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We have reprinted the powerful letter addressed to the Daily Mail by MR. H. W. WILSON, the author of “Ironclads in Action,” advocating the immediate adoption of a policy of reprisals for the Zeppelin murder raids. In our view it is the duty of every journal, whatever may be its raison d'être, to assist in keeping the attention of the public fixed upon this matter, to aid in preventing the general feeling of disgust and indignation from cooling down, and to support those who have the brains to understand the nature of the Hun in their efforts to compel the Government to adopt the most effective means at present available to put an end to the murderous excursions of the German vermin into this country. As MR. WILSON points out, the deliberate Hun policy of slaying women, children and non‐combatants is either permitted by the laws of war recognised by civilised nations or it is not permitted by those laws. If it is permitted, “then clearly the Power which refrains from making similar attacks on the enemy's towns, villages, and residential districts, loses greatly from the military standpoint.” If it is not permitted then the only course— “the force behind the laws of War”—is a policy of drastic reprisals. Moreover, it is the only course that the Hun can understand. The methods of “frightfulness” are definitely laid down in the German military system as methods to be ruthlessly followed whenever this can be done with impunity and the fear of reprisals is also definitely laid down as the only consideration which is to be allowed to operate as a check upn “frightfulness.” “The Power which fails to take reprisals when a great offence is committed is as the negligent judge or the faithless jury that acquits a murderer. It sins against humanity … it encourages the criminal in his crime.”

This study examines audit fee premiums from brand name, industry specialization, and industry leadership after the merger of two Big 6 audit firms, creating the Big 5 in 1998 in the Malaysian audit market. A sample of 679 companies listed at the main and second boards of Kuala Lumpur Stock Exchange (KLSE) are investigated for audit fee premiums. Industry specialization is determined on the basis of 20 per cent share of audit market calculated by the number of audited companies in the industry. Audit fee premiums are calculated based on the Simunic (1980) model of audit fees. Results show: that Big 5 audit firms obtain 65.4 per cent audit market share for all KLSE listed companies; that Big 5 audit firms earn higher audit fees than non‐Big 5; and that industry specialization does not generate audit fee premiums. The study finds evidence for audit fee premiums derived from industry market leadership. Results also reflect the competitiveness among Big 5 audit firms in the audit market especially following the merger of Big 6 audit firms.

The purpose of this chapter is to present key characteristics of early reading text by describing a new series of researcher-developed early reading books that were specifically designed to address multiple criteria, including word structure or decodability, familiarity, repetition, high-frequency, syntax, and text cohesion. We describe the theoretical and empirical rationale that guided the design of the books, how we developed them, and their key features. This is followed by a technical analysis that describes the (1) characteristics of the target words used to guide the writing of the books and (2) characteristics of the text, such as the percentage of words on common high-frequency word lists, word counts, type-token ratio, sentence counts, unique sight words, unique decodable words, and content (i.e., picture-supported) words. The analysis demonstrates that the target words and the text in the books are consistent with our intended goal of simultaneously addressing multiple variables.

THE QUESTIONS set in engineering examinations are in one respect surprisingly uniform in nearly all universities, and colleges, and professional institutions: each question describes a more or less simple engineering problem in as few words as possible and adds the relevant dimensions or measurements necessary for the solution which is carefully defined as the desired end. Great care is taken by examiners to ensure that the description is terse, has adequate but not redundant information, and this is occasionally assisted by a small, simplified diagram reproduced in the text of the exam paper. These diagrams are often so highly simplified that the parts are indistinguishable as real engineering components.

DR WALSHAW'S article on “Crowther and Numeracy” in the October 1960 issue ends by pointing out the difficulty of many engineering students in handling the gravitational acceleration ‘g’ in problems of applied mechanics. Although a great deal of this difficulty can be resolved by Dr Walshaw's methods of handling the units concerned, a contributory factor is that students rarely have placed before them a comparative table of different possible systems of units. Thus the less able students fail to realise the importance of consistency in using units in a particular problem.

This study is motivated by the lack of internal audit function (IAF) research and by the call for research on the impact of dominant owners such as family shareholders on audit fees and the demand for audit quality. This study aims to examine the impact of the IAF budget on the selection of industry-specialist auditors and on audit fees, particularly in companies with family-controlled shareholders, a feature unique to Malaysia.

Data of Malaysian-listed companies during the period 2009-2012 are used. To examine the relationships, logit and ordinary least square regressions are used. Several additional analyses are conducted to assess the robustness of the main results, including alternative measures of specialist auditor and family ownership, endogeneity problems and self-selection bias.

The results show that the IAF budget is positively related to hiring industry-specialist auditors and audit fees. However, family companies are less likely to support the positive association between IAF costs and engage specialist auditors than non-family companies. In addition, a complementary association between the costs of IAF and audit fees for both family and non-family companies was found. Finally, the results show that there is a negative association between family ownership and the ratio of IAF costs to audit fees, suggesting that family companies rely more upon external auditing than internal auditing.

