nep-acc New Economics Papers
on Accounting and Auditing
Issue of 2021‒01‒18
thirteen papers chosen by
Alexander Harin
Modern University for the Humanities

  1. Cultural Values and Perceived Audit Quality: A Conceptual Framework By Samirah Dunakhir
  2. Malaysia; Technical Assistance Report-Government Finance Statistics Mission and Preceding Remote Support By International Monetary Fund
  3. Albania; Technical Assistance Report–Monetary and Financial Statistics and Financial Accounts Mission By International Monetary Fund
  5. The Relationship Between Key Audit Matters (KAMS) Disclosure and Stock Reaction: Cross-Sectional Study of Thailand, Malaysia, and Singapore By Phattarawade Sawangjan
  6. What value added in the trade balances of euro area financial centres? By Di Nino, Virginia; Ekstam, Anna
  7. Republic of Moldova; Technical Assistance Report-Financial Soundness Indicators Mission By International Monetary Fund
  8. Enhancing Fiscal Transparency and Reporting in India By Patrick Blagrave; Fabien Gonguet
  9. Republic of Poland; Technical Assistance Report-Next Steps in Developing a Standard Chart of Accounts and Multi-year Budget By International Monetary Fund
  10. Productivity Gaps and Job Flows: Evidence from Censal Microdata By Elías Albagli; Mario Canales; Chad Syverson; Matías Tapia; Juan Wlasiuk
  11. Revealing Corruption: Firm and Worker Level Evidence from Brazil By Colonnelli, Emanuele; Lagaras, Spyridon; Ponticelli, Jacopo; Prem, Mounu; Tsoutsoura, Margarita
  12. Niger; Selected Issues By International Monetary Fund
  13. Corruption and Firms By Colonnelli, Emanuele; Prem, Mounu

  1. By: Samirah Dunakhir (Faculty of Economic, Universitas Negeri Makassar, Indonesia Author-2-Name: Mukhammad Idrus Author-2-Workplace-Name: Faculty of Economic, Universitas Negeri Makassar, Indonesia Author-3-Name: Author-3-Workplace-Name: Author-4-Name: Author-4-Workplace-Name: Author-5-Name: Author-5-Workplace-Name: Author-6-Name: Author-6-Workplace-Name: Author-7-Name: Author-7-Workplace-Name: Author-8-Name: Author-8-Workplace-Name:)
    Abstract: Objective - This paper aims to propose a framework for cultural values and perceived audit quality Methodology – The methodology used in this study is the content analysis of the published papers in relation to cultural values and perceived audit quality Findings – There is a strong relationship between cultural values and accounting values in the judgement process of auditing and they determine the quality of audit. Novelty – There is not much information published in the area of the roles of cultural values and perceived audit quality. Therefore, this paper offers a conceptual framework on cultural values and perceived audit quality. Type of Paper - Review
    Keywords: Culture; Cultural Values; Perception; Audit Quality
    JEL: M4 M42
    Date: 2020–12–31
  2. By: International Monetary Fund
    Abstract: This technical assistance report on Malaysia explains the effort by the mission to support the Malaysian authorities in improving Government Finance Statistics (GFS) decision making. The mission achieved significant progress with respect to the development of a budgetary central GFS compilation system based on primary accrual accounting data. The mission, together with the authorities, successfully developed a compilation sheet to facilitate the largely automated compilation of a comprehensive set of GFS tables from the system. With respect to flows reported in the income statement, the analysis suggests that it is essential to build the survey around the balancing items (net) operative income and (net) comprehensive income. The analysis of the corporate balance sheets suggests that most accounting terms used by the public corporations can be grouped sensibly and linked to GFS classifications. With respect to the extrabudgetary units of central government, the mission proposed minor refinements of the survey and prepared preliminary GFS data.
