Accounting - Research Publications
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ItemNo Preview AvailableCan knowledge based systems be designed to counteract deskilling effects?(Elsevier BV, 2023-09-01)
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ItemNo Preview AvailableActivist directors: determinants and consequences(SPRINGER, 2023-01-01)
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ItemNo Preview AvailableThe ChatGPT Artificial Intelligence Chatbot: How Well Does It Answer Accounting Assessment Questions?(American Accounting Association, 2023-11-01)ABSTRACT ChatGPT, a language-learning model chatbot, has garnered considerable attention for its ability to respond to users’ questions. Using data from 14 countries and 186 institutions, we compare ChatGPT and student performance for 28,085 questions from accounting assessments and textbook test banks. As of January 2023, ChatGPT provides correct answers for 56.5 percent of questions and partially correct answers for an additional 9.4 percent of questions. When considering point values for questions, students significantly outperform ChatGPT with a 76.7 percent average on assessments compared to 47.5 percent for ChatGPT if no partial credit is awarded and 56.5 percent if partial credit is awarded. Still, ChatGPT performs better than the student average for 15.8 percent of assessments when we include partial credit. We provide evidence of how ChatGPT performs on different question types, accounting topics, class levels, open/closed assessments, and test bank questions. We also discuss implications for accounting education and research.
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ItemEconomic effects of litigation risk on corporate disclosure and innovation(SPRINGER, 2023-01-01)Abstract Empirical studies on the relationship between shareholder litigation and corporate disclosure obtain mixed results. We develop an economic model to capture the endogeneity between disclosure and litigation. Equilibrium disclosure is determined by two countervailing effects of litigation, a deterrence effect and an insurance effect. We derive four key results. (i) Decreasing litigation risk leads to less disclosure of very bad news, due to a weakening of the deterrence effect, but to more disclosure of weakly bad news, due to a weakening of the insurance effect. (ii) Given a sufficiently large information asymmetry, litigation risk dampens (boosts) overall disclosure of bad news for low (high) litigation risk firms. (iii) Capital markets respond more to the disclosure of bad news than of good news if the deterrence effect is strong, which arises if both insiders’ penalties and litigation risk are high. (iv) In an extension, we highlight real effects of litigation on corporate innovation and establish that innovation first decreases and then increases (strictly decreases) with litigation risk if insiders’ penalties are small (large). We reconcile our findings with results from a large set of U.S.-based empirical studies and make several novel predictions.
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ItemAuditors’ Perspectives: The Impacts of IFRS Practice Statement 2 Making Materiality Judgements(Australian Accounting Standards Board, Australian Government, 2023)This report shows that the IFRS Practice Statement 2 is helpful as it clarifies the concept of materiality. However, there is a significant need for enhanced educational programs targeting key stakeholders, including auditors.
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ItemBoard diversity and shareholder voting(Elsevier BV, 2023-12)The lack of diversity across gender and race of corporate boards has been one of the most significant issues in corporate board governance in recent years. Given the critical role that shareholders have in approving director appointments, we analyze voting patterns in director elections to investigate whether and how shareholders value board diversity. Using a broad sample of director elections from 2008 through 2018, we find evidence that shareholders provide greater voting support for diversity on boards, particularly gender diversity. Our findings also indicate greater additional support for diverse boards rather than for individual candidates. However, the magnitude of incremental voting support for diversity is small, and we find little evidence that the additional support is sufficient to affect voting outcomes. These findings persist over time and across key institutional shareholders who have been some of the most outspoken proponents of board diversity (i.e., SRI funds), questioning shareholders’ commitment to promoting board diversity.
