The usefulness of fair values in improving the predictive ability of earnings: Evidence from international banks

One of the objectives of general-purpose financial reporting is to provide information about the financial position, financial performance and cash flows of an entity that is useful to a wide range of users in making economic decisions. The current focus on potentially increased relevance of fair value accounting weighed against issues of reliability has failed to consider the potential impact on the predictive ability of accounting. Based on a sample of international (non-U.S.) banks from 24 countries during 2009-2012, we test the usefulness of fair values in improving the predictive ability of earnings. First, we find that the increasing use of fair values on balance-sheet financial instruments enhances the ability of current earnings to predict future earnings and cash flows. Second, we provide evidence that the fair value hierarchy classification choices affect the ability of earnings to predict future cash flows and future earnings. More precisely, we find that the non-discretionary fair value component (Level 1 assets) improves the predictability of current earnings whereas the discretionary fair value components (Level 2 and Level 3 assets) weaken the predictive power of earnings. Third, we find a consistent and strong association between factors reflecting country-wide institutional structures and predictive power of fair values based on discretionary measurement inputs (Level 2 and Level 3 assets and liabilities). Our study is timely and relevant. The findings have important implications for standard setters and contribute to the debate on the use of fair value accounting.

Current Care Guidelines for Cardiopulmonary Resuscitation : Implementation, skills and attitudes

Background: The national resuscitation guidelines were published in Finland in 2002 and are based on international guidelines published in 2000. The main goal of the national guidelines, available on the Internet free of charge, is early defibrillation by nurses in an institutional setting. Aim: To study possible changes in cardiopulmonary resuscitation (CPR) practices, especially concerning early defibrillation, nurses and students attitudes of guideline implementation and nurses and students ability to implement the guideline recommendations in clinical practices after publication of the Current Care (CC) guidelines for CPR 2002. Material and methods: CPR practices in Finnish health centres; especially concerning rapid defibrillation programmes, as well as the implementation of CC guidelines for CPR was studied in a mail survey to chief physicians of every health centre in Finland (Study I). The CPR skills using an automated external defibrillator (AED) were compared in a study including Objective stuctured clinical examination (OSCE) of resuscitation skills of nurses and nursing students in Finnish and Swedish hospital and institution (Studies II, III). Attitudes towards CPR-D and CPR guidelines among medical and nursing students and secondary hospital nurses were studied in surveys (Studies IV, V). The nurses receiving different CPR training were compared in a randomized trial including OSCE of CPR skills of nurses in Finnish Hospital (Study VI). Results: Two years after the publication, 40.7% of Finnish health centres used national resuscitation guidelines. The proportion of health centres having at least one AED (66%) and principle of nurse-performed defibrillation without the presence of a physician (42%) had increased. The CPR-D training was estimated to be insufficient regarding basic life support and advanced life support in the majority of health centres (Study I). CPR-D skills of nurses and nursing students in two specific Swedish and Finnish hospitals and institutions (Study II and III) were generally inadequate. The nurses performed better than the students and the Swedish nurses surpassed the Finnish ones. Geriatric nurses receiving traditional CPR-D training performed better than those receiving an Internet-based course but both groups failed to defibrillate within 60 s. Thus, the performance was not satisfactory even two weeks after traditional training (Study VI). Unlike the medical students, the nursing students did not feel competent to perform procedures recommended in the cardiopulmonary resuscitation guidelines including the defibrillation. However, the majority of nursing students felt confident about their ability to perform basic life support. The perceived ability to defibrillate correlated significantly with a positive attitude towards nurse-performed defibrillation and negatively with fear of damaging the patient s heart by defibrillation (Study IV). After the educational intervention, the nurses found their level of CPR-D capability more sufficient than before and felt more confident about their ability to perform defibrillation themselves. A negative attitude toward defibrillation correlated with perceived negative organisational attitudes toward cardiopulmonary resuscitation guidelines. After CPR-D education in the hospital, the majority (64%) of nurses hesitated to perform defibrillation because of anxiety and 27 % hesitated because of fear of injuring the patient. Also a negative personal attitude towards guidelines increased markedly after education (Study V). Conclusions: Although a significant change had occurred in resuscitation practices in primary health care after publication of national cardiopulmonary resuscitation guidelines the participants CPR-D skills were not adequate according to the CPR guidelines. The current way of teaching is unlikely to result in participants being able to perform adequate and rapid CPR-D. More information and more frequent training are needed to diminish anxiety concerning defibrillation. Negative beliefs and attitudes toward defibrillation affect the nursing students and nurses attitudes toward cardiopulmonary resuscitation guidelines. CPR-D education increased the participants self-confidence concerning CPR-D skills but it did not reduce their anxiety. AEDs have replaced the manual defibrillators in most institutions, but in spite of the modern devices the anxiety still exists. Basic education does not provide nursing students with adequate CPR-D skills. Thus, frequent training in the workplace has vital importance. This multi-professional program supported by the administration might provide better CPR-D skills. Distance learning alone cannot substitute for traditional small-group learning, tutored hands-on training is needed to learn practical CPR-D skills. Standardized testing would probably help controlling the quality of learning. Training of group-working skills might improve CPR performance.

