Eric O. Olsen, Honggeng Zhou, Denis M.S. Lee, Yoke‐Eng Ng, Chow Chewn Chong and Pean Padunchwit
This study aims to address an important gap between the normative view of an integrated performance measurement system (PMS) design that assumes a clean slate and the…
Abstract
Purpose
This study aims to address an important gap between the normative view of an integrated performance measurement system (PMS) design that assumes a clean slate and the organizational realities of a PMS design as an ongoing analysis, coordination and improvement process.
Design/methodology/approach
The authors present a framework for evaluating the effectiveness of a PMS based on three criteria – i.e. causality, continuous improvement and process control – and use a case study to illustrate the application of the methodology and the interpretation of results for PMS design.
Findings
The determination of “driver measures” in an integrated PMS involves a complex process that requires a number of considerations not adequately addressed in prior research.
Research limitations/implications
This study involves only a single case study and the model presented involves only a two‐tier analysis.
Practical implications
The framework provides a simple methodology that organizations can easily adopt to analyze individual and group performance measures and relate them to the strategic performance measures of the company.
Originality/value
The study follows an emerging line of research that addresses the design of an integrated PMS as an ongoing improvement process.
Details
Keywords
Panayiotis Tahinakis and Michalis Samarinas
The purpose of this paper is to examine the incremental information content of audit opinion while considering opinion determinants, such as auditor and auditee size, or a firm’s…
Abstract
Purpose
The purpose of this paper is to examine the incremental information content of audit opinion while considering opinion determinants, such as auditor and auditee size, or a firm’s financial state.
Design/methodology/approach
A market valuation model is employed using US firm data collected over 30 years. The model relates stock returns to earnings and incorporates as additional variables auditors’ opinion types, opinion determinants and their interactions with audit expression.
Findings
The findings suggest that audit opinion has a significant market impact. The estimated positive or negative information content of the audit opinion types is associated with certain opinion determinants, such as auditor and auditee size and a firm’s financial state.
Research limitations/implications
Additional firm-year observations regarding certain opinion qualifications could benefit future research.
Practical implications
This study offers useful insights by demonstrating the importance of auditing profession to the users of financial statements. It examines investors’ perception of each audit opinion type and the conditions under which this expression has the most serious effects. The results demonstrate the role of audit opinion and its cause-effect relationship with various economic events, allowing regulators not only to track the efficiency of various audit policy changes but also act preventively and amend the regulatory framework.
Originality/value
This paper empirically supports the significance of the auditing process and audit opinions by examining investor perceptions. It employs a value relevance model, in contrast to market-based research that adopts an event study methodology.