The Business School - Te Kura Kaipakihi

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https://hdl.handle.net/10292/1066
The Business School - Te Kura Kaipakihi conducts disciplinary research that is at the fore front of international knowledge. Their researchers are recognised experts in their fields and produce research of relevance to their academic and non-academic stakeholders. The Business School has research strength in: Accounting, Business Information Systems, Economics, Finance, International Business, Management (including Human Resource Management and Employment Relations), Marketing, Advertising, Retailing and Sales.

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Browsing The Business School - Te Kura Kaipakihi by Subject "1501 Accounting, Auditing and Accountability"

Now showing 1 - 11 of 11
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    Aligning Disclosure Requirements for Managerial Assessments of Going Concern Risk: Initial Evidence From New Zealand
    (Wiley, 2023-10-20) Grosse, Matthew; Scott, Tom; Zang, Zeting
    This study examines the impact of the Financial Reporting Standard No. 44 New Zealand Additional Disclosures (FRS 44) amendment issued by the New Zealand Accounting Standards Board (NZASB). The FRS 44 amendment aligned disclosure requirements for managerial assessments of going concern risk in financial reports with auditing standards for periods ending on or after 30 September 2020. We first present descriptive evidence on the frequency of going concern opinions (GCO), frequency of going concern issues identified as key audit matters (GCKAM), and frequency and content of managerial assessments of going concern risk (GCMA) before and after the FRS 44 amendment. Second, we show lower audit fees and shorter audit lags for financially distressed companies post-FRS 44 implementation. This suggests that the harmonisation of accounting and auditing disclosure requirements alleviates tension during the going concern decision-making process for affected companies, subsequently leading to reduced audit fees.
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    Asymmetric Trading Responses to Credit Rating Announcements from Issuer- Versus Investor- Paid Rating Agencies
    (Wiley, 2023-01-11) Nguyen, Quan MP; Do, Hung Xuan; Molchanov, Alexander; Nguyen, Lily; Nguyen, Nhut H
    The credit rating industry has traditionally followed the “issuer-pays” principle. Issuer-paid credit rating agencies (CRAs) have faced criticism regarding their untimely release of negative rating adjustments, which is attributed to a conflict of interests in their business model. An alternative model based on the “investor-pays” principle is arguably less subject to the conflict of interest problem. We examine how investors respond to changes in credit ratings issued by these two types of CRAs. We find that investors react asymmetrically: They abnormally sell equity stakes around rating downgrades by investor-paid CRAs, while abnormally buying around rating upgrades by issuer-paid CRAs. Our study suggests that, through their trades, investors capitalize on value-relevant information provided by both types of CRAs, and a dynamic trading strategy taking advantage of this information generates significant abnormal returns.
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    Control Strategies for Impactful Exits in Impact Private Equity Firms
    (Wiley, 2024-05-02) Islam, SM; Akroyd, C
    Traditional private equity firms aim to maximise their financial returns when exiting an investment. In contrast, a major consideration for impact private equity firms is to ensure an impactful exit from their investments – increasing the chance of impact continuity in portfolio companies post exit. However, impactful exits may not be realised due to ownership-, management-, and operations-related threats. Drawing on data from 45 impact private equity firms, we identify the control strategies that impact investors use throughout the investment lifecycle to manage impactful exits from investment. We also highlight how control-related issues differ between traditional and impact private equity firms.
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    Does Audit Committee Busyness Affect Financial Restatement? Evidence From Audit Committee Share Ownership
    (Wiley, 2024-01-29) Uddin Bhuiyan, MB; Opare, S; Ahmed, Z
    We examine the association between audit committee (AC) busyness and financial restatement and determine whether AC share ownership moderates this relationship. Using logit regression analysis, we test our hypotheses on a sample of 6408 firm-year observations from 2004 to 2015 for companies listed on the Australian Securities Exchange. The study reveals that firms with busy ACs engage more in financial restatements. We also find that AC share ownership reduces financial restatements and attenuates the association between AC busyness and financial restatement. Our results are robust to endogeneity concerns emanating from firms’ deliberate decisions to grant shares to AC members. The findings of this research have several important policy implications. For instance, shareholders can benefit from AC members’ monitoring ability by allowing for share ownership. Further, our findings suggest that principles-based corporate governance guidelines have a beneficial effect on financial reporting quality. While prior studies offer mixed evidence, our research contributes to the auditing literature by providing evidence that AC share ownership moderates the association between AC busyness and financial restatement.
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    Does CEO Extraversion Pay Off When in Need? Evidence From the Global Financial Crisis
    (Elsevier BV, 2023-07-07) Liao, Shushu; Nguyen, Nhut H; Truong, Cameron
    We examine the effect of CEO extraversion on corporate performance during the Global Financial Crisis (GFC). Contrary to the expectation that extraverted CEOs should shield firms better from GFC adversities, we document that the extraversion characteristic of CEOs places a significant, though negative, effect on corporate performance during the financial crisis. Our findings are robust to controlling for other CEO personality traits. We also perform a battery of robustness tests and validate the underperformance of firms with extraverted CEOs during the GFC using stock returns and measures of operating performance. We argue that because extraverted CEOs are associated with heightened firm risk profile, this can hurt firms when the market disciplines excessive risk-taking during the crisis.
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    Economic Policy Uncertainty and Fund Flow Performance Sensitivity: Evidence from New Zealand
    (Wiley, 2023-01-29) Ali, Sara; Badshah, Ihsan; Demirer, Riza; Hegde, Prasad
