Miranda Lam, Hongtao Guo and Paul McGee
Tom Gould, an entrepreneur, had been operating Treadwell’s Ice Cream, a small ice cream restaurant since 2000. Treadwell’s Ice Cream had been preparing its financial statements…
Abstract
Synopsis
Tom Gould, an entrepreneur, had been operating Treadwell’s Ice Cream, a small ice cream restaurant since 2000. Treadwell’s Ice Cream had been preparing its financial statements under cash basis. Tom Gould turned over all his receipts, both personal and business expenses, to his bookkeeper who entered them into QuickBooks. At tax time, his tax accountant excluded non-qualifying expenses from the tax filing. Periodically, Tom met with his bookkeeper to determine the results of operations and financial position at the end of that period of time. Most of Treadwell’s transactions were easily recognized by Tom, who preferred to pay all expenses by cash rather than credit. However, the bookkeeper had not been separating operating from non-operating activities, and had been using multiple accounts to record the same or similar costs. Therefore, the current income statement and balance sheet were not appropriately categorized and organized. In addition, since the bookkeeper was not a tax account, business expenses had been mixed with Tom Gould’s personal expenses on the income statement. There were no adjustment to the income statement after the tax accountant identified non-qualifying expenses when preparing tax filing. As Tom and his wife were considering turning over more day to day operations to his son and hiring a non-family member as a manager to help his son, he would need the books to provide an accurate picture of the business.
Research methodology
Primary source materials included interviews with the owner, Thomas Gould, his son, Michael Gould, and their Accountant, Tom Mallas. Secondary source materials included monthly and annual financial data from QuickBooks (monthly data are available upon request but are not relevant to the case discussion). Other secondary source materials included geographic, economic, industry, and competitors’ information.
Relevant courses and levels
This case is well suited for an introductory level undergraduate financial accounting course, after accrual accounting and accounting information systems (accounting cycles) have been introduced. When analyzing this case, students will apply concepts and principles of financial statement preparation. The case is also appropriate to serve as a review of accrual accounting, and of income statement and balance sheet preparation at the beginning of an intermediate level financial accounting course. Students can be asked to reformat the income statement from the single-step format to the multiple-step format. By working through financial statements with common errors found in small businesses, students can practice identifying these errors, thus providing a review of the various sections of the income statement and prepare students for more in-depth discussions of each section. In a tax course, this case can stimulate discussions on non-qualifying expenses and common shortcomings in small business accounting.
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Jayanti Bandyopadhyay, Hongtao Guo, Miranda Lam and Jinying Liu
We obtained information on China Gerui from secondary published sources, including annual reports downloaded from the Securities and Exchange Commission’s (SEC) EDGAR database…
Abstract
Research methodology
We obtained information on China Gerui from secondary published sources, including annual reports downloaded from the Securities and Exchange Commission’s (SEC) EDGAR database, news sites and newspapers, the company’s website and journal articles. One of the authors visited the China Gerui plant in Henan, China.
Case overview/synopsis
China Gerui, a Chinese metal fabrication company, enjoyed exponential growth because of its location, product innovation and ability to move up the value chain. At the height of its success, the company listed on the Nasdaq and had plans to raise capital to fund ambitious expansion plans. Unfortunately, four years after listing on Nasdaq, the company received a letter from the listing qualifications department notifying China Gerui that they were not in compliance with Nasdaq’s filing requirements because it had not filed its Form 20-F. Now, the company had only five days to decide whether to request an appeal of the letter.
Complexity academic level
This case is best suited for higher-level undergraduate accounting and finance courses such as intermediate accounting, auditing, international accounting, financial statement analysis, corporate finance and investments analysis. It is especially appropriate for graduate-level global accounting and advanced financial statement analysis courses. In these courses, the best placement is after coverage of SEC regulations and requirements for financial statement reporting and disclosure. Moreover, the case may be used as a tool to demonstrate the step-by-step process for searching and retrieving information from a public company’s filings through the SEC’s EDGAR database.
Supplementary materials
Teaching notes are available for educators only. Please contact your library to gain login details or email support@emeraldinsight.com to request teaching notes.
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Hongtao Guo, Guojun Wu and Zhijie Xiao
The purpose of this article is to estimate value at risk (VaR) using quantile regression and provide a risk analysis for defaultable bond portfolios.
Abstract
Purpose
The purpose of this article is to estimate value at risk (VaR) using quantile regression and provide a risk analysis for defaultable bond portfolios.
Design/methodology/approach
The method proposed is based on quantile regression pioneered by Koenker and Bassett. The quantile regression approach allows for a general treatment on the error distribution and is robust to distributions with heavy tails.
Findings
This article provides a risk analysis for defaultable bond portfolios using quantile regression method. In the proposed model we use information variables such as short‐term interest rates and term spreads as covariates to improve the estimation accuracy. The study also finds that confidence intervals constructed around the estimated VaRs can be very wide under volatile market conditions, making the estimated VaRs less reliable when their accurate measurement is most needed.
Originality/value
Provides a risk analysis for defaultable bond using quantile regression approach.
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Xiaoyong Wei, Feng Ju, Bai Chen, Hao Guo, Dan Wang, Yaoyao Wang and Hongtao Wu
There is an increasing popularity for the continuum robot in minimally invasive surgery owing to its compliance and dexterity. However, the dexterity takes the challenges in…
Abstract
Purpose
There is an increasing popularity for the continuum robot in minimally invasive surgery owing to its compliance and dexterity. However, the dexterity takes the challenges in loading and precise control because of the absence of the shape tracking for the continuum robot. The purpose of this paper is to propose a new type of continuum manipulator with variable stiffness that can track the bending shape timely.
