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This paper aims to investigate the association between International Financial Reporting Standards (IFRS) effort due to higher levels of material adjustments and audit fees. In addition, this paper tests whether these associations differ between industry specialist auditors and non-specialist auditors.

The authors measure IFRS effort by using differences between local GAAP and IFRS. More specifically, they measure the differences in the balances of accounts that are prepared under IFRS as opposed to the previously used Australian Accounting Standards Board (AASB) standards. They posit that higher material adjustments and more risk to fair presentation of financial statements require additional accounting and auditing effort (“IFRS effort”).

The authors find that audit fees are higher when accounting standards are more material and complex at an aggregate level. Nevertheless, not all standards are equally complex and/or material and not all individual standards contribute to higher audit fees. In addition, the results show that the positive association between IFRS effort and audit fees is more pronounced when firms are audited by city-level industry specialists than by non-industry specialists.

Overall, the results are consistent with the prediction of increasing audit fees for firms requiring higher levels of IFRS effort compared to firms requiring lower levels of IFRS effort. The results contribute to the understanding that not all IFRS are equally complex and, thereby, the standards require different levels of auditor effort. Isolating specific standards based on materiality/risk levels is informative to standard setters for standard setting, standard implementation and post-implementation review of standards.

This paper aims to examine the information content of changes in fair values of investment property reported under international accounting standards (IAS) 40 and International Financial Reporting Standards (IFRS) 13 to debtholders. This study further examines the effect of fair value hierarchy inputs, valuer types and the quality of fair value measurement-related disclosure on the information usefulness of changes in fair value.

This paper performs a panel regression on the cost of debt capital and changes in fair value of investment properties, and fair value measurement features using data covering periods 2007–2015 from Australian real estate companies.

The findings suggest that changes in fair value of investment property are informative about the real estate firm’s future cash flow to debtholders. Also, the findings show that the use of unobservable inputs in an active market (Level 3 inputs) and Level 2 has no different impacts on the cost of debts. Also, this paper documents that employing the directors solely in valuation may lead to a higher cost of debts. Furthermore, this paper reports that an extensive fair value disclosure appears no additional value in the debt decision.

Collectively, the findings indicate that although the use of unobservable inputs is common in the real estate sector, information on the changes of the fair value of investment properties are informative to debtholders. The findings have important implications for accounting standard setters to consider revisiting the IAS 40 and IFRS 13 on whether the independent valuation should be required and whether the extensive disclosure requirement is worthwhile.

This study aims to investigate whether firms purchase directors' and officers' liability (D&O) insurance when the country-level economic policy uncertainty (EPU) is high.

This study uses D&O insurance data from Chinese listed firms between 2003 and 2019 to conduct regression analyses to examine the association between D&O insurance and EPU.

The results show that government EPU, despite being an exogenous factor, increases the likelihood of firms' purchasing D&O insurance, and this effect is more pronounced when firms are exposed to great share price crash risk and high litigation risk, suggesting that firms intend to purchase D&O insurance possibly due to the accentuated stock price crash risk and litigation risk associated with EPU. In addition, the results indicate that the effect of EPU on the D&O insurance purchase decision is moderated by the provincial capital market development and internal control quality.

The study highlights the role of uncertain economic policies in shareholder approval of D&O insurance purchases.

The study enriches the literature on the determinants of D&O insurance purchases by documenting novel evidence that country-level EPU is a key institutional factor shaping firms' decisions to purchase D&O insurance.

The purpose of this paper is to investigate whether regulatory restriction on executive compensation in Chinese state-owned enterprises is beneficial to firm performance. The authors also examine the role of monitoring mechanisms in offsetting the effect of compensation restriction.

Multivariate analysis is conducted using archival data from Chinese listed companies over the period of 2007-2014.

The findings show that the restriction on executive compensation is negatively associated with a firm’s accounting performance, and this negative effect is ameliorated in firms with good internal control and a high level of institutional shareholding. Additional analysis reveals that the negative effect of pay restriction on firm performance is more pronounced in central government-controlled listed SOEs than in those controlled by local government.

This study is the first to investigate a government’s say-on-pay policy. Specifically, the findings pinpoint the inefficacy of regulatory intervention in corporate executive compensation. The findings add to compensation literature using China’s unique institutional setting.

The purpose of this paper is to study the effective procedure for blocking and deblocking isocyanate by sodium bisulphite with special cosolvent and dropwise method.

A number of analytical techniques, including Fourier transform infrared spectroscopy (FTIR), Differential scanning calorimetry (DSC) and Thermo gravimetric analyser (TGA) were employed to assess the reactions between isocyanates and sodium bisulphite, water, cosolvent, also the deblocking temperature of blocked isocyanates.

The blocked isocyanates reacted with sodium bisulphite, water and cosolvent via a special procedure. It was found that the − NCO functional groups of the isocyanates were completely blocked by sodium bisulphite and a new method for determining the lowest deblocking temperature of the blocked isocyanates was described. It was revealed that the deblocking temperature of blocked isocyanates by sodium bisulphite was lower than others.

The paper provides some useful information about the blocking and deblocking of isocyanate, which would be helpful for the preparation of blocking and deblocking isocyanate, and guiding the practical applications of blocked isocyanate.

The investigation found that the sodium bisulphite was a very efficient blocking agent for isocyanates at the room temperature via the special procedure developed. On the basis of emulsion polymerisation theory, polymer isocyanates were blocked by sodium bisulphite, which realised the new breakthrough effectively by means of controlled temperature, stirring speed and optimum dropwise speed in the whole reaction system. Meanwhile, the special cosolvent could improve the intermiscibility of isocyanate in sodium bisulphite aqueous solution, reduce the side reaction of isocyanate with water and accelerate reaction rate of isocyanate with sodium bisulphite. If no cosolvent was present, the blocked system would not be homogeneous.

