Audit fees, non-audit fees and auditor going-concern reporting decisions in the United Kingdom

The accounting profession has come under increased scrutiny over recent years about the growing number of non-audit fees received from audit clients and the possible negative impact of such fees on auditor independence. The argument advanced is that providing substantial amounts of non-audit services to clients may make it more likely that auditors concede to the wishes of the client management when difficult judgments are made. Such concerns are particularly salient in the case of reporting decisions related to going-concern uncertainties for financially stressed clients. This study empirically examines audit reports provided to financially stressed companies in the United Kingdom and the magnitude of audit and non-audit service fees paid to the company’s auditors. We find that the magnitude of both audit fees and non-audit fees are significantly associated with the issuance of a going-concern modified audit opinion. In particular, financially stressed companies with high audit fees are more likely to receive a going-concern modified audit opinion, whereas companies with high non-audit fees are less likely to receive a goingconcern modified audit opinion. Additional analyses indicate that the results are generally robust across alternative model and variable specifications. Overall, evidence supports the contention that high non-audit fees have a detrimental effect on going-concern reporting judgments for financially stressed U.K. companies.

Has DRG payment influenced the technical efficiency and productivity of diagnostic technologies in Portuguese public hospitals? An empirical analysis using parametric and non‐parametric methods

The use of Diagnosis Related Groups (DRG) as a mechanism for hospital financing is a currently debated topic in Portugal. The DRG system was scheduled to be initiated by the Health Ministry of Portugal on January 1, 1990 as an instrument for the allocation of public hospital budgets funded by the National Health Service (NHS), and as a method of payment for other third party payers (e.g., Public Employees (ADSE), private insurers, etc.). Based on experience from other countries such as the United States, it was expected that implementation of this system would result in more efficient hospital resource utilisation and a more equitable distribution of hospital budgets. However, in order to minimise the potentially adverse financial impact on hospitals, the Portuguese Health Ministry decided to gradually phase in the use of the DRG system for budget allocation by using blended hospitalspecific and national DRG casemix rates. Since implementation in 1990, the percentage of each hospitals budget based on hospital specific costs was to decrease, while the percentage based on DRG casemix was to increase. This was scheduled to continue until 1995 when the plan called for allocating yearly budgets on a 50% national and 50% hospitalspecific cost basis. While all other nonNHS third party payers are currently paying based on DRGs, the adoption of DRG casemix as a National Health Service budget setting tool has been slower than anticipated. There is now some argument in both the political and academic communities as to the appropriateness of DRGs as a budget setting criterion as well as to their impact on hospital efficiency in Portugal. This paper uses a twostage procedure to assess the impact of actual DRG payment on the productivity (through its components, i.e., technological change and technical efficiency change) of diagnostic technology in Portuguese hospitals during the years 1992–1994, using both parametric and nonparametric frontier models. We find evidence that the DRG payment system does appear to have had a positive impact on productivity and technical efficiency of some commonly employed diagnostic technologies in Portugal during this time span.

Discriminating antigen and non-antigen using proteome dissimilarity III:tumour and parasite antigens

Computational genome analysis enables systematic identification of potential immunogenic proteins within a pathogen. Immunogenicity is a system property that arises through the interaction of host and pathogen as mediated through the medium of a immunogenic protein. The overt dissimilarity of pathogenic proteins when compared to the host proteome is conjectured by some to be the determining principal of immunogenicity. Previously, we explored this idea in the context of Bacterial, Viral, and Fungal antigen. In this paper, we broaden and extend our analysis to include complex antigens of eukaryotic origin, arising from tumours and from parasite pathogens. For both types of antigen, known antigenic and non-antigenic protein sequences were compared to human and mouse proteomes. In contrast to our previous results, both visual inspection and statistical evaluation indicate a much wider range of homologues and a significant level of discrimination; but, as before, we could not determine a viable threshold capable of properly separating non-antigen from antigen. In concert with our previous work, we conclude that global proteome dissimilarity is not a useful metric for immunogenicity for presently available antigens arising from Bacteria, viruses, fungi, parasites, and tumours. While we see some signal for certain antigen types, using dissimilarity is not a useful approach to identifying antigenic molecules within pathogen genomes.

Tacit vs. overt collusion firm asymmetries and numbers:what's the evidence?

It is conventional wisdom that collusion is more likely the fewer firms there are in a market and the more symmetric they are. This is often theoretically justified in terms of a repeated non-cooperative game. Although that model fits more easily with tacit than overt collusion, the impression sometimes given is that ‘one model fits all’. Moreover, the empirical literature offers few stylized facts on the most simple of questions—how few are few and how symmetric is symmetric? This paper attempts to fill this gap while also exploring the interface of tacit and overt collusion, albeit in an indirect way. First, it identifies the empirical model of tacit collusion that the European Commission appears to have employed in coordinated effects merger cases—apparently only fairly symmetric duopolies fit the bill. Second, it shows that, intriguingly, the same story emerges from the quite different experimental literature on tacit collusion. This offers a stark contrast with the findings for a sample of prosecuted cartels; on average, these involve six members (often more) and size asymmetries among members are often considerable. The indirect nature of this ‘evidence’ cautions against definitive conclusions; nevertheless, the contrast offers little comfort for those who believe that the same model does, more or less, fit all.

Textbook (non-)adoption motives, legitimizing strategies and academic field configuration

Textbooks are an integral part of structured syllabus coverage in higher education. The argument advanced in this article is that textbooks are not simply products of inscription and embodied scholarly labour for pedagogical purposes, but embedded institutional artefacts that configure entire academic subject fields. Empirically, this article shows the various ways that motives of the (non-) adoption of textbooks have field institutional configuration effects. The research contribution of our study is threefold. First, we re-theorise the textbook as an artefact that is part of the institutional work and epistemic culture of academia. Second, we empirically show that the vocabularies of motive of textbook (non-) adoption and rhetorical strategies form the basis for social action and configuration across micro, meso and macro field levels. Our final contribution is a conceptualization of the ways that textbook (non-) adoption motives ascribe meaning to the legitimating processes in the configuration of whole subject fields.

The effect of disfiguring features on covert and overt attention to faces

It is well documented that facial disfigurements can generate avoidance responses in observers towards the afflicted person, yet less is known about the effect of a facial disfigurement on attention to and perception of faces. In two experiments we studied overt and covert attention to laterally presented face stimuli when these contained a unilateral disfiguring feature (a simulated portwine stain), an occluding feature, or no salient feature. In Experiment 1, observers’ eye movements were tracked while they explored laterally presented faces which they had to rate for attractiveness. Overt attention, as measured by the patterns of fixations on the face, was found to be significantly affected by the presence of a facial disfigurement or an occluder. In Experiment2, we used a covert orienting task with bilaterally presented target and distractor to measure the interference effect induced by a distractor face (disfigured, occluded, or normal) on a non facetarget discrimination task. The presence of a face increased response times to the target stimulus,but this interference was not modulated by the presence of a salient feature (disfigurement or occluder). Together, these results suggest that the presence of salient features affect overt but not the covert processing of faces.