    Keywords: Government finance statistics;Public sector;Financial statements;Fiscal accounting and reporting;Business enterprises;ISCR,CR,government,state government,classification of functions of government,accounting data,GFS classification
    Date: 2019–08–13
  3. By: International Monetary Fund
    Abstract: This Technical Assistance report on Albania focuses on: compiling and disseminating flow-based monetary and financial statistics (MFS) for the central bank, other depository corporations (ODCs), and other financial corporations (OFCs); compiling and disseminating quarterly financial accounts by institutional sectors; and developing a from-whom/to-whom matrix for financial instruments. The mission reviewed the quality of Albania’s flow-based MFS, sectoral financial accounts and balance sheets, and provided technical guidance to improve their quality. The Monetary Policy Committee has requested flow-based monetary statistics as an additional vehicle to understand money and credit developments in the Albanian economy. Similarly, financial accounts by sector and financial balance sheets are considered increasingly important for analysis of financial stability and other macroeconomic developments. The mission also recommended that the BOA begins compiling quarterly sectoral financial accounts and balance sheets by mid-2021 starting with data from the first quarter of 2017.
    Keywords: Fiscal accounting and reporting;Financial statements;Financial sector;Currencies;Commercial banks;ISCR,CR,balance sheetaccount,foreign currency
    Date: 2019–10–03
  4. By: Kusumawati, Retno Ryani; Sulistiana, Indra
    Abstract: This study was conducted to determine the effect of Good Corporate Governance (GCG) on Financial Performance and Company Value in State-Owned Corporation in Indonesia in the era of 4.0 and society 5.0. Research subjects are state-owned corporation listed on the Indonesia Stock Exchange (IDX) for the 2013-2017 period. The samples taken are 10 State-Owned Corporation (BUMN) that are included in the criteria. The method used to analyze the relationship between variables in this study is multiple linear regression analysis. Hypothesis test results show that the Independent Board of Commissioners and Audit Committee have an effect on the Return on Assets (ROA) with a significance value of 0.012. The results of testing the second hypothesis Independent commissioners and audit committees have no simultaneous effect on Company Values with a significance value of 0.082. Partially the independent Board of Commissioners has an effect on Return On Assets (ROA) and company value. While the second variable of the Audit Committee does not affect the Return on Assets (ROA) and company value.
    Date: 2020–06–29
  5. By: Phattarawade Sawangjan (Faculty of Management Sciences, Prince of Songkla University, 90110, Songkhla, Thailand Author-2-Name: Muttanachai Suttipun Author-2-Workplace-Name: Faculty of Management Sciences, Prince of Songkla University, 90110, Songkhla, Thailand Author-3-Name: Author-3-Workplace-Name: Author-4-Name: Author-4-Workplace-Name: Author-5-Name: Author-5-Workplace-Name: Author-6-Name: Author-6-Workplace-Name: Author-7-Name: Author-7-Workplace-Name: Author-8-Name: Author-8-Workplace-Name:)
    Abstract: Objective - The study aimed (1) to investigate the level and issue of key audit matters (KAMs) disclosure of listed companies in Thailand, Malaysia, and Singapore, (2) to test the different level of KAMs disclosure of listed companies between Thailand, Malaysia, and Singapore, and (3) to examine the relationship between KAMs disclosure and stock reaction. Methodology – Samples were 96 listed companies of Top-50 firms from Thailand, Malaysia, and Singapore. Content analysis by word counting and checklist was used to quantify KAMs disclosure in audit reports during 2016 to 2019, while the stock reaction was measured by the stock price of the sample's common share. Descriptive analysis, independent sample t-test, correlation matrix, and multiple regression was used to analyze the data. Findings – As the results, the study found that the average word of KAMs the disclosure was 878.74 words with 2.38 average issues during 2016 to 2019. There was a significantly different level of KAMs disclosure of listed companies between Thailand and Malaysia, between Thailand and Singapore, and between Malaysia and Singapore. Moreover, the study found a positive significant relationship between KAMs disclosure (Word) and the stock price, while there was a negatively significant relationship between KAMs disclosure (Issue) and the stock price. Novelty – This study is the first cross-sectional study of KAMs disclosure in ASEAN region. Type of Paper - Empirical.
