Cal Christian and Jefferson P. Jones
This paper examines the value relevance of operating cash flows in consideration of potential weaknesses in earnings quality in the context of a merger. When two firms merge, the…
Abstract
This paper examines the value relevance of operating cash flows in consideration of potential weaknesses in earnings quality in the context of a merger. When two firms merge, the earnings stream is altered reflecting the new entity that is created thus, making the prediction of future earnings challenging due to weaknesses in the quality of earnings. The quality of generally accepted accounting principle (GAAP) earnings, has recently been questioned by investors, analysts, and regulators. The difficulty with merged firm earnings has been exacerbated because, prior to June 2001, generally accepted accounting principles (GAAP) allowed firms to account for a merger using either the purchase or the pooling method of accounting. While the pooling method has been eliminated, this paper hypothesizes that difficulties arising from the purchase method of accounting will still exist and will continue to reduce the role of earnings in explaining security returns, and, consequently, the value‐relevance of operating cash flows is expected to increase as investors search for additional means to explain security returns. This paper finds that in the year of the merger, operating cash flows provide valuerelevant information beyond earnings. This finding supports the hypothesis that the quality of earnings in the year of the merger is difficult to interpret, and given this weakness, cash flows can aid in the explanation of abnormal security returns. Additional analyses indicate that the value‐relevance of operating cash flows is positively associated with the purchase method of recording the merger. This result is consistent with operating cash flows assuming a more important role in firm valuation when the difficulties in estimating the merged firm’s earnings are more severe. These findings also suggest that earning’s quality is more value relevant in a non‐merger year than in a merger year.
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David H. Sinason, Jefferson P. Jones and Sandra Waller Shelton
The purpose of this study is to examine the duration of the auditor’s relationship with a client and factors that affect audit firm tenure. The duration of the auditor and client…
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The purpose of this study is to examine the duration of the auditor’s relationship with a client and factors that affect audit firm tenure. The duration of the auditor and client relationship has been cited as possibly affecting the risk of a loss of auditor independence. Also, audit firm tenure has been used as an independent variable in several studies with variations on the characterization of a “long auditor‐client association.” However, little is known about the duration of the auditor’s relationship with a client. Generally, no empirical justification is provided for the treatment of the variable and no consideration is included for auditor or client factors that may affect the relationship. This study evaluates the duration of the auditor relationship with a client and determines which factors contribute to changes in that relationship. In an examination of 16,976 COMPUSTAT companies over a twentyyear period, the mean duration of audit tenure is found to be more than six years. However, audit tenure is affected by client size, client growth rate, and type of audit firm involved in the change of auditor. Audit tenure is not affected by audit firm size, client risk, or audit opinion.
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Arlette Wilson and Jefferson Jones
Special purpose entities, generally known as SPEs, have been the bane of everyone in the risk management and the asset management business. But they can also be extremely useful…
Abstract
Special purpose entities, generally known as SPEs, have been the bane of everyone in the risk management and the asset management business. But they can also be extremely useful. Now, post‐Enron, further rules have been put into place to ensure that SPEs are clearly identifiable and their purpose can be transparent. The author examines how these new rules will work and assesses the likelihood of success.
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The purpose of this paper is to explore regulatory issues of short-term rentals (STR) and evaluate what constitutes effective regulation of STR by analyzing the STR ordinance in…
Abstract
Purpose
The purpose of this paper is to explore regulatory issues of short-term rentals (STR) and evaluate what constitutes effective regulation of STR by analyzing the STR ordinance in the City of Charleston, South Carolina, as well as reviewing the regulation process the City took.
Design/methodology/approach
In this case study, the study employed a documentary research method (Ahmed, 2010) using multiple sources, including government documents, historical statistics and local publications. Prior to analyzing documents, face-to-face interviews with a couple of key government officials were conducted to understand the overall context of the regulation processes as well as to obtain primary information and data pertaining to Charleston’s STR regulation processes.