The contribution of this study is to provide an empirical evidence about the tradeoff between IAF and both industry-specialist auditors and audit fees with considering the moderating impact of family-ownership shareholdings. This issue is yet to be examined, and it provides implications for policymakers and practitioners, as it offers insights into the importance of investing in IAF toward hiring industry-specialist auditors and pricing the audit services.

This study aims to examine the effects of agency cost on auditor choice. This paper also deals with the moderating role of the board’s financial expertise (Bfe) and the status of the internal control (Intecon) system on the relationship between agency cost and auditor selection.

This study’s sample consists of 1,040 firm-year observations of Iranian nonfinancial companies listed on the Tehran Stock Exchange from 2012 to 2019. The information required for this research is mainly extracted from Comprehensive Database of All Listed Companies (in Iran Stock Exchange). Data from 130 companies were obtained during the research period. This study used logistic regression to test the hypotheses.

The findings indicate that companies with higher agency costs choose the auditor from lower classes. As the proportion of financial expert members on the board increases, the intensity of this relationship will be reduced. Companies with higher agency costs choose the auditor from the lower classes, but the higher the ratio of financial expert board members, the more these companies will choose high-quality auditors. However, findings showed that the status of the Intecon system has no moderating effect on the relationship between agency costs and auditor selection.

The results of this study can expand the existing literature on the relationship between auditor selection and agency costs and the factors affecting this relationship, especially the Bfe and Intecon. This research has significant suggestions for regulators, stakeholders, shareholders and analysts in emerging economies that may encounter similar contextual implications.

Refers to previous research on investment opportunity sets, financing policies, board monitoring and directors’ shareholdings and the proportion of non‐executive directors (NEDs) on the board on the negative relationship between investment opportunities and leverage. Tests them on 1998 data from 437 top Australian companies, explains the methodology and presents the results, which suggest that the negative relationship (i.e. asset substitution or underinvestment) decreases with higher levels of executive director shareholdings or higher proportions of NEDs; and that underinvestment is greatest for firms with low management share ownership. Recognizes the limitations of the study and suggests some avenues for further research.

This study aims to identify the factors that lead non-financial companies listed in the UK to use an internal audit function (IAF) as a monitoring mechanism. Although the use of an IAF in the UK is voluntary, no prior research has examined the drivers for using one.

Financial and non-financial data were collected from the annual reports of 332 UK non-financial companies listed on the London Stock Exchange (LSE) Main Market. Univariate tests and multivariate logistic regression tests were used to test the research hypotheses. A theoretical framework based on both agency theory and transaction cost economics (TCE) theory was used to explain the economic factors affecting the use of an IAF.

The study provides evidence that firm size, level of internal risks, agency problem between owners and managers and existence of an effective audit committee are associated with the existence of an IAF. Thus, the need to have strong internal control and risk management systems and to reduce both internal and external agency costs drives companies to have an IAF. These results suggest the importance of IAF as an internal corporate governance tool and the effectiveness of UK governance regulations in monitoring the effectiveness of internal control systems.

Given the importance of the IAF’s corporate governance role, the study provides some policy implications. Regulators should pay more attention to the issue of maintaining an IAF, especially by large companies, the relationship between the IAF and other governance parties, especially the audit committee, and the disclosure of more relevant information about the IAF’s characteristics and practices.

This is the first study to examine the factors affecting the existence of the IAF within the UK’s distinctive regulatory approach of “comply or disclose reasons”. Furthermore, it provides a theoretical framework that explains how both the agency theory and TCE theory can interpret the adoption of internal audit.

Purpose – Audit quality is traditionally defined as the joint probability that an existing problem is discovered and reported by the auditor. This study examines whether and how audit quality is associated with related-party transactions and CEO duality. The first part (i.e., the ability to discover) is related to professional judgment, and the second part (i.e., report truthfully) is related to independence.

Methodology/Approach – Regression methods was used on archival data.

Findings – Our results reveal that for publicly held companies in environments with stronger capital market discipline, which causes greater reputation concerns and litigation risks, a CEO who is also the board chair does not hinder auditor independence. For privately held companies, however, such a CEO hinders auditor independence due to a lack of capital market discipline. The findings on related-party financing, on the other hand, are reversed. That is, in terms of information for an auditor, since the conflicts of interests are more severe in publicly held companies than in privately held companies, the relevance of related-party financing to a decision whether to issue a going-concern opinion is greater in publicly held companies.

Social implications – The empirical results of publicly held companies are useful for countries with better corporate governance, while those of privately held companies are helpful for countries with relatively weak corporate governance.

Originality/Value of paper – Because auditors performing audit services face different litigation risks and reputation concerns, the differences in our results between the two types of clients can have implications about the suitability of these types of companies in emerging markets.