The purpose of this paper is to investigate the effect of ownership concentration on CEO compensation and firm performance relationship in New Zealand.

The paper applies regression analysis to data from New Zealand listed companies from 2001 to 2005.

The study finds a non‐linear effect of ownership concentration on CEO compensation‐firm performance relationship, that is CEO compensation is negatively (positively) related to firm performance in firms with high (low) concentrated ownership structure respectively.

Results provide evidence for the proposition that ownership concentration at a high level in New Zealand does not constrain excessive management power, but exacerbates agency problems associated with executive pay. A highly concentrated ownership structure provides potential explanation for the misalignment between CEO compensation and firm performance in New Zealand. The positive effect of a low ownership concentration level on CEO compensation‐firm performance relationship suggests that monitoring the efficiency of large shareholders works better at a low ownership concentration level.

By exploring the non‐linear interaction between two governance mechanisms – CEO compensation and ownership concentration – the findings of the study make contributions to the current compensation and ownership literature mainly in two ways: although the non‐linearity between ownership concentration and firm value has attracted extensive research interest, little attention is given to the non‐linear effect of large shareholding on the CEO compensation contract in prior studies; and, in the context of a developed country with a small financial market, there are low regulatory “drag” and virtual absence of a litigation threat to organisations, as in New Zealand. This study suggests concentrated ownership as an underlying explanation for the misalignment between CEO compensation and firm performance.

The purpose of this paper is to investigate the impact of different categories of ownership concentration on corporate voluntary disclosure practices in New Zealand.

The study applies panel data regression analysis to a sample of New Zealand listed companies from 2001 to 2005. Two‐stage least squares analysis (2SLS) is conducted. Ownership concentration is categorised into four mutually exclusive ownership structures.

The paper finds that firm‐year observations characterised by financial institution‐controlled ownership structure tends to make significantly fewer (more) disclosures at high (low) concentration levels supporting expropriation. In contrast, firm‐year observations in the high (low) concentration group with government‐ and management‐controlled ownership structures exhibit considerably higher (lower) voluntary disclosure scores, suggesting a positive monitoring effect at high ownership concentration level.

The results provide evidence for the proposition that the efficiency of large block holders' monitoring varies with the level of ownership concentration.

To promote transparency in capital markets, regulators can encourage or discourage certain types of large shareholding, while monitoring the level of ownership concentration by means of regulation. Investors, especially less sophisticated retail investors, will benefit from the findings that different ownership groups affect disclosure policies differently.

The findings strengthen the importance of differentiating ownership structures into various classes to infer the real impact of differential controlling properties on managerial disclosure decisions. Furthermore, the results reveal that the relationship between ownership concentration and voluntary disclosure practices has a non‐linear pattern.

The purpose of this paper is to examine whether managerial ownership‐induced income smoothing accentuates or attenuates an information asymmetry problem. Standard agency theory suggests that managerial ownership may play a significant role in alleviating agency problems between managers and external shareholders that can arise from information asymmetry. According to this view, managerial ownership‐induced income smoothing could convey managerial private information and could, therefore, be considered as informative. However, managerial ownership could also entrench managers with absolute control of firms, and encourage them to engage in earnings manipulation, including earnings smoothing, in order to hide private benefits of control.

The paper uses two smoothing measures, and separate total smoothing into its innate and discretionary components. The former is determined by firm fundamentals, whereas discretionary smoothing allows managers the flexibility to use it for either informative or opportunistic reasons. The paper then regresses information asymmetry, as proxied by scaled bid‐ask‐spreads, on the interaction between managerial ownership and both these smoothing components.

The paper documents that managerial ownership‐induced discretionary smoothing has a positive effect on bid‐ask spreads. This result seems to support the entrenchment view of managerial ownership.

This study offers insights to policy makers interested in enhancing the effectiveness of the managerial ownership aspect of corporate governance in New Zealand.

This paper uses agency theory to provide a comparative assessment of the efficient versus the entrenchment hypotheses with respect to managerial ownership.

The purpose of this paper is to investigate the effect of audit quality on the market pricing of earnings and earnings components in China.

The paper measures audit quality using three tiers of audit firm designation, namely International Big 4 audit firms, local Top 10 audit firms and, finally, the local second-tier audit firms. Earnings are decomposed into accruals and cash flow components and accruals are further decomposed into discretionary and non-discretionary accruals.

The paper finds that, although earnings and its components are priced positively by the Chinese stock market, Big 4 audit does not provide any incremental benefit to clients in terms of market pricing of clients’ financial numbers. The paper finds a negative impact of local Top10 audit on the pricing of earnings in China. However, the paper finds no incremental effect of local Top 10 audit on the market pricing of earnings components.

Although prior research in China has used modified audit opinion as the audit quality matrix, the paper considers market valuation of earnings and earnings components for firms audited by different categories of auditors.

This paper aims to review the latest management developments across the globe and pinpoint practical implications from cutting-edge research and case studies.

This briefing is prepared by an independent writer who adds their own impartial comments and places the articles in context.

Companies become better positioned to exploit the capabilities of artificial intelligence (AI) when employees perceive the technology's significance. A positive response from them drives the informal learning that can enhance career resilience and boost overall firm performance.

The briefing saves busy executives and researchers hours of reading time by selecting only the very best, most pertinent information and presenting it in a condensed and easy-to-digest format.