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The purpose of this paper is to identify the circumstances that gave rise to an adverse audit opinion by a New Zealand (Christchurch) accounting firm, Hicks and Ainger, on the annual financial report of the local firm, T.J. Edmonds Ltd, in 1976. In so doing, this study revealed not only previously undocumented issues surrounding major asset purchases but also the impact of key personalities before and after the adverse opinion decision.

The study is located within the Cultural Theory of History, to theorize the narratives within the wider contextual perspective. The issues surrounding the use of memory from such interviews are also considered. The key material offered in this study is sourced from a 2015 interview with the two key audit partners in this audit engagement.

The accounting standard on depreciation at that time, SSAP 3, had not been applied properly to the accounting treatment of four helicopters for wild deer operations, purchased a week before balance date. Neither the artificial suppression of profits by this purchase decision and accounting choice nor the fall in profits nor the adverse opinion, influenced share prices or shareholder perceptions long term.

The significance of this project is that it informs the appreciation of the importance of contextual understanding of a singular adverse audit opinion.

This paper examines the effect that the introduction of the FRS 9, the general disclosure standard in New Zealand, has on the level of disclosure of certain unspecified operating expenses. Generally, a low level of operating expense disclosure was found with no overall improvement recorded after the introduction of FRS 9. In many cases, companies did not disclose any unspecified operating expenses. Firm size and overseas listing/ownership appeared to be positively associated with the disclosure of unspecified operating expenses. Most companies did disclose the mandatory expenses monitored (depreciation, audit and directors' fees). Commentary is provided on the inadequacy of the discretionary aspects of accounting standards such as FRS 9, and the inadequacy of regulatory enforcement. Given the move to international harmonisation, and the level of disclosure seemingly at odds with international practice, the adoption and enforcement of International Accounting Standard 1 (IAS 1) would provide a simple solution.

The purpose of this paper is to examine compliance with operating expense disclosure provisions contained in New Zealand approved accounting standards before and after the move to New Zealand equivalents to international financial reporting standards (NZ IFRS). Prior research showed poor disclosure practices and the paper seeks to determine if this has improved under international accounting standards for those who choose to adopt NZ IFRS prior to mandatory adoption.

An empirical archival approach is used. While the sample size of early adopters is small, it does provide the unique ability to control for any temporal effects on disclosure practices.

Full compliance with operating expenses that are mandated such as depreciation, directors and auditor fees under both NZ financial reporting standards (NZ FRS) and NZ IFRS was found. However, unspecified operating expense disclosures are still poor for those using NZ FRS. A substantial improvement was found in unspecified disclosure levels for those companies using the New Zealand equivalent to international accounting standard 1 (NZ IAS 1). However, the results also show areas of concern, for example, 14 per cent of listed companies using NZ IAS 1 did not disclose any unspecified expense items and 27 per cent of listed companies disclosed only one item.

The results should be of relevance to preparers, analysts and regulators. The preliminary results were provided to the New Zealand Securities Commission. After its own analysis, it issued a statement expressing concern with the high level of unexplained expenses in financial statements.

Adequate disclosure is considered a crucial element to help ensure efficient capital markets. The paper provides empirical insights into operating expense disclosure based on the requirements and wording contained within NZ FRS and NZ IFRS.

This paper investigates factors that influence the extent of corporate mandatory disclosure practices in New Zealand over a three‐year period. Researcher‐created disclosure‐scoring templates consisting of mandated information items from three regulatory sources were used to derive indexes of disclosure in financial annual reports of the sample companies. Regression analysis suggests that company age is the most critical factor in explaining the extent of mandatory disclosure practices of the companies. The results also indicate that company size, liquidity, profitability, existence of audit committee, and auditor‐type are consistently positively related to the extent of corporate mandatory disclosure. Further research opportunities are suggested.

This paper investigates the presence of the accrual and the cash flow anomalies in the New Zealand stock market for the period of 1987 to 2003. We observe insignificant evidence of the accrual anomaly but find strong evidence of the presence of the cash flow anomaly. However, from 1987 to 1992 – a period before the introduction of the Companies and the Financial Reporting Acts 1993 – the presence of the accrual anomaly was statistically significant suggesting that the introduction of the FRA had a significant impact on the occurrence of the anomaly. We observe further that firms with high discretionary accruals experience significant negative future stock returns. This evidence is consistent with the notion that managers of these firms engage in earnings management.

1. Introductory perspectives If you want to catch a trout, you must think like a trout. If you want to value real estate, you must look at it from various angles. If you want to understand valuations for current cost accounting you must think like an accountant and view it from several perspectives.

