Were regulatory changes in reporting "abnormal items" justified? : evidence of intra-period classificatory earnings management practices in Australia

Purpose Managers generally have discretion in determining how components of earnings are presented in financial statements in distinguishing between ‘normal’ earnings and items classified as unusual, special, significant, exceptional or abnormal. Prior research has found that such intra-period classificatory choice is used as a form of earnings management. Prior to 2001, Australian accounting standards mandated that unusually large items of revenue and expense be classified as ‘abnormal items’ for financial reporting, but this classification was removed from accounting standards from 2001. This move by the regulators was partly in response to concerns that the abnormal classification was being used opportunistically to manage reported pre-abnormal earnings. This study extends the earnings management literature by examining the reporting of abnormal items for evidence of intra-period classificatory earnings management in the unique Australian setting. Design/methodology/approach This study investigates associations between reporting of abnormal items and incentives in the form of analyst following and the earnings benchmarks of analysts’ forecasts, earnings levels, and earnings changes, for a sample of Australian top-500 firms for the seven-year period from 1994 to 2000. Findings The findings suggest there are systematic differences between firms reporting abnormal items and those with no abnormal items. Results show evidence that, on average, firms shifted expense items from pre-abnormal earnings to bottom line net income through reclassification as abnormal losses. Originality/value These findings suggest that the standard setters were justified in removing the ‘abnormal’ classification from the accounting standard. However, it cannot be assumed that all firms acted opportunistically in the classification of items as abnormal. With the removal of the standardised classification of items outside normal operations as ‘abnormal’, firms lost the opportunity to use such disclosures as a signalling device, with the consequential effect of limiting the scope of effectively communicating information about the nature of items presented in financial reports.

ACE research vignette 018 : experiments in the MBA classroom : the case of time frames in project teams

This series of research vignettes is aimed at sharing current and interesting research findings from our team of international Entrepeneurship researchers. In this vignette, Dr Rene Bakker considers project team dynamics and how executive education can be enriched by studying them in the classroom.

Standardising practices improves clinical diabetic foot management: the Queensland Diabetic Foot Innovation Project, 2006-09

Objective. The aim of this paper is to report the clinical practice changes resulting from strategies to standardise diabetic foot clinical management in three diverse ambulatory service sites in Queensland, Australia. Methods. Multifaceted strategies were implemented in 2008, including: multidisciplinary teams, clinical pathways, clinical training, clinical indicators, and telehealth support. Prior to the intervention, none of the aforementioned strategies were used, except one site had a basic multidisciplinary team. A retrospective audit of consecutive patient records from July 2006 to June 2007 determined baseline clinical activity (n = 101).Aclinical pathway teleform was implemented as a clinical activity analyser in 2008 (n = 327) and followed up in 2009 (n = 406). Pre- and post-implementation data were analysed using Chi-square tests with a significance level set at P < 0.05. Results. There was an improvement in surveillance of the high risk population of 34% in 2008 and 19% in 2009, and treating according to risk of 15% in 2009 (P < 0.05). The documentation of all best-practice clinical activities performed improved 13–66% (P < 0.03). Conclusion. These findings support the use of multifaceted strategies to standardise practice and improve diabetic foot complications management in diverse ambulatory services.

Standardising practices improves ambulatory diabetic foot management and reduces amputations : the Queensland Diabetic Foot Innovation Project, 2006 – 2009

