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on Accounting and Auditing |
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Issue of 2019‒03‒04
five papers chosen by |
| By: | Nizam, Ahmed Mehedi |
| Abstract: | Basel framework for bank's capital adequacy has been criticized for its over reliance on external credit rating agencies. Moreover, implementation of Minimum Capital Requirement (MCR) under Basel-III is often linked to a decrease in economic growth as it requires banks to maintain a higher capital base which raises their cost of fund. In addition to these, here, we criticize the Basel accord for the capital requirement under this framework is not inspired by the essence of the basic accounting equation. Moreover, under Basel framework, capital requirement and liquidity parameters are discussed separately. Here, we argue that the capital requirement should arise as a by-product of the day to day liquidity management and hence both the requirements can be brought together under one umbrella which enables us to view the overall position of a bank from a more holistic point of view. Here, we attain all the above issues and provide a comprehensive framework regarding bank's capital adequacy and liquidity requirements which is claimed to settle all the aforementioned issues and reduces all the extensive paper works needed for the implementation of the Basel accord. |
| Keywords: | Basel; Capital Adequacy; Minimum Capital Requirement; MCR; Liquidity Ratio; LCR; NSFR; Liquidity Coverage Ratio; Net Stable Funding Ratio; Banking; Basic Accounting Equation |
| JEL: | E58 G0 G01 G20 G21 G28 |
| Date: | 2019–02–22 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:92330&r=all |
| By: | Cédric Durand (Université Paris 13); Sébastien Villemot (Observatoire français des conjonctures économiques) |
| Abstract: | The probability of a partial or complete break-up of the euro has risen over the last years. Such an event could create a balance sheet problem for economic agents, if the redenomination process introduced significant currency mismatches between the asset and liability sides. We propose a new assessment of this redenomination risk, by country and by main institutional sector, for two scenarios: a single country exit and a complete break-up. Our main conclusion is that, even though the problem has to be taken seriously, its order of magnitude should not be exaggerated. Only a few sectors are at significant risk: public debts of Greece and Portugal, financial sectors of Greece, Ireland and Luxembourg. In particular, the balance sheet exposure of the non-financial private sector to the redenomination risk appears to be limited. |
| Keywords: | Financial aspects of economic integration |
| JEL: | F36 |
| Date: | 2018–01 |
| URL: | http://d.repec.org/n?u=RePEc:spo:wpmain:info:hdl:2441/2bjp23jrbs9kordke7ja90v1oq&r=all |
| By: | Matthew Gould (Brunel University, UK); Matthew D. Rablen (University of Sheffield, UK) |
| Abstract: | Tax authorities worldwide are implementing voluntary disclosure schemes to recover tax on offshore investments. The US and UK, in particular, have implemented such schemes in response to bulk acquisitions of information on o¤shore holdings, recent examples of which are the Paradise and Panama papers. Schemes oter affected investors the opportunity to make a voluntary disclosure, with reduced ne rates for truthful disclosure. Might such incentives, once anticipated by investors, simply encourage evasion in the rst place? We characterize the investor/tax authority game with and without a scheme, allowing for the possibility that some o¤shore investment has legitimate economic motives. We show that a scheme increases net expected tax revenue, decreases illegal o¤shore investment, increases onshore investment, but could either increase or decrease legal o¤shore investment. The optimal disclosure scheme o¤ers maximal incentives for truthful disclosure by imposing the minimum allowable rate of ne. |
| Keywords: | voluntary disclosure; offshore tax evasion; tax amnesty; third party information |
| JEL: | H26 D85 |
| Date: | 2019–02 |
| URL: | http://d.repec.org/n?u=RePEc:shf:wpaper:2019006&r=all |
| By: | Alexeev, Michael (Алексеев, Майкл) (The Russian Presidential Academy of National Economy and Public Administration, Indiana University); Belev, Sergey (Белев, Сергей) (The Russian Presidential Academy of National Economy and Public Administration, Gaidar Institute for Economic Policy); Gromov, Valdimir (Громов, Владимир) (The Russian Presidential Academy of National Economy and Public Administration); Deryugin, Alexander (Дерюгин, Александр) (The Russian Presidential Academy of National Economy and Public Administration); Drobyshevsky, Sergey (Дробышевский, Сергей) (The Russian Presidential Academy of National Economy and Public Administration, Gaidar Institute for Economic Policy); Kaukin, Andrey (Каукин, Андрей) (The Russian Presidential Academy of National Economy and Public Administration, Gaidar Institute for Economic Policy); Knobel, Alexander (Кнобель, Александр) (The Russian Presidential Academy of National Economy and Public Administration, Russian Foreign Trade Academy, Gaidar Institute for Economic Policy); Korytin, Andrey (Корытин, Андрей) (The Russian Presidential Academy of National Economy and Public Administration); Leonov, Elisey (Леонов, Елисей) (The Russian Presidential Academy of National Economy and Public Administration, Gaidar Institute for Economic Policy); Malinina, Tatiana (Малинина, Татьяна) (Gaidar Institute for Economic Policy); Milogolov, Nikolai (Милоголов, Николай) (The Russian Presidential Academy of National Economy and Public Administration); Sinelnikov-Murylev, Sergey (Синельников-Мурылев, Сергей) (The Russian Presidential Academy of National Economy and Public Administration, Russian Foreign Trade Academy, Gaidar Institute for Economic Policy) |
| Abstract: | Tax policy directly affects the state of the business climate in the country and the competitiveness of national business. Over the past six years, the main principle of tax policy in the Russian Federation has been to preserve unchanged tax conditions (basic tax rates), improve the structure and administration of individual taxes, and automate tax administration as a whole. In the Doing Business World Bank ranking, for 10 years from 2009 to 2018, according to the “Taxes” component, Russia has risen from 134 to 53rd place. The Russian tax system largely meets the criteria of an “optimal tax system”, but there is a stable set of myths about it that provoke heated discussions both in the business community and in the development and discussion of budget laws. |
| Date: | 2019–01 |
| URL: | http://d.repec.org/n?u=RePEc:rnp:ppaper:021907&r=all |
| By: | Duccio Gamannossi degl’Innocenti (University of Exeter, UK); Matthew D. Rablen (University of Sheffield, UK) |
| Abstract: | We relate tax evasion behavior to a substantial literature on social comparison in judgements. Taxpayers engage in tax evasion as a means to boost their expected consumption relative to others in their social network. The unique Nash equilibrium of the model relates optimal evasion to a (Bonacich) measure of network centrality: more central taxpayers evade more. Given that tax authorities are now investing heavily in big-data tools that aim to construct social networks, we investigate the value of acquiring network information. We do this using networks that allow for celebrity taxpayers, whose consumption is widely seen, and who are systematically of higher wealth. We show that there are pronounced returns to the initial acquisition of network information, albeit targeting audits with highly incomplete knowledge of social networks may be counterproductive. |
| Keywords: | Tax Evasion; Social Networks; Network centrality; Optimal Auditing; Social Comparison; Relative Consumption |
| JEL: | H26 D85 K42 |
| Date: | 2019–02 |
| URL: | http://d.repec.org/n?u=RePEc:shf:wpaper:2019005&r=all |