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on Accounting and Auditing |
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Issue of 2021‒05‒17
seven papers chosen by |
| By: | Roth, Steve |
| Abstract: | This paper highlights and unpacks a little-known reality about the Financial Accounts of the United States: the Flows matrix on page 1 of the Federal Reserve’s quarterly Z.1 report does not explain period-to-period changes in the Levels matrix on page 3. The same is true of the sectoral Flow and Levels tables underlying those matrixes. Nor do those tables provide balance-sheet-complete accounting of household or national wealth accumulation. Measures of net saving/investment/capital formation and accumulation, and national wealth accumulation, diverge by tens of trillions of dollars. The discrepancy is explained and resolved by assembling a balance-sheet-complete empirical derivation of comprehensive U.S. “Haig-Simons” income, based on the Integrated Macroeconomic Accounts. The comprehensive measure is 23% higher than national accounts’ “primary” income. Relationships to the Piketty/Saez/Zucman Distributional National Accounts (DINAs) are discussed, along with implications for economic theory and empirical modeling, both mainstream and heterodox/Post-Keynesian. |
| Keywords: | wealth; flow of funds; capital; accumulation; integrated macroeconomic accounts; IMAs; income; gains; holding gains; capital gains; haig-simons |
| JEL: | B4 B5 E21 E22 E25 |
| Date: | 2021–05 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:105281&r= |
| By: | Abhilash S Nair (Indian Institute of Management Kozhikode) |
| Abstract: | This paper attempts to analyse the information content of a qualified audit opinion on the pricing of an IPO. To minimise the effect of selection bias, we match the sample of IPOs with an audit opinion and without, based on their propensity scores. Based on classical underpricing, firms with audit opinion were less underpriced as compared to others. As in prior literature, it is possible that the audit opinion helps investors assess and assume risk in a more informed manner. However, based on initial returns, these firms seem to be overpriced. This indicates that rather than signalling more information to the investor, the auditor’s report probably has little information owing to lack of effective and independent oversight by the auditor. |
| Keywords: | Audit Qualification, Underpricing, IPO, Propensity Score Matching |
| Date: | 2021–03 |
| URL: | http://d.repec.org/n?u=RePEc:iik:wpaper:432&r= |
| By: | Eduardo Levi Yeyati (Universidad Torcuato Di Tella/The Brookings Institution); Federico Sturzenegger (Universidad de San Andrés/Harvard Kennedy School) |
| Abstract: | This paper proposes a new methodology to assess fiscal sustainability. Our approach relies on computing both government ´s assets and liabilities as opposed to focuting only on explicity liabilities. Assets are primarily the present discounted value of taxes, while liablities are primarily the present discounted value of expenditures in addition to explicit liabilities. By looking at the government ´s balance sheet we can compute the net worth of government, as well as evaluate it’s response to growth, commodity prices or real exchange rate shocks. We show that the implications for fiscal sustainability may be different from those obtained by focusing only on explicit liabilities as in the traditional approaches. |
| Date: | 2021–04 |
| URL: | http://d.repec.org/n?u=RePEc:aoz:wpaper:55&r= |
| By: | Abraham Mathews T (Indian Institute of Management Kozhikode); Abhilash S Nair (Indian Institute of Management Kozhikode) |
| Abstract: | This paper attempts to analyse the information content of a qualified audit opinion on the pricing of an IPO. To minimise the effect of selection bias, we match the sample of IPOs with an audit opinion and without, based on their propensity scores. Based on classical underpricing, firms with audit opinion were less underpriced as compared to others. As in prior literature, it is possible that the audit opinion helps investors assess and assume risk in a more informed manner. However, based on initial returns, these firms seem to be overpriced. This indicates that rather than signalling more information to the investor, the auditor’s report probably has little information owing to lack of effective and independent oversight by the auditor. |
| Keywords: | Audit Qualification, Underpricing, IPO, Propensity Score Matching |
| Date: | 2021–03 |
| URL: | http://d.repec.org/n?u=RePEc:iik:wpaper:433&r= |
| By: | European Fiscal Board (EFB) |
