Applied Accounting - Practitioner eJournal最新文献

{"title":"No Place to Hide: Investing in a World With No Risk-Free Asset","authors":"James White, Victor Haghani","doi":"10.2139/ssrn.3903372","DOIUrl":"https://doi.org/10.2139/ssrn.3903372","url":null,"abstract":"Now, more than perhaps at any time in the past 70 years, investors are concerned that there's no asset they can invest in which is truly risk-free. Worries of unsustainable public policies leading to debasement or default – through inflation, taxation or repudiation – have sapped confidence in the traditional safe assets of bills and bonds issued by the US and other rich countries. Investors are increasingly considering whether other assets – equities, real estate, commodities, crypto-currencies – should be used to construct an ersatz risk-free asset. In this note, we'll address this problem with a practical definition of the ideal personalized risk-free asset, and then we'll discuss how to construct an efficient portfolio when that ideal asset doesn't exist in investable form. Rather than the common practice of trying to construct a pseudo-risk-free asset from a set of available assets which don't really fit the bill, instead we should simply treat the opportunity set as consisting entirely of risky assets and optimize the real risk-adjusted return of the risky portfolio, using our personalized inflation index as the deflator. In practice, this approach to portfolio construction in the absence of a truly risk-free asset is flexible enough to handle an arbitrarily large number of different assets and a broad range of assumptions about possible outcomes in asset prices, including discontinuous jumps as well as changing risk and correlation patterns over time. The impact of this change in perspective will depend largely on the starting point of the investor's asset allocation. For investors with low to moderate risk-aversion– who start off with a high allocation to equities and other patently risky assets– treating the safest assets as being risky, but still the least risky of the available options, is likely to have a modest impact on optimal portfolio weights. But for investors who exhibit a high level of risk-aversion, who are mostly allocated to the safest assets to begin with, explicitly accounting for the risk in government bills and bonds can have a significant impact on their asset allocation. And for almost all investors, regardless of their degree of risk-aversion, moving to an Ideal Risk-Free Asset more closely aligned with per capita income growth will reduce the investor's risk-adjusted real return and thereby call for a lower long-term spending policy.","PeriodicalId":198128,"journal":{"name":"Applied Accounting - Practitioner eJournal","volume":"38 1","pages":"0"},"PeriodicalIF":0.0,"publicationDate":"2021-08-11","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"123493055","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}

{"title":"2021 Texas Estates & Trust Codes with Commentary","authors":"Gerry W. Beyer","doi":"10.2139/ssrn.3880732","DOIUrl":"https://doi.org/10.2139/ssrn.3880732","url":null,"abstract":"This document contains the Texas Estates Code and the Texas Trusts Code (and related Property Code provisions) showing all changes made by the Regular Session of the 2021 Texas Legislature. The changes, most of which take effect on September 1, 2021, are shown in red-lined format for easy comparison of the prior and new versions of the statutes. Also included are charts converting Probate Code to Estates Code sections and Estates Code to Probate Code sections. I have included commentary entitled Statutes in Context to many sections. These annotations provide background information, explanations, and citations to key cases which should assist you in identifying the significance of the statutes and how they operate.","PeriodicalId":198128,"journal":{"name":"Applied Accounting - Practitioner eJournal","volume":"11 1","pages":"0"},"PeriodicalIF":0.0,"publicationDate":"2021-07-05","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"131723621","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}

{"title":"What Are the Reasons for Extensions – Development of an Extension Framework","authors":"D. Beerbaum","doi":"10.2139/ssrn.3846764","DOIUrl":"https://doi.org/10.2139/ssrn.3846764","url":null,"abstract":"We investigate the nature of extension. Extensions are discussed controversial in the academic literature. It can be summed up within the literature with one group, which regards extension as a means for increasing transparency, while the second group assumes extension are misused and “abnormal” extensions reflect obfuscation of unfavorable information. Some of the authors draw the conclusions that XBRL reporting should be revised due to the identified obfuscation. This working paper looks into the facts and the research methodologies applied to draw conclusions. XBRL is in this context very often described as the issue, but XBRL is just a tool, so the question is rather how the tool is applied and what are the set conditions. Extensions offer limited transparency, which is an issue caused by the architecture of XBRL and not by the preparers. Therefore, the author recommends to improve the architecture on the extension and develop a framework, which reflects the substance of extensions. The findings have implications for regulators in determining the form and nature of extensions to allow, practitioners in preparing and coding digitized financial statements.","PeriodicalId":198128,"journal":{"name":"Applied Accounting - Practitioner eJournal","volume":"56 1","pages":"0"},"PeriodicalIF":0.0,"publicationDate":"2021-05-15","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"133978507","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}

