nep-acc New Economics Papers
on Accounting and Auditing
Issue of 2018‒10‒08
six papers chosen by

  1. The effects of the new fiscal rule and creative accounting: Empirical evidence from Japanese municipalities By Hirota, Haruaki; Yunoue, Hideo
  2. Interactions between regulatory and corporate taxes: How is bank leverage affected? By Bremus, Franziska; Schmidt, Kirsten; Tonzer, Lena
  3. Impacts of the Largest Export Guaranteed Operations in Finland By Ali-Yrkkö, Jyrki; Kuusi, Tero
  4. Financial Analysis of Afghanistan International Bank By Tahiri, Noor Rahman
  5. Tax Assessment of Unauthorized (Illegal) Building Works in Taipei City, Taiwan By Tzu-Chin Lin; Wen-Chieh Wu
  6. Report on the 3rd Dutch Accounting Research Conference By Dierynck, Bart; Sextroh, Christoph

  1. By: Hirota, Haruaki; Yunoue, Hideo
    Abstract: The purpose of this paper is to analyze creative accounting by stock-flow adjustment in Japanese municipalities after the introduction of a new fiscal rule. We contribute to the literature by analyzing the interdependency of the new fiscal indexes, which comprise three flow indexes and one stock index. Our main contribution is the finding that municipalities tolerated an increase in their stock indexes while they decreased their flow indexes by reducing reserved funds to avoid exceeding the criteria of the new fiscal rule, as the stock index criterion is weaker than that of the three flow indexes.
    Keywords: fiscal rule, creative accounting, stock-flow adjustments
    JEL: H72 H74 H77
    Date: 2017–06–20
  2. By: Bremus, Franziska; Schmidt, Kirsten; Tonzer, Lena
    Abstract: Regulatory bank levies set incentives for banks to reduce leverage. At the same time, corporate income taxation makes funding through debt more attractive. In this paper, we explore how regulatory levies affect bank capital structure, depending on corporate income taxation. Based on bank balance sheet data from 2006 to 2014 for a panel of EU-banks, our analysis yields three main results: The introduction of bank levies leads to lower leverage as liabilities become more expensive. This effect is weaker the more elevated corporate income taxes are. In countries charging very high corporate income taxes, the incentives of bank levies to reduce leverage turn ineffective. Thus, bank levies can counteract the debt bias of taxation only partially.
    Keywords: bank levies,debt bias of taxation,bank capital structure
    JEL: G21 G28 L51
    Date: 2018
  3. By: Ali-Yrkkö, Jyrki; Kuusi, Tero
    Abstract: Abstract This study focuses on the impacts of the largest export guaranteed operations on employment and value added including effects through companies’ value chains. The results suggest that the activities of Meyer and Nokia related to export guarantees create value added accounting for 0.29% (Meyer) and 0.27% (Nokia) of the Finnish GDP. Corresponding employment effects are 0.32 % (Meyer) and 0.12 % (Nokia) of the Finnish total employment. These effects cannot be interpreted in such a way that without export guarantees the Finnish GDP and employment would decline correspondingly. Our other results suggest that export guaranteed operations slightly crowd out other activities, but the net effect remains positive. The results also show that the suppliers of Meyer and Nokia are more productive than companies belonging to the control group.
    Keywords: Export credit agency, ECA, Guarantee, Exports, Finnvera, Value added, Employment, Impact, Value chain
    JEL: G23 G28
    Date: 2018–09–25
  4. By: Tahiri, Noor Rahman
    Abstract: Afghanistan International Bank (AIB) is one the Afghanis commercial banks, its head office in Kabul. The bank has seven branch offices in the major cities of the country. AIB has international shareholders, two Afghan business groups, and one Afghan/American business group. It opened in 2004. Vision: We aspire to remain the most reputable financial institution and bank of choice in Afghanistan. Mission: Our mission is to foster economic development in Afghanistan, to be a catalyst for growth, and ultimately contribute to the prosperity of the country and its people. We strive to adhere to international best practices in corporate governance, financial and risk management (including anti-money laundering and ‘know your customer’), customer service, operations, information technology, and internal controls. A major factor in our success is dedication to staff development and training within a culture of integrity and professionalism. Financial statements are made and organized by board of directors in order to report to shareholders in releasing of their stewardship function and also to corporate law directs the responsibility of laying down prior to yearly shareholders general meeting, profit and loss account should be included in the balance sheet and auditor’s report should be attached thereto
    Keywords: Bank, Financial statement, analyze
    JEL: G10 G21 G24
    Date: 2018–08–10
  5. By: Tzu-Chin Lin; Wen-Chieh Wu
    Abstract: Taiwan is among those countries or places of a developed economies such as Hong Kong, Italy and Greece where unauthorized building works (UBWs) are prevalent. A variety of measures have been employed in various countries to tackle the UBWs that include at least immediate teardown, pardon, amnesty through retrospective penalty and etc. In response to the accumulated massive number of illegal extra floors or extensions on the rooftop, or unpermitted enclosed balcony, a set of rules have been established in Taiwan to identify, and record UBWs for them to be later dealt with. However, due to historical, cultural and even political factors, a significant number of UBWs still remain untouched. Official statistics show that as of Oct. 2017, there was 670,000 UBWs in Taiwan nationwide. That is to say, approximately 8% of households committed construction of UBWs in their houses, apartments or condos. There is no exception in the largest city of Taiwan, Taipei where the laws are widely recognized to be well enforced compared to other Taiwan cities. Despite the seemingly uncontrolled situations in Taiwan, prior to demolition, UBWs are subject to annual house taxes. There are at present over 300,000 UBWs registered in house tax records in Taipei alone. Because land and buildings are taxed separately at differing rates, UBWs can largely be viewed as a special form of buildings as far as house tax is concerned. UBWs are taxed annually along with the legal buildings which they are attached to. In spite of the long practice of taxing UBWS, the rationales and revenue contribution of this tax is rarely discussed in academic literature. In addition, how the value of UBWs is determined for taxation is poorly understood. This paper first reviews the pieces of legislation passed and amended over time that regulate UBWs. This historical account is hoped to understand the rationales behind the legal changes. We afterwards carefully examine the tax records that comprise of both legal buildings and UBWs. Various regression models are employed primarily to unveil the relationship between house taxes on the legal buildings and UBWs. In so doing, how the UBWs is assessed compared to the legal buildings they are attached to and their relative tax burden will be revealed. Those empirical evidence allows us to better interpret the house tax on UBWs either as a supplementary source of tax revenue, a penalty on illegal activities or a tacit acknowledgement of their de facto existence.
    Keywords: house tax; Taipei; tax assessment of buildings; unauthorized building works
    JEL: R3
    Date: 2018–01–01
  6. By: Dierynck, Bart (Tilburg University, School of Economics and Management); Sextroh, Christoph (Tilburg University, School of Economics and Management)
    Abstract: One of the best protected secrets of the Dutch accounting community is that the Netherlands is among the best European countries when it comes to accounting research and that Dutch universities also perform excellent when making worldwide comparisons. The current situation is the result of the hard work of many people at the different Dutch universities during the last three decades. Despite the fact that accounting research flourishes in the Netherlands and despite the geographic concentration of the different universities, initiatives to bring accounting researchers together were lacking. The Dutch Accounting Research Conference (DARC) aims at filling this gap.
    Date: 2017

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