Fr

Indice

Financial Reporting

n. 2/2016

 

Sommario

Put Your Money where Your Mouth is: The Difference between Real Commitment to Sustainability and Mere Rhetoric

Laura Bini, Marco Bellucci, Francesco Giunta

pag. 5
Income Smoothing via Loan Loss Provision in Credit Cooperative Banks

Stefano Azzali, Luca Fornaciari, Tatiana Mazza

» 33
 
The Connectivity of Information in Integrated Reporting. Empirical Evidence from International Context

Alberto Incollingo, Michela Bianchi

» 55
 
Web-Based Financial Reporting: An Interpretative Model for Corporate Communications on Social Media

Paola Ramassa, Costanza Di Fabio

» 79
 
Book Review

Roberto Di Pietra, Stefano Zambon

» 113
 
 
Fr

Put Your Money where Your Mouth is: The Difference between Real Commitment to Sustainability and Mere Rhetoric

Companies exhibit growing interest in sustainability rhetoric. Such an interest is alternatively justified by a company’s need to address legitimacy instances, rather than to satisfy stakeholders’ requests about its sustainability performance. Whatever the case, a main debated issue concerning sustainability rhetoric deals with the difficulties in understanding whether companies’ commitment towards sustainability is “real”, or it only consists of “empty words” that hide opportunistic strategies. Our paper contributes to this debate, proposing a methodological approach, which is based on a company’s business model (BM) representation. We argue that the inclusion of adequate sustainability information in a company’s BM representation can testify to a real company’s engagement, as it illustrates how sustainability affects its value creation process. Compared to extant methodological proposals, mainly based on linguistic analyses, our approach does not require specific competences to be applied. Moreover, it saves user’s time, as it allows the assessment of entire company’s sustainability rhetoric through the analysis of the information reported in its BM. Our approach is consistent with previous contributions that propose a company’s BM as a representation device able to illustrate strategic information that cannot be represented in the traditional corporate reporting. Our approach proposes a possible answer to address the challenges faced by regulators and standard setters involved in the regulation of sustainability disclosure. Such approach has found a first step of implementation in the UK, where since 2013, listed companies are requested to describe their BM in Strategic Reports.

Keywords: Sustainability rhetoric, business model, corporate social responsibility, non-financial disclosure, mining industry

Fr

Income Smoothing via Loan Loss Provision in Credit Cooperative Banks

This research investigates whether income smoothing via loan loss provision is lower for Credit Cooperative Banks than for non-Credit Cooperative Banks. Using data collected from the financial reporting of a sample of private banks, and Ordinary Least Square models based on net income or its variation, as used by previous literature, we find that income smoothing through loan loss provision is lower in Credit Cooperative Banks than in banks with different ownership structures. Results remain the same using several robustness tests (decomposition of loans, quality of loans, change in economic growth, cluster and fixed effect, effect of financial crisis). Mutual ownership, smaller size, and the local boundaries that characterize Credit Cooperative Banks may reduce the need for managers to manipulate earnings. Our findings give a positive evaluation of the recent Italian Law No. 18/2016 which reforms Credit Cooperative Banks, and imply that benefits of Credit Cooperative Banks ownership structure may derive from the group structure which gives a higher level of stability and solidity.

Keywords: Income smoothing, loan loss provision, credit cooperative banks

Fr

The Connectivity of Information in Integrated Reporting. Empirical Evidence from International Context

