This study examines whether, and to what extent, SFAS166/167 changed the role of securitization in bank liquidity and lending activities. We compare the sensitivity of on-balance sheet loan growth to ...the loan portfolio liquidity index proposed by Loutskina (2011) The role of securitization in bank liquidity and funding management, Journal of Financial Economics 100, 663–684 between affected banks and control banks. We find that SFAS166/167 is significantly associated with a reduction in the use of securitization to enhance on-balance sheet liquidity, consistent with the view that consolidation on balance sheets may render the securitization of loans too costly to be considered an effective source of liquidity. In addition, we find that affected banks with the highest increase in liabilities from consolidating Qualified Special Purpose Entities (QSPEs) experienced a significant decrease in lending activities relative to the control banks. This is likely because consolidating former QSPEs may adversely affect the ability and willingness of banks to engage in securitization and issue new loans. Taken together, our results suggest that SFAS166/167, requiring the consolidation of former QSPEs, led to a decline in the role of securitization as a liquidity management tool in banks and to a significant decline in lending.
We examine whether SFAS 166/167, which ended exclusion of qualifying special purpose entities (QSPEs) from consolidation, impacted the cost of equity capital for a sample of banks. This exclusion ...previously allowed banks to avoid consolidating many, risky asset securitization transactions. These transactions were prevalent during and after the global financial crisis (GFC). We compare changes in the cost of equity capital for a sample of banks that consolidated SPEs after implementation of SFAS 166/167, to a control group of banks that reported no material impact of SFAS 166/167. We find the cost of equity capital increased significantly more for the banks consolidating previously unconsolidated SPE’s, than for the banks that were relatively unaffected by the rule change. In particular, we find that banks with greater reductions to their reported Tier-1 capital ratios as a result of consolidation are associated with significantly greater cost of equity capital in the post-SFAS166/167 period.
...if we count the present value of our Medicare, Medicaid, Social Security, and other major federal and state health and postemployment benefit obligations, we have obligated ourselves as a country ...to more than a quarter of a quadrillion dollars-92 percent of the world's wealth, including every country except China, even though our share of the world's wealth is only about 38 percent (Forgione 2018). ...healthcare does have the core elements needed for cost analysis. Hospital service departments and revenue-producing units are identified and utilization statistics are analyzed down to square feet of floor space and pounds of clean, dry laundry. After Texas passed tort reform legislation several years ago, capping pain-and-suffering claims at $250,000, malpractice insurance costs dropped substantially-in some specializations, reportedly by as much as 50 percent-because the action eliminated a large number of frivolous claims (Insurance Journal 2013). ...how much are you spending on direct-to-consumer advertising (which leads to unnecessary prescriptions and potential adverse effects on patients and which we, as consumers, will not pay for)?
•In Canada, the Netherlands and the USA, most specialists are self-employed.•Many countries are shifting towards blended payment systems.•In countries with salaries, systematic bonus systems have ...become more prominent.•The Netherlands and Switzerland have bundled payments for self-employed specialists working in hospitals.
Payment systems for specialists in hospitals can have far reaching consequences for the efficiency and quality of care. This article presents a comparative analysis of payment systems for specialists in hospitals of eight high-income countries (Canada, England, France, Germany, Sweden, Switzerland, the Netherlands, and the USA/Medicare system). A theoretical framework highlighting the incentives of different payment systems is used to identify potentially interesting reform approaches. In five countries,most specialists work as employees − but in Canada, the Netherlands and the USA, a majority of specialists are self-employed. The main findings of our review include: (1) many countries are increasingly shifting towards blended payment systems; (2) bundled payments introduced in the Netherlands and Switzerland as well as systematic bonus schemes for salaried employees (most countries) contribute to broadening the scope of payment; (3) payment adequacy is being improved through regular revisions of fee levels on the basis of more objective data sources (e.g. in the USA) and through individual payment negotiations (e.g. in Sweden and the USA); and (4) specialist payment has so far been adjusted for quality of care only in hospital specific bonus programs. Policy-makers across countries struggle with similar challenges, when aiming to reform payment systems for specialists in hospitals. Examples from our reviewed countries may provide lessons and inspiration for the improvement of payment systems internationally.
SYNOPSIS The program expense ratio is widely used as a measure of nonprofit (NP) performance. It can be derived from either GAAP financial statements or IRS Form 990. However, these sources have ...conflicting disclosure requirements that can significantly affect the ratio. The FASB has consolidation requirements for GAAP financial statements, but allows wide latitude in how program-specific functional expenses are disclosed. The IRS requires disclosure of functional expenses on Form 990, but allows wide latitude in how the reporting entity is defined. Thus, the program ratio can vary significantly based on the accounting choices of management. We examine the association of program ratios and consolidation choices in NP hospitals using Form 990 data. We find that hospitals receiving support from unconsolidated affiliates realize significantly higher program ratios. The IRS and FASB should consider this finding when evaluating the latitude in reporting requirements for NP hospitals. JEL Classifications: G1; G3; G18; G38; L3; L30; L31; L38; M4; M41; M48. Data Availability: All data are from publicly available sources quoted in the text.
Purpose
The purpose of this paper is to investigate donor responses to discretionary accounting information consolidation. Nonprofit (NP) financial statement consolidation discretion significantly ...impacts program ratio reporting, the primary NP performance measure. Stakeholders are misled to allocate limited resources inefficiently. While some NPs file group Internal Revenue Service (IRS) Form 990 returns with their affiliates, effectively providing consolidated statements, others choose to file independently of their affiliates.
Design/methodology/approach
The authors use OLS regression analysis and panel data for 5,697 NP-year observations for the period 2009-2011 retrieved from the National Center for Charitable Statistics Form 990 database.