    Keywords: Key Audit Matters Disclosure; Stock Reaction; Thailand; Malaysia; Singapore.
    JEL: M40 M41 M42
    Date: 2020–12–31
  6. By: Di Nino, Virginia; Ekstam, Anna
    Abstract: Beside large capital flows, euro area financial centres feature important and growing trade surpluses. We investigate the composition of their gross trade flows and disentangle (i) domestic and foreign production content that is (ii) directly traded with final absorbing economies or embedded in intermediates that are carried to final destination by partner countries. This accounting exercise uncovers that foreign production transiting through their borders accounts for most of the surpluses of financial centres but also that the net surplus in domestic value added traded directly with final consumers is twice as large as in other euro area economies. MNEs allocate the value created globally to financial centres. They do so through transfer pricing practices which undermine the correct representation of the external position of these countries with a bearing also on the external position of the euro area. Their participation in production chains also appears oddly large. When we replace the official trade statistics with predictions based on the gravity law of trade, the surpluses of main euro area financial centres disappear. JEL Classification: F14, F23, F40
    Keywords: domestic and foreign value added, financial centres, profit shifting, trade balance
    Date: 2020–12
  7. By: International Monetary Fund
    Abstract: This Technical Assistance Report on the Republic of Moldova provides details of IMF mission to review available source data for deposit takers and other sectors including other financial corporations (OFCs); and to review the current financial soundness indicators (FSI) compiled by the National Bank of Moldova with a view to ensure methodological consistency of the FSI compilation with the IMF’s FSI Compilation Guide 2006. The mission found some deviations from the FSI Guide in key indicators currently compiled based on the International Financial Reporting Standards and Basel III principles as well as national supervisory standards. Some methodological deviations include the measurement of capital. In order to support progress in the above work areas, the mission recommended a detailed action plan with several priority recommendations. It is recommended to expand the coverage of the OFCs sector to include the non-bank credit organizations (microfinance institutions and leasing companies) in collaboration and coordination with the National Commission for Financial Markets.
    Keywords: Financial soundness indicators;Financial statements;Commercial banks;Personal income;Banking;ISCR,CR,FSI Guide,balance sheet capital,compilation Guide,FSI compilation Guide,metadata template
    Date: 2019–09–04
  8. By: Patrick Blagrave; Fabien Gonguet
    Abstract: Current fiscal transparency and reporting practices in India place it behind most peer G20 economies, implying that policy makers are lacking critical data to ground their fiscal and other economic planning decisions. The increasing use of off-budget financing at the central government level in recent years represents one key example of reduced transparency—we provide estimates of the public sector borrowing requirement and an extended notion of the fiscal deficit, each of which shows a more expansionary stance in recent years than ‘headline’ deficit figures presented in budget documents. We then investigate the current state of fiscal reporting practices in India and suggest areas for reforms—these include enhanced IT systems, stronger central-local coordination, and a gradual transition to accrual accounting.
    Keywords: Government debt management;Fiscal reporting;Budget planning and preparation;Fiscal transparency;Fiscal risks;Government Statistics,Budget Systems,India,WP,Union government,cash-basis accounting regime,General government data,borrowing need,government activity
    Date: 2020–11–13
  9. By: International Monetary Fund
    Abstract: This Technical Assistance report on the Republic of Poland provide details of an IMF mission to analyse next steps in developing a standard chart of accounts (SCoA) and multi-year budget. The Ministry of Finance (MoF) has started many preparatory activities for developing the SCoA. Extensive discussions and presentations during this mission afforded the mission the opportunity to convey information on the conceptual framework for the SCoA in more detail. Counterparts raised issues for clarification during initial meetings with the mission. Through a mini workshop, the mission tried to ensure that all counterparts fully understand the parameters of a multi-dimensional SCoA and the implication of decisions related to it. The main recommendations of this mission on the SCoA present various options available to address issues discussed. The mission recommended increasing the effectiveness of the accounting users’ survey by ensuring that the SCoA survey respondents are made fully aware of the purpose of the survey and the implications of their responses.