{"title":"Analyst Coverage Overlaps and Interfirm Information Spillovers","authors":"Tim Martens, Christoph J. Sextroh","doi":"10.2139/ssrn.3428691","DOIUrl":"https://doi.org/10.2139/ssrn.3428691","url":null,"abstract":"We investigate the role of financial analysts in facilitating the flow of relevant competitive information between firms. Using patent citations as a proxy for interfirm information spillovers, we find that firms are more likely to cite another firm's patent if that firm is covered by the same financial analyst. Difference-in-difference analyses exploiting exogenous shocks to analyst coverage overlaps over time suggest that the documented effect is not simply due to changes in firms' business models and corresponding changes in analyst coverage; consistent with a causal relationship between analyst coverage overlaps and interfirm information spillovers. The effect is stronger for analysts with a relatively higher industry-specialization, more experience, a larger coverage portfolio, and a higher forecast activity, as well as for firm pairs with a larger geographic or organizational diversity. Overall, our findings suggest that capital market relationships not only play an important role in reducing information asymmetries between firms and capital markets but also facilitate the production of business intelligence through feedback and interfirm information transfers.","PeriodicalId":198128,"journal":{"name":"Applied Accounting - Practitioner eJournal","volume":"57 1","pages":"0"},"PeriodicalIF":0.0,"publicationDate":"2021-05-15","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"115399500","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}

{"title":"Procedural Fairness of Objective and Subjective Performance Evaluations: Exploring the Combined Effects of Uncertainty and Trust","authors":"Pascal Langevin, Carla Mendoza","doi":"10.3917/CCA.272.0111","DOIUrl":"https://doi.org/10.3917/CCA.272.0111","url":null,"abstract":"Les recherches empiriques sur les couts et avantages des evaluations de performance subjectives comparees a objectives ont produit des resultats qui restent mitiges. Pour eclairer ce debat, nous examinons les effets de ces deux types d’evaluation sur la perception de justice procedurale des managers dans differents contextes combinant incertitude et confiance. L’objectif est, d’une part, d’identifier si un type d’evaluation de performance est percue comme plus juste que l’autre dans certains contextes et, d’autre part, d’explorer comment ces perceptions de justice se forment.Pour traiter ces deux questions, nous analysons les donnees quantitatives et qualitatives recueillis aupres de 418 managers a l’aide d’un questionnaire base sur des scenarios. Nos resultats montrent que les evaluations subjectives sont percues comme plus justes que les evaluations objectives par les managers confrontes a des situations de forte incertitude et qui ont confiance dans leur superieur. A l’inverse, les evaluations objectives sont percues comme plus justes dans les situations ou incertitude et confiance sont tous les deux faibles. Nos resultats montrent egalement que les managers forment leur jugement de justice en considerant deux dimensions : ils percoivent que les evaluations subjectives leur offrent la possibilite d’exprimer leur point de vue, alors que les evaluations purement objectives sont vues comme plus precises et moins biaisees.Globalement, ces resultats suggerent que les organisations peuvent ameliorer leurs systemes d’evaluation des performances, soit en utilisant les mesures appropriees au contexte, soit en agissant sur l’incertitude et/ou la confiance.","PeriodicalId":198128,"journal":{"name":"Applied Accounting - Practitioner eJournal","volume":"1 1","pages":"0"},"PeriodicalIF":0.0,"publicationDate":"2021-05-11","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"130625020","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}

{"title":"The Investment Usefulness of Value Relevance Model: International Evidence","authors":"Yuto Yoshinaga","doi":"10.2139/ssrn.3702199","DOIUrl":"https://doi.org/10.2139/ssrn.3702199","url":null,"abstract":"While valuation models such as the discounted cash flow model have been proposed and sophisticated, valuation practice often faces difficulties in estimating firm value because various assumptions on their factors are possible. Therefore, this study aims to provide a valuation procedure with the value relevance model which does not force analysts to set their personal assumptions. To show the usefulness of this procedure for investment around the world, we engage in empirical analyses with the annual data of the listed firms in 126 countries. After confirming that the value relevance model can explain the present market value of equity, we indicate that the ratio of the estimated intrinsic values to present market values is significantly related with future annual returns. We also demonstrate that significantly positive long-short returns can be obtained based on the ratio.","PeriodicalId":198128,"journal":{"name":"Applied Accounting - Practitioner eJournal","volume":"35 1","pages":"0"},"PeriodicalIF":0.0,"publicationDate":"2021-04-19","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"121085515","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}

{"title":"Spending Like You'll Live Forever","authors":"James White, Victor Haghani","doi":"10.2139/ssrn.3820939","DOIUrl":"https://doi.org/10.2139/ssrn.3820939","url":null,"abstract":"A sound policy for spending wealth over time is as important as a sensible investment policy. It's a complex problem for taxable individuals with finite, uncertain longevity. A good start is thinking about the simpler problem of how one would spend if immortal. This is exactly the real problem faced by endowments, foundations and other long-lived pools of capital. In this article, we will explain and apply a framework first proposed by Robert C. Merton (1969) to this problem. We will also discuss the important and fascinating result that, under most reasonable sets of assumptions, it is optimal to spend substantially less than the expected real return of the endowment's investment portfolio. We will also give a summary description of some of the key extensions of this model since first introduced.","PeriodicalId":198128,"journal":{"name":"Applied Accounting - Practitioner eJournal","volume":"215 1","pages":"0"},"PeriodicalIF":0.0,"publicationDate":"2021-04-06","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"114415244","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}