Knowledge through Discussion : An Interpretation of Epistemology in Plato's Meno

According to Meno s paradox we cannot inquire into what we do not know because we do not know what we are inquiring into. There are many ways to interpret the paradox but the central issue about our ability to reach truth is a profound one. In the dialogue Meno, Plato presents the paradox and an outline of a solution which enables us to reach knowledge (epistēmē) through philosophical discussion. During the last century Meno has often been considered transitional between Socratic thinking and Plato s own philosophy, and thus the dialogue has not been adequately interpreted as an integrated whole. Therefore the distinctive epistemology of the dialogue has not gained due notice. In this thesis the dialogue is analysed as an integrated whole and the philosophical interpretation also takes into account its dramatic features. The thesis emphasises the role of language and definitions in acquiring knowledge. Among the results concerning these subjects is a new interpretation of Socrates s defintion of shape (schēma). The theory of anamnēsis all learning is recollection in the Meno is argued to answer the paradox philosophically although Plato s presentation also contains playful and ironic elements. The background of the way Plato presents his case is that he appreciated the fact that no argument can plausibly demonstrate that argumentation is able to reach truth. In the Meno, Plato makes the earliest explicit distinction between knowledge and true belief in the history of Western philosophy. He also gives a definition of knowledge which is the basis of the so called classical definition of knowledge as justified true belief. In the Meno, true beliefs become knowledge when someone ties them down by reasoning about the explanation. The analysis of the epistemology of the dialogue from this perspective gives an interpretation which integrates the central concepts of the epistemology in the dialogue elenchos, anamnēsis and hypothetical inquiry into a unified whole which contains a plausible argument according to which the ignorant can reach knowledge through discussion. The conception that emerges by such an analysis is interesting both from the point of view of current interests and that of the history of philosophy. The method of knowledge acquisition in the Meno can, for example, be seen as a predecessor of modern scientific methods. The Meno is the earliest Greek mathematical text that has survived in its original form. The analysis presented in the thesis of the geometric passages in the dialogue provides new results both concerning Socrates s geometry lesson with the slave and the example presenting the hypothetical method. Concerning the latter, a new interpretation is presented. Keywords: anamnēsis, epistēmē, knowledge, Meno s paradox, Plato

Applicability of Statistical Learning Algorithms for Spatial Variability of Rock Depth

Two algorithms are outlined, each of which has interesting features for modeling of spatial variability of rock depth. In this paper, reduced level of rock at Bangalore, India, is arrived from the 652 boreholes data in the area covering 220 sqa <.km. Support vector machine (SVM) and relevance vector machine (RVM) have been utilized to predict the reduced level of rock in the subsurface of Bangalore and to study the spatial variability of the rock depth. The support vector machine (SVM) that is firmly based on the theory of statistical learning theory uses regression technique by introducing epsilon-insensitive loss function has been adopted. RVM is a probabilistic model similar to the widespread SVM, but where the training takes place in a Bayesian framework. Prediction results show the ability of learning machine to build accurate models for spatial variability of rock depth with strong predictive capabilities. The paper also highlights the capability ofRVM over the SVM model.

