Audit fees and asset securitization risks

The thesis investigates “where were the auditors in asset securitizations”, a criticism of the audit profession before and after the onset of the global financial crisis (GFC). Asset securitizations increase audit complexity and audit risks, which are expected to increase audit fees. Using US bank holding company data from 2003 to 2009, this study examines the association between asset securitization risks and audit fees, and its changes during the global financial crisis. The main test is based on an ordinary least squares (OLS) model, which is adapted from the Fields et al. (2004) bank audit fee model. I employ a principal components analysis to address high correlations among asset securitization risks. Individual securitization risks are also separately tested. A suite of sensitivity tests indicate the results are robust. These include model alterations, sample variations, further controls in the tests, and correcting for the securitizer self-selection problem. A partial least squares (PLS) path modelling methodology is introduced as a separate test, which allows for high intercorrelations, self-selection correction, and sequential order hypotheses in one simultaneous model. The PLS results are consistent with the main results. The study finds significant and positive associations between securitization risks and audit fees. After the commencement of the global financial crisis in 2007, there was an increased focus on the role of audits on asset securitization risks resulting from bank failures; therefore I expect that auditors would become more sensitive to bank asset securitization risks after the commencement of the crisis. I find that auditors appear to focus on different aspects of asset securitization risks during the crisis and that auditors appear to charge a GFC premium for banks. Overall, the results support the view that auditors consider asset securitization risks and market changes, and adjust their audit effort and risk considerations accordingly.

Aligning off-balance sheet risk, on-balance sheet risk and audit fees: a PLS path modelling analysis

This study focuses on using the partial least squares (PLS) path modelling technique in archival auditing research by replicating the data and research questions from prior bank audit fee studies. PLS path modelling allows for inter-correlations among audit fee determinants by establishing latent constructs and multiple relationship paths in one simultaneous PLS path model. Endogeneity concerns about auditor choice can also be addressed with PLS path modelling. With a sample of US bank holding companies for the period 2003-2009, we examine the associations among on-balance sheet financial risks, off-balance sheet risks and audit fees, and also address the pervasive client size effect, and the effect of the self-selection of auditors. The results endorse the dominating effect of size on audit fees, both directly and indirectly via its impacts on other audit fee determinants. By simultaneously considering the self-selection of auditors, we still find audit fee premiums on Big N auditors, which is the second important factor on audit fee determination. On-balance-sheet financial risk measures in terms of capital adequacy, loan composition, earnings and asset quality performance have positive impacts on audit fees. After allowing for the positive influence of on-balance sheet financial risks and entity size on off-balance sheet risk, the off-balance sheet risk measure, SECRISK, is still positively associated with bank audit fees, both before and after the onset of the financial crisis. The consistent results from this study compared with prior literature provide supporting evidence and enhance confidence on the application of this new research technique in archival accounting studies.

Aligning off-balance sheet risk, on-balance sheet risk and audit fees: a PLS path modelling analysis

This study focuses on using the partial least squares (PLS) path modelling methodology in archival auditing research by replicating the data and research questions from prior bank audit fee studies. PLS path modelling allows for inter-correlations among audit fee determinants by establishing latent constructs and multiple relationship paths in one simultaneous PLS path model. Endogeneity concerns about auditor choice can also be addressed with PLS path modelling. With a sample of US bank holding companies for the period 2003-2009, we examine the associations among on-balance sheet financial risks, off-balance sheet risks and audit fees, and also address the pervasive client size effect, and the effect of the self-selection of auditors. The results endorse the dominating effect of size on audit fees, both directly and indirectly via its impacts on other audit fee determinants. By simultaneously considering the self-selection of auditors, we still find audit fee premiums on Big N auditors, which is the second important factor on audit fee determination. On-balance-sheet financial risk measures in terms of capital adequacy, loan composition, earnings and asset quality performance have positive impacts on audit fees. After allowing for the positive influence of on-balance sheet financial risks and entity size on off-balance sheet risk, the off-balance sheet risk measure, SECRISK, is still positively associated with bank audit fees, both before and after the onset of the financial crisis. The consistent results from this study compared with prior literature provide supporting evidence and enhance confidence on the application of this new research technique in archival accounting studies.