    Utilizing a large sample of actively managed equity funds and a recently developed EPU index for New Zealand, we show that fund flow performance sensitivity decreases with policy uncertainty. The role of policy uncertainty as a determinant of fund flow performance sensitivity is found to be stronger, particularly for funds with global focus, large sized funds, high momentum funds and those with high idiosyncratic volatility and low downside risk. The findings support the argument that high policy uncertainty dampens investors' ability to process information that allows them to distinguish fund manager skill from luck. The results remain strong after accounting for various macroeconomic factors.
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    How Impact Investing Firms Use Reference Frameworks to Manage Their Impact Performance: An Industry-Level Study
    (Wiley, 2023-06-21) Islam, Syrus M; Habib, Ahsan
    Using meaning-oriented content analysis, we show how impact investing firms use various reference frameworks (e.g., International Finance Corporation (IFC) Performance Standards, Impact Management Project framework, UN Sustainable Development Goals) to manage their impact performance throughout the investment lifecycle. Our study provides an industry-level picture of the various roles that different reference frameworks play to help impact investors attain their impact goals. We also discuss the potential industry effects on management accounting practice, that is, how reference frameworks used in performance management in the impact investing industry differ from those used in some other industries.
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    Impact Investment Deal Flow and Sustainable Development Goals: “Mind the gap?”
    (Wiley, 2023-02-05) Islam, SM; Rahman, A
    We examine the linkage between the available impact investment deals and Sustainable Development Goals (SDGs) to ascertain to what extent those deals are likely to achieve the aims of the SDGs, that of a sustainable and prosperous world. Drawing on 292 available deals, we find that most deals are directly or indirectly linked to only four of the 17 SDGs and are concentrated in two regions of the world. Accordingly, we conclude that impact investing has a significant imbalance in the SDG–deal flow–region nexus. Without addressing such an imbalance, impact investing will have only a limited impact on overall SDG attainment. Therefore, we also share some thoughts on addressing the imbalance.
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    Staff Responses to Management Control Systems Changes in an Australian University
    (Emerald, 2024-02-13) Billah, Mamun; Ahmed, Zahir Uddin; Ali, Mohoboot
    Purpose This study aims to examine staff responses to management control systems (MCS) changes in an Australian university. Through the analysis of the category of staff responses, it aims to understand the perception gaps among the staff at different levels of the university. Design/methodology/approach Using a case study approach on an Australian university, data was collected from interviews with staff across three hierarchical levels to explore their behavioural responses. Findings This study finds that staff at all levels largely complied with MCS changes due to institutional enforcement. Top management emphasised aligning with government policies and funding, often using manipulation and compartmentalisation tactics in implementing the new MCS. Mid-level managers generally favour research strategies but feel excluded from decision-making and have limited influence over funding. They adopted a balancing tactic within a compromise strategy. Meanwhile, operating-level academics had mixed experiences, feeling largely powerless in influencing MCS while also showing instances of self-motivated compliance. Overall, the study reveals varying responses across different hierarchical levels, highlighting the complexities of MCS changes in staff behaviour and attitudes. Research limitations/implications The insights from this study can guide university administrators and policymakers in understanding the intricate variations in staff reactions to institutional changes. By recognising the factors that drive compliance and defiance, institutions can better navigate and implement changes in MCS. Originality/value This research offers a unique perspective on the behavioural side of MCS changes in higher education. By focusing on varied hierarchical levels within a university, the study provides a granular understanding of individual responses, enriching the existing literature on MCS transitions in academia.
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    The Influence of Prior Knowledge on the Self-Efficacy of Students Enrolled in a Tertiary Introductory Accounting Course
    (Informa UK Limited, 2024-09-25) Choo, Nicolas; Fieger, Peter; Wells, Paul; Tseng, Katie
    Given that self-efficacy has been found to influence the achievement of learning outcomes, this study examines the influence of prior knowledge on the self-efficacy levels of students enrolled in a tertiary level introductory accounting course. The self-efficacy levels of 272 students, captured through an in-class survey, were compared by gender, age, prior knowledge and work experience. The results suggest there was no significant difference in self-efficacy levels between students who had previously studied accounting at secondary school and those who had not. This research makes a theoretical contribution by confirming that prior knowledge does not necessarily influence an individual’s level of self-efficacy when there are few similarities between the prior knowledge gained and the current course being studied. In addition, there is a practical contribution which suggests that students who have not studied accounting at secondary school should not be discouraged from studying accounting at tertiary level.
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    Toxic Chemical Releases and Idiosyncratic Return Volatility: A Prospect Theory Perspective
    (Wiley, 2022-04-24) Bahadar, S; Nadeem, M; Zaman, R
    We investigated whether and how firms’ toxic chemical releases (TCRs) affect idiosyncratic return volatility (IRV) using a prospect theory lens. Utilising a large sample of US public listed firms over the period 2001–2018, we find a significant and positive association between TCRs and IRV, suggesting that firms releasing more toxic chemicals have higher IRV. Additional analyses show that a positive association between TCR and IRV is more evident among firms with (i) high revenue, (ii) lower financial constraints and (iii) fewer environmental violations. A further test also suggests that a positive association between TCRs and IRV is contingent on political leadership ideology and market states. Our results remain consistent with weighted TCRs, IRV based on the Fama–French three-factor model, fixed-effect two-stage least square estimator (FE-2SLS), and other robustness checks. These findings shed light on the role of equity markets as a driver for capital-intensive pollution abatement activities and enhanced compliance with environmental laws, standards and best practices.
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