Background Diabetic foot complications are recognised as the most common reason for diabetic related hospitalisation and lower extremity amputations. Multi-faceted strategies to reduce diabetic foot hospitalisation and amputation rates have been successful. However, most diabetic foot ulcers are managed in ambulatory settings where data availability is poor and studies limited. The project aimed to develop and evaluate strategies to improve the management of diabetic foot complications in three diverse ambulatory settings and measure the subsequent impact on ospitalisation and amputation. Methods Multifaceted strategies were implemented in 2008, including: multi-disciplinary teams, clinical pathways and training, clinical indicators, telehealth support and surveys. A retrospective audit of consecutive patient records from July 2006 – June 2007 determined baseline clinical indicators (n = 101). A clinical pathway teleform was implemented as a clinical record and clinical indicator analyser in all sites in 2008 (n = 327) and followed up in 2009 (n = 406). Results Prior to the intervention, clinical pathways were not used and multi-disciplinary teams were limited. There was an absolute improvement in treating according to risk of 15% in 2009 and surveillance of the high risk population of 34% and 19% in 2008 and 2009 respectively (p < 0.001). Improvements of 13 – 66% (p < 0.001) were recorded in 2008 for individual clinical activities to a performance > 92% in perfusion, ulcer depth, infection assessment and management, offloading and education. Hospitalisation impacts recorded reductions of up to 64% in amputation rates / 100,000 population (p < 0.001) and 24% average length of stay (p < 0.001) Conclusion These findings support the use of multi-faceted strategies in diverse ambulatory services to standardise practice, improve diabetic foot complications management and positively impact on hospitalisation outcomes. As of October 2010, these strategies had been rolled out to over 25 ambulatory sites, representing 66% of Queensland Health districts, managing 1,820 patients and 13,380 occasions of service, including 543 healed ulcer patients. It is expected that this number will rise dramatically as an incentive payment for the use of the teleform is expanded.

Wound Management Innovation Cooperative Research Centre - a new model for inter-disciplinary wound research

Wound research is a complex multidimensional activity most effectively conducted by inter-disciplinary teams that connect studies in basic wound biology, devices and biomaterials with clinical practice. These complexities have been recognised in a new initiative through the establishment of an inter-disciplinary wound research centre in Australia; the Wound Management Innovation Cooperative Research Centre (WMI CRC). The centre is funded by the Australian Government's Cooperative Research Centre Program and a consortium of 22 participants and has a resource of US$108 million over 8 years...

L’internationalisation des jeunes entreprises de hautes technologies : Le rôle des compétences internationales des fondateurs [The internationalization of new technology based firms : the role of the international skills of founding teams]

Extending recent research on the importance of specific resources and skills for the internationalization of start-ups, this article tests a negative binomial model on a sample of 520 recently created high technology firms from the UK and Germany. The results show that previous international experience of entrepreneurs facilitates the rapid penetration of foreign markets, especially when the company features a clear and deliberate strategic intent of internationalization from the outset. This research provides one of the first empirical studies linking the influence of entrepreneurial teams to a high probability of success in the internationalization of high-technology ventures.

Turnover in entrepreneurial teams : are spousal teams different?

Entrepreneurial teams are increasingly prevalent. An important stage in new venture formation involves the recruitment and retention of team members, characterised by changes in the membership of the ET. ET turnover involves members joining or leaving the team, which could have positive or negative effects on the team and the firm. Spousal Entrepreneurial Teams (SET) are a frequently occurring, yet unique type of ET, with very distinct characteristics and dynamics. In an SET turnover is likely to be have different meanings and effects than in Other Entrepreneurial Teams. This research asks: What influences members joining and leaving entrepreneurial teams? And are SET different? Using data from 561 young firms over X years, we find significant differences between SET and NSET. Specifically, we find X.

The role of HRM practices in building intellectual capital in knowledge-based teams

In this paper, we investigate the ways HRM systems support development of intellectual capital in teams in three case studies of knowledge-intensive firms (KIFs) in Denmark. By focusing on team composition and structure, findings build on the rapidly growing body of literature on HRM’s role in supporting intellectual capital development. Specifically, we make a theoretical contribution to this literature by identifying three distinct ways KIFs develop intellectual capital: 1) through HRM development systems that build relationship-centric team-based intellectual capital by targeting development of social capital; 2) through HRM employee relations systems that build human-centric team based intellectual capital by targeting human capital; 3) through a balanced approach to HRM that builds polycentric team-based intellectual capital through focusing on all aspects of intellectual capital. The findings also have managerial implications regarding the need to align team composition and structure, HRM systems, and intellectual capital focus to support development of team-based intellectual capital.