{"title":"Estimating Project Cash Flows","authors":"S. Senthilnathan","doi":"10.2139/ssrn.3815383","DOIUrl":"https://doi.org/10.2139/ssrn.3815383","url":null,"abstract":"The cash flow estimation is important to evaluate projects in view of adding values to the owners’ equity of a firm. Cash flow estimation is a primary requirement for capital budgeting and using project evaluation techniques. Hence, this paper provides cash flow estimation methods from an accounting perspective to facilitate a reader understand the basics and bases of cash flows estimation with suitable exhibits from an accounting point of view. This paper provides explanations on basic principles of project cash flow estimation, meaning of incremental cash flow, trade-off between the equity and debt capitals used in projects, reason for excluding the cost of financing a project, tax concern, opportunity cost consideration, and the process and methods of estimating cash flows.","PeriodicalId":198128,"journal":{"name":"Applied Accounting - Practitioner eJournal","volume":"142 1","pages":"0"},"PeriodicalIF":0.0,"publicationDate":"2021-03-30","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"116535803","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}

{"title":"Integrated reporting: Evidence from developed, developing and an emerging economy","authors":"Dewan Azmal Hossain","doi":"10.2139/ssrn.3785764","DOIUrl":"https://doi.org/10.2139/ssrn.3785764","url":null,"abstract":"With the changing landscape in the corporate world, exploring value-maximizing activities has become a trend. Through integrated reporting organizations tell the story of overall performance and value-creating activities to their stakeholders (Deloitte, 2016). Current corporate reporting creates a gap between the stakeholders’ expectation and actual corporate reporting and integrated reporting helps organizations to disclose both their short term and long term value-maximizing activities to their stakeholders (KPMG, 2012). The aim of this essay is to discuss what integrated reporting is objective/importance of Integrated Reporting, Competitive advantage of Integrated Reporting, Integrated Reporting Framework as per The International Integrated Reporting Council (IIRC), Components of Integrated Reporting, Integrated Reporting Practices in Developed Countries, Integrated Reporting Practices in Asian Countries, Integrated Reporting Practices in Bangladesh, Areas of Future Research from the perspective of Bangladesh.","PeriodicalId":198128,"journal":{"name":"Applied Accounting - Practitioner eJournal","volume":"3 1","pages":"0"},"PeriodicalIF":0.0,"publicationDate":"2021-02-15","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"116007981","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}

{"title":"A Needle Found: Machine Learning Does Not Significantly Improve Corporate Fraud Detection Beyond a Simple Screen on Sales Growth","authors":"S. Walker","doi":"10.2139/ssrn.3739480","DOIUrl":"https://doi.org/10.2139/ssrn.3739480","url":null,"abstract":"Recent papers have been highly promotional of the benefits of machine learning in the detection of corporate fraud. For example, Bao, Ke, Li, Yu, and Zhang (2020) recently published in the Journal of Accounting Research report that their machine learning model increases performance by +75% above the current parsimonious standard in the accounting literature, the financial ratio-based F-Score (Dechow, et al. 2011), when measured at the highest risk levels. They also show that raw variables alone, rather than financial ratios, can achieve this task. However, a quick peak under the hood reveals an issue that, if corrected for, reduces the results to no better than the F-Score. \u0000 \u0000In this paper, I create a machine learning model applying the latest in machine learning known as XGBoost to over 100 financial ratios sourced from prior literature. I compare this model to an XGBoost model applying the 28 raw variables suggested by Bao, et al. Additional models are benchmarked include the F-Score, the M-Score (Beneish 1999), the FSD Score based on Benford’s Law (Amiram, et al. 2015), and a simple screen on 4-year sales growth. \u0000 \u0000A Wilcoxon rank sum test will show that differences between the models at the top 1% of risk are not significantly different. In fact, at this level, the models fail often in any given year. At the top 10% of risk where models produce consistent annual results, advanced methods match the performance of the F-Score, or even a simple univariate screen on sales growth I measure performance using positive predictive values (PPV) also known as precision which measures the likelihood of a fraud case within the top 1% or top 10% list. My XGBoost model outperforms the models at the 1% level, but positive predictive values remain quite low to be of any practical use with PPVs in the 3% range. A discussion will follow to explain what would be required to move positive predicted values beyond the single digits for this research question.","PeriodicalId":198128,"journal":{"name":"Applied Accounting - Practitioner eJournal","volume":"32 1","pages":"0"},"PeriodicalIF":0.0,"publicationDate":"2020-11-29","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"132167855","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}