Findings
The authors find evidence that consolidation discretion substantially impacts donor decisions. NP managers have incentive to utilize consolidation discretion to influence charitable giving.
Practical implications
The authors urge the IRS and the Financial Accounting Standards Board to reconsider the consolidation guidance for NP organizations, to develop performance measures beyond the widely used program ratio, and to require program ratio segment reporting to allow for better comparability among NPs irrespective of consolidation status. Further, the authors caution stakeholders to consider supporting organization transactions in their resource allocation decisions.
Originality/value
The authors are the first to use NP supporting organization information to investigate consolidation discretion and its impact on donor responses.
PurposeThe purpose of this paper is to examine whether firms use different earnings management approaches when facing financial difficulties and the effects of industry-specialist auditors in ...constraining those choices. The empirical results suggest that (1) firms with lower risk of business failure but with stronger incentives to adjust earnings upward tend to use real earnings management (REM) income-increasing approaches while (2) at the same time, using discretionary accruals for income-decreasing earnings management, due to constraints imposed by specialist auditors on the use of accrual-based earnings management (AEM). This is consistent with the findings of Chi et al., and the authors do not find similar evidence for the firms with higher risk of failure. Also, (3) regardless of the level of failure risk, firms turn to REM while interestingly, such REM behavior is effectively curbed by industry-leading specialist auditors (specialist auditors with the highest client market share) on financially distressed firms. These results extend the findings of Chi et al. (2011), suggesting that industry-specialist auditors have different tolerance levels for earnings management approaches by firms with different levels of business failure risk. That is, when auditing clients with higher risk of failure, specialist auditors are more likely to maintain higher audit quality through more stringent audit testing and use of more audit staff time to prevent an occurrence of audit failure.Design/methodology/approachThe authors examine earnings management behavior across firms in Taiwan with different levels of business failure risk and the effects of audit partner industry specialization in constraining that behavior. Chi et al. (2011) studied low-risk firms with incentives to adjust earnings upward and found firms use REM when the auditors constrain AEM. The authors extend the work of Chi et al. and observe firms with different levels of failure risk.FindingsThe authors find (1) lower risk firms may use discretionary accruals to adjust earnings downward while the authors find no similar evidence for financially distressed firms, (2) lower risk firms may use REM when their industry-specialist auditors curb AEM and (3) the industry leaders among specialist auditors do the same for the financially distressed firms. The results demonstrate the extent to which industry-specialist auditors apply different tolerance levels for earnings management behaviors across firms with different levels of failure risk.Originality/valueThe study contributes to the literature in the following three ways: first, the authors fill a gap in the existing literature by comparing firms with higher risk of business failure to firms with lower risk of business failure to explore the possible difference in the two different kinds of earnings management behavior; second, the authors extend the findings of Chi et al. (2011) and examine whether specialist auditors, when auditing firms with higher risk of business failure, will input more audit effort to constrain their clients' use of REM and third, since business failures have a significant impact on the capital markets and any associated audit failures can have an even greater negative impact on investor confidence, the study provides information useful to auditors and regulators in the formation of salient policy regarding the use of REM by firms experiencing high risk of business failure.
Demand for building competencies in implementation research (IR) outstrips supply of training programs, calling for a paradigm shift. We used a bootstrap approach to leverage external resources and ...create IR capacity through a novel 2-day training for faculty scientists across the four Texas Clinical & Translational Science Awards (CTSAs). The Workshop combined internal and external expertise, targeted nationally established IR competencies, incorporated new National Institutes of Health/National Cancer Institute OpenAccess online resources, employed well-known adult education principles, and measured impact. CTSA leader buy-in was reflected in financial support. Evaluation showed increased self-reported IR competency; statewide initiatives expanded. The project demonstrated that, even with limited onsite expertise, it was possible to bootstrap resources and build IR capacity de novo in the CTSA community.
This paper examines whether financial analysts use the information contained in clinical trial disclosures to improve their forecast accuracy for pharmaceutical companies. Findings indicate that the ...improved clinical trial disclosures due to a quasi-regulation issued by the International Committee of Medical Journal Editors (ICMJE) significantly reduce analysts’ long-term forecast error. In addition, a propensity-score matching analysis provides additional strong evidence that issuance of the 2005 ICMJE’s regulation is accompanied by an average 45 % decrease in long-term forecast error, and a more than 50 % decrease in long-term forecast dispersion. This study contributes to the accounting literature regarding nonfinancial disclosures by providing the first insights into financial analysts’ use of clinical trial disclosures in their forecasts of future earnings. In addition, because the major event examined in this study is a quasi-regulation issued by the ICMJE, we provide additional insights on the effectiveness of industry-initiated regulations (or quasi-regulations) on nonfinancial disclosure practice.
Audit Fees at U.S. Non-Profit Organizations Vermeer, Thomas E.; Raghunandan, K.; Forgione, Dana A.
Auditing : a journal of practice and theory,
11/2009, Letnik:
28, Številka:
2
Journal Article
Recenzirano
Non-profit organizations account for a significant share of the U.S. national economy. Some recent scandals and governance failures in non-profits have led to increased scrutiny of non-profits, ...including new state laws related to external audits. In this paper, we extend audit fee research by developing a model that seeks to explain non-profit audit fees. Results from data provided by 125 of the largest non-profits indicate that auditee size, complexity, liquidity, and resource dependency are associated with audit fees; in addition, audit fees are higher for non-profits with a Big 4 auditor. The results also suggest that alternative monitoring mechanisms, such as a good audit committee and internal auditing, are complements rather than substitutes for monitoring by external auditors. Our results can be useful for researchers examining non-profit auditing-related issues and for non-profit organizations seeking to benchmark their audit fees.
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