Year 2014 , Volume  3, Issue 2, Part 4 1 Hidden Reserves Under IFRS ? Empirical Insights GERNOT BR?HLER and SEBASTIAN SCHMIDT Pages: 1073-1087 Details (2633) The application of IFRS has caused a broad variety of examinations in literature. Numerous research studies in this context refer to accounting quality, comparability of financial reports and whether fair-value accounting is superior to historical-cost principles or not. All these issues have in common that hidden reserves, as the difference between historical book values and their fair value counterpart, play an important role in these fields. Nevertheless, there is currently no detailed examination showing empirical data about hidden reserves. Using information from 456 Purchase Price Allocations, we are the first to show which balance sheet items mainly comprise hidden reserves and to what extent. Our results show that hidden reserves exist in all balance sheet items, even in positions which are not supposed to contain reserves. We also find fewer hidden reserves than we expected in provisions but higher portions in inventories, for example. Moreover, we provide details of which factors seem to influence the extent of hidden reserves. We contribute to the existing literature by adding empirical evidence to the theoretical discussions of faithfulness and comparability of financial statements. Key Words: Hidden Reserves, Comparability, Faithfulness, Financial Statements, IFRS, IFRS 3. 2 Satisfaction-Trust Model: Developing Customer Satisfaction and Trust Indices for Mobile Service Providers in the UK BANDER A. ALSAJJAN Pages: 1088-1104 Details (1648) This paper introduces a behavioral model that investigates well-known loyalty antecedents. The model proposes that trust and satisfaction mediate the effect of service quality on loyalty. Structural equation modeling confirms the fit of the model, and it demonstrates significance explaining 65% of student loyalty toward mobile service providers in the UK. The invariance analysis demonstrates the psychometric equivalence of the proposed model measurements between two groups: highly satisfied and low satisfied customers. At the structural level, the influence of trust and satisfaction on loyalty varies between the two groups. In addition, two indices are calculated, a customer satisfaction index (CSI) and a customer trust index (CTI). These indexes reveal that customer loyalty and the role of its proposed antecedents vary in accordance with satisfaction and trust levels with respect to telecommunication companies. Additionally, several managerial implications are discussed. Key Words: Customer Satisfaction Inde 3 Conjoint Analysis of Informal Worker Preference on Health Care Insurance in the Northeastern Region of Thailand THITIWAN SRICHAROEN Pages: 1105-1127 Details (1179) This research aims to analyze the demand on health care insurance of informal worker in the northeastern region of Thailand. Research data collect from 772 informal workers, which can be classified into 466 female and 308 male. Research results identify that average ages of respondents are 39 years with the average income at 5,887 Baht per month. Average household income is at 30,114 Baht per month. They have average education degree at vocational education. They work on the average of 60.52 hours per weeks. Average health care expenditure is 7,614 Baht per year per person. They mostly works as wage-earner accounts for 28.63%, following by the workers who work at home, amounting for 19.56%; and self-employed or freelance about 19.3%. The analysis of demand on health care insurance applies conjoint analysis to find out the demand on health care insurance. The result shows that the coverage of health care that include accident and operation is most selected with 26%. For the payment of health insurance, research results indicate that annual payment is most popularly chosen with 28%. Refer to insurance plan; it is interesting that most of informal workers choose to buy health insurance together with life insurance with 48%. Note to the payment for hospital room, food and health care service, it concludes that coverage of both inpatient and outpatient costs are most selected with 32%. Lastly, the rights of choosing insured hospital, respondents express the result that they choose to insured with public hospital with high percentage of 27%. Key Words: Micro Insurance, Health Insurance, Informal Worker Preference, Informal Worker Welfare Arrangement, Health Care Protection, Health Care Treatment, Conjoint Analysis. 4 Detecting Market Anomalies: Do Evidences hold in Nigeria? AREWA AJIBOLA, NWAKANMA PRINCE C and TORBIRA LEZASI LENEE Pages: 1128-1138 Details (1310) In this study, we presented robust analyses of the Nigerian equity market using weekly stock prices of 140 listed companies in Nigeria over the period of Jan 1 2006 to Dec 27 2012. We adopted two sets of tests. The first set comprises Llliefors, Cramer-Von-Mises, Anderson-Darling and Ljung-Box which confirmed that stock prices are not normally distributed. But the second set includes size/rank variance ratio tests and TGARCH in mean technique. The tests jointly revealed strong presence of inefficiency as anomalies can be traced to persisted volatility, lack of randomity, significant effects of information and heteroskedasticity/leptokurtic nature of stock prices. We therefore conclude that information plays significant role in Nigerian stock market. Key Words: Anomalies, Normality, Volatility, Heteroskedasticity, Randomity, Information. 