Learning processes in creative service teams : towards a dynamic systems theory

The fastest-growing segment of jobs in the creative sector are in those firms that provide creative services to other sectors (Hearn, Goldsmith, Bridgstock, Rodgers 2014, this volume; Cunningham 2014, this volume). There are also a large number of Creative Services (Architecture and Design, Advertising and Marketing, Software and Digital Content occupations) workers embedded in organizations in other industry sectors (Cunningham and Higgs 2009). Ben Goldsmith (2014, this volume) shows, for example, that the Financial Services sector is the largest employer of digital creative talent in Australia. But why should this be? We argue it is because ‘knowledge-based intangibles are increasingly the source of value creation and hence of sustainable competitive advantage (Mudambi 2008, 186). This value creation occurs primarily at the research and development (R and D) and the marketing ends of the supply chain. Both of these areas require strong creative capabilities in order to design for, and to persuade, consumers. It is no surprise that Jess Rodgers (2014, this volume), in a study of Australia’s Manufacturing sector, found designers and advertising and marketing occupations to be the most numerous creative occupations. Greg Hearn and Ruth Bridgstock (2013, forthcoming) suggest ‘the creative heart of the creative economy […] is the social and organisational routines that manage the generation of cultural novelty, both tacit and codified, internal and external, and [cultural novelty’s] combination with other knowledges […] produce and capture value’. 2 Moreover, the main “social and organisational routine” is usually a team (for example, Grabher 2002; 2004).

Analysing governance categories used on project alliances in the construction industry

In Australia, collaborative contracts, and in particular, project alliances, have been increasingly used to govern infrastructure projects. These contracts use formal and informal governance mechanisms to manage the delivery of infrastructure projects. Formal mechanisms such as financial risk sharing are specified in the contract, while informal mechanisms such as integrated teams are not. Given that the literature contains a multiplicity of often untestable definitions, this paper reports on a review of the literature to operationalize the concepts of formal and informal governance. This work is the first phase of a study that will examine the optimal balance of formal and informal governance structures. Desk-top review of leading journals in the areas of construction management and business management, as well as recent government documents and industry guidelines, was undertaken to to conceptualise and operationalize formal and informal governance mechanisms. The study primarily draws on transaction-cost economics (e.g. Williamson 1979; Williamson 1991), relational contract theory (Feinman 2000; Macneil 2000) and social psychology theory (e.g. Gulati 1995). Content analysis of the literature was undertaken to identify key governance mechanisms. Content analysis is a commonly used methodology in the social sciences area. It provides rich data through the systematic and objective review of literature (Krippendorff 2004). NVivo 9, a qualitative data analysis software package, was used to assist in this process. A previous study by the authors identified that formal governance mechanisms can be classified into seven measurable categories: (1) negotiated cost, (2) competitive cost, (3) commercial framework, (4) risk and reward sharing, (5) qualitative performance, (6) collaborative multi-party agreement, and (7) early contractor involvement. Similarly, informal governance mechanisms can be classified into four measureable categories: (1) leadership structure, (2) integrated team, (3) team workshops, and (4) joint management system. This paper explores and further defines the key operational characteristics of each mechanism category, highlighting its impact on value for money in alliance project delivery. The paper’s contribution is that it provides the basis for future research to compare the impact of a range of individual mechanisms within each category, as a means of improving the performance of construction projects.

Terms of engagement : consensus or control in remote Australian resource management?

Public engagement is a defining feature of collaborative approaches to environmental management (Petts 2006, Whelan and Oliver 2005). Public engagement in this context is focused on incorporating residents and communities of interest in activities like ecological restoration, catchment management, and environmental conservation in a wide range of situations (Nelson and Pettit 2004, Petts 2007). Some authors consider public engagement to be a sign of healthy democratic functioning in society (Skocpol and Fiorina 1999). Others draw attention to overcoming widely noted practical limitations of top-down mechanisms, emphasising that public engagement results in programs being implemented more effectively (Broderick 2005, Leach et al. 1999).

Nurse Prescribing in Acute and Chronic Pain Management

This chapter contains sections titled: Introduction Acute pain Chronic pain Rationale for service development Evaluation use of audit and CPD Justifying the advanced nursing contribution to develop nurse prescribing in pain management Conclusions References

How emergent roles and structures create trust In hastily formed inter-organizational teams

Many activities, from disaster response to project management, require cooperation among people from multiple organizations who initially lack interpersonal relationships and trust. Upon entering inter-organizational settings, pre-existing identities and expectations, along with emergent social roles and structures, may all influence trust between colleagues. To sort out these effects, we collected time-lagged data from three cohorts of military MBA students, representing 2,224 directed dyads, shortly after they entered graduate school. Dyads that shared organizational identity, boundary-spanning roles, and similar network positions (structural equivalence) were likely to have stronger professional ties and greater trust.

