This dissertation examines the implications of technological advances on the net working capital balance of U.S. firms over the past five decades. I find that the annual mean value of the net working capital balance of U.S. firms has sharply declined, from 28.9% of average total assets in the 1970s to 6.5% in the 2010s. I also show that an increase in IT spending is associated with a reduction in net working capital balance, after controlling for alternative explanations. This real (vis-à-vis accounting) change in net working capital balance has significant implications for practical financial management and accounting research. On one hand, companies have become more efficient in managing their working capital and thus in conserving cash, leading to an increased cash savings at U.S. firms. On the other, the declining working capital balance has reduced accounting current accruals from 18.8% to 5.4% of earnings, which, in turn, has reduced the explanatory power of the Jones (1991) model from 23.7% to 3.7% and increased the correlation between earnings and cash flows from 0.689 to 0.947 over time. Such a structural change is worth noting for accounting research addressing the relationship between accruals, cash flows, and earnings.

Thesis (PhD) -- AUT University, 2007. / Includes bibliographical references. Also held in print (ix, 102 leaves ; 30 cm.) in City Campus Theses Collection (T 658.1511 KOE)

Thesis (Ph. D.)--University of Hong Kong, 1999. / Includes bibliographical references (leaves 102-105).

<p> Internal controls play critical roles in all organizations. Internal control weaknesses that have resulted in accounting fraud have global and local ramifications including job and investment losses. The ramifications have been felt globally in the United States, Britain, China, and locally, in Northern Virginia. Weak internal controls or the lack thereof was the most preeminent factor contributing to accounting fraud. Many studies have discretely and narrowly examined either internal control weaknesses or fraud. Consequently, there was a dearth of research on internal control failures that have resulted in accounting fraud. The problem addressed in this study was the need to understand accountants&rsquo; perspectives on how they detected and handled internal control weaknesses within their organizations and their perceptions of their preparedness to detect and prevent fraud based on the academic and on-the-job training they have received. The purpose of this qualitative multiple case study was to describe how accountants in the Northern Virginia area detected and handled internal control weaknesses within their organizations and their perceptions of their preparedness to detect and prevent fraud based on the academic and on-the-job training they received. In this study, informal face-to-face, open-ended semi-structured interviews and document review were conducted. Purposive snowball and criterion sampling were used to recruit 15 professional accountants. Lists maintained by professional accounting organizations were used to identify members who met the study criteria. Data were analyzed using qualitative content analyses to identify themes related to the research questions. Results indicated that lack of monitoring preeminently contributed to fraud. However, accountants shared strategies they used to detect and prevent internal control weaknesses and accounting fraud within their organizations. Additionally, accountants received inadequate internal control and fraud training both in college and from their employers. Recommendations for practical application include providing accountants with adequate internal control and fraud training in college and by employers. Future research should explore organizational managements&rsquo; perspectives on internal control weaknesses that resulted in accounting fraud to shed more light on the pervasiveness of the deficiencies identified. This study was limited to accountants in Northern Virginia, future research may replicate this study, but in different geographic locations.</p>

<p> Why do some firms survive and grow and others do not? Is Gibrat&rsquo;s Law still valid? This is an ongoing debate in industrial organization and management since Gibrat published in 1931. Gibrat (1931) suggested firm growth is independent of firm size and is by chance. However, recent studies call for chance to be supplemented by deterministic models. We considered determinants of firm growth. Specifically, we examined whether firm growth is explained by firm size, firm profitability, firm leverage, firm agency costs, and firm R&amp;D intensity. Also, persistence of firm growth was considered. Evidence was based on a balanced panel data set obtained from Compustat annually for 1991-2015. Data consisted of 82 surviving U.S. public companies in the industrial economic sector. Empirical analysis involved panel econometric techniques like pooled ordinary least squares, random effects models, fixed effects models, and system Generalized Method of Moments methodology. We find that firm growth is not independent of firm size; therefore, Gibrat&rsquo;s Law does not hold. We find that a significant, positive relationship exists between firm research and development intensity and firm growth. We find that a significant, negative relationship exists between profitability measured by ROA, firm leverage, firm agency costs and firm growth. Finally, we conclude that firm growth persists.</p><p>

