External audit in the National Health Service in England and Wales:a study of an oversight body's control of auditor remuneration

In the National Health Service (NHS) in England and Wales an oversight body, the Audit Commission (AC), defines the scope of the external auditors’ work, appoints the auditors and has oversight of their fees and audit quality. This heavily regulated audit regime mitigates some of the deficiencies observed in high profile corporate failures. Independence, it has been argued, is influenced by the total auditor remuneration paid by the client. In this study we examine total auditor remuneration in a regulated market which seeks to ensure audit independence and audit quality. In particular we undertake rigorous analysis of auditor remuneration by the type of auditor: We place emphasis on the differentiation between private sector firms and the AC’s in-house auditors (District Audit). Individual private audit firms charge premiums (up to 16%) for particular audit work in identified locations, but no premiums were found when we examined total auditor remuneration. The regime appears to permit efficient operation of the audit market while safeguarding both audit independence and standards.

Productivity and price performance in the privatized water and sewerage companies of England and Wales

After its privatization in 1989, the water and sewerage industry of England and Wales faced a new regulatory régime and implemented a substantial capital investment program aimed at improving water and environmental standards. A new RPI + K regulatory pricing system was designed to compensate the industry for its increased capital costs, encourage increased efficiency, and maintain fair prices for customers. This paper evaluates how successful privatization and the resulting system of economic regulation has been. Estimates of productivity growth, derived with quality adjusted output indices, suggest that despite reductions in labor usage, total factor productivity growth has not improved since privatization. Moreover, total price performance indices reveal that increases in output prices have outstripped increases in input costs, a trend which is largely responsible for the increase in economic profits that has occurred since privatization. * We would like to thank Emmanuel Thanassoulis, Joshy Easaw, Jim Love, John Sawkins, and an anonymous referee for helpful comments on earlier drafts of this paper. The usual disclaimer applies.

Seasonal growth of the crustose lichen Rhizocarpon geographicum (L.) DC. in South Gwynedd, Wales

Seasonal growth was studied in the slow-growing crustose lichen Rhizocarpon geographicum (L.) DC. in an area of South Gwynedd, Wales. Radial growth rate (RGR) of a sample of 20 thalli was measured in situ at three-month intervals over 51 months on a southeast-facing rock surface. There were five periods of significant growth: July-September of 1993, 1994 and 1995, in January-March of 1996, and in April-June of 1997. In four of these periods, growth coincided with a mean temperature maximum (Tmax) over a three-month period exceeding 15°C and three of the maxima with greater than 450 sunshine hours. Two of the growth maxima coincided with periods of total rainfall exceeding 300 mm and one with greater than 50 rain days in a three-month period. There were no significant linear correlations between RGR and the climatic variables measured. However, there were significant non-linear relationships between RGR and Tmax, the mean temperature minimum (Tmin), the total number of air and ground frosts and the number of rain days in a growth period, the relationship with Tmax being the most significant. Hence, in south Gwynedd, maximum growth of R. geographicum occurs in any season although the period July-September appears to be the most favourable. Relationships between growth and climatic variables were non-linear, temperature having the most significant influence on seasonal growth. ©2006 Balaban.