In recent years, an increasing number of accounting scholars have been investigating the concept and the purpose of integrated reporting. After the issue of IIRC Framework, which is principle-based, it is now recognized that there is an urgent need for empirical analysis of the content of the reports at their first development stage. This in order to understand if the aims of this new reporting approach are realistic and achievable in practice. This paper responds to such call and it tries to contribute in two ways. Firstly, it illustrates the way in which the Guiding Principle of Connectivity of Information is applied at international level. In particular, we analyzed the compliance of disclosure practices in integrated reports of 2013 with the key forms of Connectivity of information presented in the Framework. Secondly, the paper tries to interpret the practices observed, in order to identify useful implementation criteria of this Guiding Principle. This is light of the fact that the Guiding Principle was noted as the most important to obtain a truly integrated report, but, at the same time, difficult to interpret and problematic to apply. The results of the analysis indicate an application of the principle extremely heterogeneous (and in such cases disappointing), confirming the need to establish practical guidelines to apply it. By this study, we made a preliminary attempt to identify some characteristic attributes of Connectivity of information within integrated reporting. The findings carry implications for eventual refinement of the IIRC Framework and, especially, to support companies wishing to prepare an integrated report.

Keywords: Integrated reporting, non-financial information, connectivity of information, IIRC Framework

Fr

Web-Based Financial Reporting: An Interpretative Model for Corporate Communications on Social Media

This paper aims at contributing to financial reporting literature by proposing a conceptual interpretative model to analyse the corporate use of social media for financial communication purposes. In this perspective, the FIRE model provides a framework to study social media shifting the focus on the distinctive features that might enhance web investor relations. The model highlights these features through four building blocks: (i) firm identity (F); (ii) information posting (I); (iii) reputation (R); and (iv) exchange and diffusion (E). They represent key aspects to explore corporate communication activities and might offer a framework to interpret to what degree corporate web financial reporting exploits the potential of social media. Accordingly, the paper proposes metrics based on this model aimed at capturing the interactivity of corporate communications via social media, with a particular focus on web financial reporting. It tries to show the potential of this model by illustrating an exploratory empirical analysis investigating to what extent companies use social media for financial reporting purposes and whether firms are taking advantage of Twitter distinctive features of interaction and diffusion.

Keywords: Investor relations, web financial reporting, social media, Twitter

Fr

Indice

Financial Reporting

n. 1/2016

 

Sommario

“The ‘Real’ Impact Factor: Accounting Research, Practice, and Users: Towards a New Relationship between Academia, Professionals, and Standard Setters in Accounting

Anne McGeachin, Alan Teixeira, Stefano Zambon

pag. 5
The “Real” Impact Factor: Reflections on the Impact of the Research Excellence Framework

Jane Broadbent

» 15
 
The Real Impact Factor and the Gap between Accounting Research and Practice

Alberto Quagli, Francesco Avallone, Paola Ramassa

» 29
 
Accounting Research: Relevance Lost

Andrew Higson, Rasha Kassem,

» 59
 
Who Influences Whom? An Exploratory Analysis of the Interrelations between Accounting Research and the IASB’s Standard Setting Activity

Michele Pizzo, Nicola Moscariello, Claudio Teodori, Monica Veneziani, Laura Rocca, Alberto Quagli, Elisa Roncagliolo

» 77
 
Accounting Theory and Accounting Practice as Loosely Coupled Systems: A Historical Perspective on the Italian Case (1930-1990)

Stefano Zambon, Laura Girella

» 95
 
Commentary. Research and practice in accounting: A collaborative perspective

Allister Wilson

» 135
 
Fr

“The ‘Real’ Impact Factor: Accounting Research, Practice, and Users: Towards a New Relationship between Academia, Professionals, and Standard Setters in Accounting

Researchers are facing a growing demand to demonstrate that their work has consequences – an impact. Those who fund the research are increasingly seeking evidence that the research has practical, or real-world, implications. For example, the Research Excellence Framework (REF – formerly Research Assessment Exercise – RAE) currently run in the UK includes the need for explicit and documented information on the effect of the scholarly work on “real life” and professional realms. The governments of the Netherlands, Canada and Australia are following a similar line. There is nothing new in thinking about who is your audience. Brown (1993) provides 10 qualities good research will possess. He suggests that good empirical research is motivated by the choice of a question that is important to others and an outcome that is believed will add to knowledge or understanding. The author(s) should also have a sound appreciation of the study’s implications and limitations. The other seven qualities are more closely associated with the robustness of the research itself. Research Councils UK (RCUK) defines research impact as “the demonstrable contribution that excellent research makes to society and the economy”. RCUK also differentiates between academic impact and economic and societal impact. The former is the impact the research makes to scientific advances, such as, in understanding, method, theory and application. The latter is the contribution the research makes to society and the economy, of benefit to individuals, organisations and nations. The quality of the research remains paramount. Researchers are not being forced to limit their work to areas that might lead to immediate and observable practical implications, or we hope that they are not. But some funding bodies are providing greater weight to good research that also has demonstrated practical consequences. Bodies such as RCUK want funding applicants to think about the audience for the research, from the outset […]

