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.

Benefits and risks of large hydrostatic recesses in hydroelectric turbine thrust bearings

Operators of hydroelectric power stations sometimes call upon engineers to modify existing hydroelectric turbines, usually several decades old, for improved maintainability and reliability. One common modification is the hybridisation of plain thrust pads to allow hydrostatic operation to reduce the risk of bearing wipe at low speed (virtually all new installations benefit from this feature). A modification such as this is not a difficult undertaking; however, there are numerous factors that need to be considered in order to maximize bearing performance. One factor that stands out above the others is whether the thrust bearing should be designed to lift the turbine immediately from the standing condition, which presents an interesting challenge: the recess has to have a sufficiently large area in order for the supply pressure to be able to overcome the dead weight of the turbine. If the combination of groove area and pressure is insufficient, then lifting is neither immediate nor guaranteed. This need not be a significant problem, as the bearings have exhibited adequate performance even in the absence of a hydrostatic lubricant supply. A case study is presented whereby relatively large hydrostatic recesses are added to the pads of thrust bearing. It is demonstrated with the aid of simple numerical modelling that the impact of the recess relative to the original pad is small under normal operating conditions. Most surprising, however, is that significant reductions in average oil film temperature and power dissipation are predicted.

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.

Parent's socio-economic status and social support as risks for child mortality : consideration of health equity in The Gambia

A matched case-control study of mortality to children under age five was conducted to consider associations with parents' socio-economic status and social support in the Farafenni Demographic Surveillance Site (DSS). Cases and controls were selected from Farafenni DSS, matched on date of birth, and parents were interviewed about personal resources and social networks. Parents with the lowest personal socio-economic status and social support were identified. Multivariate multinomial regression was used to consider whether the children of these parents were at increased risk of either infant or 1-4 mortality, in separate models using either parents' characteristics. There was no benefit found for higher SES or better social support with respect to child mortality. Children of fathers who had the poorest social support had lower 1-4 mortality risk (OR=0.52, p=0.037). Given that socio-economic status was not associated with child mortality, it seems unlikely that the explanation for the link between father's social support and mortality is linked to resource availability. Explanations for the risk effect of father's social ties may lie in decision-making around health maintenance and health care for children.

Interpreting and comparing risks in the presence of competing events

Competing events are common in medical research. Ignoring them in the statistical analysis can easily lead to flawed results and conclusions. This article uses a real dataset and a simple simulation to show how standard analysis fails and how such data should be analysed

Regulating Workplace Risks: A Comparative Study of Inspection Regimes in Times of Change

Regulating Workplace Risks is a study of regulatory inspection of occupational health and safety (OHS) and its management in five countries – Australia, Canada (Québec), France, Sweden and the UK – during a time of major change. It examines the implications of the shift from specification to process based regulation, in which attention has been increasingly directed to the means of managing OHS more systematically at a time in which a major restructuring of work has occurred in response to the globalised economy. These changes provide both the context and material for a wider discussion of the nature of regulation and regulatory inspection and their role in protecting the health, safety and well-being of workers in advanced market economies.

OHS inspectors and psychosocial risk factors: Evidence from Australia

Legislation giving prominence to psychosocial risk factors at work has changed the role of government occupational health and safety (OHS) inspectors in many countries. Yet little is known about how inspectorates have responded to these changes. Between 2003 and 2007 an Australian study was undertaken on OHS standards, entailing detailed documentary analysis, interviews with 36 inspectorate managers and 89 inspectors, and observations made when researchers accompanied inspectors on 120 typical workplace visits. Our study found that general duty provisions in OHS legislation clearly incorporated psychosocial hazards and inspectorates had introduced guidance material, pursued campaigns and increased interventions in this area. However, the regulatory framework remained narrow (focused on bullying/harassment, occupational violence and work stress) and workplace visits revealed psychosocial hazards as a marginal area of inspectorate activity. These findings were reinforced in interviews. While aware of psychosocial hazards inspectors often saw the issue as problematic due to limited training, resourcing constraints, deficiencies in regulation and fears of victimisation amongst workers. In order to address these problems a number of changes are required that recognize the distinctiveness of psychosocial hazards including their ‘invisibility’. Notable here are revisions to regulation (both general duty provisions and specific codes), the development of comprehensive guidance and assessment tools to be used by inspectors, greater use of procedural enforcement, and enhanced inspectorate resourcing and training. There is also a need to recognize complex inter-linkages between psychosocial hazards and the industrial relations context.

The influence of psychosocial factors on expectations and persistent symptom report after mild traumatic brain injury

This thesis examines how psychosocial factors influence the report of persistent symptoms after mild traumatic brain injury. Using quasi-experimental methods, the research program demonstrates how factors unrelated to trauma-induced physiological brain damage can contribute to persistent symptoms after a mild traumatic brain injury. The results of this thesis highlight the possibility that outcome from mild traumatic brain injury could be improved by targeting psychosocial factors.

Workforce-related risks in projects with a contingent workforce

Our research examined how projects can draw together the fields of human resource management (HRM) and risk management (RM) to consider workforce-related risks on projects; particularly those with a large contingent workforce. It is argued that RM frameworks could be enhanced by a more comprehensive understanding of the specific potential non-technical “people risks” in projects. The study focussed on the Oil and Gas industry and undertook interviews with experts in the field. The findings are considered within the framework of key HRM areas; Management Practices, General Employment Practices, Staffing, HR Development, and Compensation and Benefits, along with Project Completion. Drawing together RM and HRM in a project environment, our research provides a unique opportunity to identify critical workforce-related risks. Such identification is the first step towards a more comprehensive approach to risk assessment and planning for mitigation of such risks in projects.