A generalized mathematical theory and experimental verification of proportional notches

A theory and generalized synthesis procedure is advocated for the design of weir notches and orifice-notches having a base in any given shape, to a depth a, such that the discharge through it is proportional to any singular monotonically-increasing function of the depth of flow measured above a certain datum. The problem is reduced to finding an exact solution of a Volterra integral equation in Abel form. The maximization of the depth of the datum below the crest of the notch is investigated. Proof is given that for a weir notch made out of one continuous curve, and for a flow proportional to the mth power of the head, it is impossible to bring the datum lower than (2m − 1)a below the crest of the notch. A new concept of an orifice-notch, having discontinuity in the curve and a division of flow into two distinct portions, is presented. The division of flow is shown to have a beneficial effect in reducing the datum below (2m − 1)a from the crest of the weir and still maintaining the proportionality of the flow. Experimental proof with one such orifice-notch is found to have a constant coefficient of discharge of 0.625. The importance of this analysis in the design of grit chambers is emphasized.

Origins of the sex differences in handedness and mental rotation ability : genetic, environmental and hormonal effects

In humans, well-replicated and robust sex differences in cognitive functions exist for handedness and mental rotation ability. A common characteristic in human cognitive functions is the lateralization of language functions. Handedness is a common measure of laterality and is related to language lateralization. The prevalence of left-handedness is higher in males than in females, the male to female ratio being about 1.2. Among cognitive abilities, the largest sex difference is evident in the Vandenberg and Kuse Mental Rotation Test (MRT), which requires the ability to rotate objects in mental space. On average, males achieve scores one standard deviation higher than females in the MRT. The present thesis investigated the origins of the sex differences in laterality and spatial ability as represented by handedness and mental rotation ability, respectively. Two population-based Finnish twin cohorts were utilized in this study. Handedness was studied in 25 810 twins and 4068 singletons born before 1958 from the Older Finnish Twin Cohort, and in 4736 twins born in 1983-87 from the FinnTwin12. MRT was studied in a sub-sample of 804 young adult participants from the FinnTwin12 sample. The main findings of this study were: 1) the prevalence of left-handedness was higher among males than among females in both singletons and in twins; 2) males had significantly higher scores than females in MRT; 3) about one quarter of the variance in handedness and about half of the variance in MRT was explained by genetic effects, whereas the remainder of the variance in these traits was explained by environmental effects unique to each individual. The magnitude of the genetic effects was similar in both sexes; 4) left-handedness was significantly less common in female co-twins of a male than in female co-twins of a female, and female co-twins of a male scored significantly higher than did female co-twins of a female in the Mental Rotation Test. This dissertation discusses whether these differences between females from opposite- and same-sex twin pairs are due to the prenatal transfer of testosterone from the male fetus in females with male co-twins or whether they arise from postnatal socialization effects.

Structural stability of slender aerospace vehicles: Part I Mathematical modeling

A detailed mechanics based model is developed to analyze the problem of structural instability in slender aerospace vehicles. Coupling among the rigid-body modes, the longitudinal vibrational modes and the transverse vibrational modes due to asymmetric lifting-body cross-section are considered. The model also incorporates the effects of aerodynamic pressure and the propulsive thrust of the vehicle. The model is one-dimensional, and it can be employed to idealized slender vehicles with complex shapes. Condition under which a flexible body with internal stress waves behaves like a perfect rigid body is derived. Two methods are developed for finite element discretization of the system: (1) A time-frequency Fourier spectral finite element method and (2) h-p finite element method. Numerical results using the above methods are presented in Part II of this paper. (C) 2010 Elsevier Ltd. All rights reserved.

Tool wear monitoring using ant behaviour

In this paper we show the applicability of Ant Colony Optimisation (ACO) techniques for pattern classification problem that arises in tool wear monitoring. In an earlier study, artificial neural networks and genetic programming have been successfully applied to tool wear monitoring problem. ACO is a recent addition to evolutionary computation technique that has gained attention for its ability to extract the underlying data relationships and express them in form of simple rules. Rules are extracted for data classification using training set of data points. These rules are then applied to set of data in the testing/validation set to obtain the classification accuracy. A major attraction in ACO based classification is the possibility of obtaining an expert system like rules that can be directly applied subsequently by the user in his/her application. The classification accuracy obtained in ACO based approach is as good as obtained in other biologically inspired techniques.

