German open ended funds: was there a valuation problem?

In late 2005, a number of German open ended funds suffered significant withdrawals by unit holders. The crisis was precipitated by a long term bear market in German property investment and the fact that these funds offered short term liquidity to unit holders but had low levels of liquidity in the fund. A more controversial suggestion was that the crisis was exacerbated by a perception that the valuations of the fund were too infrequent and inaccurate. As units are priced by reference to these valuations with no secondary market, the valuation process is central to the process. There is no direct evidence that these funds were over-valued but there is circumstantial evidence and this paper examines the indirect evidence of the process to see whether the hypothesis that valuation is an issue for the German funds holds any credibility. It also discusses whether there is a wider issue for other funds of this nature or whether it is a parochial problem confined to Germany. The conclusions are that there is reason to believe that German valuation processes make over-valuation in a recession more likely than in other countries and that more direct research into the German valuation system is required to identify the issues which need to be addressed to make the valuation system more trusted.

Decadal to multidecadal variability and the climate change background

Three prominent quasi-global patterns of variability and change are observed using the Met Office's sea surface temperature (SST) analysis and almost independent night marine air temperature analysis. The first is a global warming signal that is very highly correlated with global mean SST. The second is a decadal to multidecadal fluctuation with some geographical similarity to the El Niño–Southern Oscillation (ENSO). It is associated with the Pacific Decadal Oscillation (PDO), and its Pacific-wide manifestation has been termed the Interdecadal Pacific Oscillation (IPO). We present model investigations of the relationship between the IPO and ENSO. The third mode is an interhemispheric variation on multidecadal timescales which, in view of climate model experiments, is likely to be at least partly due to natural variations in the thermohaline circulation. Observed climatic impacts of this mode also appear in model simulations. Smaller-scale, regional atmospheric phenomena also affect climate on decadal to interdecadal timescales. We concentrate on one such mode, the winter North Atlantic Oscillation (NAO). This shows strong decadal to interdecadal variability and a correspondingly strong influence on surface climate variability which is largely additional to the effects of recent regional anthropogenic climate change. The winter NAO is likely influenced by both SST forcing and stratospheric variability. A full understanding of decadal changes in the NAO and European winter climate may require a detailed representation of the stratosphere that is hitherto missing in the major climate models used to study climate change.

Creative participation in construction firms: bridging creativity and innovation

An intricate evolution of mainstream theories follows the growing need to explain employees’ commitment and engagement. Our understanding of these work-related phenomena and behaviour has improved but creativity and innovation as desired indicators are still often treated as coexisting constructs with very little attention given to a state of willingness of an individual to even consider contributing ideas. In this research we investigate the influence of knowledge and understanding, perceived radicality, personality dimensions, and favouring of ideas on employee willingness to creatively participate in order to trace its existence in propagation of ideas. A total of 76 construction and non-construction professionals participated in between-subject quasi-experiments. We also proposed IPO-based radicality of ideas construct from the viewpoint of employees involved in the processes of transformation. The research findings show that experts with deep understanding of the work are more likely to contribute highly radical ideas to decision-makers than less knowledgeable employees. Furthermore, personal factors that impact employee willingness to creatively participate have been valued higher than organisational factors. Personality dimensions by The BigFive Inventory have shown no effect on willingness to contribute ideas, while favouring of ideas showed a significant effect. In general, the findings show similarities with some studies of consumer willingness to participate in co-creation processes and thus indicate that firms may be studied as dynamic internal markets of ideas.

A 2000-year annual record of snow accumulation rates for Law Dome, East Antarctica

Accurate high-resolution records of snow accumulation rates in Antarctica are crucial for estimating ice sheet mass balance and subsequent sea level change. Snowfall rates at Law Dome, East Antarctica, have been linked with regional atmospheric circulation to the mid-latitudes as well as regional Antarctic snowfall. Here, we extend the length of the Law Dome accumulation record from 750 years to 2035 years, using recent annual layer dating that extends to 22 BCE. Accumulation rates were calculated as the ratio of measured to modelled layer thicknesses, multiplied by the long-term mean accumulation rate. The modelled layer thicknesses were based on a power-law vertical strain rate profile fitted to observed annual layer thickness. The periods 380–442, 727–783 and 1970–2009 CE have above-average snow accumulation rates, while 663–704, 933–975 and 1429–1468 CE were below average, and decadal-scale snow accumulation anomalies were found to be relatively common (74 events in the 2035-year record). The calculated snow accumulation rates show good correlation with atmospheric reanalysis estimates, and significant spatial correlation over a wide expanse of East Antarctica, demonstrating that the Law Dome record captures larger-scale variability across a large region of East Antarctica well beyond the immediate vicinity of the Law Dome summit. Spectral analysis reveals periodicities in the snow accumulation record which may be related to El Niño–Southern Oscillation (ENSO) and Interdecadal Pacific Oscillation (IPO) frequencies.

