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To discuss and interpret the recently published summary of the select priorities of the SEC’s Office of Compliance Inspections and Examinations (“OCIE”) in connection with the National Exam Program for 2015.

This article highlights the broad OCIE focus areas and provides detail on the associated initiatives.

OCIE’s priorities appear to place particular emphasis on retail investors and investors saving for retirement and market-wide risks, including cybersecurity. The examination priorities also emphasize OCIE’s evolving ability to analyze data to identify and examine registrants that may be engaged in illegal activity. Of particular interest to private equity fund sponsors, the National Exam Program will continue to conduct examinations that focus on fees and expenses borne by investors in private equity funds.

In view of the OCIE’s priorities, recent public comments by OCIE officials (concerning, for example, presentation of performance data) and our experience representing private equity firms being examined by OCIE, private equity fund sponsors should continue to be prepared for rigorous examinations on these issues and the areas of focus highlighted by the SEC in the past three years.

The article summarizes the OCIE’s recently published examination priorities for 2015 that cover a broad range of market participants and target a variety of their products, practices and procedures, including a continued focus on private equity fund sponsors.

Describe an important recent enforcement action by the Securities and Exchange Commission (SEC) regarding expense allocations by private equity funds.

Discusses a recent enforcement action by the SEC regarding a registered investment adviser’s handling of expense allocation with respect to two private fund clients and certain of their underlying portfolio companies.

The settlement and sanctions are noteworthy because: (i) there was no suggestion that the misallocations of expenses were designed to systematically favor one private fund client over the other, that the manager benefited from such misallocations, or that the failure to allocate expenses in accordance with the policy had been deliberate and (ii) while not stated explicitly, it appears likely that a significant portion of the disgorgement related to misallocations that occurred before the manager was a registered investment adviser.

Registered investment advisers should ensure that they and their portfolio companies have written policies in place designed to fairly allocate all expenses among all entities that benefit from the activities driving such expenses and that none of the sponsor’s clients are directly or indirectly benefited or harmed from allocation policies at the portfolio company level.

Description of a noteworthy SEC enforcement action regarding expense allocation and practical guidance from investment management lawyers to remind private equity sponsors to ensure that they have adopted and implemented expense allocation policies.

Facing a high birth rate, a falling mortality rate, and inconsistent policies on family planning from the 1950s to the early 1970s, the People's Republic of China (PRC) launched its widely known one‐child policy in 1979. The intention was to restrict population growth by reducing fertility through family planning and thereby to conserve the nation's resources to advance economic development. The effectiveness of the one‐child policy has varied greatly because policy regulations are differentially carried out by officials of provinces, municipalities, counties, communes, and minority regions. Generally speaking, the state policy has had greater acceptance in urban areas but is far less rigidly enforced by local officials in rural areas and for certain national minorities, which can have a second child under certain circumstances (Chow and Chen, 1994).

The Internet has enabled consumers to act as their own travel agents and to verify independently the accuracy of the information provided by airlines through the CRSs and travel agents. As a result, the relationships between consumers and the suppliers of air-travel information have been radically altered, and we document these changes. We identify the relevant market for air-travel information, which includes CRSs, online travel agencies, and the websites and call centers of individual carriers. We determine market concentration and market shares using the Herfindhal-Hirschman Index. Based on our analysis, we argue that there is no longer any need to regulate independent CRSs. However, airlines that own CRSs continue to have an incentive to withdraw their flight and fare information from rival CRSs and, to prevent this from happening, the mandatory participation rule adopted in 1992 should be maintained.

We propose a research design involving the use of Bloom’s taxonomy both in facilitating the teaching–learning process and in the educator assessing students’ final grades. The latter are compared with students’ self-acknowledged grades. Testing is done by considering a sample of accounting students enrolled for the Controlling course in Romania.

The employed research methodology relies on two instruments: a questionnaire and the examination process. Cluster analysis is used in analyzing students’ grades. Determinants of students’ academic performance are discussed by using factor analysis.

