Anchoring, the norm reminder effect, and the faithful representation of an entity’s financial position

Purpose: The aim of the paper is to verify the assumptions about the impact of the anchoring effect and the norm reminder effect in accounting decisions, in the case of the freedom of choice left by legal regulations, Methodology/approach: The study was based on a 2 × 2 experimental design and was conducted with 110 working accountants. Findings: The results confirmed the regularities in decision-making identified in psychology, which may influence the quality of the information provided by accountants. Being re-minded of the legal norm concerning the rules for creating write-downs of receivables bur-dened with the risk of non-payment led to a significant increase in accountants’ propensity to create write-downs. Similarly, the anchor used in the experiment showed that introducing a numerical value unrelated to the criteria for the write-down significantly impacted the accountants’ assessment of the percentage value and the write-off. Practical implications: The anchoring and norm reminder effect may affect the quality of the presented numerical information and the fulfillment of the faithful representation requirement in financial statements. Originality/value: The study presented in the article, which concerns the impact of cognitive biases on professional accounting decisions, has not been empirically verified so far in Poland. At the same time, it is one of the few experimental studies within behavioral accounting in Poland. Keywords: anchoring heuristic, legal norm, decision-making, behavioral accounting.

Qualitative Characteristics of Financial Reporting: An Evaluation According to the Albanian Users’ Perception

The last 20 years’ changes in accounting has led to an essential review process of national accounting standards due to the main objective of improving financial reporting information for stakeholders. Financial reporting as a communication tool has become extremely important for appropriate decision making to economic reporting entities and also financial information users such as analysts, creditors, managers, auditors and government agencies in Albania and all over the world. The absence of a generally accepted definition for qualitative financial reporting has created a gap for continuous research on this matter. The main objective of this study is to examine users’ perception of qualitative financial reporting, toward their perceptions of some selected qualitative characteristics of financial statements. This study aims to determine the attitudes of financial statements’ users toward the importance of qualitative characteristics of financial information reported on these published financial statements. The chosen qualitative characteristics were relevance, faithful representation, comparability, timeliness, verifiability and understandability. An opinion survey was conducted on three hundred external users of financial statements, such as managers, bank officers, financial analysts, government officers and auditors. Each single characteristic has been operationalized using a structured questionnaire, and a five point Likert type scale was used. Selection process of qualitative characteristics of reported financial information will be based on the data taken from conceptual framework of international financial reporting standards published by the International Accounting Standards Board in a continuous process of improving financial reporting. This research examined primary data taken through an opinion survey directed to three hundred daily users of financial statements ‘information, reported by economic entities in Albania. Results of the study show a very strong positive correlation between users ‘perception and qualitative characteristic of faithful representation, a relatively strong positive correlation with relevance, comparability and understandability, and a moderate correlation with timeliness and verifiability. Users of financial reporting in Albania generally have a very positive attitude towards the qualitative characteristics of financial reporting. Received: 3 July 2021 / Accepted: 23 August 2021 / Published: 5 November 2021

Speculations from 1850: being some thoughts on Rangiātea and the House of Tāmihana Te Rauparaha

In March, 1852, the Wellington Independent reported its satisfaction at the sight of a drawing of the interior of Otaki Church, by Mr. C. D. Barraud. It declared the drawing a faithful representation of the church and its congregation that had been executed with "that taste and excellence we are led to expect from the pencil of so able an artist" ('[Untitled]" p 3). It concluded that the print would soon to be published - "in colours" – as it would make a beautiful, interesting and "novel" picture. This claim was added to a few days later in the New Zealand Spectator and Cook's Strait Guardian. Without irony they described the theologically themed depiction as being "spirited" as well as graphic. They go on to claim the "Native Church at Otaki" as one of the "lions" of the "settlement". Yet, for all that initial eagerness, Rangiātea would not go on to become a popular destination, and it has remained largely a picture of architecture. Indeed, even scholarly interest in it as an object of architecture does not appear in depth until the doctoral research of Sarah Treadwell, in the 1990s, who located the architectural significance of Rangiātea in a dialogue with the spatial and cultural patterns of the traditional Māori meeting house. In 2008 Treadwell reflected upon her PhD work with the admission that, in hindsight, her argument suffered the same kind of representational stability we can find in Barraud's rendition. The significance of Rangiātea as the singularly outstanding example of Māori building of the 1850s is uncontested, but Treadwell suggests that what we know and mean by historic "significance" – in his case history's preference for clear lines of origin and influence – are not to be depended upon as a stable discourse. I take that as an invitation to speculate on aspects of Rangiātea's influence and significance with a particular focus on a near neighbour in Ōtaki, the house of Tāmihana Te Rauparaha.

