nep-acc New Economics Papers
on Accounting and Auditing
Issue of 2012‒11‒24
six papers chosen by
Alexander Harin
Modern University for the Humanities

  1. Integrated Approach Model of Risk, Control and Auditing of Accounting Information Systems By Claudiu BRANDAS; Dan STIRBU; Otniel DIDRAGA; Mihai DRAGOTA
  2. Excessive credit growth and countercyclical capital buffers in basel III: an empirical evidence from central and east european countries By Seidler, Jakub; Gersl, Adam
  3. The Swedish Inheritance and Gift Taxation, 1885–2004 By Du Rietz, Gunnar; Henrekson, Magnus; Waldenström, Daniel
  4. Form follows function? Evidence on tax savings by multinational holding structures By Dreßler, Daniel
  5. Tax policy response to market changes: the case of the gaming services sector. By Valeria De Bonis; Alessandro Gandolfo
  6. The world's dream: economic growth [:]the balance sheet approach By DE KONING, Kees

  1. By: Claudiu BRANDAS (Business Information Systems Department, Faculty of Economics and Business Administration, West University of Timisoara, Romania); Dan STIRBU (Department of Accounting and Audit, Faculty of Economics and Business Administration, West University of Timisoara, Romania); Otniel DIDRAGA (Business Information Systems Department, Faculty of Economics and Business Administration, West University of Timisoara, Romania); Mihai DRAGOTA (IBDO Auditors & Business Advisors, Timisoara, Romania)
    Abstract: The use of IT in the financial and accounting processes is growing fast and this leads to an increase in the research and professional concerns about the risks, control and audit of Accounting Information Systems (AIS). In this context, the risk and control of AIS approach is a central component of processes for IT audit, financial audit and IT Governance. Recent studies in the literature on the concepts of risk, control and auditing of AIS outline two approaches: (1) a professional approach in which we can fit ISA, COBIT, IT Risk, COSO and SOX, and (2) a research oriented approach in which we emphasize research on continuous auditing and fraud using information technology. Current researches emphasize the need for an integrated approach to risk, control and audit of AIS to ensure integrity, reality, accuracy and availability of financial statements. Starting from the limits of existing approaches, our study is aimed to developing and testing an Integrated Approach Model of Risk, Control and Auditing of AIS. This model treats risk, control and audit on three cycles of business processes, as follows: purchases cycle, sales cycle and cash cycle. The purpose of this model is the integration approach of risk, control and AIS audit in the IT audit processes and financial audit processes in order to improve the efficiency of IT Governance, as well as ensuring integrity, reality, accuracy and availability of financial statements.
    Keywords: risk, control, audit, IT Governance, Accounting Information Systems
    JEL: M15 M42 D81 G30
    Date: 2012–10–20
  2. By: Seidler, Jakub; Gersl, Adam
    Abstract: Excessive credit growth is often considered to be an indicator of future problems in the financial sector. This paper examines the issue of how best to determine whether the observed level of private sector credit is excessive in the context of the “countercyclical capital buffer”, a macroprudential tool proposed in the new regulatory framework of Basel II by the Basel Committee on Banking Supervision. An empirical analysis of selected Central and Eastern European countries, including the Czech Republic, provides alternative estimates of excessive private credit and shows that the HP filter calculation proposed by the Basel Committee is not necessarily a suitable indicator of excessive credit growth for converging countries.
    Keywords: credit growth; financial crisis; countercyclical capital buffer; Basel II
    JEL: G18 G01 G21
    Date: 2012
  3. By: Du Rietz, Gunnar (Research Institute of Industrial Economics); Henrekson, Magnus (Research Institute of Industrial Economics); Waldenström, Daniel (Uppsala Center for Fiscal Studies)
