172 research outputs found
Voluntary social and environmental disclosure in New Zealand corporate annual reports
No full textThis study empirically examines the levels of social and environmental disclosures made in annual reports of New Zealand companies over the three-year period of the study, and tests for any association between a number of corporate attributes and the level of social and environmental disclosures.
Similar to Belkaoui and Karpik (1989), a social and environmental disclosure index consisting of 71 items was developed to measure the level of social and environmental information disclosures annual reports. This index was then applied to 135 corporate annual reports for the 2000, 2001 and 2002 financial years of the NZX top 50 listed companies. The association between the extent of disclosure and various corporate characteristics was examined using a linear regression model. Profitability, ownership concentration, reporting in 2002 annual reports, and companies within the primary sector were positively associated with the levels of disclosure. Company size, leverage, and reporting in 2001 annual reports were not found to be associated with the levels of social and environmental disclosure.
A significant increase in the levels of social and environmental disclosures was found over the period of the study, 2000 to 2002. However, the incremental changes between 2000 and 2001, and between 2001 and 2002 were not individually significant. It is concluded from these results that even though there is a general increase in the levels of social and environmental disclosures, this increase is on a gradual basis and was only statistically significant over a two-year period.
The results contribute to the social and environmental reporting literature in a New Zealand context. An index was developed, in a New Zealand context that may contribute to further research that measures the level of social and environmental disclosures and reporting. Additionally, this is the first significant study examining social and environmental disclosures within New Zealand since the area has become popularised, through the introduction of initiatives such as triple bottom line reporting
Local Government Accounting Standard-Setting in Australia:\ud Did Constituents Participate?
No full textThe Public Sector Accounting Standards Board (PSASB) has developed accounting standards for the public sector in Australia. A procedural 'due process' has been developed to protect the openness, neutrality and independence of Australian accounting standard-setting both in the private and public sectors. Prior research into constituent participation in the 'due process' for specific cases in the public sector has raised doubts as to whether the 'due process' operated in an open, neutral and independent manner. It has found that account preparers were under-represented in their responses and used less sophisticated lobbying strategies than other respondents. The research also concluded that some constituents had favourable access to the 'due process', and that standard setters did not receive all pertinent information from constituents. This paper examines constituent participation in the 'due process' for the first public sector accounting standard, that for local government (AAS 27). The submissions made on the exposure draft preceding the standard - ED 50 - have been analysed using content analysis. The findings suggest that account preparers were well-represented in their responses and adopted the lobbying strategy of weighting their responses with supporting argument for the most controversial issues. Contrary to prior research, the paper concludes that in the case of ED 50 there is no evidence that the 'due process' failed to operate in an open and neutral manner
The value of public sector annual reports and annual reporting awards in organisational legitimacy
No full textDespite considerable diversity in Australian public sector organisations, annual reports have been promoted as an appropriate tool to discharge the accountability of all government agencies. Further, annual reporting competitions have been promoted as a means of ensuring the quality of those annual reports. The limited prior research which addresses these positions ignores the possibility that there may be a variation in the value of both the annual report and the competition depending on the type of public sector organization. This study applies institutional theory, informed by accountability theory, to understand the influence of stakeholders on the annual reporting practices and policies adopted by organisations. It focuses on the Queensland public sector and the Queensland Annual Reporting Award (QARA) and uses a series of case studies to examine the value of the annual report. Consistent with institutional theory, the results indicate that both the annual report and competition entry were used as legitimising tools. Further, cross sectional variation in the perceived value of the annual report and the entry into the annual reporting competition was found
Public regulatory reform and management earnings forecasts in a low private litigation environment\ud
No full textWe examine the impact of continuous disclosure regulatory reform on the likelihood, frequency and qualitative characteristics of management earnings forecasts issued in New Zealand’s low private litigation environment. Using a sample of 720 earnings forecasts issued by 94 firms listed on the New Zealand Exchange before and after the reform (1999–2005), we provide strong evidence of significant changes in forecasting behaviour in the post-reform period. Specifically, firms were more likely to issue earnings forecasts to pre-empt earnings announcements and, in contrast to findings in other legal settings, those earnings forecasts exhibited higher frequency and improved qualitative characteristics (better precision and accuracy). An important implication of our findings is that public regulatory reforms may have a greater benefit in a low private litigation environment and thus add to the global debate about the effectiveness of alternative public regulatory reforms of corporate requirements
Financing, Accounting and Accountability in Social Institutions: Nelson Primary Education (1842-1859)
No full textThe objective of this archival-based research is to examine the migration of and any changes in financing, accounting and accountability practices as the provision and control of primary education in the newly established settlement of Nelson moved from not-for-profit to public sector organisations. More specifically, it examines these changes from the Nelson education system's birth in 1842 where the settlers organised the first voluntary school system and then within 17 years, developed it into New Zealand's most successful provincial public system. A theoretical framework based on institutional theory provides an explanation for these changes. In doing so, the study provides an understanding of financing, accounting and accountability practices in the past as well as challenging contemporary beliefs and affording an appreciation of how and why these practices developed.