Retrodeformation of the Steinheim Cranium: Insights into the Evolution of Neanderthals

A number of different approaches are currently available to digitally restore the symmetry of a specimen deformed by taphonomic processes. These tools include mirroring and retrodeformation to approximate the original shape of an object by symmetrisation. Retrodeformation has the potential to return a rather faithful representation of the original shape, but its power is limited by the availability of bilateral landmarks. A recent protocol proposed by Schlager and colleagues (2018) overcomes this issue by using bilateral landmarks and curves as well as semilandmarks. Here we applied this protocol to the Middle Pleistocene human cranium from Steinheim (Germany), the holotype of an abandoned species named Homo steinheimensis. The peculiar morphology of this fossil, associated with the taphonomic deformation of the entire cranium and the lack of a large portion of the right side of the face, has given rise to different hypotheses over its phylogenetic position. The reconstruction presented here sheds new light on the taphonomic origin of some features observed on this crucial specimen and results in a morphology consistent with its attribution to the Neanderthal lineage.

Current value as relational becoming: the case of goodwill impairment testing

Purpose The purpose of this study is to shed light on the tools, processes and negotiations involved in the formation of acceptable current values in the context of goodwill impairment testing. The study raises the questions of how a current value for goodwill becomes a faithful representation and how one expectation about the future becomes more convincing than other expectations. Design/methodology/approach Drawing on the study of associations, the analysis presents a case study of a large, internationally active organisation. By combining field notes, interview transcripts and a variety of documents, the qualitative analysis focusses on strategies and mechanisms of persuasion. Findings The findings reveal how epistemological objectivity of current values forms in three moments of relational becoming that codify, depersonalise and proceduralise the valuation task. Further, the study suggests that a convincing argument forms with the help of four enablers: a bricolage of inscriptions, methodological mystification, transformed professional identities and a practical need for closure. Originality/value The study contributes with an analysis and illustration of financial accounting as practice, elaborating on the meaning and construction of faithful representation in cases of measurement uncertainty.

ACCOUNTING STANDARDS FOR FIXED ASSETS OF U.S. GAAP AND IFRS: COVID-19 PANDEMIC AND EARNINGS MANAGEMENT PERSPECTIVES

FASB and IASB have differences in setting the accounting standard for fixed asset. The FASB does not allow firms to restore the asset value that has been written down, while the IASB allow companies to recover the asset values that has been written down. These differences have distinct implication to depict the COVID-19 pandemic phenomenon and prevent earnings management that will affect the qualitative characteristics of the faithful representation. Therefore, this study aims to analyze the fixed asset accounting standards of U.S. GAAP or IFRS which is more optimal to improve the faithful representation in the case of the COVID-19 pandemic and earnings management. Based on an analysis of the theory and literature review, this study conclude that the fixed assets accounting standard of IFRS is more optimal to represent the COVID-19 pandemic faithfully than that of U.S. GAAP. This is because IFRS allows for recovery of impairment losses. In addition, the fixed asset accounting standard of U.S. GAAP is more optimal than that of IFRS for preventing earnings management so as to improve the quality of faithful representation of the fixed asset value. This is because the fair value measurement for fixed assets involves estimation and subjectivity of the asset appraiser enhancing the possibility of earnings management.

The Crossed Product of Finite Hopf C*-Algebra and C*-Algebra

Let H be a finite Hopf C*-algebra and A a C*-algebra of finite dimension. In this paper, we focus on the crossed product A⋊H arising from the action of H on A, which is a ∗-algebra. In terms of the faithful positive Haar measure on a finite Hopf C*-algebra, one can construct a linear functional on the ∗-algebra A⋊H, which is further a faithful positive linear functional. Here, the complete positivity of a positive linear functional plays a vital role in the argument. At last, we conclude that the crossed product A⋊H is a C*-algebra of finite dimension according to a faithful ∗- representation.