| Abstract: | The report provides a comprehensive and independent assessment of how the SGP was applied in the last complete surveillance cycle, 2018. Economic growth in 2018 turned out relatively strong, albeit slowing down in the second semester. Although it was in line with the expectations of spring 2017, many perceived the growth outturn as disappointing by comparison with the strong momentum of 2017 and after an intermediate period of more optimistic forecasts. Growth was unexpectedly job-rich and tax revenues turned out higher than planned. As a result, on aggregate fiscal positions improved more rapidly than expected, with the aggregate deficit reaching a historical low in both the EU and the euro area. On aggregate, the structural primary balance improved marginally. However, a large share of the unexpectedly high tax revenues was located in countries that already had fiscal space; and most of the countries that needed to reduce their high debt levels spent their higher revenues, if not more, instead of building fiscal buffers. Therefore, their fiscal position deteriorated or did not improve by as much as required. For the euro area as a whole, the relatively vigorous pace of expenditure growth net of revenue measures actually signals that fiscal policy was overly expansionary. During the 2018 fiscal surveillance cycle, the Commission applied a ‘margin of discretion’ on top of existing flexibility, reducing fiscal requirements for two Member States. When assessing compliance with requirements, it also used various elements of discretion to justify not drawing conclusions or taking corrective measures against several Member States for which there were serious signs of significant deviation. In this context, useful interventions by some national independent fiscal institutions (IFIs) helped strengthening transparency and accountability in individual Member States. More generally, IFIs could play a more effective role if they all were to meet an EU-wide set of minimum standards ensuring that they have sufficient means, independence and impact. The 2018 experience provides a good illustration of more general weaknesses in the EU fiscal framework and its implementation, as the EFB highlighted in its recent Assessment report. To overcome issues of complexity, opacity, poor compliance and political interference, the Board proposes radically simplifying the rules and clarifying governance. The reformed Pact would target a sustainable debt level, to be achieved by controlling net expenditure growth in a way that allows stabilising the economic cycle. An escape clause would allow room for inevitable discretion, but based on independent judgement. Additional possible reforms include a targeted Golden Rule to protect growth-enhancing public expenditure, making compliance with rules a precondition for access to a central fiscal capacity, reconsidering reverse qualified majority voting, and appointing a full-time President of the Eurogroup who is not a national finance minister. |
| Date: | 2019–10–29 |
| URL: | http://d.repec.org/n?u=RePEc:aon:annual:2019&r= |
| By: | Laurent Piet (SMART - Structures et Marché Agricoles, Ressources et Territoires - AGROCAMPUS OUEST - Institut Agro - Institut national d'enseignement supérieur pour l'agriculture, l'alimentation et l'environnement - INRAE - Institut National de Recherche pour l’Agriculture, l’Alimentation et l’Environnement); Vincent Chatellier (SMART - Structures et Marché Agricoles, Ressources et Territoires - AGROCAMPUS OUEST - Institut Agro - Institut national d'enseignement supérieur pour l'agriculture, l'alimentation et l'environnement - INRAE - Institut National de Recherche pour l’Agriculture, l’Alimentation et l’Environnement); Philippe Jeanneaux (Territoires - Territoires - AgroParisTech - VAS - VetAgro Sup - Institut national d'enseignement supérieur et de recherche en alimentation, santé animale, sciences agronomiques et de l'environnement - AgroSup Dijon - Institut National Supérieur des Sciences Agronomiques, de l'Alimentation et de l'Environnement - INRAE - Institut National de Recherche pour l’Agriculture, l’Alimentation et l’Environnement - UCA - Université Clermont Auvergne); Cathie Laroche-Dupraz (SMART - Structures et Marché Agricoles, Ressources et Territoires - AGROCAMPUS OUEST - Institut Agro - Institut national d'enseignement supérieur pour l'agriculture, l'alimentation et l'environnement - INRAE - Institut National de Recherche pour l’Agriculture, l’Alimentation et l’Environnement); Aude Ridier (SMART - Structures et Marché Agricoles, Ressources et Territoires - AGROCAMPUS OUEST - Institut Agro - Institut national d'enseignement supérieur pour l'agriculture, l'alimentation et l'environnement - INRAE - Institut National de Recherche pour l’Agriculture, l’Alimentation et l’Environnement); Patrick Veysset (UMRH - Unité Mixte de Recherche sur les Herbivores - UMR 1213 - VAS - VetAgro Sup - Institut national d'enseignement supérieur et de recherche en alimentation, santé animale, sciences agronomiques et de l'environnement - AgroSup Dijon - Institut National Supérieur des Sciences Agronomiques, de l'Alimentation et de l'Environnement - INRAE - Institut National de Recherche pour l’Agriculture, l’Alimentation et l’Environnement) |
