Taxation of multinational banks : using formulary apportionment to reflect economic reality (Part 1)

Formulary apportionment does not attempt to undertake a transactional division of a highly integrated multinational entity. Rather, it allocates income to the jurisdictions based on an economically justifiable formula. Opposition to formulary apportionment is generally based on the argument that it is not a theoretically superior (or optimal) model because of the implementation difficulties. The conclusion that the unitary taxation model may be theoretically superior to the current arm's-length model that applies to multinational banks, despite significant implementation, compliance, and enforcement issues, is based on the unitary taxation model providing greater alignment with the unique features of these banks. The formulary apportionment model looks to the economic substance of the multinational entity and, in this sense, adopts a substance-over- form approach. Formulary apportionment further recognizes the impossibility of using arm's-length pricing for economically interdependent multinational entities. A final advantage to formulary apportionment, which is also a consequence of this model achieving greater inter-nation equity, is the elimination of double taxation.

Assessing financial reporting comparability across institutional settings : the case of pension accounting

The drive for comparability of financial information is to enable users to distinguish similarities and differences in economic activities for an entity over time and between entities so that their resource allocation decisions are facilitated. With the increased globalisation of economic activities, the enhanced international comparability of financial statements is often used as an argument to advance the convergence of local accounting standards to international financial reporting standards (IFRS). Differences in the underlying economic substance of transactions between jurisdictions plus accounting standards allowing alternative treatments may render this expectation of increased comparability unrealistic. Motivated by observations that, as a construct, comparability is under-researched and not well understood, we develop a comparability framework that distinguishes between four types of comparability. In applying this comparability framework to pension accounting in the Australian and USA contexts, we highlight a dilemma: while regulators seek to increase the likelihood that similar events are accounted for similarly, an unintended consequence may be that preparers are forced to apply similar accounting treatment to events that are, in substance, different.

La cláusula general antiabuso tributario en Colombia

En la Ley 1607 de 2012 se introdujo a nuestra legislación una cláusula general antiabuso en materia tributaria. Este trabajo busca analizar y determinar su aplicabilidad práctica, considerando sus elementos descriptivos y las circunstancias de realización de conductas abusivas, que concluyen en la elusión o reducción de un tributo.

O impacto das diferenças culturais nas fusões e aquisições

A cultura é um conceito amplo e que traz consigo contextos históricos, valores e percepções partilhadas que, no âmbito social, influenciam as interações coletivas e institucionais. Desta forma, operações de fusão e aquisição, por mais que tenham particularmente uma essência econômica em sua origem, são diretamente impactadas por questões culturais, tendo em vista que estas são realizadas por pessoas, que aprendem a interagir e se expressar através de suas culturas. Este trabalho se propõe a fazer um levantamento teórico de como os autores entendem a influência da cultura nas operações de fusões e aquisições, de acordo com as bases teóricas da psicologia, antropologia e sociologia, propiciando ou limitando o alcance dos resultados desejados. Para compreender o cenário em que o conceito de cultura é investigado, também fizemos um levantamento das principais diferenças culturais levantadas em operações de fusão e aquisição, e que foram analisadas à luz dos conceitos de cultura abordados neste trabalho. Constatamos que, por não haver uma preocupação em se definir corretamente o objeto de pesquisa de cultura, os resultados acerca desta influência permanecem confusos e contraditórios. Com isso, torna-se difícil endereçar corretamente as perspectivas de ação no campo individual e coletivo.

The quality of financial information in the extractive industries: a value relevance analysis

The extractive industry is characterized by high levels of risk and uncertainty. These attributes create challenges when applying traditional accounting concepts (such as the revenue recognition and matching concepts) to the preparation of financial statements in the industry. The International Accounting Standards Board (2010) states that the objective of general purpose financial statements is to provide useful financial information to assist the capital allocation decisions of existing and potential providers of capital. The usefulness of information is defined as being relevant and faithfully represented so as to best aid in the investment decisions of capital providers. Value relevance research utilizes adaptations of the Ohlson (1995) to assess the attribute of value relevance which is one part of the attributes resulting in useful information. This study firstly examines the value relevance of the financial information disclosed in the financial reports of extractive firms. The findings reveal that the value relevance of information disclosed in the financial reports depends on the circumstances of the firm including sector, size and profitability. Traditional accounting concepts such as the matching concept can be ineffective when applied to small firms who are primarily engaged in nonproduction activities that involve significant levels of uncertainty such as exploration activities or the development of sites. Standard setting bodies such as the International Accounting Standards Board and the Financial Accounting Standards Board have addressed the financial reporting challenges in the extractive industry by allowing a significant amount of accounting flexibility in industryspecific accounting standards, particularly in relation to the accounting treatment of exploration and evaluation expenditure. Therefore, secondly this study examines whether the choice of exploration accounting policy has an effect on the value relevance of information disclosed in the financial reports. The findings show that, in general, the Successful Efforts method produces value relevant information in the financial reports of profitable extractive firms. However, specifically in the oil & gas sector, the Full Cost method produces value relevant asset disclosures if the firm is lossmaking. This indicates that investors in production and non-production orientated firms have different information needs and these needs cannot be simultaneously fulfilled by a single accounting policy. In the mining sector, a preference by large profitable mining companies towards a more conservative policy than either the Full Cost or Successful Efforts methods does not result in more value relevant information being disclosed in the financial reports. This finding supports the fact that the qualitative characteristic of prudence is a form of bias which has a downward effect on asset values. The third aspect of this study is an examination of the effect of corporate governance on the value relevance of disclosures made in the financial reports of extractive firms. The findings show that the key factor influencing the value relevance of financial information is the ability of the directors to select accounting policies which reflect the economic substance of the particular circumstances facing the firms in an effective way. Corporate governance is found to have an effect on value relevance, particularly in the oil & gas sector. However, there is no significant difference between the exploration accounting policy choices made by directors of firms with good systems of corporate governance and those with weak systems of corporate governance.

