Accounting - Theses
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ItemEssays on the intermediation of investors( 2020)Institutions that intermediate between investors and companies are crucial to the proper functioning of capital markets. These institutions provide marketplaces for and facilitate the transaction activity of investors, gather and disseminate information, and record the property rights of securities holders. The effectiveness of these institutions should be valuable to economies as they allow investors to effectively exercise and maximize the rights of ownership (La Porta et al., 2002; Claessens and Laeven, 2003; Hail and Leuz, 2006; Dixit, 2009). This thesis contains two essays that examine the value of different institutions involved in such intermediation. In the first essay, I examine the effect of securities transfer agents. Transfer agents are used to intermediate between the company and company-registered shareholders. Their primary responsibility is the proper maintenance of shareholder records, and the administration of shareholder transactions. Recent compliance failures by transfer agents, including reported acts of malfeasance by transfer agent staff, have increased regulatory scrutiny of the industry. Follow these events, the Securities and Exchange Commission (“SEC”) has released draft updates to the existing transfer agent regulatory requirements designed to improve the quality of transfer agent services and prevent further failures. Given concerns regarding the effect of this regulation on the costs of operating securities transfer agencies and competition, I examine two questions relevant to the regulatory discussion: Do transfer agents differ in quality? And, do these quality differences matter to investors? In the second essay, I examine the effect of the minimum price requirements (“MPRs”) of the NASDAQ and New York Stock Exchange (“NYSE”). MPRs permit exchanges to delist firms with stock prices persistently below $1.00. Proponents of MPRs argue they allow exchanges to maintain the quality of listed companies. Critics of the requirements argue they lack fundamental basis, limit access to capital, and harm investors. The merits of MPRs are likely rooted in the quality of firms subject to MPRs, the response of firm managers to (potential) breaches of MPRs, and the steps taken in the event of forced delisting. In this essay, I focus on the actions of firms in response to noncompliance with MPRs and examine whether these noncompliant firms respond by increasing news flow to the market.
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ItemAn investigation into the nature and quality of information utilized by the advisers in the stock-broking industry in Victoria( 1973)In our economy stockbrokers and investment advisers are in a position to exert considerable influence on the financial decisions made by investors. However, there has been little effort in Australia to discover, by direct inquiry, the nature and quality of information utilized by them. Therefore, the main thrust of this study was to discover the nature and sources of information used by investment advisers and to discover the quality of that information with particular reference to quality as perceived by investment advisers. The investigation has yielded data relating to these questions, to the competence of advisers to use the sources of information currently available and to the extent to which those sources are actually used. The discussion contains suggestions and formal recommendations directed towards those responsible for the sources of information which could lead to improvements in the quality of information available. There are also suggestions which could lead to more effective use by investment advisers of the information already available. Implementation of either or both of these groups of suggestions would result in better information in the capital market and hence lead to its more efficient operation. In order to reduce it to manageable proportions the study was restricted to the Victorian stock-broking industry. However, for several reasons it is thought that this study is strongly indicative of Australian, as well as Victorian, practice. For example, the institutional investors – the life assurance companies, etc. – tend to take a national view and , within the rules of the Australian Associated Stock Exchanges, brokers compete for business on a national basis. However, it may be that similar research in other states would prove fruitful. As far as can be established from published sources this study is unique in the sense that no section of the Australian stock-broking industry has previously been investigated in this manner. Although the Report of the Senate Select Committee on Securities and Exchange is not yet available it is understood that that investigation related to the operation of the Stock Exchanges rather than to the nature and quality of information. Overseas, several organizations and numerous independent researchers have considered the problem of information in their own capital markets. Few of these studies were directed towards the information-gathering activities of investment advisers; the majority of them examined the informational content of various statements or variables. (From Preface)
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ItemSpecialisation in the market for audit and related services: supply and demand side characteristics at industry and client levels( 2002)This PhD study considers both the supply of, and demand for, audit firm industry specialisation in the market for listed company audits within Australia. In order to investigate the concept of auditing industry specialisation, the concept needs to be both defined and operationalised. At present, there exists no generally accepted definition or unambiguous measure of auditor industry specialisation. This study seeks to gain a better understanding of the dynamics of and incentives within the market for industry specialist audit services, and secondly, investigate important related issues such as the appropriate unit of analysis when measuring audit industry specialisation. The researcher followed a structured interview process of the suppliers of industry specialist audit services, in this case all the Big Five and a sample of their large and small corporate auditees. Then a framework was developed that enabled archival data to be analysed, and the subsequent empirical results indicate the following. The results of the interview and archival research indicate the existence of two theorized dimensions, one being the existence of a dimension driven by industry wide factors, and the second being a dimension driven by company-specific factors. The interviews indicate that different industries require different levels of audit industry specialisation. The archival research conveys that the pricing of audit engagements depends on both the level of audit specialisation required due to industry wide factors (dimension one), or the level of audit industry specialisation demanded by particular clients, which is dependent more on company-specific factors (dimension two). What has been found in the statistical analysis for the total population (period 1990-95) using the claim audit specialisation model, is that, for the highly regulated and more technical industries (such as mining and financial services, etc) audit fee discounting tends to dominate. In sum, the current research study provides new evidence for the period 1990-1995, that in fact production economies tend to dominate positive returns on investment in audit specialisation, and in fact it is only for a small sample of specific companies, where in fact positive returns on investment in audit specialisation are observed.