Design/methodology/approach
The low-melting-point alloy (LMPA) is used to implement the stiffness variation and shape detection for the continuum manipulator. A conceptual design for a single module is presented, and the principle of stiffness control based on the established static model is formulated. Afterward, a shape detection method is introduced in which the shape of the continuum manipulator can be detected by measuring the resistance of every LMPA. Finally, the effect of the proposed variable stiffness method is verified by simulation; the variable stiffness and shape detection methods are evaluated by experiments.
Findings
The results from the simulations and experiments indicate that the designed continuum manipulator has the ability of stiffness variation over 42.3% and the shape detection method has high precision.
Originality/value
Compared with conventional structures, the novel manipulator has a simpler structure and integrates the stiffness variation and shape detection capabilities with the LMPA. The proposed method is promising, and it can be conveniently extended to other continuum manipulators.
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Debiao Meng, Shiyuan Yang, Chao He, Hongtao Wang, Zhiyuan Lv, Yipeng Guo and Peng Nie
As an advanced calculation methodology, reliability-based multidisciplinary design optimization (RBMDO) has been widely acknowledged for the design problems of modern complex…
Abstract
Purpose
As an advanced calculation methodology, reliability-based multidisciplinary design optimization (RBMDO) has been widely acknowledged for the design problems of modern complex engineering systems, not only because of the accurate evaluation of the impact of uncertain factors but also the relatively good balance between economy and safety of performance. However, with the increasing complexity of engineering technology, the proposed RBMDO method gradually cannot effectively solve the higher nonlinear coupled multidisciplinary uncertainty design optimization problems, which limits the engineering application of RBMDO. Many valuable works have been done in the RBMDO field in recent decades to tackle the above challenges. This study is to review these studies systematically, highlight the research opportunities and challenges, and attempt to guide future research efforts.
Design/methodology/approach
This study presents a comprehensive review of the RBMDO theory, mainly including the reliability analysis methods of different uncertainties and the decoupling strategies of RBMDO.
Findings
First, the multidisciplinary design optimization (MDO) preliminaries are given. The basic MDO concepts and the corresponding mathematical formulas are illustrated. Then, the procedures of three RBMDO methods with different reliability analysis strategies are introduced in detail. These RBMDO methods were proposed for the design optimization problems under different uncertainty types. Furtherly, an optimization problem for a certain operating condition of a turbine runner blade is introduced to illustrate the engineering application of the above method. Finally, three aspects of future challenges for RBMDO, namely, time-varying uncertainty analysis; high-precision surrogate models, and verification, validation and accreditation (VVA) for the model, are discussed followed by the conclusion.
Originality/value
The scope of this study is to introduce the RBMDO theory systematically. Three commonly used RBMDO-SORA methods are reviewed comprehensively, including the methods' general procedures and mathematical models.
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Jianhua Liu, Peng Geng and Hongtao Ma
This study aims to obtain the more precise decision map to fuse the source images by Coefficient significance method. In the area of multifocus image fusion, the better decision…
Abstract
Purpose
This study aims to obtain the more precise decision map to fuse the source images by Coefficient significance method. In the area of multifocus image fusion, the better decision map is very important the fusion results. In the processing of distinguishing the well-focus part with blur part in an image, the edge between the parts is more difficult to be processed. Coefficient significance is very effective in generating the better decision map to fuse the multifocus images.
Design/methodology/approach
The energy of Laplacian is used in the approximation coefficients of redundant discrete wavelet transform. On the other side, the coefficient significance based on statistic property of covariance is proposed to merge the detail coefficient.
Findings
Due to the shift-variance of the redundant discrete wavelet and the effectiveness of fusion rule, the presented fusion method is superior to the region energy in harmonic cosine wavelet domain, pixel significance with the cross bilateral filter and multiscale geometry analysis method of Ripplet transform.
Originality/value
In redundant discrete wavelet domain, the coefficient significance based on statistic property of covariance is proposed to merge the detail coefficient of source images.
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Zhihuai Xiao, Jiang Guo, Hongtao Zeng, Pan Zhou and Shuqing Wang
The purpose of this paper is to develop a new hybridized controller based on fuzzy reasoning and neural network (NN) for hydropower generator unit (HGU).
Abstract
Purpose
The purpose of this paper is to develop a new hybridized controller based on fuzzy reasoning and neural network (NN) for hydropower generator unit (HGU).
Design/methodology/approach
The approach contains fuzzy neural networks controller (FNNC), RBF network identification (RBFNI) and HGU system. FNNC may give control value to control HGU via fuzzy NN reasoning and computing according to HGU rotate speed error and error varying rate. RBFNI is used to identify the character of HGU system and predict its output. FNNC may adjust parameters and member function according to the identifying and predictive outcome of RBFNI.
Findings
Sees that the hybridized control system is feasible and stable, and the controlling performance of the hybridized system is superior to conventional fuzzy controller.
Research limitations/implications
The theoretical proof of stability of the proposed scheme still remains to be studied. Accessibility and availability of membership functions and control rules is also a limitation applied.
Practical implications
The main advantage of the proposed method is that FNNC has reasoning, learning, and optimizing capability which can control effectively HGU. This will be useful for control engineers to control complex industrial plants.
Originality/value
The paper proposes new combined approach to optimal control of HGU using FNNC, and it is aimed at operational researches and engineers, especially those who dealt with HUG controller.