NORDEK : A Plan for Increased Nordic Economic Co-operation and Integration 1968-1970

For the first time the attempt of Denmark, Finland, Norway and Sweden to increase Nordic economic co-operation and integration (NORDEK 1968-1970) is analysed by using records from the four governments archives and interviews with central actors participating. A dominating argument has until now been that dynamics in Nordic economic integration is different from dynamics in European integration. This archive based study disproves the myth however of ideological Nordism and of short term political developments outside Norden as most important for the NORDEK initiative. The NORDEK initiative was actually more a consequence of a long term socioeconomic and socio-political path dependant process. The study also disproves the myth that the NORDEK plan was a political and ideological symbol without socioeconomic substance. The purpose with NORDEK was to create a better basis for generating economic growth and social welfare. The proposed NORDEK institutions were therefore developed to promote economic progress. The study finally shows that the NORDEK failure in 1970 was not a result of lacking economic rationale or incompatible economic interests. The failure was a result of a power struggle in Finnish domestic policy and lacking political will in the other Nordic countries to continue without Finland.

Excessive alcohol consumption in young men: is there an association with their earlier family situation? A baseline-analysis of the C-SURF-study (Cohort Study on Substance Use Risk Factors).

AIMS: To determine whether parental factors earlier in life (parenting, single parent family, parental substance use problem) are associated with patterns of alcohol consumption among young men in Switzerland. METHODS: This analysis of a population based sample from the Cohort Study on Substance Use Risk Factors (C-SURF) included 5,990 young men (mean age 19.51 years), all attending a mandatory recruitment process for the army. These conscripts reported on parental monitoring and rule-setting, parental behaviour and family structure. The alcohol use pattern was assessed through abstention, risky single occasion drinking (RSOD), volume drinking and dependence. Furthermore, the impact of age, family socio-economic status, educational level of the parents, language region and civil status was analysed. RESULTS: A parental substance use problem was positively associated with volume drinking and alcohol dependence in young Swiss men. Active parenting corresponded negatively with RSOD, volume drinking and alcohol dependence. Single parent family was not associated with a different alcohol consumption pattern compared to standard family. CONCLUSION: Parental influences earlier in life such as active parenting (monitoring, rule-setting and knowing the whereabouts) and perceived parental substance use problem are associated with alcohol drinking behaviour in young male adults. Therefore, health professionals should stress the importance of active parenting and parental substance use prevention in alcohol prevention strategies.

A preliminary physicochemical, exergetic and economic study of hydrogen production utilizing glycerol