Findings
The study identified three noteworthy points. First, the legalization process was transparent and democratic; opportunities for stakeholder participation in crafting the Charleston’s ordinance included the establishment of the STR Task Force and public listening sessions. Second, the Charleston’s STR regulation is designed to protect non-participating residents and the historic characters of its neighborhoods; several measures (e.g. strict eligibility, operational restrictions, licensing and permitting, enforcement) protect non-participants and the neighborhood overall, while the City allows STR to be legal. Third, there is a unique enforcement mechanism and tourism-related governance structure; dedicated staff in the Department of Livability and Tourism enforce the STR laws in Charleston.
Originality/value
Empirical analysis of the STR regulations has never been established. The study provides useful and timely insights for local governments, destination management organizations, tourism scholars, and stakeholders in tourism cities to advance the discussions and debates around STR regulations.
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President Bill Clinton has had many opponents and enemies, most of whom come from the political right wing. Clinton supporters contend that these opponents, throughout the Clinton…
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President Bill Clinton has had many opponents and enemies, most of whom come from the political right wing. Clinton supporters contend that these opponents, throughout the Clinton presidency, systematically have sought to undermine this president with the goal of bringing down his presidency and running him out of office; and that they have sought non‐electoral means to remove him from office, including Travelgate, the death of Deputy White House Counsel Vincent Foster, the Filegate controversy, and the Monica Lewinsky matter. This bibliography identifies these and other means by presenting citations about these individuals and organizations that have opposed Clinton. The bibliography is divided into five sections: General; “The conspiracy stream of conspiracy commerce”, a White House‐produced “report” presenting its view of a right‐wing conspiracy against the Clinton presidency; Funding; Conservative organizations; and Publishing/media. Many of the annotations note the links among these key players.
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John E. Elliott and Joanna V. Scott
This article examines relationships between capitalism and democracy as perceived by contending perspectives within the liberal capitalist‐liberal democratic tradition(s). Bentham…
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This article examines relationships between capitalism and democracy as perceived by contending perspectives within the liberal capitalist‐liberal democratic tradition(s). Bentham and the Mills are taken as initiating both this tradition and the core elements of the debate within it. Pre‐Benthamite theories are first reviewed. Then, after discussion of Bentham and James Mill and of John Stuart Mill, Mill's late nineteenth and early twentieth century successors are examined. We then go on to consider hypotheses concerning the “exceptional” quality of relationships between capitalism and democracy in the United States. The penultimate section of the article adumbrates the main contours of mid‐twentieth century pluralist‐elitist theories. We conclude with a summary.
Using the philosophical lenses of revisionist ontology and the politics of personhood, this paper explores the notion of Black Founders of the United States. I introduce the…
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Using the philosophical lenses of revisionist ontology and the politics of personhood, this paper explores the notion of Black Founders of the United States. I introduce the concept critical intellectual agency to argue that Black Founders brought unique contributions to the American experience. Their efforts were twofold. First, Black Founders established separate Black institutions that would become staples in Black communities after emancipation. Second, Black Founders challenged the supposed egalitarian beliefs of White Founders through media outlets. To illustrate, I focus on one Black Founder, Benjamin Banneker and his letter to Thomas Jefferson to illustrate how Black Founders philosophically responded and challenged White Founders prejudicial beliefs about Blackness. This paper seeks to challenge social studies teachers’ curricular and pedagogical approaches to Black Americans during the colonial period by providing a heuristics and language to explore the voices of Black Americans in U.S. history.
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Inquiries, commissions, reviews and the promise of broader data collection about racial and gender disparities are now the reflex defensive responses from state institutions…
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Inquiries, commissions, reviews and the promise of broader data collection about racial and gender disparities are now the reflex defensive responses from state institutions charged with grievous social harm, particularly in the UK. Recommendations from these exercises are rarely implemented. As criminologists, our ability to produce and analyse data that evidences or better illuminates social harm has long been a key offer of the discipline to activism.
How are we to respond to the very institutions activist criminologists seek to challenge immediately offering this very activity, invariably protracted and ineffectual, as a reflex response to activist challenge? This chapter explores this tension. Grounded in the work of groups struggling to end police stop and search, it considers the strategy impasse around research and data production that faces grassroots activists and their accomplice researchers. The chapter proposes new routes for collaboration and action across activist and criminologist communities that may help move past the ‘data trap’. In short, it seeks to answer: do activists need more evidence?