Advances in Accounting Behavioral Research, Volume 27: Volume 27

Allocation problems in accounting require joint costs to be allocated among participating agents. In this setting, however, unfair allocations can stifle cooperation and lead to inefficient group outcomes. Then, what qualifies as fair enough for individual agents to agree to cooperate and extract joint benefits? Building on prior analytical literature that has offered perspectives involving joint cost allocations, we experimentally evaluate two common notions of fairness that present competing predictions in the cost allocation context – proportionality and equality. We operationalize two notions of fairness using a behavioral approach and examine which fairness notion prevails in cost allocation problems. More specifically, we examine fairness considerations in the cost allocation context using a modified ultimatum game, where joint cost savings can only be acquired through cooperation between two agents and individual contributions are varied transparently. Our experimental evidence suggests that fairness considerations in cost allocations coincide more with the proportionality notion when individuals make different contributions to create joint benefits. These findings provide important insights on the key rationale underlying the prevalent cost allocation method in accounting practices and the design of fair cost allocations that promote cooperation among agents.

We employ an experiment with experienced Chinese auditors to examine how family firm structures influence auditors' reliance on management's explanations for evidence and their assessments of fraud risk. Our findings indicate that for firms with family ownership, high levels of family managerial control cause auditors to rely less on management's explanations and assess higher levels of fraud risk when a firm's control environment is strong. However, when the control environment is weak, auditors' judgments are not influenced by family firm structure.

Prior research finds that firms disclosing a focus on corporate social responsibility (CSR) experience less negative reactions following a corporate misstep. We predict that this “insurance effect” is limited to cases of ordinary failures (i.e., failures not directly related to the social or environmental impacts of the firm) and may provide no protection when a failure is directly related to CSR. Further, we hypothesize a potential “backfire effect,” where investors react more negatively to a CSR-focused firm in the case of a CSR-related failure than to a traditional firm experiencing the same failure. In-keeping with attribution theory and expectancy violations theory, our results support the predicted limitation of the insurance effect. In addition, we find that the limited insurance effect is mediated by reputational assessments. Although directionally consistent, the proposed backfire effect is not statistically significant. Overall, our results suggest that CSR is not a panacea for dampening the penalties associated with business missteps, and managers seeking to benefit from CSR engagement should be diligent in monitoring their firms' future CSR performance.

Increasing one's chances for early job attainment is a major motivation for accounting graduates. Accounting programs are often evaluated by the job attainment rates of their graduates. Therefore, it is important to understand the factors that affect the early job attainment of accounting graduates. This study provides insight into variables that influence job outcomes for accounting graduates. In particular, our results demonstrate that gender, internship experience, grade point average (GPA), and transfer status each significantly impact the early employment of accounting students. Further, the relationships between gender and job attainment, as well as GPA and job attainment, are partially mediated through internship experience. This suggests that gender and GPA not only impact job outcomes directly but also impact job outcomes through their effect on internship attainment. The findings could help accounting programs better prepare, advise, and assist future students in their academic activities, thereby improving students' chances of early accounting job attainment.

This study examines the sequential mediating role of employee organisational commitment (EOC) and innovation on the relationship between budgetary participation and competitive advantage. Data were collected from a mail survey questionnaire of 86 Australian organisations with PROCESS applied to analyse the data. The study's findings make a significant contribution to the budgetary participation and behavioural management literature and practice. Specifically, the study provides a theoretical insight into the role of an important employee behavioural factor, EOC and innovation in mediating the relationship between budgetary participation and competitive advantage. In particular, the findings inform practitioners that budgetary participation influences the EOC of employees and subsequently influence competitive advantage through exploratory innovation.

The Criminal Investigations unit of the Internal Revenue Service (IRS) is charged with the criminal enforcement of the tax code. Using a grounded theory approach and based on 32 interviews with 28 retired and four active special agents of the IRS, this paper attempts to explore their world. This is structured with the job characteristics model, which evaluates work roles in accordance with the extent that incumbents possess the opportunity to use a variety of skills, exercise autonomy, receive feedback, experience the significance of their work and are able to produce whole results. In general, the interviews suggest that the work of special agents is highly enriched in these terms. Nonetheless, Criminal Investigations itself is challenged as an organization on several fronts.