This work has as objective to demonstrate technical and economic viability of hydrogen production utilizing glycerol. The volume of this substance, which was initially produced by synthetic ways (from oil-derived products), has increased dramatically due mainly to biodiesel production through transesterification process which has glycerol as main residue. The surplus amount of glycerol has been generally utilized to feed poultry or as fuel in boilers, beyond other applications such as production of soaps, chemical products for food industry, explosives, and others. The difficulty to allocate this additional amount of glycerol has become it in an enormous environment problem, in contrary to the objective of biodiesel chain, which is to diminish environmental impact substituting oil and its derivatives, which release more emissions than biofuels, do not contribute to CO2-cycle and are not renewable sources. Beyond to utilize glycerol in combustion processes, this material could be utilized for hydrogen production. However, a small quantity of works (theoretical and experimental) and reports concerning this theme could be encountered. Firstly, the produced glycerol must be purified since non-reacted amounts of materials, inclusively catalysts, contribute to deactivate catalysts utilized in hydrogen production processes. The volume of non-reacted reactants and non-utilized catalysts during transesterification process could be reutilized. Various technologies of thermochemical generation of hydrogen that utilizes glycerol (and other fuels) were evaluated and the greatest performances and their conditions are encountered as soon as the most efficient technology of hydrogen production. Firstly, a physicochemical analysis must be performed. This step has as objective to evaluate the necessary amount of reactants to produce a determined volume of hydrogen and determine thermodynamic conditions (such as temperature and pressure) where the major performances of hydrogen production could be encountered. The calculations are based on the process where advance degrees are found and hence, fractions of products (especially hydrogen, however, CO2, CO, CH4 and solid carbon could be also encountered) are calculated. To produce 1 Nm3/h of gaseous hydrogen (necessary for a PEMFC - Proton Exchange Membrane Fuel Cell - containing an electric efficiency of about 40%, to generate 1 kWh), 0,558 kg/h of glycerol is necessary in global steam reforming, 0,978 kg/h of glycerol in partial oxidation and cracking processes, and 0,782 kg/h of glycerol in autothermal reforming process. The dry reforming process could not be performed to produce hydrogen utilizing glycerol, in contrary to the utilization of methane, ethanol, and other hydrocarbons. In this study, steam reforming process was preferred due mainly to higher efficiencies of production and the need of minor amount of glycerol as cited above. In the global steam reforming of glycerine, for one mole of glycerol, three moles of water are necessary to produce three moles of CO2 and seven moles of H2. The response reactions process was utilized to predict steam reforming process more accurately. In this mean, the production of solid carbon, CO, and CH4, beyond CO2 and hydrogen was predicted. However, traces of acetaldehyde (C2H2), ethylene (C2H4), ethylene glycol, acetone, and others were encountered in some experimental studies. The rates of determined products obviously depend on the adopted catalysts (and its physical and chemical properties) and thermodynamic conditions of hydrogen production. Eight reactions of steam reforming and cracking were predicted considering only the determined products. In the case of steam reforming at 600°C, the advance degree of this reactor could attain its maximum value, i.e., overall volume of reactants could be obtained whether this reaction is maintained at 1 atm. As soon as temperature of this reaction increases the advance degree also increase, in contrary to the pressure, where advance degree decrease as soon as pressure increase. The fact of temperature of reforming is relatively small, lower costs of installation could be attained, especially cheaper thermocouples and smaller amount of thermo insulators and materials for its assembling. Utilizing the response reactions process in steam reforming, the predicted volumes of products, for the production of 1 Nm3/h of H2 and thermodynamic conditions as cited previously, were 0,264 kg/h of CO (13% of molar fraction of reaction products), 0,038 kg/h of CH4 (3% of molar fraction), 0,028 kg/h of C (3% of molar fraction), and 0,623 kg/h of CO2 (20% of molar fraction). Through process of water-gas shift reactions (WGSR) an additional amount of hydrogen could be produced utilizing mainly the volumes of produced CO and CH4. The overall results (steam reforming plus WGSR) could be similar to global steam reforming. An attention must to be taking into account due to the possibility to produce an additional amount of CH4 (through methanation process) and solid carbon (through Boudouard process). The production of solid carbon must to be avoided because this reactant diminishes (filling the pores) and even deactivate active area of catalysts. To avoid solid carbon production, an additional amount of water is suggested. This method could be also utilized to diminish the volume of CO (through WGSR process) since this product is prejudicial for the activity of low temperature fuel cells (such as PEMFC). In some works, more three or even six moles of water are suggested. A net energy balance of studied hydrogen production processes (at 1 atm only) was developed. In this balance, low heat value of reactant and products and utilized energy for the process (heat supply) were cited. In the case of steam reforming utilizing response reactions, global steam reforming, and cracking processes, the maximum net energy was detected at 700°C. Partial oxidation and autothermal reforming obtained negative net energy in all cited temperatures despite to be exothermic reactions. For global steam reforming, the major value was 114 kJ/h. In the case of steam reforming, the highest value of net energy was detected in this temperature (-170 kJ/h). The major values were detected in the cracking process (up to 2586 kJ/h). The exergetic analysis has as objective, associated with physicochemical analysis, to determine conditions where reactions could be performed at higher efficiencies with lower losses. This study was performed through calculations of exergetic and rational efficiencies, and irreversibilities. In this analysis, as in the previously performed physicochemical analysis, conditions such as temperature of 600°C and pressure of 1 atm for global steam reforming process were suggested due to lower irreversibility and higher efficiencies. Subsequently, higher irreversibilities and lower efficiencies were detected in autothermal reforming, partial oxidation and cracking process. Comparing global reaction of steam reforming with more-accurate steam reforming, it was verified that efficiencies were diminished and irreversibilities were increased. These results could be altered with introduction of WGSR process. An economic analysis could be performed to evaluate the cost of generated hydrogen and determine means to diminish the costs. This analysis suggests an annual period of operation between 5000-7000 hours, interest rates of up to 20% per annum (considering Brazilian conditions), and pay-back of up to 20 years. Another considerations must to be take into account such as tariffs of utilized glycerol and electricity (to be utilized as heat source and (or) for own process as pumps, lamps, valves, and other devices), installation (estimated as US$ 15.000 for a plant of 1 Nm3/h) and maintenance cost. The adoption of emission trading schemes such as carbon credits could be performed since this is a process with potential of mitigates environment impact. Not considering credit carbons, the minor cost of calculated H2 was 0,16288 US$/kWh if glycerol is also utilized as heat sources and 0,17677 US$/kWh if electricity is utilized as heat sources. The range of considered tariff of glycerol was 0-0,1 US$/kWh (taking as basis LHV of H2) and the tariff of electricity is US$ 0,0867 US$/kWh, with demand cost of 12,49 US$/kW. The costs of electricity were obtained by Companhia Bandeirante, localized in São Paulo State. The differences among costs of hydrogen production utilizing glycerol and electricity as heat source was in a range between 0,3-5,8%. This technology in this moment is not mature. However, it allows the employment generation with the additional utilization of glycerol, especially with plants associated with biodiesel plants. The produced hydrogen and electricity could be utilized in own process, increasing its final performance.

