One of the most important issue relating to corporate governance reports\ud
refers to their ability to provide users with a complete set of information regarding the\ud
effective ability of an entity to achieve oversight objectives by the compliance to corporate\ud
governance practices required by a specific law or industry code. In addition, other\ud
features, such as the quality of the internal auditing function or the sensitivity of top\ud
management to issues relating to corporate internal controls and risk management, can\ud
also be taken into account when formulating a judgment on the quality of corporate\ud
governance practices. Is there an association between the compliance to codes and\ud
internal controls effectiveness?Wepropose to assess the quality of corporate governance\ud
through a proxy that considers several characteristics of internal audit departments and\ud
combines them to determine an Internal Audit Departments global quality index—IAD\ud
Index. To define IAD global quality we consider the effectiveness of an internal audit\ud
function analysing its operational aspects. The IAD Index is based on several signalling\ud
elements that previous literature assumed as proxies for quality of IADs which are\ud
grouped into four pillars: a formal quality index; a static quality index; an activity-related\ud
quality index; and a performance-linked quality index.We then test the IAD index on a\ud
sample of Italian listed firms and conclude that there are significant associations (positive\ud
and negative) between the degree of compliance to some corporate governance regulations\ud
for listed firms and the IAD Index for the sample being considered
The purpose of the present work was to gauge the extent of the impact on earnings management derived from the adoption of International Financial Reporting Standards (IFRS) 15 as well as detecting whether the impact will be similar in different industries. To provide empirical evidence that earnings management is more frequent in some industries and less frequent in others by means of a statistical analysis, a sample of Italian listed companies in the period 2001-2017 was observed. Specifically, companies belonging to two sectors were selected: "Telecommunications" and "Utilities". The Jones Model was applied. The statistical analysis brought to light that earnings management practices are "commonly adopted" in the "Telecommunications" industry, which is consequently highly impacted by the introduction of IFRS 15. That being said, the lesson learned from this study is that the implementation of the new principle, written to discipline the accountancy of revenues, and its consequences, must be carefully analyzed and monitored by the regulators, as well as correctly adopted by managers, as the determined revenues could have an impact on the pre-existing earning management practices. The scientific contribution of the present research also concerns the predictions on the behavior of managers that can be foreseen considering the agency theory; therefore, knowing ex-ante in which industries earnings management has a high impact, provides the option to foresee the hypothetical moves of the managers in the implementation of IFRS 15.
Clubs where a different business model is performingDesign/methodology/approach -The paper first identifies the potential drivers of profitability of Professional Football Clubs (PFCs) in the "Serie A" in terms of financial related variables. Secondly, the paper tests the associationvia the application of an OLS multivariate modelof these factors with the actual profitability of clubs over a seven-year period, from 2006 to 2012.Findings -The paper shows that the business model that best explains the profitability of PFCs is one where: (i) the core activity is not merely the provision of entertainment; and (ii) as a consequence, they pursue objectives of profit maximization.Research limitations/implications -The main limitation of this study is due to the focus on the Italian domestic professional football market. Further research may provide evidence of the validity of our conclusions to a wider set of clubs at an international level.Practical implications -The business model of Italian PFCs, as resulting from our findings, may drive a revision of the annual reports of these entities to better reflect their economic and financial position.Originality/value -The paper tries overcoming the 'dogma' of PFCs being looked at as mere entertainment producers by showing that they perform other (more profitable) operating activities which characterize a different business model.
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