In this first decade since the beginning of the social media revolution, there have been numerous changes to society in many realms. From commerce to politics and the financial industry amongst them, using this new medium is an innovative approach … Continue reading
Category Archives: Academia
Considering Internal Whistleblower Systems When Evaluating External Risk
Whistleblowers can serve as an integral component for identifying and stopping securities fraud. According to PricewaterhouseCooper’s 2016 Global Economic Crime Survey, 33% of suspicious activity was identified by internal reporting from staff and an additional 10% of suspicious activity was … Continue reading
Academic Literature Review: Accounting Reporting Complexity and Non-GAAP Earnings Disclosure
The overall complexity of financial disclosures affects the ability of anyone reading the financial statements, including stockholders, regulators, and investors, to analyze and assess the information presented. One way to measure complexity of disclosures is by determining accounting reporting complexity … Continue reading
EU Statutory Audit Reform
Audit Analytics was recently cited in a study commissioned by the European Parliament, EU Statutory Audit Reform: Impact on costs, concentration and competition. The authors, Marlene Willekens, Simon Dekeyser, and Ines Simac of KU Leuven and BI Norwegian Business School, … Continue reading
Academic Literature Review – Changes in Accounting Estimates
In theory, accounting is supposed to be black and white, with binary decision-making processes and no wiggle room. In practice, however, not all figures shown in financial statements are unequivocal. In some cases, the lines are blurry because transactions are … Continue reading
How to Predict Which Acquisitions Will Fail and Generate Negative Stock Returns
Summary of Key Findings It can be difficult to predict which acquisitions are going to fail An academic article using Audit Analytics’ data identified statistically significant negative abnormal returns of 12% for a subset of acquisitions that were excluded from … Continue reading
Literature Review: “The Effect of Enforcement Transparency: Evidence from SEC Comment-Letter Reviews”
In recent years, more attention has been given to policies surrounding transparency in financial reporting practices, such as banks disclosing results of stress tests and the recently proposed “Public Accounting Oversight Board (PCAOB) Enforcement Transparency Act of 2017”. In 2004, … Continue reading