Effects of single or repeated amphetamine treatment and withdrawal on lung allergic inflammation in rats

The effects of single or repeated amphetamine (AMPH) treatment and those of AMPH withdrawals on immune-mediated lung inflammatory response were studied in rats. Two experiments were done. In the first, rats egg-albumin (OVA) sensitized were singularly or repeatedly (21 days, once daily) treated with AMPH (1.0 mg/kg) or with a similar number and volume of 0.9% NaCl. The OVA aerosol challenge was performed 12 h after the single or last repeated AMPH treatment and also 72 and 120 h after AMPH withdrawal. In the second experiment, the effects of reserpine (1.0 mg/kg/day for 5 consecutive days) on single AMPH actions on lung allergic response of rats were analyzed. Single and repeated AMPH treatment induced opposite actions on Bronchoalveolar lavage fluid (BAL) cellularity of allergic rats: single treatment decreased and repeated treatment increased the total number of cells as well as those of macrophages, neutrophils and eosinophils. Our data also showed that single but not repeated AMPH treatment decreased the number of neutrophils, monocytes and lymphocytes in the peripheral blood, and increased the total number of bone marrow cells in rats sensitized and challenged with OVA. Furthermore, it was shown that reserpine treatment precluded the effects of single AMPH treatment on cellular migration to the lung of OVA-sensitized and challenged rats. It was concluded that AMPH effects on lung inflammatory response and cell recruitment to the lung in allergic rats rely at least partially on corticosterone serum levels. The possible involvement of vesicular monoamine transporter type 2 (VMAT2) with these observed effects was discussed. (c) 2008 Elsevier B.V. All rights reserved.

Financial characteristics of Australian initial public offerings from 1994 to 1999

A variety of financial characteristics of Australian initial public offerings (IPOs) for the period 1994-1999 are explored. A number of previous Australian studies have investigated the initial day underpricing and longer term underperformance of IPOs and this study updates those papers. This paper partitions the IPO data into no liability/limited liability; share option/no share option; underwriter option/no underwriter option and dividend reinvestment/no dividend reinvestment characteristics to better understand the types of IPOs that list on the Australian Stock Exchange. The data supports the findings of previous studies in that IPOs are underpriced at the time of listing and underperform the market in the first year following their listing.

The importance of audit committees in initial public offerings

This paper follows Balvers, McDonald and Miller (1988), and Beatty (1989), who find lower underpricing in Initial Public Offerings (IPOs) when prestigious auditors are used to attest to the IPO's financial statements. Australian IPOs are not obliged to nominate audit firms in the prospectus, but often identify that they will have audit committees so as to assist in more appropriate corporate governance. This paper analyzes if IPOs identifying the existence of audit committees in the prospectus have a lower underpricing return. While our findings are consistent with previous studies concluding that both the size of the new issue and the use of an underwriter are important ingredients in the level of underpricing return, the inclusion of an audit committee in the prospectuses has actually increased underpricing returns. The capital market may view the audit committee identification with some skepticism.

The importance of intangible assets in initial public offerings

This paper follows Beatty and Ritter (1986), who argue that lower uncertainty about the value of an initial public offering (IPO) reduces the 'need' for the underpricing of an IPo. Australian IPOs often identify the existence of intangible assets such as goodwill, licenses, brand names, trademarks, patents and capitalized research and development costs in the prospectus. This paper analyses if IPOs identifying the existence of such intangible assets in the prospectus might reduce uncertainty about their valuation and hence allow a lower underpricing return. While the reporting of intangible assets such as goodwill and license costs in the prospectus are not significant ingredients in the level of underpricing, the identification and valuation of intangible assets such as brand names, trademarks, patents and capitalized research and development costs is significant in reducing the level of underpricing return. Our findings are also consistent with previous studies concluding that both the size of the new issue and the use of an underwriter are important in the level of underpricing return.

Effects of timed voiding for the management of uninary incontinence in adults: systematic review

Aim: The aim of this paper is to present a systematic review assessing the effectiveness of timed voiding for the management of urinary incontinence in adults. Background: Despite the widespread use of systematic voiding programmes, their effectiveness is unclear, and the evidence for timed voiding has not been subject to rigorous and systematic evaluation. The impact on psychosocial factors and cost is also untested. The physiological basis for timed voiding is also poorly established. Methods: The systematic review incorporated the methodology of the Cochrane Collaboration. All randomized or quasi-randomized controlled trials that addressed timed voiding for the management of urinary incontinence in adults were searched, appraised, analysed and summarized. The date of the latest search was 2002. Data were extracted independently and appraised according to the level of concealment of random allocation prior to formal entry; few and identifiable withdrawals and dropouts and an analysis based on an intention to treat. The relative risk for dichotomous data was calculated with 95% confidence intervals. Where data were insufficient to support quantitative analysis, a narrative overview was undertaken. Results: Two trials of timed voiding met the inclusion criteria. In both, timed voiding was combined with other strategies. Participants were predominantly cognitively and physically impaired older women who resided in nursing home settings. Within-group improvements for the intervention groups were reported for both trials. One trial additionally reported a statistically significant reduction in night-time incontinence for the intervention group. The quality of the trials was modest and interpretation was limited by the potential for bias associated with inadequate concealment, missing data and no analysis by intention to treat. Conclusion: Terms used to describe voiding programmes that involve a fixed interval of voiding are variable. No conclusions can be drawn at this point about the effectiveness of timed voiding for the management of urinary incontinence in adults.