Impact of a change in tillage and crop residue management practice on soil chemical and microbiological properties in a cereal-producing red duplex soil in NSW, Australia

The effect of a change of tillage and crop residue management practice on the chemical and micro-biological properties of a cereal-producing red duplex soil was investigated by superimposing each of three management practices (CC: conventional cultivation, stubble burnt, crop conventionally sown; DD: direct-drilling, stubble retained, no cultivation, crop direct-drilled; SI: stubble incorporated with a single cultivation, crop conventionally sown), for a 3-year period on plots previously managed with each of the same three practices for 14 years. A change from DD to CC or SI practice resulted in a significant decline, in the top 0-5 cm of soil, in organic C, total N, electrical conductivity, NH4-N, NO3-N, soil moisture holding capacity, microbial biomass and CO2 respiration as well as a decline in the microbial quotient (the ratio of microbial biomass C to organic C; P <0.05). In contrast, a change from SI to DD or CC practice or a change from CC to DD or SI practice had only negligible impact on soil chemical properties (P >0.05). However, there was a significant increase in microbial biomass and the microbial quotient in the top 0-5 cm of soil following the change from CC to DD or SI practice and with the change from SI to DD practice (P <0.05). Analysis of ester-linked fatty acid methyl esters (EL-FAMEs) extracted from the 0- to 5-cm and 5- to 10-cm layers of the soils of the various treatments detected changes in the FAME profiles following a change in tillage practice. A change from DD practice to SI or CC practice was associated with a significant decline in the ratio of fungal to bacterial fatty acids in the 0- to 5-cm soil (P <0.05). The results show that a change in tillage practice, particularly the cultivation of a previously minimum-tilled (direct-drilled) soil, will result in significant changes in soil chemical and microbiological properties within a 3-year period. They also show that soil microbiological properties are sensitive indicators of a change in tillage practice.

