Doing business in China : how Australian companies make their decisions when entering the Chinese market

This report describes and analyses the experiences of Australian businesses which have established operations or conduct business in China, both successfully and unsuccessfully. The information was collected over the period from August to November in 2007. It involved interviews with 43 respondents from 40 different Australian businesses across both manufacturing and service industries. The project was motivated by the increasing significance of China to Australia’s economy (such as the demand for Australian iron and coal exports and the transfer of much of Australia’s manufacturing operations there) and its extraordinary growth and development over the past 10 years. Using the contemporary modes of international expansion as a framework, the research considered companies which had entered China through Wholly Owned Foreign Enterprises (WOFEs), Joint Ventures, exporting and other forms such as licensing and agents. Most of the participants had located their operations in China in the eastern region, including Shanghai, Beijing, Guanzhou, Shenzhen and Tianjin.

Funding the ‘Islamic State’: looting antiquities and the international black market

A key revenue stream for various militant groups across the Middle East, including the Islamic State in Iraq and Syria (ISIS), is the illicit looting and trafficking of antiquities which are sold on the international black market. Various heritage sites are being looted by ISIS and others with devastating efficiency and on an industrial scale. While exact figures are difficult to ascertain, the profits from these looting operations are estimated to be the second largest revenue stream for ISIS after the illegal sale of crude oil. The illicit trafficking of antiquities is therefore financing the devastating advance of ISIS and any effort, including that by the Australian Department of Defence, to defeat ISIS must address this significant issue. More research is urgently needed to understand the precise nature, scope and variety of antiquities looting across the Middle East, the extent to which it is funding groups like ISIS, and to consider Australia’s role in international strategies to stanch this ongoing problem.

The market for financial report audits : regulation of and competition for auditor independence

The independence of auditors and the quality of financial report audits generally are rarely tested except in circumstances of corporate failure when alleged sub-optimality is present. Often auditors have good defences as to their expertise or competency, but rarely do they have equally convincing defences for the independence of their audit. A major issue for the regulation of auditor independence is that the threats to independence are often subtle and difficult to measure. This paper argues that firms undertaking financial report audits need to be transparent and competitive in respect of auditor independence. Two models that adopt this premise are proposed.

Utilising self-report data to measure racial discrimination in the labour market

Although economists have developed a series of approaches to modelling the existence of labour market discrimination, rarely is this topic examined by analysing self-report survey data. After reviewing theories and empirical models of labour market discrimination, we examine self-reported experience of discrimination at different stages in the labour market, among three racial groups utilising U.S. data from the 2001-2003 National Survey of American Life. Our findings indicate that African Americans and Caribbean blacks consistently report more experience of discrimination in the labour market than their non-Hispanic white counterparts. At different stages of the labour market, including hiring, termination and promotion, these groups are more likely to report discrimination than non-Hispanic whites. After controlling for social desirability bias and several human capital and socio-demographic covariates, the results remain robust for African Americans. However, the findings for Caribbean blacks were no longer significant after adjusting for social desirability bias. Although self-report data is rarely utilised to assess racial discrimination in labour economics, our study confirms the utility of this approach as demonstrated in similar research from other disciplines. Our results indicate that after adjusting for relevant confounders self-report survey data is a viable approach to estimating racial discrimination in the labour market. Implications of the study and directions for future research are provided.

The Dawson report and merger regulation

Discusses the Review of the Competition Law Provisions of the Trade Practices Act recommended by the Dawson Committee in Australia. Prohibition of mergers that lessens market competition by Trade Practices Act 1974; Requirement for a request of informal clearance; Establishment of an optional formal clearance procedure; Submission of merger authorization requests to the Australian Competition Tribunal.

Do dot coms add value : a preliminary study of the market capitalisation of Australian and Indian telecoms and banking sectors

E-Business is increasingly reshaping the way businesses operate across the globe. Globally, businesses in the banking and telecoms sectors have been re-engineering their value chains by adopting e-Business presence by means of dot com launches. The second half of the 1990s, however, saw both the rise and subsequent collapse of dot com entities as a major focus of investment interest, with consequent speculation over the viability of this corporate vehicle. The perceived increase in market capitalisation by means of these ventures during the boom period is now not so certain. In this paper, we report the results of a preliminary study which investigated the impact of dot com launches on market capitalisation within the banking and telecoms sectors of Australia and India.

Auditor independence : shared meaning between the demand and supply sides of the audit services market?

Purpose – The purpose of the paper is to examine the extent to which there is shared meaning of the concept of auditor independence between the three major groups of parties on the demand and supply sides of the audit services market – auditors, financial report preparers and financial report users.

Design/methodology/approach – The paper utilises the measurement of meaning framework (semantic differential analysis) originally proposed by Osgood et al. in 1957. The framework is used to investigate the extent to which there is shared meaning (agreement in interpretations) of the independence concept, in response to alternative audit engagement case contexts, between key parties to the financial reporting communication process. The study's research data was collected in the period March 2004-May 2005.

Findings – Findings indicate a robust and stable single-factor cognitive structure within which the research participants interpret the connotative meaning of the auditor independence concept. An analysis of the experimental cases finds similarities in connotations (interpretations) of an audit firm's independence for the participant groups for most cases, with the exception of cases involving the joint provision of audit and non-audit (taxation) services.

Research limitations/implications – The usual external validity threat that applies to experimental research generally applies to the study. That is, the results may not be generalisable to settings beyond those examined in the study. An important implication of the study is that it emphasises the continuing problematic nature of the joint provision of audit and non-audit services, even in situations where the non-audit services comprise only traditional taxation services.

Originality/value – The study is the first to examine the concept of auditor independence by means of the Osgood et al. measurement of meaning research framework using, as research participants, the three major groups on the demand and supply sides of the audit services market.