Bioactive substance contents and antioxidant capacity of the lipid fraction of Annona crassiflora Mart. seeds

Annona crassiflora Mart. is a typical fruit of the Brazilian cerrado, considered to be a species of economic interest, mainly for its use in cooking, which is widespread among the inhabitants of that region, and can be found in many typical local dishes, especially sweets, jellies, liqueurs, soft drinks, ice creams and juices. Thus, the objective of this study was to determine the bioactive substance contents and the antioxidant capacity of the lipid fraction of A. crassiflora Mart. seeds in the interest of better identifying the quality of this raw material from the Brazilian cerrado. After the receipt of the fruits, the seeds were removed manually and, then, the lipid fraction was obtained by cold extraction with chloroform:methanol:water (2:1:0.8, v/v/v) and analyzed for the composition of phytosterols, tocopherols, fatty acids, total carotenoids, antioxidant activity and oxidative stability index. The lipid fraction showed significant quantity of bioactive substances, especially phytosterols, tocopherols and unsaturated fatty acids, as well as significant antioxidant capacity and oxidative stability, influenced by the content of phytosterols and the composition of fatty acids present in the analyzed fraction. © 2012 Elsevier B.V.

Do Exposure Suits Produce a 'Race to File'? An Economic Analysis of a Tort for Risk

Conventional tort law does not allow victims of exposure to a toxic substance to seek compensation until they develop actual symptoms of illness. This may effectively bar recovery because at the time the illness arises, injurers may be judgment proof. One possible response is to allow a tort for risk that allows victims to seek expected damages at the time of exposure. However, critics charge that this could create a 'race to file' wherein victims rush to file suit to ensure that they will get a share of the injurer's limited assets. We show that such a race may or may not occur in equilibrium, and that when it does occur, not all victims choose to file at exposure if bankruptcy is an inevitable result. If bankruptcy is not inevitable, it is possible that a tort for risk will trigger bankruptcy, although a no-bankruptcy equilibrium always exists and Paretodominates the bankruptcy equilibrium. We examine the consequences of the various tort-for-risk equilibria on the compensation of exposure victims, litigation costs, and injurer care.

Electronic health records: essential tools in integrating substance abuse treatment with primary care.

While substance use problems are considered to be common in medical settings, they are not systematically assessed and diagnosed for treatment management. Research data suggest that the majority of individuals with a substance use disorder either do not use treatment or delay treatment-seeking for over a decade. The separation of substance abuse services from mainstream medical care and a lack of preventive services for substance abuse in primary care can contribute to under-detection of substance use problems. When fully enacted in 2014, the Patient Protection and Affordable Care Act 2010 will address these barriers by supporting preventive services for substance abuse (screening, counseling) and integration of substance abuse care with primary care. One key factor that can help to achieve this goal is to incorporate the standardized screeners or common data elements for substance use and related disorders into the electronic health records (EHR) system in the health care setting. Incentives for care providers to adopt an EHR system for meaningful use are part of the Health Information Technology for Economic and Clinical Health Act 2009. This commentary focuses on recent evidence about routine screening and intervention for alcohol/drug use and related disorders in primary care. Federal efforts in developing common data elements for use as screeners for substance use and related disorders are described. A pressing need for empirical data on screening, brief intervention, and referral to treatment (SBIRT) for drug-related disorders to inform SBIRT and related EHR efforts is highlighted.