    Keywords: Budget planning and preparation;Expenditure;Medium-term budget frameworks;Fiscal accounting and reporting;Budget classification;ISCR,CR,PFM reform,government transaction,administration responsibility,expenditure ceiling,local government
    Date: 2019–09–05
  10. By: Elías Albagli; Mario Canales; Chad Syverson; Matías Tapia; Juan Wlasiuk
    Abstract: A large body of work has highlighted the importance of employment reallocation as a driver of aggregate productivity growth, but there is little direct evidence on the extent and nature of this process. We use an administrative matched employer-employee census for Chile to provide novel insights on the relationship between productivity gaps between firms and job transitions. As expected, the fraction of worker flows reflecting movements from lower- to higher-productivity firms is greater than that of the opposite sign, but only marginally so. Almost half of all transitions occur "down the firm-productivity ladder." This process is also highly heterogeneous across several dimensions. Up-the-ladder flows are more likely for direct job-to-job transitions than those that pass through non-employment. They are also much more likely for young, highskilled workers, whose job transitions comprise in an accounting sense the lion’s share of aggregate productivity growth. Interestingly, workers with higher job turnover rates contribute proportionally the least to aggregate productivity growth. Put together, this evidence is suggests that the productivity benefit of job reallocation might have a net benefit, but this benefit reflects massive and heterogeneous gross flows underneath.
    Date: 2020–12
  11. By: Colonnelli, Emanuele; Lagaras, Spyridon; Ponticelli, Jacopo; Prem, Mounu; Tsoutsoura, Margarita
    Abstract: We study how the disclosure of corrupt practices affects firms and their employees. We construct novel firm-level measures of involvement in corrupt practices using randomized audits and public procurement suspensions in Brazil. On average, exposed firms grow larger after the audits. However, this result masks large heterogeneity depending on the degree of firm involvement in the corruption scheme. Using contract-, loan-, and worker- level data, we show that highly corrupt firms suffer after anti-corruption initiatives, while other exposed firms grow by changing their investment strategy when shifting away from doing business with the government.
    Date: 2020–12–30
  12. By: International Monetary Fund
    Abstract: This Selected Issues paper takes stock of Niger’s tools to directly and indirectly combat corruption and shows that shortcomings in public-sector governance take a toll on private-sector development, especially young firms and exporters. Measures to advance Niger’s anticorruption agenda are laid out. This paper describes Niger’s anti-corruption framework, discusses how broader public-sector governance reforms can contribute to curbing corruption, assesses the impact on the private sector, and suggests measures to advance anticorruption reforms. The authorities profess commitment to fight corruption and have taken steps to revamp the anti-corruption framework. Niger is also equipped with legal and regulatory audit bodies that contribute to combatting corruption and promoting good governance. Although the legal and regulatory framework for public procurement is sound, its effective implementation remains elusive. Recent progress in simplifying administrative procedures should discourage public officials from exploiting complex bureaucracy to extract bribes. Formal regression analysis confirms that firms subject to corruption record lower sales and productivity growth relative to those that do not pay bribe.
    Keywords: Corruption;Anti-money laundering and combating the financing of terrorism (AML/CFT);Auditing;Public investment and public-private partnerships (PPP);Legal support in revenue administration;ISCR,CR,anti-corruption framework,clearance time,due diligence,president of the republic,public funds
    Date: 2019–07–22
  13. By: Colonnelli, Emanuele; Prem, Mounu
    Abstract: We estimate the causal real economic effects of a randomized anti-corruption crackdown on local governments in Brazil using rich micro-data on corruption and firms. After anti-corruption audits, municipalities experience an increase in the number of firms concentrated in sectors most dependent on government relationships. Through the estimation of geographic spillovers and additional tests, we show that audits operate via both a direct detection effect as well as through indirect deterrence channels. Politically connected firms suffer after the audits. Our estimates indicate the anti-corruption program generates significant local multipliers which are consistent with the presence of a large corruption tax on government-dependent firms.
    Date: 2020–12–30

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