Finance scholars disagree on how real world financial markets work. On the one hand, efficient market hypothesis (EMH) advocates claim that arbitrage ensures that market prices do not systematically deviate from their fundamental value even when some market participants are less than fully rational. Hence, in the EMH world, securities’ prices always reflect all available information. On the other hand, behavioural finance theorists argue that investors suffer important cognitive biases and that arbitrage is both risky and costly. In this alternative setting, prices may not reflect all available information and can systematically deviate from their fundamental value for long periods of time. My thesis contributes to this ongoing debate by exploring how the US equity market reacts to bankruptcy announcements. Using a set of 351 non-financial, non-utility firms filing for Chapter 11 between 1979 and 2005 that remain listed on a main exchange, I first find a strong, negative and statistically significant mean post-bankruptcy announcement drift. This ranges from -24 to -44 percent over the following 12 months depending on the benchmark adopted to measure abnormal returns. A number of robustness tests confirm that this result is not a mere statistical artefact. In fact, the post-bankruptcy drift is not subsumed by known confounding factors like the post-earnings announcement drift, the post-first-time going concern drift, the momentum effect, the book-to-market effect, industry clustering or the level of financial distress. In addition, I show that my main result is robust to different methods for conducting longer-term event studies. My empirical findings are consistent with the previous behavioural finance literature that claims that the market is unable to deal appropriately with acute bad news events. In the second part of this thesis, I investigate how limits to arbitrage impact the stock price of firms undergoing a Chapter 11 reorganization. I find that, despite the apparent large negative abnormal returns, the post-bankruptcy announcement drift offers only an illusory profit opportunity. Moreover, I show that noise trader risk is critical for the pricing of these firms’ stock. Taken together, my results suggest that limits to arbitrage issues can explain the persistence of the market-pricing anomaly I uncover. As such, the market for firms in Chapter 11 appears to be “minimally rational” (Rubinstein, 2001). My work additionally explores whether behavioural finance theory can help clarify why the post-bankruptcy announcement drift occurs in the first place. I find that the Barberis, Shleifer and Vishny (1998) and the Hong and Stein (1999) models do not account well for the typical return pattern associated with the announcement of Chapter 11. My results call into question the reliability of existing theoretical models based on behavioural concepts in explaining how real world financial markets really work. In the last part of this thesis, I show that the different motivations for filing for Chapter 11 Court protection affect the market’s reaction to this extreme event. Solvent firms addressing the Bankruptcy Court not as a last resort but as a planned business strategy characterize a strategic bankruptcy; companies on the verge of imminent failure typify a non-strategic bankruptcy. I find that for non-strategic bankruptcies, there is a negative and statistically significant post-event drift lasting at least twelve months. Conversely, I show that, although the initial market reaction to bankruptcy filing is similar in the case of strategic bankruptcies in terms of viewing all bankruptcies as homogeneous, there is a subsequent reversal in the stock return pattern for these peculiar firms. In effect, abnormal returns become strongly positive and significant suggesting that, over time, the market to recognise strategic bankruptcies as good news events. Overall, the results of my PhD allow me to make some important contributions to finance theory and the finance literature, in particular in the bad news disclosure and market pricing domains.

<p> There is a near-universal assumption in both practice and literature that greater accuracy and management to the budget improves profitability (Libby &amp; Lindsay, 2010; Umapathy, 1987). Prior to this study, this assumption has gone untested and we know little about the wisdom of such an assumption. </p><p> The results of this study indicate greater accuracy in forecasting and/or tighter management to the budget, or favorably exceeding it, leads to improved profitability. More specifically, smaller unfavorable budget variances are associated with greater operating margins while greater favorable budget variances are associated with greater operating margins. A single standard deviation reduction in unfavorable revenue and expense increases operating margin by 5.2% and 6.3%, respectively. An equivalent favorable deviation in revenue and expense increases operating margin by 3.2% and 2.7%, respectively. Managers can improve hospitals&rsquo; operating margins by first prioritizing the reduction and/or eliminating unfavorable variances, and second increasing favorable variances.</p>

Thesis (Ph.D.)--Indiana University, Kelley School of Business, 2007. / Source: Dissertation Abstracts International, Volume: 68-09, Section: A, page: 3932. Adviser: James M. Wahlen. Title from dissertation home page (viewed May 7, 2008).

Thesis (Ph. D.)--University of Texas at Austin, 2008. / Vita. Includes bibliographical references.

Artificial Intelligence (AI) is the way forward in accounting and auditing. The purpose of this study was to examine the relationship between accounting students’ level of technology readiness (TR) and AI technology adoption (TA). This quantitative study examined the independent variables of TR, perceived ease of use (PEOU), and perceived usefulness (PU) and the dependent variable of TA. Moreover, the present study examined the mediating effect of PEOU and PU on the relationship between TR and TA. The present study was related to individual accounting students’ perceptions of TR and TA. Student participants (n = 101) recruited for this study were randomly sampled from 2 universities in Southern California, the United States. An online questionnaire consisting of 30 items regarding perceptions of TR, PEOU, PU, and TA was administered. The bivariate correlation and regression between variables showed that TR, PEOU, and PU positively influence TA; TR positively influences PEOU and PU; and PEOU positively influences PU. Mediation analysis showed that both PEOU and PU mediate the relationship between TR and TA. Because of the significant relationships among variables, the model met the criteria for technology readiness and acceptance model (TRAM) and Model 6 of process mediation. This study adds to the empirical research regarding the relationships between the constructs of TR and TA of AI within higher education, in which there is a gap in the literature. The study contributed by applying the TRAM construct to the use and adoption of AI. TR, PEOU, and PU are important constructs within higher education and predict AI TA by accounting students. Additionally, TR is a precursor to PEOU and PU of AI for this population. For practice, universities should enhance use perceptions by creating opportunities for accounting students to interact with AI. Effective adoption of AI in accounting curricula aimed at enhancing students’ perceptions is essential to increase their adoption of AI and overall career readiness. For research, replicating the study at other universities, examining other factors that influence students’ adoption of AI, and exploring other AI topics in higher education could expand the literature on technology readiness and TA of AI.