The pricing of property trust IPOs in Australia

Following Brounen and Eichholtz (2002) this paper adds to the international literature investigating the underpricing of REIT initial public offerings (IPOs), with a study into Australian property trusts. This study finds that initial day returns can in part be explained by forecast profit distributions (or dividends) and the market sentiment towards property trusts from the date of the prospectus to the date of listing. There is some support for the “winners curse” explanation of underpricing with evidence that large investor or institutional involvement at the outset of the IPO also has some explanatory power.

The costs of raising equity capital by Australian property trust initial public offerings

This paper reports some of the direct costs of raising equity capital by property trust initial public offerings (IPOs) in Australia from 1994 to 2004. It also documents the amount of underpricing by these IPOs. The results indicate the average fees paid to underwriters and/or stockbrokers in managing and marketing the issue was around 3.3% of the public equity capital raised. The average fees paid to legal firms, accounting firms and valuers for their professional involvement and expert reports were 0.4%, 0.2% and 0.1% respectively, totaling 0.7% of the equity raised. Other fees such as printing, listing fees, postage, distribution and advertising cost around 2.1%. The total average direct costs amounted to around 6.1% of the proceeds raised. The average underpricing by these property trust IPOs was 2.6%. This paper also investigates the hypotheses that the percentage direct capital raising costs are influenced by the size of the IPO and whether the IPO is underwritten. This study confirms that larger property trust equity capital raisings have lower percentage total direct cost;, however, it does not find that underwriting significantly influences the percentage of total direct costs for these property trust IPOs.

Intangible assets and the underpricing of industrial company initial public offerings

This study analyses 262 industrial company initial public offerings (IPOs) in Australia from 1994 to 1999. It finds that the identification and valuation of brand name, trademark, patent and capitalized research and development cost intangible assets in the prospectus significantly reduces underpricing. The identification of goodwill and license cost intangibles does not appear to be significant to underpricing. This paper supports the Beatty and Ritter (1986) argument that IPOs may display financial and nonfinancial characteristics that lower the uncertainty about the value of the lPO and hence lower the underpricing of that IPO. Our findings suggest implications for the issuer who wants to maximize the value of the firm at the time of the lPO, the underwriter who is required to guarantee the success of the capital raising and for the initial investors who are looking to reduce their uncertainty about the valuation of the lPO.

Conflicts of interest and china's A-Share underpricing

The extremely high A- share underpricing in China's primary market provides us with a very interesting area of empirical research. Previous studies on China's IPO underpricing have been suggestive, but in-conclusive. We investigate the A- share underpricing by employing the most recent data available. A significant decline in A- share underpricing is found in 2003 relative to previous years (and much less than that recorded in the literature to date). We examine the validity of previous A- share underpricing models, reported in the literature, and find a statistically significant structural break in the data during 2003 when these models are specified. We further explore conflicts of interest in the Chinese IPO market and specify an alternative class of models to further examine this change in observed market behaviour. Our results suggest that a contract with high underwriter's fee leads to less A- share underpricing. Our results also suggest that the asymmetric information hypothesis does not apply in the Chinese !PO market in 2003. Overpricing by the secondary market and the trading activity on the first trading day are the main functions of the A- share underpricing. This study has important implications such as guiding the Chinese government policy regarding the regulations of Initial Public Offering.

Factors influencing the direct costs of property trust IPOs

Underwriting, legal, accounting and valuation costs average around 3.3%, 0.39%, 0.23% and 0.12% of proceeds raised and are substantial costs to property trust initial public offering (IPO) issuers. As such, identifYing factors that influence these costs is important. This paper investigates factors influencing these costs as well as the total direct costs of raising equity capital by property trust IPOs in Australia from 1994 to 2004. The results suggest clear economies of scale in direct costs. In addition, IPOs that employ more debt are likely to have higher capital raising costs while those that have proportionally higher net asset values and offer stapled securities (and likely to be engaged in property development activities) have lower capital raising costs.

The costs of raising equity capital for closed-end fund IPOs

This article reports on some of the direct costs of raising equity capital by closed-end fund licensed investment company (LIC) initial public offerings (IPOs) in Australia from 1995 to 2005. The amount of underpricing by these IPOs is also identified. The average total direct costs amounted to a relatively low 3.4% of the capital raised, while fees paid to underwriters and/or stockbrokers was around 2.3%, to legal firms around 0.25% and to accounting firms around 0.07%. The average underpricing by these LIC IPOs was 1.3%. This article also confirms that the percentage total direct capital raising costs are inversely related to the size of the IPO and underwritten closed-end fund IPOs tend to have higher percentage total capital raising costs than those not underwritten.