Firm Compliance and Public Disclosure in Vietnam

2019 ◽  
Author(s):  
Claire H. Hollweg
Keyword(s):  
Public Disclosure ◽  
Firm Compliance

scholarly journals Have EU derivative policy reforms since the 2008 financial crisis been designed effectively?

2021 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Charles Fergus Graham
Keyword(s):  
Financial Crisis ◽  
Heterogeneous Firms ◽  
Public Disclosure ◽  
The European Union ◽  
Policy Reforms ◽  
2008 Financial Crisis ◽  
Content Type ◽  
Reporting Requirements ◽  
Firm Compliance ◽  
The 2008 Financial Crisis

Purpose In response to the 2008 financial crisis, the European Union (EU) comprehensively restructured its derivative regulation. A key component of this new framework is a reporting obligation for every derivative trade. As the reporting requirement does not involve public disclosure of the information, existing academic analysis on reporting regulations to-date, which focusses on public disclosure, is limited in predicting the effectiveness of the reform. This paper aims to assess whether the reform has been designed effectively based on the regulatory setup in the UK. Design/methodology/approach Framing the reporting regulation as a moral hazard problem with asymmetric information, this paper uses a game-theoretical approach to evaluate whether the new derivative reporting obligation effectively induces firm compliance. I also discuss potential extensions of the derivative reporting model, with particular emphasis on how the framework could account for heterogeneous firms and different regulatory tools. Findings Based on the theoretical analysis, this paper finds that while firms are unlikely to comply fully with derivative reporting requirements, it is possible to induce relatively high firm compliance. Although this does not mean we are immune from another financial crisis, the derivative reporting requirements should equip EU regulators to monitor a more transparent and secure derivatives market. Originality/value This paper provides a theoretical foundation for further study of post-crisis derivatives reforms. In particular, the implications of the model point to an empirical strategy to test the accuracy of the model.

Real Earnings Management before and after Reporting SOX 404 Material Weaknesses

2015 ◽  
Vol 30 (1) ◽  
pp. 119-141 ◽  
Author(s):  
Tuukka Järvinen ◽  
Emma-Riikka Myllymäki
Keyword(s):  
Earnings Management ◽  
Internal Control ◽  
Internal Controls ◽  
Real Earnings Management ◽  
Public Disclosure ◽  
High Quality ◽  
The Public ◽  
Material Weaknesses ◽  
Internal Control System ◽  
Before And After

SYNOPSIS The purpose of this study is to investigate whether SOX Section 404 material weaknesses manifest in real earnings management behavior. The empirical findings indicate that, compared to companies with effective internal controls, companies with existing material weaknesses in their internal controls engage in more manipulation of real activities (particularly inventory overproduction). This implies that the weak commitment by management to provide effective internal control system and high-quality financial information relates to a tendency to use real earnings management methods. Moreover, we find evidence suggesting that companies employ real earnings management (overproduction and reduction of discretionary expenses) after disclosing previous year's material weaknesses. We conjecture that the public disclosure of material weaknesses induces management to strive to mitigate the expected negative reactions of stakeholders to the disclosure by engaging in real earnings management, which is not easily detected or constrained by outsiders. Overall, this study suggests that material weaknesses in internal controls signal an environment where management is more inclined to employ real earnings management.

Pricing Initial Audit Engagements: A Test of Competing Theories

1999 ◽  
Vol 74 (2) ◽  
pp. 201-216 ◽  
Author(s):  
Allen T. Craswell ◽  
Jere R. Francis
Keyword(s):  
United States ◽  
Product Quality ◽  
Audit Fees ◽  
The United States ◽  
Public Disclosure ◽  
Audit Pricing ◽  
Experience Goods ◽  
Economic Theories ◽  
Time Period

Two competing theories of initial engagement audit pricing are examined empirically. DeAngelo's (1981a) model predicts initial engagement discounts in all settings, while Dye's (1991) model specifically predicts discounting will not occur in settings where audit fees are publicly disclosed. Unlike the United States and most countries, audit fees are publicly disclosed in Australia. Our study examines initial engagement pricing in Australia during a time period when comparable U.S. studies report discounts of 25 percent (Ettredge and Greenberg 1990; Simon and Francis 1988). The Australian evidence finds initial engagement discounting only for upgrades from non-Big 8 to Big 8 auditors. Discounting for upgrades to Big 8 auditors is consistent with economic theories of discount pricing by sellers of higher-priced, higher-quality experience goods as an inducement to purchase when uncertainty about product quality is resolved through buying (experiencing) the goods. The evidence in our study is generally consistent with Dye's (1991) conclusion that public disclosure of audit fees precludes initial engagement discounting and the potential independence problems arising from such discounting.

Building Trust in Public Institutions

2017 ◽  
Author(s):  
Cynthia M. Horne
Keyword(s):  
Political Parties ◽  
Political Trust ◽  
Public Institutions ◽  
Truth Commissions ◽  
Trust Building ◽  
Public Disclosure ◽  
Building Trust ◽  
Building Effects

This chapter examines the conditions under which lustration and truth commissions affected trust in targeted public institutions, such as the judiciary, the parliament, the police, and political parties, or composites of institutions, such as oversight institutions or elected institutions. I find strong and consistent relationships between lustration and political trust, except for the most highly politicized public institutions. More extensive and compulsory programs were associated with the largest trust-building effects. Truth commissions were not associated with political trust-building. This chapter also demonstrates that delayed reforms were more effective than reforms initiated right after the transition for most of the institutions, except for highly politicized institutions. This runs contrary to assumptions about the necessity of starting reforms immediately after the transition or not at all. The chapter presents the paired cases of Bulgaria and Romania and illustrates the possibilities for public disclosure programs to effect lustration-like reforms.

Classifying Countries within the Transitional Justice Typology

2017 ◽  
Author(s):  
Cynthia M. Horne
Keyword(s):  
Transitional Justice ◽  
Truth Commissions ◽  
Public Disclosure ◽  
Employment Change ◽  
The Czech Republic ◽  
File Access ◽  
Independent Variable ◽  
Public Disclosures

Chapter 2 explores each of the country cases in this project, namely the Czech Republic, Slovakia, Hungary, Poland, Romania, Bulgaria, Estonia, Latvia, Lithuania, Russia, Ukraine, and Albania. The chapter provides historical details of the transitional justice reforms in all twelve countries from 1989–2013, covering lustration, file access, public disclosures, and truth commissions. This material is then used to place each country case within the typology developed in Chapter 1, according to whether the measures were expansive and included compulsory employment change, limited and included largely voluntary employment change, informal and largely symbolic, or actively rejected. The chapter provides variable conceptualization and operationalization specifics to be used in the subsequent statistical analyses, including three different lustration variables, a truth commission variable, and timing of reform variables. It provides qualitative, comparative historical details to justify the classification of countries according to the primary independent variable, namely lustration and public disclosure programs.

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