The research suggests that financing, accounting, and accountability practices had a role to play as both a technique and an institution. This role changed as control for education provision in mid-nineteenth century Nelson migrated from not-for-profit to public sector organisations. Some of the practices or techniques observed were sector dependent while others were common to both sectors. Furthermore, as a technique, it reflected many of the financing, accounting, and accountability practices currently used by similar social institutions. Hence, these practices had a degree of sophistication that is not acknowledged in contemporary papers, raising the conundrum of how far have accounting practice developments come versus how much of the 'wheel" has been reinvented.
Some of these practices were also institutions used by the not-for-profit and public sector education providers as legitimating devices to receive the support of and funding from the government and community. Some education organisations were seen as less legitimate than others and did not survive. Additionally, some of the more successful education providers manipulated their accounting information to gain this legitimacy. Financing, accounting and accountability practices were seen to change because of the various institutional pressures exerted from the institutional environment. The not-for-profit institutional pressures were predominately normative, with some cultural-cognitive/mimetic and regulatory/coercive influences. Those on the public sector were mainly regulatory/coercive. It also appears that some institutions are the result of a mixture of institutional pressures.
Although this research contributes to the literature relating to accounting and associated practices within their organisational and societal context and identifies, using institutional theory, that these practices play a dual role within this social context, the research's main contribution has been to fill a gap in knowledge in the New Zealand and international history literature. The study provides a detailed narrative and theoretical explanation of financing, accounting, and accountability practices for a time-period not covered in prior New Zealand historical research. The New Zealand focus also augments the limited UK and Australian literature regarding these concepts in nineteenth century social institutions. Furthermore, it contributes to the New Zealand education historical literature by applying a theoretical approach to pre-1877 education administration, and adding to the limited research on funding aspects, while also examining accounting and accountability; two areas not covered in other New Zealand education-based histories
Examination of Statements of Service Performance of New Zealand Local Authorities: the Case of Wastewater Services
No full textThe provision of statements of service performance (SSPs) by local government in New Zealand is a product of the economic reforms carried out in the late 1980s. A statement of service performance is regarded as an important document of New Zealand local government reporting. It is statutorily required by the Local Government Act 2002 and complemented by accounting guidance provided by the New Zealand Institute of Chartered Accountants (NZICA), with the objective of strengthening accountability obligations (Local Government Act 2002, s. 98; NZICA, 2002).
In spite of twenty years‟ experience in preparing statements of service performance, the Office of the Auditor-General (OAG) (2008) criticised that the quality of SSPs prepared by local authorities (and other public-sector entities) was poor. A fundamental problem of statements of service performance reporting is the lack of comprehensive authoritative requirements on their preparation and presentation (Office of the Auditor-General, 2008). Arguably, the present authoritative requirements have been written to cater for the needs of large, profit-oriented entities in the private-sector rather than for the public-sector‟s specific needs for performance reporting and pitched at a higher or more conceptual level than is typically required for financial reporting standards (Office of the Auditor-General, 2008, Webster, 2007). This may be due to the fact that the current authoritative requirements, developed in early 1990s, have been influenced by the economic framework highlighting the decision-usefulness purpose of private-sector reporting, which is not suitable for public-sector reporting (Mack, 2003; Parker & Gould, 1999). Responding to the need for more adequate guidance for non-financial performance reporting of public-sector entities, the OAG and the International Public Sector Accounting Standards Board (IPSASB) are working on improving accounting guidance applicable for the preparation for SSP reporting by public-sector entities (Office of the Auditor-General, 2010; International Public Sector Accounting Standard Board, 2010).
Pallot (1992) points out that accountability is the preferred purpose for public-sector reporting since the nature of the relationship between providers and users of government is non-voluntary. Past theoretical literature has attempted to define the possible components of accountability that would be suitable for public-sector entities to adequately discharge their accountability. Among them, Stewart (1984) has developed accountability bases, which provide a platform for understanding accountability expectations and, hence desirable characteristics of any accountability documents provided by public-sector entities for the public. It is possible that accountability documents pertaining to these accountability expectations will enable the public-sector entities to adequately discharge their accountability.
New Zealand local government is the important second tier of New Zealand government sector. Among the wide range of community services provided by New Zealand local authorities, wastewater services represent one of the most crucial services. New Zealand constituents could be expected to be concerned not only about the performance of wastewater services provided by their local authorities, but also with the disclosures about that performance. However, the research on SSP wastewater disclosures by New Zealand local authorities is limited (Smith & Coy, 2000). Given the criticism on the usefulness of authoritative requirements for SSP reporting and the recognition of accountability expectations by the literature, the first two objectives of this study are to examine the consistency of SSP disclosures, regarding wastewater services provided by New Zealand local authorities, with the existing authoritative requirements, and the accountability expectations, using the disclosure index as a measurement tool. To understand possible explanations for the cross-sectional differences on the extent of disclosures, according to the authoritative requirements and accountability expectations, the third objective of this study is to examine the influential factors of the disclosures, using multiple regression analysis.