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ItemUpgrading the genome of an elite japonica rice variety Kongyu 131 for lodging resistance improvement(WILEY, 2023-02)Developing a new rice variety requires tremendous efforts and years of input. To improve the defect traits of the excellent varieties becomes more cost and time efficient than breeding a completely new variety. Kongyu 131 is a high-performing japonica variety with early maturity, high yield, wide adaptability and cold resistance, but the poor-lodging resistance hinders the industrial production of Kongyu 131 in the Northeastern China. In this study, we attempted to improve the lodging resistance of Kongyu 131 from perspectives of both gene and trait. On the one hand, by QTL analysis and fine mapping we discovered the candidate gene loci. The following CRISPR/Cas9 and transgenic complementation study confirmed that Sd1 dominated the lodging resistance and favourable allele was mined for precise introduction and improvement. On the other hand, the Sd1 allelic variant was identified in Kongyu 131 by sequence alignment, then introduced another excellent allelic variation by backcrossing. Then, the two new resulting Kongyu 131 went through the field evaluation under different environments, planting densities and nitrogen fertilizer conditions. The results showed that the plant height of upgraded Kongyu 131 was 17%-26% lower than Kongyu 131 without penalty in yield. This study demonstrated a precise and targeted way to update the rice genome and upgrade the elite rice varieties by improving only a few gene defects from the perspective of breeding.
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ItemNo Preview AvailableProfessional financial statement users' perceived value of carbon accounting disclosures and decision context(EMERALD GROUP PUBLISHING LTD, 2023-07-10)Purpose This study aims to investigate how professional financial statement users use carbon accounting information in their decisions and whether this use is sensitive to changing the decision context from an investment to a donation. Design/methodology/approach Using a sample of 173 US professional financial statement users, the authors conduct an experiment that manipulates an investment or donation choice to evaluate how differing levels of carbon sequestration affect decision-making across contexts. Findings Carbon sequestration information affects users’ donation decisions but does not affect investment decisions. Variation in the reliability of the information and whether the information is linked to strategy do not affect users’ decision-making. Research limitations/implications This study is performed by an experiment and informs our understanding of the relevance to users of carbon sequestration disclosure. Results indicate that carbon sequestration disclosure has value for donation but not investment decisions. The authors interpret this as evidence of some value of this type of disclosure in professional financial statement users’ decision-making but not for a financially focused evaluation. Originality/value This paper provides unique insights into the effect of reporting carbon sequestration on decision-making. There has been significant research on the broader topic of corporate sustainability, and capital markets research indicates that the market values increased sustainability disclosure. This study extends the research by examining a specific component of carbon disclosure that is not currently widely reported and by the use of information for different types of evaluations. The results find evidence that the value of this type of carbon disclosure does not stem from a purely financial perspective but instead, from other nonpecuniary factors.
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ItemDoes a Liability of Foreignness in Liquidity Apply to US IPOs?(Taylor & Francis, 2022-11-30)We provide evidence regarding two unanswered and consequential questions regarding share trading liquidity, a primary motive for US listings, for the prominent listing cohort of foreign-firm US initial public offerings (FIPOs). First, we test whether FIPOs exhibit a ‘liability of foreignness (Bell et al. 2012) in liquidity’ (LFL) compared with matched domestic-firm IPOs (DIPOs), despite listing requirements that are more stringent than for the mature cross-listed foreign firms studied previously. Second, we test whether US IPO LFL is moderated by FIPO home country institutional attributes that promote liquidity. Our findings for 327 FIPOs from 36 countries between 1990 and 2012 reveal that US IPO LFL is moderated, but not eliminated, by FIPO home country attributes, thus indicating incomplete bonding with US institutions. These findings extend prior research and serve to inform foreign firms considering US IPOs, exchanges competing for them, listing facilitators, regulators, and investors regarding a salient listing consideration.
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ItemVoluntary versus mandatory disclosure of liability insurance coverage limit(Elsevier BV, 2022-11)This article analyzes the disclosure of the liability insurance coverage limit and the impact of mandating disclosure of the coverage limit in a setting where voluntary disclosure of a firm’s cash flow information is subject to litigation risk and the firm has directors’ and officers’ (D&O) liability insurance. Disclosure of cash flow information is costly, but disclosure of the insurance coverage limit features no direct disclosure friction. We find that, when the litigation environment is weak, the usual unraveling argument applies, and the manager always voluntarily discloses the coverage limit in equilibrium. However, when the litigation environment is strong, either no coverage limit is disclosed or only sufficiently high coverage limits are disclosed in equilibrium. Further analysis shows that mandatory disclosure of the coverage limit increases the voluntary disclosure of cash flow information.