Bank audit fees and asset securitization risks

Using the lens of audit pricing, we provide insights into auditors’ behaviors in relation to the risk of asset securitizations to bank holding companies in a period encompassing the Global Financial Crisis (GFC) and the introduction of the accounting standards FAS 166 and FAS 167. Using US bank holding company data from 2003 to 2011, we find significant and positive associations between asset securitization risks and audit fees. We find that auditors appear to focus on different aspects of asset securitization risks after the onset of the GFC, and increase their attention to the systemic risks facing bank holding companies in general. After the implementation of FAS 166 and FAS 167, which removed the discretion to treat asset securitizations as sales and required the consolidation of the accounts of special purpose entities, asset securitization risks no longer have a significant effect on audit fees.

The cultural economy in recession : Examining the US experience

Over the last two decades we have witnessed the global rise and spread of urban development policies aimed at stimulating the cultural economy. However, with the onset of the global financial crisis and recession, the cultural economy may experience a dramatic reorganization and even decline. Given the attention many cities place on the cultural sectors it is important to examine how they fare following this major economic event. To do so, this article examines the occupational distribution and geographic structure of the cultural economy in the 30 largest US metropolitan areas during recession and captures the changes that have occurred over the last decade. Based on this analysis, we identify a set of key trends, which highlight that while the boom period is generally characterized by widespread and, in some places, extreme growth in the cultural sectors, the recession is a period of selective growth and not a period of total decline. These findings have implications for determining the relevance of the arts and cultural sectors as targets of urban economic development policy in the post-recession era.

Longitudinal change in sleep and daytime sleepiness in postpartum women

Sleep disruption strongly influences daytime functioning; resultant sleepiness is recognised as a contributing risk-factor for individuals performing critical and dangerous tasks. While the relationship between sleep and sleepiness has been heavily investigated in the vulnerable sub-populations of shift workers and patients with sleep disorders, postpartum women have been comparatively overlooked. Thirty-three healthy, postpartum women recorded every episode of sleep and wake each day during postpartum weeks 6, 12 and 18. Although repeated measures analysis revealed there was no significant difference in the amount of nocturnal sleep and frequency of night-time wakings, there was a significant reduction in sleep disruption, due to fewer minutes of wake after sleep onset. Subjective sleepiness was measured each day using the Karolinska Sleepiness Scale; at the two earlier time points this was significantly correlated with sleep quality but not to sleep quantity. Epworth Sleepiness Scores significantly reduced over time; however, during week 18 over 50% of participants were still experiencing excessive daytime sleepiness (Epworth Sleepiness Score ≥12). Results have implications for health care providers and policy makers. Health care providers designing interventions to address sleepiness in new mothers should take into account the dynamic changes to sleep and sleepiness during this initial postpartum period. Policy makers developing regulations for parental leave entitlements should take into consideration the high prevalence of excessive daytime sleepiness experienced by new mothers, ensuring enough opportunity for daytime sleepiness to diminish to a manageable level prior to reengagement in the workforce.