An intractable effect of revenue and expense recognition based on tax regulation and accounting rules is unresolved and may be manageable only by reducing the value of deferred taxes. Therefore, in this study, the authors examined the relationship between the International Accounting Standard 12 (IAS 12) and deferred income taxes associated with tax and accounting rules.

The authors used a large sample of balanced data from 144 firms across 1992–2019. To mitigate the problem of superfluous results, the authors used the same number of firms and years for pre- and post-IAS 12 periods. The authors employed robust econometric estimations to establish the impact of IAS 12 on deferred tax.

The regression results show that deferred tax assets decreased significantly, whereas deferred tax liabilities increased significantly, in the post-IAS 12 period. These contrasting results imply that IAS 12 implementation has increased conservatism and prudence in financial reporting. However, the authors find that the increase in deferred tax assets post-IAS 12 is value destructive, suggesting that its implementation has unintended consequences. The results are robust to alternative measurements and econometric identification strategies.

While prior studies have explored topics such as deferred tax measurement and the impact of income and expense recognition, the authors specifically analyzed how IAS 12 affects deferred taxes and their effect on the market valuation. The authors find that certain accounting standards may not be relevant to the capital market.

Research undertaken by the authors over the last two years has revealed a number of problems in valuing non‐market, non‐investment properties in the public sector. The first part of the article draws together some of the literature in the area of public sector asset valuation and management. This is intended, first, to highlight current thinking about the issues involved in the valuation exercise, second, to focus on some of the unresolved aspects and, finally, to suggest areas for further consideration to help resolve these.The second part of the article provides an introduction to, and critical examination of, the valuation methodology commonly used to value specialised property assets. Possible alternative approaches are suggested, which may better enable authorities to assess the performance of their assets and integrate these into the management processes.

To highlight the pressures that the auditors would face in the era of globalisation and the challenges they should be willing to accept in order to maintain trust and integrity.

A wide range of articles and journals published in international journals as well as local journals has been reviewed. The areas covered include audit fraud, true and fair view interpretation, auditor independence and role of internal auditors. Further, ideas have also been obtained from critical write‐ups in the business magazines on the fall of multinationals.

A wide range of interpretation has been given by various groups of people on their understanding of the phrase “true and fair”. This has created great confusion as to the interpretation of the audit reports. This has been proven by the fall of many multinationals and the audit pioneers, Andersens. This is one of the causes of audit fraud and it is also seen that as the auditors face an enormous challenge as they enter the twenty‐first century, they should be willing to change their attitudes towards their clients. Professionalism should be in the forefront, and an overhaul in the concept of “true and fair” could probably be the solution to harmonisation of the economy.

This paper lacks statistical data on the views of the authors. It is based purely on secondary data.

Provides awareness to the auditors, corporations and general public on the necessity to revamp the existing auditing practices. This can help the auditors not only to be professionals, but also to be seen as professionals.

This paper provides scope for research in this area to identify whether the overhaul concept is acceptable. If yes, what should the new concept be? If no, what is the solution to the existing public outcry?

This study aims to compare the value relevance of the recognised deferred tax elements under International Accounting Standard 12 (IAS 12): Income Taxes (balance sheet method) relative to the taxes payable (flow through) method. It also investigates the value relevance of the IAS 12 deferred tax disclosures.

This study used standard valuation models to examine the association between share price and the recognised amounts and footnote disclosures of IAS 12. The Vuong (1989) test is then used to assess which information set is more value relevant. The sample includes 440 firm years over the period 2008-2012.

The results show that deferred tax amounts recognised under the balance sheet method provide no more information to investors than the taxes payable method (TPM). Deferred tax footnote disclosures, however, are more relevant than the amounts recognised under the balance sheet method. This study investigates potential reasons for the relevance of footnote disclosures.

This study has not addressed whether the deferral method of deferred tax is relevant. In addition, while footnote disclosures look promising, further research is necessary.

The results suggest, given the complexity and cost of compliance with IAS 12, that the International Accounting Standards Board (IASB) should undertake a comprehensive re-think on the relevance of the balance sheet method in IAS 12 and revert to the TPM.

The IASB and the European Financial Reporting Advisory Group have expressed concerns over the balance sheet method under IAS 12. The IASB and the Financial Accounting Standards Board also have concerns over the cost and complexity of the deferred tax disclosures. The study’s results offer a perspective by examining whether the balance sheet method is value relevant. Prior research has addressed this issue using local data (i.e. pre-International Financial Reporting Standards). This study also provides suggestions for future research into deferred tax footnote disclosures.