Predictive testing for familial adenomatous polyposis in a rural South Indian community

During the course of genome studies in a rural community in the South Indian state of Karnataka, DNA-based investigations and counselling for familial adenomatous polyposis (FAP) were requested via the community physician. The proposita died in 1940 and FAP had been clinically diagnosed in 2 of her 5 children, both deceased. DNA samples from 2 affected individuals in the third generation were screened for mutations in the APC gene, and a frame-shift mutation was identified in exon 15 with a common deletion at codon 1061. Predictive testing for the mutation was then organized on a voluntary basis. There were 11 positive tests, including confirmatory positives on 2 persons diagnosed by colonoscopy, and to date surgery has been successfully undertaken on 3 previously undiagnosed adults. The ongoing success of the study indicates that, with appropriate access to the facilities offered by collaborating centres, predictive testing is feasible for diseases such as FAP and could be of significant benefit to communities in economically less developed countries.

A New Approach to 2-Asummability Testing

A relationship between 2-monotonicity and 2-asummability has been established and thereby a fast method for testing 2-asummability of switching functions derived. The approach is based on the fact that only a particular type of 2-sums need be examined for 2-asummability testing of 2-monotonic switching functions. These 2-sums are those which contain more than five 1's. 2-asummability testing for these 2-sums can be easily done by using the authors' technique.

A mathematical programming approach to optimal Markovian switching of Poisson arrival streams to queueing systems

Motivated by certain situations in manufacturing systems and communication networks, we look into the problem of maximizing the profit in a queueing system with linear reward and cost structure and having a choice of selecting the streams of Poisson arrivals according to an independent Markov chain. We view the system as a MMPP/GI/1 queue and seek to maximize the profits by optimally choosing the stationary probabilities of the modulating Markov chain. We consider two formulations of the optimization problem. The first one (which we call the PUT problem) seeks to maximize the profit per unit time whereas the second one considers the maximization of the profit per accepted customer (the PAC problem). In each of these formulations, we explore three separate problems. In the first one, the constraints come from bounding the utilization of an infinite capacity server; in the second one the constraints arise from bounding the mean queue length of the same queue; and in the third one the finite capacity of the buffer reflect as a set of constraints. In the problems bounding the utilization factor of the queue, the solutions are given by essentially linear programs, while the problems with mean queue length constraints are linear programs if the service is exponentially distributed. The problems modeling the finite capacity queue are non-convex programs for which global maxima can be found. There is a rich relationship between the solutions of the PUT and PAC problems. In particular, the PUT solutions always make the server work at a utilization factor that is no less than that of the PAC solutions.

Relative ability of ovine follicle stimulating hormone and its beta-subunit to generate antibodies having bioneutralization potential in nonhuman primates

The relative ability of ovine follicle stimulating hormone and its beta-subunit, two potential candidates for male contraceptive vaccine, to generate antibodies in monkeys capable of bioneutralizing follicle stimulating hormone was assessed using in vitro model systems. Antiserum against native ovine follicle stimulating hormone was found to be highly specific to the intact form with no cross-reactivity with either of the two subunits while the antiserum against beta-subunit of follicle stimulating hormone could bind to the beta-subunit in its free form as well as when it is combined with alpha-subunit to form the intact hormone. Both antisera could block the binding of the hormone to the receptor if the hormone was preincubated with the antibody. However, the follicle stimulating hormone beta-antisera could only inhibit the binding of the hormone partially (33 percent inhibition) if the antibody and receptor were mixed prior to the addition of the hormone, while antisera to the native follicle stimulating hormone could block the binding completely (100 percent inhibition) in the same experiment. Similarly antisera to the native follicle stimulating hormone was significantly effective in blocking (100 percent) response to follicle stimulating hormone but not the beta-subunit antisera (0 percent) as checked using an in vitro granulosa cell system. Thus the probability of obtaining antibodies of greater bioneutralization potential is much higher if intact hormone is used as an antigen rather than its beta-subunit as a vaccine.