SWCNT networks on nanoporous silica catalyst support : morphological and connectivity control for nanoelectronic, gas-sensing, and biosensing devices

Effective control of morphology and electrical connectivity of networks of single-walled carbon nanotubes (SWCNTs) by using rough, nanoporous silica supports of Fe catalyst nanoparticles in catalytic chemical vapor deposition is demonstrated experimentally. The very high quality of the nanotubes is evidenced by the G-to-D Raman peak ratios (>50) within the range of the highest known ratios. Transitions from separated nanotubes on smooth SiO2 surface to densely interconnected networks on the nanoporous SiO2 are accompanied by an almost two-order of magnitude increase of the nanotube density. These transitions herald the hardly detectable onset of the nanoscale connectivity and are confirmed by the microanalysis and electrical measurements. The achieved effective nanotube interconnection leads to the dramatic, almost three-orders of magnitude decrease of the SWCNT network resistivity compared to networks of similar density produced by wet chemistry-based assembly of preformed nanotubes. The growth model, supported by multiscale, multiphase modeling of SWCNT nucleation reveals multiple constructive roles of the porous catalyst support in facilitating the catalyst saturation and SWCNT nucleation, consistent with the observed higher density of longer nanotubes. The associated mechanisms are related to the unique surface conditions (roughness, wettability, and reduced catalyst coalescence) on the porous SiO2 and the increased carbon supply through the supporting porous structure. This approach is promising for the direct integration of SWCNT networks into Si-based nanodevice platforms and multiple applications ranging from nanoelectronics and energy conversion to bio- and environmental sensing.

Furan substituted diketopyrrolopyrrole and thienylenevinylene based low band gap copolymer for high mobility organic thin film transistors

A novel solution processable donor-acceptor (D-A) based low band gap polymer semiconductor poly{3,6-difuran-2-yl-2,5-di(2-octyldodecyl)-pyrrolo[3,4- c]pyrrole-1,4-dione-alt-thienylenevinylene} (PDPPF-TVT), was designed and synthesized by a Pd-catalyzed Stille coupling route. An electron deficient furan based diketopyrrolopyrrole (DPP) block and electron rich thienylenevinylene (TVT) donor moiety were attached alternately in the polymer backbone. The polymer exhibited good solubility, film forming ability and thermal stability. The polymer exhibits wide absorption bands from 400 nm to 950 nm (UV-vis-NIR region) with absorption maximum centered at 782 nm in thin film. The optical band gap (Eoptg) calculated from the polymer film absorption onset is around 1.37 eV. The π-energy band level (ionization potential) calculated by photoelectron spectroscopy in air (PESA) for PDPPF-TVT is around 5.22 eV. AFM and TEM analyses of the polymer reveal nodular terrace morphology with optimized crystallinity after 200 °C thermal annealing. This polymer exhibits p-channel charge transport characteristics when used as the active semiconductor in organic thin-film transistor (OTFT) devices. The highest hole mobility of 0.13 cm 2 V -1 s -1 is achieved in bottom gate and top-contact OTFT devices with on/off ratios in the range of 10 6-10 7. This work reveals that the replacement of thiophene by furan in DPP copolymers exhibits such a high mobility, which makes DPP furan a promising block for making a wide range of promising polymer semiconductors for broad applications in organic electronics.

Scaling laws for localised states in a nonlocal amplitude equation

It is well known that, although a uniform magnetic field inhibits the onset of small amplitude thermal convection in a layer of fluid heated from below, isolated convection cells may persist if the fluid motion within them is sufficiently vigorous to expel magnetic flux. Such fully nonlinear(‘‘convecton’’) solutions for magnetoconvection have been investigated by several authors. Here we explore a model amplitude equation describing this separation of a fluid layer into a vigorously convecting part and a magnetically-dominated part at rest. Our analysis elucidates the origin of the scaling laws observed numerically to form the boundaries in parameter space of the region of existence of these localised states, and importantly, for the lowest thermal forcing required to sustain them.

A proteomic view into infection of greyback canegrubs (Dermolepida albohirtum) by Metarhizium anisopliae

Metarhizium anisopliae is a naturally occurring cosmopolitan fungus infecting greyback canegrubs (Dermolepida albohirtum). The main molecular factors involved in the complex interactions occurring between the greyback canegrubs and M. anisopliae (FI-1045) were investigated by comparing the proteomes of healthy canegrubs, canegrubs infected with Metarhizium and fungus only. Differentially expressed proteins from the infected canegrubs were subjected to mass spectrometry to search for pathogenicity related proteins. Immune-related proteins of canegrubs identified in this study include cytoskeletal proteins (actin), cell communication proteins, proteases and peptidases. Fungal proteins identified include metalloproteins, acyl-CoA, cyclin proteins and chorismate mutase. Comparative proteome analysis provided a view into the cellular reactions triggered in the canegrub in response to the fungal infection at the onset of biological control.