| Abstract: | This article presents an analysis of the indicators used to measure the economic performance of farms in France. While the chart of accounts makes it possible to identify the precise method of calculation of various intermediate management balances (including the gross added value, the gross operating surplus and the farm income), the statistical sources used to discuss the question of the level of 'income' of French farmers are diverse and the indicators used are not always homogeneous. This sometimes results in a fragility in the public expression of the notion of farmers' income. By matching two distinct sources of information over fifteen years (2003 to 2017), namely, on the one hand, the Farm Accounting Data Network (Rica) produced by the Ministry of Agriculture and, on the other hand, the database for self-employed contributors (COTNS) of the Caisse Centrale de la Mutualité Sociale Agricole (CCMSA), this article compares the level of several economic performance indicators. The matching was carried out using the SIRET number of the farms and methodological work was carried out so that the scope of the farms is common to both databases. This analysis highlights several original results: the fiscal 'agricultural profit' (published by the MSA) is lower than the current result before tax (derived from the Rica) by one third; the amount of private levies is weakly correlated to the accounting result or to the reported tax income; the heterogeneity observed in income levels depends on structural determinants but also on the strategic choices made by farmers themselves. |
| Abstract: | Cet article présente une analyse portant sur les indicateurs utilisés pour mesurer la performance économique des exploitations agricoles en France. Si le plan comptable permet d'identifier le mode de calcul précis de différents soldes intermédiaires de gestion (dont la valeur ajoutée brute, l'excédent brut d'exploitation et le résultat courant avant impôt), les sources statistiques utilisées pour évoquer la question du niveau de « revenu » des agriculteurs français sont variées et les indicateurs pris en référence pas toujours homogènes. Il en résulte parfois une fragilité dans l'expression publique de la notion de revenu des agriculteurs. En procédant à un appariement entre deux sources d'informations distinctes sur quinze années (de 2003 à 2017), à savoir, d'un côté, le Réseau d'Information Comptable Agricole (Rica) du Ministère de l'Agriculture et, d'un autre côté, la base des cotisants non-salariés (COTNS) de la Caisse Centrale de la Mutualité Sociale Agricole (CCMSA), cet article procède à une comparaison du niveau de plusieurs indicateurs de performance économique. L'appariement a été réalisé à partir du numéro SIRET des entreprises et un travail méthodologique a été effectué de façon à ce que le champ des exploitations soit commun aux deux bases. Cette analyse permet de mettre en évidence plusieurs résultats originaux : le « bénéfice agricole » fiscal (publié par la MSA) est, en moyenne, inférieur d'un tiers au résultat courant avant impôt (issu du Rica) ; le montant des prélèvements privés est peu corrélé au niveau du résultat comptable ou à celui du revenu fiscal déclaré ; l'hétérogénéité observée dans les niveaux de revenu dépend de déterminants structurels mais également des choix stratégiques réalisés par les agriculteurs eux-mêmes. |
| Keywords: | Farm income,Private levies,Economic performance,FADN,Revenu agricole,Prélèvements privés,Performance économique,RICA,MSA |
| Date: | 2021–04–07 |
| URL: | http://d.repec.org/n?u=RePEc:hal:journl:hal-03206915&r= |
| By: | Breza, Emily; Kanz, Martin; Klapper, Leora |
| Abstract: | How do inexperienced consumers learn to use a new financial technology? We present results from a field experiment that introduced payroll accounts in a population of largely unbanked factory workers in Bangladesh. In the experiment, workers in a treatment group received monthly wage payments into a bank or mobile money account while workers in a control group continued to receive wages in cash, with a subset also receiving an account without automatic wage payments. We find that exposure to payroll accounts leads to increased account use and consumer learning. Those receiving accounts with automatic wage payments learn to use the account without assistance, begin to use a wider set of account features, and learn to avoid illicit fees, which are common in emerging markets for consumer finance. The treatments have real effects, leading to increased savings and improvements in the ability to cope with unanticipated economic shocks. We conduct an additional audit study and find suggestive evidence of market externalities from consumer learning: mobile money agents are less likely to overcharge inexperienced customers in areas with higher levels of payroll account adoption. This suggests potentially important equilibrium effects of introducing accounts at scale. |
| Keywords: | financial consumer protection; financial inclusion; learning |
| JEL: | G5 G51 G53 O16 |
| Date: | 2020–12 |
| URL: | http://d.repec.org/n?u=RePEc:cpr:ceprdp:15565&r= |