Priority threat management of invasive plant species in the Lake Eyre Basin

This project is led by scientists in conservation decision appraisal and brings together a group of experts working across the Lake Eyre Basin (LEB). The LEB covers a sixth of Australia, with an array of globally significant natural values that are threatened by invasive plants, among other things. Managers at various levels are investing in attempts to control, contain and eradicate these invasive plant species, under severe time and resources limitations. To date there has been no basin-wide assessment of which weed management strategies and locations provide the best investments for maximising outcomes for biodiversity per unit cost. Further, there has been no assessment of the extent of ecosystem intactness that may be lost without effective invasive plant species management strategies. Given that there are insufficient resources to manage all invasive plant species everywhere, this information has the potential to improve current investment decisions. Here, we provide a prioritisation of invasive plant management strategies in the LEB. Prioritisation was based on cost-effectiveness for biodiversity benefits. We identify the key invasive plant species to target to protect ecosystem intactness across the bioregions of the LEB, the level of investment required and the likely reduction in invasive species dominance gained per dollar spent on each strategy. Our focus is on strategies that are technically and socially feasible and reduce the likelihood that high impact invasive plant species will dominate native ecosystems, and therefore change their form and function. The outputs of this work are designed to help guide decision-making and further planning and investment in weed management for the Basin. Experts in weed management, policy-making, community engagement, biodiversity and natural values of the Basin, attended a workshop and agreed upon 12 strategies to manage invasive plants. The strategies focused primarily on 10 weeds which were considered to have a high potential for broad, significant impacts on natural ecosystems in the next 50 years and for which feasible management strategies could be defined. Each strategy consisted of one or more supporting actions, many of which were spatially linked to IBRA (Interim Biogeographical Regionalisation of Australia) bioregions. The first strategy was an over-arching recommendation for improved mapping, information sharing, education and extension efforts in order to facilitate the more specific weed management strategies. The 10 more specific weed management strategies targeted the control and/or eradication of the following high-impact exotic plants: mesquite, parkinsonia, rubber vine, bellyache bush, cacti, mother of millions, chinee apple, athel pine and prickly acacia, as well as a separate strategy for eradicating all invasive plants from one key threatened ecological community, the GAB (Great Artesian Basin dependant) mound springs. Experts estimated the expected biodiversity benefit of each strategy as the reduction in area that an invasive plant species is likely to dominate in over a 50-year period, where dominance was defined as more than 30% coverage at a site. Costs were estimated in present day terms over 50 years largely during follow up discussions post workshop. Cost-effectiveness was then calculated for each strategy in each bioregion by dividing the average expected benefit by the average annual costs. Overall, the total cost of managing 12 invasive plant strategies over the next 50 years was estimated at $1.7 billion. It was estimated that implementation of these strategies would result in a reduction of invasive plant dominance by 17 million ha (a potential 32% reduction), roughly 14% of the LEB. If only targeting Weeds of National Significance (WONS), the total cost was estimated to be $113 million over the next 50 years. Over the next 50 years, $2.3 million was estimated to eradicate all invasive plant species from the Great Artesian Basin Mound Springs threatened ecological community. Prevention and awareness programs were another key strategy targeted across the Basin and estimated at $17.5 million in total over 50 years. The cost of controlling, eradicating and containing buffel grass were the most expensive, over $1.5 billion over 50 years; this strategy was estimated to result in a reduction in buffel grass dominance of a million ha in areas where this species is identified as an environmental problem. Buffel grass has been deliberately planted across the Basin for pasture production and is by far the most widely distributed exotic species. Its management is contentious, having economic value to many graziers while posing serious threats to biodiversity and sites of high cultural and conservation interest. The strategy for containing and locally eradicating buffel grass was a challenge to cost based on expert knowledge, possibly because of the dual nature of this species as a valued pastoral grass and environmental weed. Based on our conversations with experts, it appears that control and eradication programs for this species, in conservation areas, are growing rapidly and that information on the most cost-effective strategies for this species will continue to develop over time. The top five most cost-effective strategies for the entire LEB were for the management of: 1) parkinsonia, 2) chinee apple, 3) mesquite, 4) rubber vine and 5) bellyache bush. Chinee apple and mother of millions are not WONS and have comparatively small populations within the semi-arid bioregions of Queensland. Experts felt that there was an opportunity to eradicate these species before they had the chance to develop into high-impact species within the LEB. Prickly acacia was estimated to have one of the highest benefits, but the costs of this strategy were high, therefore it was ranked 7th overall. The buffel grass strategy was ranked the lowest (10th) in terms of cost effectiveness. The top five most cost-effective strategies within and across the bioregions were the management of: 1) parkinsonia in the Channel Country, 2) parkinsonia in the Desert Uplands, 3) mesquite in the Mitchell Grass Downs, 4) parkinsonia in the Mitchell Grass Downs, and 5) mother of millions in the Desert Uplands. Although actions for several invasive plant species like parkinsonia and prickly acacia were concentrated in the Queensland part of the LEB, the actions involved investing in containment zones to prevent the spread of these species into other states. In the NT and SA bioregions of the LEB, the management of athel pine, parkinsonia and cacti were the main strategies. While outside the scientific research goals of study, this work highlighted a number of important incidental findings that led us to make the following recommendations for future research and implementation of weed management in the Basin: • Ongoing stakeholder engagement, extension and participation is required to ensure this prioritisation effort has a positive impact in affecting on-ground decision making and planning. • Short term funding for weed management was identified as a major reason for failure of current efforts, hence future funding needs to be secure and ongoing. • Improved mapping and information sharing is essential to implement effective weed management. • Due to uncertainties in the outcomes and impacts of management options, strategies should be implemented as part of an adaptive management program. The information provided in this report can be used to guide investment for controlling high-impact invasive plant species for the benefits of biodiversity conservation. We do not present a final prioritisation of invasive plant strategies for the LEB, and we have not addressed the cultural, socio-economic or spatial components necessary for an implementation plan. Cost-effectiveness depends on the objectives used; in our case we used the intactness of ecosystems as a surrogate for expected biodiversity benefits, measured by the extent that each invasive plant species is likely to dominate in a bioregion. When other relevant factors for implementation are considered the priorities may change and some actions may not be appropriate in some locations. We present the costs, ecological benefits and cost-effectiveness of preventing, containing, reducing and eradicating the dominance of high impact invasive plants through realistic management actions over the next 50 years. In doing so, we are able to estimate the size of the weed management problem in the LEB and provide expert-based estimates of the likely outcomes and benefits of implementing weed management strategies. The priorities resulting from this work provide a prospectus for guiding further investment in management and in improving information availability.