Fr

The “Real” Impact Factor: Reflections on the Impact of the Research Excellence Framework

This paper is an argument for the importance of academics undertaking some (but not only) research that relates to the practical issues faced by practitioners and policy makers and that is geared to achieving impact. It offers a normative argument informed by my experience as a practitioner and an academic and by my experiences in the assessment of impact as part of the UK Research Excellence Framework (REF) in 2014. The paper introduces the nature of the REF and how it was implemented. It also addresses the implications of the performance measurement of impact of REF for Higher Educational Institutions and the individual academics that work within them. In that respect it recognises that performance measures give extrinsic encouragement to particular behaviours. The paper argues that academics should also be intrinsically driven to research that has impact. In order to achieve impact, the paper suggests that we should not see a gap between academics and practitioners, but should instead see practice and academic endeavour as different but complementary elements of the same profession. We should seek to develop better discourses between academics and practitioners and should not attribute greater importance to the views of either party. Instead we should have an engagement that is open to the generation of disagreement as well as agreement but that nevertheless does not see disagreement as the basis for closing down communication.

Keywords: Research impact, engagement, evidence for policymakers and practitioners, Research Excellence Framework

Fr

The Real Impact Factor and the Gap between Accounting Research and Practice

This paper explores the gap between accounting research and practice with two primary objectives. First, it provides a review of the main results obtained by the impressive literature on the topic to get a comprehensive picture of this phenomenon, considering the different perspectives and research methods used so far. This review aims not only at summarizing results, but also at outlining a logical framework that could be useful for both our analysis and future studies on the topic. Against this background, our second objective is to carry out an empirical analysis on scholars’ motivations and incentives – rather neglected by prior literature – with a particular focus on their relationships with professional associations. Evidence from our survey (with 447 questionnaires completed by EAA members) suggests that there is a hierarchy of objectives informing scholars’ motivations and that the first one is to publish on highly ranked journals. In such a context, the positive attitude of academics towards practice can be sometimes in conflict with scholars’ expectation about effort, individual result and peers’ consideration. In other terms, our study supports the idea that there is a gap between research and practice, together with a risk of an increasingly closed community of scientists. Our results seem in line with studies stating that the reasons for this gap essentially lie in the current evaluation logic driving scholars’ incentives. Additionally, evidence on scholars’ incentives might be helpful in finding new solutions to bridge the gap and supporting future research sharing the same objective.

Keywords: Research-practice gap, research impact, real impact factor, accounting research, accounting practice

Fr

Accounting Research: Relevance Lost

For research to have an impact, it has to exist in the first place. Moves in the UK to link University funding to research activity have reinforced the importance of research to academia – however, this may also have had adverse consequences. It is now very difficult for qualified accountants to obtain teaching and research positions at UK universities because of the lack of a research background. Institutional pressures on those conducting research may also have resulted in dysfunctional behaviour regarding the nature of the work conducted and the output. In the 1960s there was an attempt to make accounting research more “scientific”, however, this seems to resulted in the emphasis on research methodology rather than the importance of making a contribution to knowledge. The lack of emphasis on the reliability (the reproducibility of the results) and validity (whether you are testing what you think you are testing) of statistical findings merely appears to have resulted in the application of pseudoscience to accounting research. All these factors appear to have combined to bring into question the relevance of the accounting research produced.

Keywords: Research, publications, impact, pseudoscience