Gyula Hajnóczi and A New Dimension of Heritage Restoration

The restoration of monuments: a distinctly cultural act realized by the means of architecture; thus, it is an architectural work, and as such is not independent of the prevailing architectural conception of its own age. Gyula Hajnóczi created added value by implementing his heritage restorations in a moderate and authoritative way, as one of the periods of the monument's lifetime and history that respects the previous ones, but at the same time has its own significance measurable to them. The fact that Hajnóczi was both an archaeologist and an architect contributed to the development of his holistic approach. His oeuvre mainly focused on the conservation and restoration of archaeological monuments and ruins. Closely related to this area there are particularly challenging issues, namely the conservation/technical solutions and methods or (in addition to preserving values) the other main purpose and mission of monument restoration: presentation. Hajnóczi placed emphasis on the faithful representation of the remains from the "original" age, at the same time, he consciously applied fitting/imitating supplementation as much and to such an extent that was necessary for understanding and interpreting the monument, and/or for satisfying the physical requirements of conservation. Everything else, however, that was additional or supplemented the heritage, in particular the design of protective buildings serving the display of the mass/space of monuments was strictly realized by choosing materials and technical-aesthetic solutions typical in the restored era. Hajnóczi's approach to heritage restoration added a new dimension to the conservation and restoration of monuments, especially Roman ruins, incorporating and further developing the experience of his predecessors' work as well as the knowledge of international theory and practice. He had his own way in the contemporary context that was not far from the slightly dogmatic interpretation of the Venice Charter. Not contradicting the philosophy of the Charter, even carefully fulfilling its requirements of giving priority to the respect of existing values, he had the personal commitment to create restorations that not only preserved the values, but also served the understandable and experiential learning of heritage. The heritage restoration works of Gyula Hajnóczi became examples and sources of inspiration in such a way that they were incorporated into the practice of heritage restoration with quiet naturalness.A műemlék-helyreállítás meghatározóan kulturális tett, amely az építészet eszközeivel valósul meg, azaz építészeti alkotás, s mint ilyen, nem független saját korának uralkodó építészeti felfogásától. Hajnóczi Gyula hozzáadott értéket teremtett, mértéktartó és mértékadó módon valósítva meg a műemlék-helyreállításait, mint a műemlék életének, történetének egyik, a korábbiakat tiszteletben tartó, ugyanakkor azokhoz mérhető jelentőségű periódusát. Egészlátó szemléletének a kialakulásában közrejátszott, hogy régész és építész képzettséggel is rendelkezett. Munkásságának fő területe a régészeti műemlékek - romemlékek konzerválása, restaurálása. Ehhez szorosan kapcsolódnak az e területen különösen is nagy kihívást jelentő kérdések, nevezetesen a konzerválási-műszaki/technikai megoldások mikéntje és a műemlék-helyreállításnak az értékmegőrzés melletti másik fő célja és küldetése: a bemutatás. Hangsúlyos az „eredeti" korból fennmaradt részek hűséges megjelenítése, de tudatosan alkalmazza az olyan mértékű, illeszkedő-utánzó kiegészítést, amilyen és amennyi a megértéshez, értelmezéshez, és/ vagy a konzerválás fizikai követelményei miatt szükséges. Minden más viszont, ami ezen felül van, illetve ehhez kapcsolódik, így különösen a tér-tömeg megjelenítést is szolgáló védőépületek kialakítása már szigorúan a helyreállítás korában „járatos" anyaghasználattal, műszaki-esztétikai megoldással készül. Hajnóczi műemlék-helyreállító szemlélete új dimenziót jelent a műemlékek, elsősorban is a római romemlékek konzerválásában és helyreállításában, beépítve és alkotó módon továbbfejlesztve az elődök munkájának és a nemzetközi elméletnek és gyakorlatnak a tapasztalatait. A Velencei Chartában megfogalmazottak kissé dogmatikus értelmezésétől sem idegen közegben a maga útját járta. Nem ellentmondva a Charta filozófiájának, sőt, gondosan teljesítve a meglévő értékek tiszteletben tartásának elsőbbségét előíró elvárásait, kiegészítve azzal a rá jellemző törekvéssel, hogy az értékek megőrzésén túl azok érthető, átélhető, élményszerű megismerését is szolgálja. Hajnóczi Gyula műemlék-helyreállításai oly módon váltak példává, inspirációs forrássá, hogy csendes természetességgel épültek be a műemlék-helyreállítási gyakorlatba.

The expected impact of applying IFRS (17) insurance contracts on the quality of financial reports

This study aimed to explore the expected effect of applying the International Financial Reporting Standard (IFRS) 17 Insurance Contracts on the quality of financial reports. The study followed the exploratory descriptive analytical approaches. A questionnaire was developed and distributed to a sample of 120 financial employees in all insurance companies in Jordan. It concluded that the expected impact of applying the standard on the quality of financial reports was significant, especially on the comparability of financial reports, and faithful representation. It was found that there is an expected, statistically significant and positive effect between the application of the standard, and the quality of financial reports in general, and the expected influence of applying the standard and each of comparability, faithful representation, relevance, verifiability, timely, and understandability respectively. The study recommends the application of the standard in the specified time, work to create appropriate conditions, and the need to follow objective assumptions from the company's management for the estimation of cash flows when applying the standard.