    Abstract: This paper studies the evolution of the modern Swedish inheritance taxation from its introduction in 1885 to its abolishment in 2004. A thorough description is offered of the basic principles of the tax, including underlying ideas and ambitions, tax schedules, and rules concerning valuation of assets, liability matters and deduction opportunities. Using these rules, we calculate inheritance tax rates for the whole period for a number of differently endowed family firms and individuals. The overall trend in inheritance tax burden exhibits an inverse-U shape for all firms and individuals. Up until World War II, inheritance tax rates were very low (never above six percent), but in the postwar era tax rates increased rapidly for both inherited firms and individual fortunes. Effective tax rates peaked in the mid-1970s. Valuation reliefs were introduced in the 1970s, which sharply reduced tax rates for inherited family businesses. Tax rates for deceased individuals were first cut in 1987 and then significantly reduced in 1991– 1992. Finally, inheritance and gift tax revenues were relatively small, around a quarter of a percent of GDP.
    Keywords: Gift tax; Inheritance tax; Estate tax; Tax avoidance; Excess burden; Entrepreneurship; Ownership transfers of family firms
    JEL: D31 H20 K34
    Date: 2012–11–06
  4. By: Dreßler, Daniel
    Abstract: I provide evidence on the group structures of multinationals and analyze to what extent these structures are tax efficient. While the corporate income tax can hardly be avoided if a subsidiary is active in a country, withholding taxes depend on the structure in which the subsidiary is embedded. By vertically inserting holding companies or adjusting the superior/subordinate relationship of subsidiaries, multinationals can often influence their total tax burden, especially regarding the repatriation of profits by means of dividends. I analyze group structures across 58 countries in the years 1996 to 2008 using the MiDi database provided by the German Central Bank (Deutsche Bundesbank). The results show that a higher withholding tax between two members of a group located in different countries increases the probability of indirect participation. However, in about half of the observations, the existence of an intermediate subsidiary does not lower the overall tax burden, and in 5% of the cases the tax burden on repatriated profits with such a holding company is even higher than without it. Although group structures generally seem to be tax driven, there are non-tax influencing factors which sometimes prevail. Besides drivers of the vertical company structure, I provide evidence of a horizontal driver: once a form of group taxation is available, groups seem to spread their national investments across more subsidiaries. --
    Keywords: Corporate Taxation,Foreign Direct Investment,Holdings,Multinational Firms,Withholding Taxes
    JEL: F23 H25 H32
    Date: 2012
  5. By: Valeria De Bonis; Alessandro Gandolfo
    Abstract: Beginning with the 1990’s, the gaming services sector has undergone several changes that have induced governments to review gambling taxes. We examine the economic rationale behind actual and prospected reforms, comparing different tax instruments with respect to their incidence.
    Keywords: gaming sector; government policy and regulation; taxation incidence.
    JEL: H22 K34 M38
    Date: 2012–11–01
  6. By: DE KONING, Kees
    Abstract: Economists may need to change their tools of analysis from analysing income and expenditure contributors (GDP) to asset value contributors -the net worth levels of individual households-. Assessment of the latter requires a balance sheet analysis. Why; because the level of individual households’ savings in the U.S currently stands at $62.7 trillion, GDP at $15.1 trillion and tax revenues at $2.4 trillion. Such U.S. analysis has to be made through the study of time series, not just for a single year. For instance the cause of the current crisis was the banker’s shift in action from recovering doubtful mortgage debts out of incomes to recovering them out of selling of home assets. This caused an extra supply of 880 000 second hand homes to come on the market every year from 2008. In stead of only affecting the 4.4 million doubtful debtors, it affected all 78.6 million home owners. Their loss was nearly equal to three years of U.S. Federal Government revenues. To counteract such savings losses requires adjustments in the U.S economic set up - the econsystem changes-. It also requires turning some assets -pension savings assets- temporarily into cash in order to support the income base of society in times of slow growth. Keeping unemployed people on the sideline of an economy is not the best way of earning one’s way out of income troubles.
    Keywords: balance sheet of households; net worth; financial crisis; economic growth; income to assets switch; economic easing; quantitative easing; Fannie Mae and Freddy Mac; bank restructuring; home mortgage process; fiscal cliff; econsystem
    JEL: E44 E21 G01 D53 G2 E58 E61 G21
    Date: 2012–11–12

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