Comparing students’ self-acknowledged grades with those assessed by the educator, we document the necessity of further work in enhancing students’ ability to better assess their academic performance. Questions belonging to the application and analysis levels seem to be preferred by students.

We raise a series of theoretical questions in the area of examination performance. The obtained results in relation to the assessment of accounting students’ academic performance and its determinants offer useful insights for accounting educators.

Our chapter tests the use of Bloom’s taxonomy in the context of an emerging country’s educational system that lacked consistency and faced significant challenges throughout history. We also consider two measures for students’ academic performance as perceptions upon what should be the same result of the teaching–learning process. The chapter addresses the evolutions and particularities of the Romanian academic environment in the area of economics, developing a brief analysis meant to position the testing of the proposed research design.

Are the social domains of kinship and business on balance complementary or contradictory? Do ventures that invest heavily in both – conventionally referred to as “family firms” – bear a net gain or net loss? We are scarcely the first to raise these questions. How then will we try to contribute to an answer? We try this in five ways, all of them based on previous literature. First, we develop the dichotomy of kinship and business by taking seriously the metaphor of yin and yang, merging it with the anthropological constructs of structural domains such as “domestic” and “public.” This metaphor proves to shed light on the relevant literature. Second, we provide a qualitative survey of the costs and benefits of kinship in business. Third, we summarize the empirical work that addresses the performance outcomes from family involvement. Fourth, we consider the practitioner implications of these studies. Finally, we ask if scholars are as yet in a position to answer these questions.

If child custody decisions are based on erroneous beliefs, family courts may not be acting in the best interests of children. This study examined family court professionals' beliefs about family violence. Respondents (N = 410) of diverse professions, including child custody mediators, evaluators, and therapists, family law attorneys and judges, victim advocates and university students, completed a 10‐item multiple‐choice quiz. Results revealed low rates of correct responding, with respondents correctly answering approximately three out of 10 items on average, based on current research in the field. Overall, response rates were highly consistent with the discredited patriarchal paradigm. Shelter workers and victim advocates had the lowest average score, and men were found to have slightly higher scores than women. More troubling, students' scores were not significantly lower than those of family court professionals. Implications are discussed with respect to decision‐making in the context of child custody disputes.

The purpose of this paper is to investigate practicing auditors' beliefs regarding the effect of prior involvement on the occurrence of quality threatening behaviour (QTB) during an audit. The authors examine the extent to which auditors' beliefs about QTB are consistent with the theoretical framework of Kanodia et al., according to which prior involvement in audit work would increase the likelihood of auditors suppressing evidence inconsistent with earlier audit decisions.

The authors conduct an experiment in which auditors assess the likelihood of perceived reputation threats associated with encountering disconfirming evidence late in the audit, and the likelihood that such evidence will be suppressed.

Auditors participating in the study believe that prior involvement will induce a perception of personal reputation threats in an auditor encountering evidence inconsistent with the conclusions of earlier audit work. Participants perceive an auditor with prior involvement in the audit work to be more likely to suppress audit evidence than an auditor with no prior involvement; this effect is largely explained by the personal reputation threats believed to be induced by prior involvement.

The findings provide important information, from the perspective of practicing auditors, about a situational antecedent of QTB that is present on most audit engagements. Prior involvement is perceived by auditors to induce a conflict of interest in reporting troublesome evidence uncovered late in the audit. These perceptions suggest it is important to raise reviewers' awareness of the possibility of undesirable behavior in such situations. Potential limitations of the study relate to generalizability of the results under different levels of misstatement risk and under different environments in audit practice. Also, the authors do not measure auditors' actual behaviour, but their assessment of hypothetical situations and beliefs about others' actions. Future research can examine actual auditor behaviour in the presence of prior involvement.

The paper provides evidence on auditors' beliefs about the effects on QTB of prior involvement, a factor that has not been previously studied in this line of research. The authors show that auditors' beliefs about QTB are consistent with Kanodia et al.'s theoretical framework. The study is the first to measure auditors' assessments of perceived reputation threats and to show their mediating effect on the predicted behavior of audit professionals.