5 Leading Comprehensive Internationalization: Strategy for Action ROSA CAIAZZA and TIZIANA VOLPE Pages: 1139-1144 Details (1124) Internationalization strategies have interested scholars for since several decades. They have developed many theories about their causes, motivations, nature, outcomes etc. Starting from existing literature we explore the changing geography of international business that has led academics and practitioners to rethink cross-border Mergers & Acquisitions (M&A). This phenomenon raises an interesting question regarding factors that influence cross-border deals. The paper presents new insights in literature and discusses results of some case study on this topic. Key Words: Business, Geography, Internationalization strategy. 6 Cost Allocation of Operational Materials for an Alloy and Special Steel Plant using Excel Solver IBRAHIM ABDULLAH ALJASSER, BOKKASAM SASIDHAR and BADRI TOPPUR Pages: 1145-1150 Details (1173) While manufacturing different grades of steel in an alloy and special steel plant, it is practically impossible to allocate the cost of major operational materials such as refractories, electrodes and nipples, ingot moulds etc. to each grade of steel. Conventionally, cost allocation of operational materials is done based on the time taken for processing a particular grade of steel. A more accurate picture of the utilization levels of these operational materials by different grades of steel can be obtained if one factors in the differences in the rate of consumption, in view of the variations in temperature and intensity of chemical reactions. Earlier quadratic model with a non-linear objective function and linear constraints has been envisaged to estimate the consumption pattern for each grade manufactured, so that a realistic grade-wise cost can be arrived at. In this paper, use of Excel Solver has been demonstrated based on the quadratic model envisaged earlier. The same has been validated with results obtained using examples, which the managers will be able to use for obtaining the results immediately for scaled-up scenarios. Key Words: Cost allocation, Operational Materials, Steel, Mathematical Modeling, Quadratic Programming, Excel, Solver. 7 Risk Management in Early Product Lifecycle Phases JAN MACHAC and FRANTISEK STEINER Pages: 1151-1162 Details (1565) A new product coming to the market usually brings certain uncertainty of its success. Especially, hidden failures and risks which might appear in the product service life could bring producers into difficulties costing them money. This might turn into a product phase out and loss of company reputation. Therefore, identification and treatment of risks in early phases of a product lifecycle are becoming more commonplaces nowadays. Since state-of-art companies that want to keep up with competitors, have to consider all actions which might prevent losses or customers dissatisfaction. This paper deals with a new risk management procedure concerning the early phases of a product lifecycle. Proper risk identification in early phases should result in mitigation or removal of an impact that might cause considerable property, health or the environment losses in late phases of a product lifecycle. It is always very complicated to assess risks in an early phase of a project since almost no data is available. Therefore, this procedure has been developed to help to manage such risks. The procedure is focused on risk priorities according to customers needs, requirements and it can be used for various products and industries. Key Words: Risk Management, Product Lifecycle, Voice of Customer, Conceive, Design, Risk Value. 8 Assessing the Impact of Strategic Human Resource Management on Tangible Performance: Evidence from Nigerian SMEs SOLOMON OZEMOYAH UGHEOKE, MOHD FAIZAL MOHD ISA and WAN SHAKIZAH WAN MOHD NOOR Pages: 1163-1173 Details (1359) Human resource management (HRM) is the most sustainable competitive advantage of the firm. The study examines the impact of strategic human resource management on tangible firm performance. Therefore, to test this relationship, the study employs cross sectional approach to collect data from a sample of 250 SMEs in Lagos Nigeria. Using multiple regressions, the result shows that strategic human resource management (SHRM) has a significant positive influence on tangible performance. Base on the aforementioned result, the study recommended that implementing these sets of practices within SMEs can induce firms to perform better. Key Words: SHRM, Firm, Employee, SMEs, Tangible Performance. 9 Information Security for Organizations and Accounting Information Systems A Jordan Banking Sector Case SHAMSI S. BAWANEH Pages: 1174-1188 Details (2192) This research examines three types of information security and control procedures for organizations that are expected to be used within Accounting Information Systems (AIS): security and general control for organizations; security and general control for Information Technology (IT), and application controls for transaction processing. In practice, this study found that banks, to be able to protect themselves against computer fraud, formulate control procedures relate to input controls, processing controls, output controls, and physical security. Furthermore, banks and accountants in their practice adapted several methods for thwarting (mitigating) computer crimes, abuses, and fraud as follows: Enlist top-management support; Increase employee awareness and education1; Assess security measures and protects passwords2; Implement controls which based on the believe that most computer crimes and abuse succeed because of the absence of control rather than the failure of control. The study found that the solution to the computersecurity problems of most banks is straightforward: design and implement control. This means that accountants install control procedures to deter computer crimes, and managers enforce them, and both internal and external auditors test them. Furthermore, the study found that no bank Employ forensic accountants in the normal situation. Top managers in many banks explain that when a bank suspects an ongoing computer crime or fraud, it can hire forensic accountants to investigate its problems, document findings, and make recommendations. Accountants may use specialized software tools to help them perform their tasks3. Good security for banks starts with a clear disaster recovery plan and a solid security policy which are not applied and many banks are not conducting a risk assessment procedure. Probably the best security investment in Jordanian banks is user training: training individual users on data recovery and ways to defeat social engineering. Key Words: Information Security, Information Technology, Control Procedures, Accounting Information Systems, Internet, Computer Abuse, Fraud, Forensic Accounting, Corporate Governance, Financial Institutions, Jordan. 10 Evolution and Conceptual Development of Service Quality in Service Marketing and Customer Satisfaction GANESH, R and HASLINDA, A Pages: 1189-1197 Details (2996) The conceptual origination of service quality and its evolution has developed to encompass the ideology of the customer as value co-creator in the core of service marketing as the key to success in business service management for sustainable competitive advantage with customer satisfaction and retention. In this literature review paper, the topic is approached via extensive searches of relevant service quality and customer satisfaction databases to ensure that all literature in the field of service quality and service marketing is examined. In order to generate sound strategy, it is essential to prioritise the importance of service quality concepts and the paradigm shift in service quality in which customers are placed as value co-creators to increase customer satisfaction with products/services offered. Key Words: Service Marketing, Service Quality, Satisfaction, Value Creation. 11 On the Variance of Financial Statement Accounts and Earnings Management FELICIA Y. AMADI, GENE R. SULLIVAN and MITCHELL FRANKLIN Pages: 1198-1219 Details (1260) This study examined the relationship between the variance of selected financial statement accounts (Accounts Receivable (AR); selling, General and Administrative expense (SG&A); and Net Change in Accruals (NCA)) and the frequency with which a firm meets, or beats analysts earnings forecast. The study focused on the consumer goods sector. The objective was to examine if the selected financial statement of accounts are purposefully used by management to manipulate earnings in order to meet and/or beat analysts earnings forecasts. All prior research on earnings management and managements earnings guidance used estimates of discretionary accruals as the predominant earnings management tool. The estimates of the discretionary accruals were based on Jones model, and/or modified Jones model. The validity of these studies is very much dependent on the relationship between the estimated discretionary variables and their actual levels. Researchers looked at the variance of those accounts that are suspect for earnings management. Researchers believed that these variables will exhibit markedly different variance if manipulated to meet forecast estimates than if they vary with the normal business operations. Researchers found that there is a significant difference between the variance of SG&A and NCA of the firms that meet and/or beat the analysts forecast and those that do not. Researchers also found that accounts receivable was significant in explaining the frequency of meeting and/or beating the analysts forecast. The other explanatory variables (NCA and SG&A), were not statistically significant, suggesting that real economic activity may not be a potent tool for earnings management Key Words: Jones Model, Sales, Accruals, Inventory, Accounts Receivable, GAAP. 12 Roles of Audit Oversight Bodies in Governing Financial Reporting ZURAIDAH MOHD SANUSI, YUSARINA MAT ISA, TAKIAH MOHD ISKANDAR and LEE TECK HEANG Pages: 1220-1228 Details (1648) In the financial reporting ecosystem, external auditors are important players entrusted with providing quality audits in order to uphold public confidence in audited financial statements. Many mechanisms have been adopted in an effort to regulate external auditors in order to maintain quality audit practices, including the adoption of International Standards on Quality Control 1 (ISQC 1) and the International Standards on Quality Control for Audits of Historical Financial Information (ISA 220). To complement the standards that govern audit quality, audit oversight functions are introduced as a means of auditing the auditors. The present study examines the features, characteristics and best practices of selected audit oversight bodies in the United States of America, the United Kingdom, Australia, Japan, Singapore and Malaysia. A content analysis of annual reports from oversight bodies in the aforementioned countries was undertaken. The analysis reveals contrasting practices in several areas including membership registration and transparency in the disclosure and reporting of the audit firms under sanctions. Based on these findings, the best practices adopted by the selected audit oversight bodies can be set as a benchmark for other countries in learning the pathway to improve financial reporting. Key Words: Audit oversight, External Auditors, Audit Quality.