nep-acc New Economics Papers
on Accounting and Auditing
Issue of 2009‒09‒26
eight papers chosen by
Alexander Harin
Modern University for the Humanities

  1. Recent Trends in Top Income Shares in the USA: Reconciling Estimates from March CPS and IRS Tax Return Data By Burkhauser R; Feng S; Jenkins S; Larrimore J
  2. Multinationals, tax competition, and outside options By Olsen, Trond; Osmundsen, Petter
  3. Value chain analysis Methodologies in the context of environment and trade research By Faße, Anja, Grote, Ulrike; Winter, Etti
  4. Basel II and the Capital Requirements Directive: Responding to the 2008/09 Financial Crisis By Ojo, Marianne
  5. Modernization of Tax Administrations and Optimal Fiscal Policies By Martin Besfamille; Cecilia Parlatore Siritto
  6. Ethics and internal audit: whistleblowing issues By Bunget, Ovidiu-Constantin; David-Sobolevschi, Maria-Iulia
  7. Incidence of an outsourcing tax on intermediate inputs By Subhayu Bandyopadhyay
  8. Study on the VAT invoicing rules contained in the VAT Directive By Pricewaterhousecoopers

  1. By: Burkhauser R (Cornell University); Feng S (Shanghai University of Finance and Economics); Jenkins S (Institute for Social and Economic Research); Larrimore J (Cornell University)
    Abstract: Although the majority of research on US income inequality trends is based on public-use March CPS data, a new wave of research using IRS tax return data reports substantially higher levels of inequality and faster growing trends. We show that these apparently inconsistent estimates are largely reconciled if the inequality measure and the income distribution are defined in the same way. Using internal CPS data for 1967–2006, we closely match IRS data-based estimates of top income shares reported by Piketty and Saez (2003). Our results imply that any inequality increases since 1993 are concentrated among the top 1 percent of the distribution.
    Date: 2009–09–14
  2. By: Olsen, Trond (NHH, Norwegian School of Economics and Business Administration); Osmundsen, Petter (University of Stavanger)
    Abstract: .
    Keywords: Tax competition; mobility; common agency; countervailing incentives
    JEL: D82 H21 L51
    Date: 2009–08–01
  3. By: Faße, Anja, Grote, Ulrike; Winter, Etti
    Abstract: This paper gives an overview of different methodologies related to value chain analysis in the context of environment and trade research. Four major fields of methodologies are identified: Accounting of input-output flows, general computable equilibrium models, econometrics, and global commodity chain analysis. Accounting of flows includes different physical (e.g. life cycle assessment) and monetary (e.g. social accounting matrix) accounting frameworks providing the foundation for computable general equilibrium models. Econometric value chain analysis is widespread in the field of impact assessment of value chains. It can be applied to analyze the effects of standards (e.g. food, social, and environmental) as well as transaction costs on the income of households (micro level) or on trade volumes of countries (macro level). Global commodity chain analysis aims to identify and measure the balance of power between the participating actors.
    Keywords: Value Chain Analysis, Environment, International Trade, Mapping, Accounting, Econometrics, General Equilibrium Model
    JEL: Q56 D57 D58 C13 L23
    Date: 2009–09
  4. By: Ojo, Marianne
    Abstract: This paper addresses factors which have prompted the need for further revision of banking regulation, with particular reference to the Capital Requirements Directive. The Capital Requirements Directive (CRD), which comprises the 2006/48/EC Directive on the taking up and pursuit of the business of credit institutions and the 2006/49/EC Directive on the capital adequacy of investment firms and credit institutions, implemented the revised framework for the International Convergence of Capital Measurement and Capital Standards (Basel II) within EU member states. Pro cyclicality has attracted a lot of attention – particularly with regards to the recent financial crisis, owing to concerns arising from increased sensitivity to credit risk under Basel II. This paper not only considers whether such concerns are well-founded, but also the beneficial and not so beneficial consequences emanating from Basel II’s increased sensitivity to credit risk (as illustrated by the Internal Ratings Based approaches). In so doing it considers the effects of Pillar 2 of Basel II, namely, supervisory review, with particular reference to buffer levels, and whether banks’ actual capital ratios can be expected to correspond with Basel capital requirements given the fact that they are expected to hold certain capital buffers under Pillar 2. Furthermore, it considers how regulators can respond to prevent systemic risks to the financial system during periods when firms which are highly leveraged become reluctant to lend. In deciding to cut back on lending activities, are the decisions of such firms justified in situations where such firms’ credit risk models are extremely and unduly sensitive - hence the level of capital being retained is actually much higher than minimum regulatory Basel capital requirements ?
