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Auditing, accounting, finance, control.

Upper level undergraduate, MBA, MS accounting.

This case takes an internal approach by exploring how PricewaterhouseCoopers - Egypt develops and applies industry specialization in an emerging market such as Egypt. The case focuses on three aspects of specialization. First, the strategic drivers behind specialization. Second, the internal processes of building industry-specific knowledge. Finally, the costs and benefits of specialization.

Industry specialization is a strategy:

• Specialization is a strategy primarily used by Big 4 auditing firms, such as PwC-Egypt as a means of differentiating it self from the market.

Specialization is a strategy primarily used by Big 4 auditing firms, such as PwC-Egypt as a means of differentiating it self from the market.

Industry specialization is a culture:

• For specialization to be fully effective a learning culture should be in place in which firm personnel are committed to continually seek new in-depth knowledge about clients and their industries.

For specialization to be fully effective a learning culture should be in place in which firm personnel are committed to continually seek new in-depth knowledge about clients and their industries.

Human resources are the most valuable asset of auditing firms:

• Auditing is a service that involves extensive professional judgment. Thus, knowledge and expertise of its personnel is what differentiates one auditing firm's staff from another.

Auditing is a service that involves extensive professional judgment. Thus, knowledge and expertise of its personnel is what differentiates one auditing firm's staff from another.

Teaching notes.

Businesses of all sizes are susceptible to unforeseen shocks, which could have severe adverse effects on its brand, its reputation and even its survival. This case draws on three main streams of academic business literature and bodies of knowledge that come into play under such circumstances: reputational risk, crisis management and social media.

The author used primary and secondary sources in the research and development of this case. An interview with one of the cofounders of The Bakery Shop (TBS) provided a primary first-hand account of the events leading to this crisis and the subsequent remedial actions taken. The author supplemented this research with information from TBS’s website, social media accounts and TBS-provided material.

In 2015, TBS, a growing Egyptian business specializing in premium baked goods, launched a new fusion dessert “The Croissant Om Ali.” Triggered by social media, the new product was an instant hit, resulting in orders that exceeded TBS’s initial projection. However, the business suffered a sudden turn of events when some consumers showed symptoms of food poisoning. Once again, social media came into play with an aggressive customer backlash toward TBS. Its cofounders devised an appropriate action plan to address the crisis and salvage TBS’s tarnished reputation.

This case is written primarily for an introductory business course for first-year students of business and other closely related disciplines. This case mainly addresses crisis management as a means of restoring corporate reputation. It also highlights the important role of social media in a crisis.

This paper aims to examine whether female representation on boards is significantly associated with audit fees paid by top Egyptian listed companies.

The authors collect data on audit fees, board of directors' characteristics and financial data for the top 100 companies listed on the Egyptian Exchange (EGX100) for a period of six years. The authors employ an ordinary least squares regression model to capture the relationship between board diversity (i.e. the proportion of female board directors) and the natural logarithm of audit fees while controlling for firm and industry fixed effects as well as other known firm characteristics.

The authors find that audit fees are significantly associated with the proportion of females serving on firms' boards of directors. The findings suggest a complementary relationship between females on boards, as a quality-enhancing board attribute; and audit fees, as a proxy for audit effort and audit quality.

Limitations of this study arise first from the relatively small sample size, and second from the fact that inferences may be specific to the Egyptian context and similar markets.

The results have important implications for Egyptian policy makers and regulators in terms of board composition.

This study provides empirical evidence that further enforces the business case for women's empowerment and the impact of this on the effectiveness of corporate governance.

To the best of the authors’ knowledge, this is the first archival study to examine the association between female board representation and audit fees in Egypt.

This exploratory study aims to provide preliminary evidence regarding the non-audit committee corporate governance determinants of audit committee functionality.

The study is based on archival accounting, corporate governance data, and interviews of subjects of the top 100 companies listed on the Egyptian Stock Exchange (EGX100). A logistic regression is used to identify the non-audit committee governance attributes that affect the likelihood of of having a functional audit committee.

Board size and board independence, (CEO-chairman duality) are positively (negatively) related to audit committee functionality, suggesting complementary governance relations. On the other hand, the authors document a negative relation between auditor type (Big4) and audit committee functionality indicating a substitutive governance effect.

To the best of the authors' knowledge, this is the first study that explores the actual functioning of audit committees in Egypt beyond mere regulatory requirements. The study highlights the importance of assuring that the “spirit” of corporate governance laws and regulations is adhered to rather than the mere compliance with their “letter”.

The purpose of this study is to examine the impact of corporate governance attributes of listed Egyptian companies on the propensity (adoption) and comprehensiveness (quality) of corporate internet reporting (CIR) practices.

This study uses archival data from the largest (top) 100 listed companies on the Egyptian Stock Exchange (EGX 100). Corporate governance attributes are captured by ownership structure (free float, managerial ownership, government ownership) and board of directors' structure (board size, board independence, CEO‐chair duality). Empirical models are used to estimate the effects of these attributes on the propensity, content, presentation, and overall comprehensiveness of CIR.

The results of this study indicate mixed effects of governance attributes on the choice to adopt CIR and its quality. The results from the Binary Logistic Regression suggest that Egyptian companies with greater (less) ownership dispersion, managerial ownership, governmental ownership, and (board independence) are more likely to adopt CIR. On the other hand – and as revealed by the seemingly unrelated regressions – among CIR companies those with greater (less) ownership dispersion, board size (governmental ownership), and (board independence) have more comprehensive CIR.

This study extends the relatively limited research on the effects of corporate governance and CIR in emerging markets. The study contributes to this literature by demonstrating how corporate governance attributes affects the choice to adopt CIR disclosure practices and the level of its quality in an emerging market such as Egypt.