The study finds that the performance disclosures made by the local authorities have low levels of correspondence with the index that is based on the authoritative requirements. The result also provides evidence that the current authoritative requirements are focused on financial information reporting and pitched at a high conceptual level. This supports the view that the existing authoritative pronouncements are not providing sufficient guidance for local authorities. The index based on accountability expectations has relatively greater correspondence with the disclosures made. This identifies that local authorities are providing information consistent with accountability expectations. The study suggests that accountability expectations provide a model suitable for SSP reporting guidance. According to the multiple regression analysis, the result shows that only size is significantly related to the extent of the disclosures. Larger local authorities report more corresponding information. The findings of this study provide three immediate implications which should be useful to: (i) accounting standard-setters for their current work on improving accounting guidance for SSP reporting; (ii) the Office of the Auditor-General for providing more insightful comments in the audit statement for SSP reporting; and (iii) regulators for increased attention on some special local authorities. By doing so, it is expected that New Zealand local authorities may lead the world in providing comprehensive SSPs, which enable them to adequately discharge their accountability and, hence in reaching a reform principle for greater accountability
Accounting for goodwill in an Australian context
No full textThis article empirically documents the impact of regulation of goodwill accounting practice in Australia. Using a sample of 84 firms over the period 1983 to 1989, this study investigates changes in accounting practice in response to both professional regulation (AAS 18) and statutory-backed regulation (ASRB 1013). Evidence presented reveals that the diversity of accounting practice was reduced after the imposition of AAS 18 and was reduced further after the imposition of ASRB 1013. The findings support the contention that statutory regulation was relatively more effective than professional regulation in the promotion of uniformity of practice. Previous writers have suggested that the effectiveness of the regulation was limited because firms avoided the application of the goodwill standards by making discretionary changes to their treatment of identifable intangibles. This study confirms that the average balance of identifiable intangible assets increased subsequent to the imposition of accounting regulation
Assessment of Earnings Conservatism in Malaysian Financial Reporting
No full textThis study examines four influences on earnings conservatism of financial reporting in Malaysia. The study employs a sample of 3,126 firm-year observations of Malaysian listed companies over the period 2003 to 2008 and measures conservatism by the asymmetric timeliness of earnings measure due to Basu (1997). First, the study assesses the degree of earnings conservatism in reporting during the period following the institutional reforms which started after the 1997 Asian financial crisis. The results suggest that conservatism has increased with the reforms which contrasts with the findings of Ball et al. (2003) who find no evidence of earnings conservatism in Malaysia. Second, this study investigates the effect of the adoption of IFRS on the level of earnings conservatism. The results show no systematic difference in the level of earnings conservatism for the short period of one to two years before and after the adoption, suggesting that conservatism may not be specific to any particular set of accounting standards. Third, this study examines the effect of ownership structure on earnings conservatism. Reporting by family firms and widely-held firms exhibits earnings conservatism, but this is not the case for state-controlled firms. The analysis also shows no significant difference between the levels of earnings conservatism for family firms and widely-held firms. Additional tests show that family firms that are strategically controlled by a family, that is, where a member of the controlling family acts as CEO and chairman of the corporate board, report significantly higher earnings conservatism than other family firms.
Finally, the study examines the link between corporate governance and earnings conservatism. Employing a comprehensive set of corporate governance variables, this study does not find any evidence to link corporate governance and earnings conservatism. This result is contrary to the evidence from developed markets, such as the United States and the United Kingdom, where firms with good governance are more timely in recognising bad news. This raises the possibility that the different ownership structures in Malaysia make corporate governance reforms less important. However, this suggestion is subject to environmental and cultural issues that have not been addressed in this study
Earnings Quality, Family Influence and Corporate Governance: Empirical Evidence from Malaysia
No full textThis study investigates whether family ownership and control, and corporate governance are associated with earnings quality, and whether family influence in firms weakens the association between corporate governance and earnings quality. This study uses a panel sample of 527 publicly traded firms over the period 2003-2008 from the Malaysia Stock Exchange (Bursa Malaysia). Identifying family firms as firms in which family members hold a significant portion of shares and possess control over the board of directors, this study finds that family firms have significantly higher earnings quality. The results remain unchanged, even after using alternative measures of earnings quality and family influence. This study also finds that the earnings quality of firms in Malaysia is positively associated with the size and independence of the audit committee and negatively associated with the size of the board of directors. However, these relationships exist only for nonfamily firms. These results on the corporate governance variables suggest that the effectiveness of corporate governance could be mediated by family influence. Using multivariate regressions that include interaction variables for corporate governance and family firms, the study finds that the relationship between corporate governance and earnings quality is mediated by family ownership and control. The result is consistent with the argument that the monitoring role of corporate governance reduces when there is substantial control by family owners in a firm. Overall, this study concludes that family ownership and control drives higher quality earnings for firms regardless of their corporate governance structure
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