Stop-signal task difficulty and the right inferior frontal gyrus

The stop-signal paradigm is increasingly being used as a probe of response inhibition in basic and clinical neuroimaging research. The critical feature of this task is that a cued response is countermanded by a secondary ‘stop-signal’ stimulus offset from the first by a ‘stop-signal delay’. Here we explored the role of task difficulty in the stop-signal task with the hypothesis that what is critical for successful inhibition is the time available for stopping, that we define as the difference between stop-signal onset and the expected response time (approximated by reaction time from previous trial). We also used functional magnetic resonance imaging (fMRI) to examine how the time available for stopping affects activity in the putative right inferior frontal gyrus and presupplementary motor area (right IFG-preSMA) network that is known to support stopping. While undergoing fMRI scanning, participants performed a stop-signal variant where the time available for stopping was kept approximately constant across participants, which enabled us to compare how the time available for stopping affected stop-signal task difficulty both within and between subjects. Importantly, all behavioural and neuroimaging data were consistent with previous findings. We found that the time available for stopping distinguished successful from unsuccessful inhibition trials, was independent of stop-signal delay, and affected successful inhibition depending upon individual SSRT. We also found that right IFG and adjacent anterior insula were more strongly activated during more difficult stopping. These findings may have critical implications for stop-signal studies that compare different patient or other groups using fixed stop-signal delays.

Melatonin synthesis : a possible indicator of intolerance to shiftwork

Hypothesis Melatonin synthesis, which is directly controlled by the central circadian pacemaker indicates the circadian phase better than rectal temperature. Methods: Thirty four men (16-32 years, 7 morning, 13 neither, 14 evening types) performed a constant routine (24-26-hr bedrest, < 30 lux, 18-20°C, hourly isocaloric diet). Salivary melatonin level was determined hourly and rectal temperature was continuously recorded. Results: The nadir of rectal temperature occurred 1.5 hr (P = 0.017), the onset of melatonin synthesis 3 hr earlier (P < 0.0001) in morning than in evening types. Morningness was not related to the quantitative but significantly to the temporal parameters, closer to those of melatonin than of rectal temperature. Conclusions: The melatonin onset is a more reliable indicator of the diurnal type than the nadir of rectal temperature. As morningness has been associated with intolerance to shiftwork, melatonin profiling provides a suitable basis for the establishment of directed preventive measures.

Dapsone-induced agranulocytosis. The role of xenobiotic-metabolizing enzymes demonstrated by a case report [Dapson-induzierte Agranulozytose]

A 34-year-old female patient with a three year history of generalized granuloma annulare was treated systemically with dapsone (DADPS). Six weeks after the onset of treatment, the patient developed an extensive tonsillitis of the base of the tongue with fever and malaise. Routine laboratory work showed a leukocytopenia with agranulocytosis. Further investigation revealed a marked decrease of the enzyme activity of N-acetyltransferase 2, which plays an important role in dapsone metabolism. Treatment included the cessation of dapsone, antibiotic coverage, and G-CSF leading to the rapid improvement of symptoms and normalization of leukocyte counts. Dapsone-induced angina agranulocytotica is a rare event and is interpreted as an idiosyncratic reaction. Depending on genetic polymorphisms of various enzymes, dapsone can be metabolized to immunologically or toxicologically relevant intermediates. Because of the risk of severe hematologic reactions, dapsone should only be employed for solid indications and with appropriate monitoring. [Article in German]