The purpose of this paper is to investigate the impact of certain audit quality attributes, namely auditor size, auditor industry specialization and auditor tenure on a client firm's cost of equity capital.

The paper uses empirical data to construct a measure of ex ante cost of equity capital for each firm and year using analyst forecasts. Independent audit quality measures used are auditor size, auditor industry specialization and auditor tenure. Firm cost of equity capital is regressed against the three independent variables and appropriate control variables.

The paper finds that auditor size (auditor is a member of the BigX), auditor industry specialization and auditor tenure are negatively associated with the client firm's cost of equity capital. However, the paper finds that this effect is limited only to small client firms, potentially reflecting the poor information environment associated with such firms.

The study highlights the importance of audit quality attributes in determining the firm's cost of capital. It also highlights ways in which firms (especially small firms) can reduce the cost of equity capital by improving their information environment through the judicious selection of auditors.

This is believed to be the first paper to examine whether the effects of three audit quality attributes (auditor size, auditor industry specialization and auditor tenure) on a firm's cost of capital are dependent on the client's size. The paper empirically shows that such effects are more pronounced for smaller clients.

The aim of this paper is to investigate the impact of voluntary disclosure on information asymmetry between investors and the average information content of subsequent the earnings announcement.

The authors use empirical methodology relying on multiple regression analyses. The authors estimate models of trading volume and stock returns around the earnings’ release date as a function of voluntary disclosures, measured using information in the 8-K statements.

Voluntary disclosures prior to the earnings release date increase trading volume related to stock returns. In addition, voluntary disclosures also reduce stock price movement around that date.

The results indicate that voluntary disclosures increase trading volume related to stock returns around the earnings release date. Such increases indicate increased differential precision among investors, demonstrating that voluntary disclosures increase differences in opinion among investors. The reduced stock price movement around the earnings release date also show that voluntary disclosures reduce the information content of earnings. One limitation is that the measure of voluntary disclosures does not consider the variation in the information content of individual disclosures.

Firms who make voluntary disclosures will need to carefully consider how to structure such releases to minimize asymmetry between investors. Investors should pay greater attention to finding out, and interpreting, voluntary disclosures by firms.

Regulators have previously expressed concern about leveling the playing field between more and less informed investors. The results showing increased differences in information as a result of voluntary disclosures provide valuable insights as regulators debate the balance of mandated and voluntary disclosure.

This is the first study to investigate the effect of voluntary disclosures on information asymmetry among investors using trading volume and, consequently, the first to find increased differences among investors that result from those voluntary disclosures. The paper is also the first to use a direct measure of voluntary disclosure developed by Cooper et al. to demonstrate the negative relation between voluntary disclosure and the average informativeness of earnings announcements.

This paper aims to present a critical appraisal of Ghassan Kanafani’s short story “The Child Goes to the Camp” using the Appraisal Theory proposed by Martin and Rose (2007) in an attempt to investigate the predicament of the Palestinians who were forced to flee their country and live in refugee camps as well as the various effects refugee life had on them.

Using the Appraisal Theory, and with a special focus on the categories of Attitude and Graduation, the paper aims to shed light on the plight of refugees through revealing the narrator’s suffering in a refugee camp where the most important virtue becomes remaining alive.

Analysing the story using the Appraisal Theory reveals the impact refugee life has left on the narrator and his family. This story serves as a warning for the world of the suffering refugees have to endure when they are forced to flee their war-torn countries.

Although Kanafani’ resistance literature has been studied extensively, his short stories have not received much scholarly attention. In addition, his works have not been subject to linguistic analysis. This study presents an appraisal analysis of Kanafani’s “The Child Goes to the Camp” in an attempt to investigate how the author’s linguistic choices are key to highlighting the suffering of the Palestinians, especially children, in refugee camps.

The purpose of this paper is to examine the motivations of earnings management and financial aggressiveness levels in the big 100 companies listed on the NASDAQ 100 after the 2007 financial crisis.

This paper uses two samples. The first contains 471 observations of 100 companies listed on the NASDAQ 100 for the period 2008-2012 and is used to examine the motivations of earnings management. The second represents 282 observations of companies listed on the NASDAQ 100 that use financial aggressiveness. The authors use a panel data model to analyze the effects of four explanatory variables (corporate governance structure, CEO compensation, CEO characteristics and audit fees) on both earnings management and financial aggressiveness levels.

The results of the investigation show the significant impact of corporate governance structure, CEO compensation, CEO characteristics and audit fees on reducing the earnings management and financial aggressiveness levels.

The findings can be valuable to both investors and researchers. For researchers, the present work may help in explaining the motivations of earnings management and financial aggressiveness practices used by large American firms after the 2007 US financial crisis. For investors, this study serves to highlight the critical importance of corporate governance, CEO compensation and CEO characteristics in limiting such behaviors. Thus, investors are recommended to account for such variables in order to make effective investment decisions. As an extension to this study, researchers might consider other CEO psychological variables. Other market indices could also be considered in order to generalize and validate the results of the research.

Investors must take into consideration the corporate governance structure and ask for supplementary information about CEO characteristics to ensure better investment decisions.

In this paper, and in contrast to previous research, the authors test the impact of corporate governance structure, CEO compensation, CEO characteristics and audit fees together on the level of both earnings management and financial aggressiveness behavior for large US non-financial firms after the 2007 financial crisis. The authors show that older CEOs use less earnings management and financial aggressiveness. The findings can be valuable to investors, managers and regulators because they have implications for their interactive decision-making process.