    Keywords: Basel II; Capital Requirements Directive; pro cyclicality; risk; regulation; banks
    JEL: E0 D0 K2 E5 E3
    Date: 2009–09–18
  5. By: Martin Besfamille; Cecilia Parlatore Siritto
    Abstract: Since Sandmo (1981), many articles have analyzed optimal fiscal policies in economies with tax evasion. All share a feature: they assume that the cost of enforcing the tax law is exogenous. However, governments often invest resources to reduce these enforcement costs. In a very simple model, we incorporate such investments in the analysis of an optimal fiscal policy. We characterize their optimal level and we show numerically how they interact with the other dimensions of the optimal fiscal policy. Finally, we highlight the differences between our results and those obtained in a model without investment in the tax administration.
    Keywords: Tax administration, Tax rates, Tax evasion, Enforcement, Audit costs.
    JEL: D82 H26 H83
    Date: 2009–07
  6. By: Bunget, Ovidiu-Constantin; David-Sobolevschi, Maria-Iulia
    Abstract: It is undisputed that the companies’ performances are now more than ever, in the concerns caused by global competition and financial crisis. In this context, one of the interveners in the direction of performance is having an ethical and responsable behavior regrading the public. An ethical behavior is related first of all to the idea of morality, above respecting the law. „Ethics aims to the heart of the corporate’s reputation and in the end that is all you have if you hope to be successful and prosperous in the business world (Harold Tinkler-director of ethics departament of Deloitte & Touche). Developing a system of ethical values within an organization depends not only on the framework provided by the law, but also by creating a participatory framework in order to eliminate waste, or other forms of fraud. Whistleblowing („who blows the whistle”) which can be translated by „giving signals” means that employees can be a part of the internal structures of companies with duties of discovering non-ethical practices. Whistleblowing policy is the result of implementation by U.S. firms which are present in other states, of the Sarbanes Oxley Act in the U.S. What these companies do not realize is that the implementation of whistleblowing schemes in Romania can be interpreted as a violation of the rights of data subjects to personal data protection. Being an anglo-saxon practice type, the question is to what extent the European type company will be able to fald with and also how it can be controlled? It is believed that controling the activity of whistleblowing can be performed by a specialized team of internal audit department. So, internal auditors should realise also missions regarding the research of those tort facts reported by employees. Whistleblowing is designed as a just and effective mean in order to improve the individual and collective behavior of a company.
    Keywords: company; ethics; internal audit; whistleblowing
    JEL: M42
    Date: 2009–09–15
  7. By: Subhayu Bandyopadhyay
    Abstract: The paper uses a Hecksher-Ohlin-Samuelson type general equilibrium framework to consider the incidence of an outsourcing tax on an economy in which the production of a specific intermediate input has been fragmented and outsourced. When the input is ?non-traded?, the outsourcing tax can reduce domestic wages even if the intermediate input producing sector is the most capital-intensive sector of the economy. This implies that contrary to received wisdom, a tax on a capital-intensive sector may actually hurt labor. On the other hand, if the intermediate input is traded, the outsourcing tax must close down the final good producing sector that uses it specifically in its production. In turn, this may force the government to look for additional policy instruments to help sustain this domestic industry.
    Keywords: Contracting out ; Taxation
    Date: 2009
  8. By: Pricewaterhousecoopers
    Abstract: A study on the VAT invoicing rules contained in the VAT Directive (2006/112/EC) was carried out for the European Commission by PricewaterhouseCoopers. It aims to look at the four principal areas of invoicing - the requirement to issue an invoice, the content of an invoice, electronic invoicing and the storage of invoices - with a view to mapping the existing legislation in all Member States, analysing burdens on business and Member States' control needs, and providing recommendations for a more harmonised and modern set of VAT invoicing rules.
    Keywords: European Union, taxation, VAT
    JEL: H24
    Date: 2009–01

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