debate abou...