Exploring the effect of political risks in large infrastructure projects in politically unstable countries using a probabilistic modelling approach

This research aims to explore and identify political risks on a large infrastructure project in an exaggerated environment to ascertain whether sufficient objective information can be gathered by project managers to utilise risk modelling techniques. During the study, the author proposes a new definition of political risk; performs a detailed project study of the Neelum Jhelum Hydroelectric Project in Pakistan; implements a probabilistic model using the principle of decomposition and Bayes probabilistic theorem and answers the question: was it possible for project managers to obtain all the relevant objective data to implement a probabilistic model?

Government grants - an abrogation or management of risks?

New public management (NPFM), with its hands-on, private sector-style performance measurement, output control, parsimonious use of resources, disaggreation of public sector units and greater competition in the public sector, has significantly affected charitable and nonprofit organisations delivering community services (Hood, 1991; Dunleavy, 1994; George & Wilding, 2002). The literature indicates that nonprofit organisations under NPM believe they are doing more for less: while administration is increasing, core costs are not being met; their dependence on government funding comes at the expense of other funding strategies; and there are concerns about proportionality and power asymmetries in the relationship (Kerr & Savelsberg, 2001; Powell & Dalton, 2011; Smith, 2002, p. 175; Morris, 1999, 2000a). Government agencies are under increased pressure to do more with less, demonstrate value for money, measure social outcomes, not merely outputs and minimise political risk (Grant, 2008; McGreogor-Lowndes, 2008). Government-community service organisation relationships are often viewed as 'uneasy alliances' characterised by the pressures that come with the parties' differing roles and expectations and the pressures that come with the parties' differing roles and expectations and the pressurs of funding and security (Productivity Commission, 2010, p. 308; McGregor-Lowndes, 2008, p. 45; Morris, 200a). Significant community services are now delivered to citizens through such relationships, often to the most disadvantaged in the community, and it is important for this to be achieved with equity, efficiently and effectively. On one level, the welfare state was seen as a 'risk management system' for the poor, with the state mitigating the risks of sickness, job loss and old age (Giddens, 1999) with the subsequent neoliberalist outlook shifting this risk back to households (Hacker, 2006). At the core of this risk shift are written contracts. Vincent-Jones (1999,2006) has mapped how NPM is characterised by the use of written contracts for all manner of relations; e.g., relgulation of dealings between government agencies, between individual citizens and the state, and the creation of quais-markets of service providers and infrastructure partners. We take this lens of contracts to examine where risk falls in relation to the outsourcing of community services. First we examine the concept of risk. We consider how risk might be managed and apportioned between governments and community serivce organisations (CSOs) in grant agreements, which are quasiy-market transactions at best. This is informed by insights from the law and economics literature. Then, standard grant agreements covering several years in two jurisdictions - Australia and the United Kingdom - are analysed, to establish the risk allocation between government and CSOs. This is placed in the context of the reform agenda in both jurisdictions. In Australia this context is th enonprofit reforms built around the creation of a national charities regulator, and red tape reduction. In the United Kingdom, the backdrop is the THird Way agenda with its compacts, succeed by Big Society in a climate of austerity. These 'case studies' inform a discussion about who is best placed to bear and manage the risks of community service provision on behalf of government. We conclude by identifying the lessons to be learned from our analysis and possible pathways for further scholarship.

Women with self-reported lower-limb lymphedema after treatment for gynecological cancers: Are they more likely to self-report psychosocial symptoms and less likely to use services?

Background: Due to improved screening and treatment for gynaecological cancers survivorship has increased. Use of supportive care services after treatment is important to improve quality of life. Objective: To assess self-reported lower-limb lymphoedema (LLL), depression, anxiety, quality of life, unmet supportive care needs, and service use among gynaecological cancer survivors. Methods: In 2010 a population-based cross-sectional mail survey was conducted (n=160 gynaecological cancer survivors 5 to 30 month post-diagnosis (53% response rate)). Results: Overall, 30% of women self-reported LLL, 21% and 24% depression or anxiety, respectively. Women with LLL were more likely to also report symptoms of depression or anxiety, and with these symptoms had higher unmet supportive care needs. Services needed but not used by 10-15% of women with LLL, anxiety or depression respectively were lymphoedema specialist, pain specialist and physiotherapist, or psychiatrists, psychologists and pain specialists. Limitations: Small sample size, self-report data, limited generalisation to other countries, underrepresentation of older women (age >70) and women from non-Caucasian backgrounds. Conclusions: Women with LLL or high distress were less likely to use services they needed. Funding: This study was funded by Cancer Australia.

A recommendation system for predicting risks across multiple business process instances

This paper proposes a recommendation system that supports process participants in taking risk-informed decisions, with the goal of reducing risks that may arise during process execution. Risk reduction involves decreasing the likelihood and severity of a process fault from occurring. Given a business process exposed to risks, e.g. a financial process exposed to a risk of reputation loss, we enact this process and whenever a process participant needs to provide input to the process, e.g. by selecting the next task to execute or by filling out a form, we suggest to the participant the action to perform which minimizes the predicted process risk. Risks are predicted by traversing decision trees generated from the logs of past process executions, which consider process data, involved resources, task durations and other information elements like task frequencies. When applied in the context of multiple process instances running concurrently, a second technique is employed that uses integer linear programming to compute the optimal assignment of resources to tasks to be performed, in order to deal with the interplay between risks relative to different instances. The recommendation system has been implemented as a set of components on top of the YAWL BPM system and its effectiveness has been evaluated using a real-life scenario, in collaboration with risk analysts of a large insurance company. The results, based on a simulation of the real-life scenario and its comparison with the event data provided by the company, show that the process instances executed concurrently complete with significantly fewer faults and with lower fault severities, when the recommendations provided by our recommendation system are taken into account.