nep-acc New Economics Papers
on Accounting and Auditing
Issue of 2024‒05‒27
four papers chosen by

  1. Questionner la neutralité pour dépasser le mythe de l’image fidèle en comptabilité : une nécessité pour responsabiliser la profession comptable By Christophe Godowski; Emmanuelle Negre; Marie-Anne Verdier
  2. The TruEnd-procedure: Treating trailing zero-valued balances in credit data By Arno Botha; Tanja Verster; Roelinde Bester
  3. New Gig Work or Changes in Reporting? Understanding Self-Employment Trends in Tax Data By Andrew Garin; Emilie Jackson; Dmitri K. Koustas
  4. Memories lost: a history of accounting records as forms of projection By Matringe, Nadia; Power, Michael

  1. By: Christophe Godowski; Emmanuelle Negre (IRGO - Institut de Recherche en Gestion des Organisations - UB - Université de Bordeaux - Institut d'Administration des Entreprises (IAE) - Bordeaux); Marie-Anne Verdier
    Abstract: L'objectif de l'article est d'étudier dans quelle mesure le concept de neutralité en comptabilité participe à diffuser le « mythe de l'image fidèle » et de comprendre comment une remise en cause de ce mythe peut s'opérer au sein d'une partie de la profession comptable soucieuse des enjeux sociétaux. Il prend appui sur une étude qualitative reposant sur 28 entretiens semi-directifs menés auprès d'experts-comptables (EC) présentant des profils variés. Ces entretiens, analysés selon la méthode Gioia, permettent de révéler les enjeux associés au concept de neutralité tel que perçu par les EC. Nos résultats montrent qu'en appréhendant le concept de neutralité principalement du point de vue de leurs pratiques, la plupart des EC s'inscrivent dans une vision technicienne de la comptabilité qui masque sa dimension politique. Ce faisant, ils constituent les médiateurs d'une visée monologique de la comptabilité traductrice de l'idéologie dominante qui, sous couvert de neutralité, contribue à asseoir le mythe de l'image fidèle. Nos résultats révèlent toutefois que certains EC, conscients de l'incapacité d'une telle vision de la comptabilité à répondre aux enjeux sociétaux, questionnent le concept de neutralité et proposent des pistes de réflexion pour dépasser ce mythe, même si le dialogue avec le reste de la profession comptable s'avère difficile.
    Date: 2024–02–12
  2. By: Arno Botha; Tanja Verster; Roelinde Bester
    Abstract: A novel procedure is presented for finding the true but latent endpoints within the repayment histories of individual loans. The monthly observations beyond these true endpoints are false, largely due to operational failures that delay account closure, thereby corrupting some loans in the dataset with `false' observations. Detecting these false observations is difficult at scale since each affected loan history might have a different sequence of zero (or very small) month-end balances that persist towards the end. Identifying these trails of diminutive balances would require an exact definition of a "small balance", which can be found using our so-called TruEnd-procedure. We demonstrate this procedure and isolate the ideal small-balance definition using residential mortgages from a large South African bank. Evidently, corrupted loans are remarkably prevalent and have excess histories that are surprisingly long, which ruin the timing of certain risk events and compromise any subsequent time-to-event model such as survival analysis. Excess histories can be discarded using the ideal small-balance definition, which demonstrably improves the accuracy of both the predicted timing and severity of risk events, without materially impacting the monetary value of the portfolio. The resulting estimates of credit losses are lower and less biased, which augurs well for raising accurate credit impairments under the IFRS 9 accounting standard. Our work therefore addresses a pernicious data error, which highlights the pivotal role of data preparation in producing credible forecasts of credit risk.
    Date: 2024–04
  3. By: Andrew Garin; Emilie Jackson; Dmitri K. Koustas
    Abstract: Rising self-employment rates in U.S. tax data that are absent in survey data have led to speculation that tax records capture a rise in new “gig” work that surveys miss. Drawing on the universe of IRS tax returns, we show that trends in firm-reported payments to “gig” and other contract workers do not explain the rise in self-employment reported to the IRS; rather, that increase is driven by self-reported earnings of individuals in the EITC phase-in range. We isolate pure reporting responses from real labor supply responses by examining births of workers’ first children around an end-of-year cutoff for credit eligibility that creates exogenous variation in tax rates at the end of the tax year after labor supply decisions are already sunk. We find that ex-posing workers with sunk labor supply to negative marginal tax rates results in large increases in their propensity to self-report self-employment—only a small minority of which leads to bunching at kink-points. Consistent with pure strategic reporting behavior, we find no impact on reporting among taxpayers with no incentive to report additional income and no effects on firm-reported payments of any kind. Moreover, we find these reporting responses have grown over time as knowledge of tax incentives has become widespread. Quantification exercises suggest that changes in taxpayer reporting behavior are a major driver of discrepancies between self-employment trends in self-reported and third-party reported data. Our findings suggest caution is warranted before deferring to self-reported tax data over other data sources when measuring labor market trends.
    JEL: H26 J21 J41 J46 J82
    Date: 2024–04
  4. By: Matringe, Nadia; Power, Michael
    Abstract: This paper develops a theoretical history of the intricate relationship between accounting as a recording technology and memory, arguing that accounting's influence extends beyond mere financial documentation to shape human memory and projections into the past and the future. Drawing on Stiegler's theory of transindividuation, understood as the trans-formation of individuals, groups and technologies, and his emphasis on technology-mediated memory, we propose that varying types of accounting records cultivate different memory forms by fostering spatiotemporal projections which reshape the societal perception and comprehension of accounting. Our analysis relies on a comparison between two decentralized transaction recording systems similar in their operations, but which emerged in two different eras: blockchain and early double-entry bookkeeping. Our approach draws from Haydu (1998) to identify similarities and contrasts between different periods which can emphasize the uniqueness of each, while conceptualizing long-term trends. By juxtaposing DEB and BC as instances of decentralized records, the study postulates a critical shift in accounting's transindividuation over time. We argue that while DEB's norms of recording aided in the formation of collective memory and long-term projections, turning records into objects of social investment, BC's recording, propelled by automation and an economic emphasis, manifests as an isolated numerical sequence hindering the scope of human projections. We posit that compared to early DEB, BC recording, although it holds the potential for democratization, may lead to divisions between users, among themselves, and with their records. We discuss the potential implications of this trans-dividuation process for notions of accountability, transparency, regulation, and the broader political role of accounting in society.
    Keywords: theoretical history; recording; automation; memory forms; projections; double-entry bookkeeping; Stiegler; transindividuation; Elsevier deal
    JEL: M40
    Date: 2023–10–10

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