The term “audit style” is used to characterize the unique set of internal working rules of each Big 4 audit firm for the implementation of auditing standards and the enforcement of GAAP within their clienteles. Audit style implies that two companies audited by the same Big 4 auditor, subject to the same audit style, are more likely to have comparable earnings than two firms audited by two different Big 4 firms with different styles. By comparable we mean that two firms in the same industry and year will have a more similar accruals and earnings structure. For a sample of U.S. companies for the period 1987 to 2011, we find evidence consistent with audit style increasing the comparability of reported earnings within a Big 4 auditor's clientele. Data Availability: All data are publicly available from the sources identified in the text.

We extend research on the determinants of corporate tax avoidance to include the role of Internal Revenue Service (IRS) monitoring. Our evidence from large samples implies that U.S. public firms undertake less aggressive tax positions when tax enforcement is stricter. Reflecting its first-order economic impact on firms, our coefficient estimates imply that raising the probability of an IRS audit from 19 percent (the 25th percentile in our data) to 37 percent (the 75th percentile) increases their cash effective tax rates, on average, by nearly two percentage points, which amounts to a 7 percent increase in cash effective tax rates. These results are robust to controlling for firm size and time, which determine our primary proxy for IRS enforcement, in different ways; specifying several alternative dependent and test variables; and confronting potential endogeneity with instrumental variables and panel data estimations, among other techniques.

This study investigates whether individual top executives have incremental effects on their firms’ tax avoidance that cannot be explained by characteristics of the firm. To identify executive effects on firms’ effective tax rates, we construct a data set that tracks the movement of 908 executives across firms over time. Results indicate that individual executives play a significant role in determining the level of tax avoidance that firms undertake. The economic magnitude of the executive effects on tax avoidance is large. Moving between the top and bottom quartiles of executives results in approximately an 11 percent swing in GAAP effective tax rates; thus, executive effects appear to be an important determinant in firms’ tax avoidance.

We develop and describe a new measure of long-run corporate tax avoidance that is based on the ability to pay a low amount of cash taxes per dollar of pre-tax earnings over long time periods. We label this measure the “long-run cash effective tax rate.” We use the long-run cash effective tax rate to examine (1) the extent to which some firms are able to avoid taxes over periods as long as ten years, and (2) how predictive one-year tax rates are for long-run tax avoidance. In our sample of 2,077 firms, we find there is considerable cross-sectional variation in tax avoidance. For example, approximately one-fourth of our sample firms are able to maintain long-run cash effective tax rates below 20 percent, compared to a sample mean tax rate of approximately 30 percent. We also find that annual cash effective tax rates are not very good predictors of long-run cash effective tax rates and, thus, are not accurate proxies for long-run tax avoidance. While there is some evidence of persistence in annual cash effective tax rates, the persistence is asymmetric. Low annual cash effective tax rates are more persistent than are high annual cash effective tax rates. An initial examination of characteristics of firms successful at keeping their cash effective tax rates low over long periods shows that they are well spread across industries but with some clustering.

The Securities and Exchange Commission now requires auditors to review interim earnings reports on a timely basis. Previously, auditors could perform this review retrospectively, as part of the year-end audit. We investigate whether timely reviews are likely to increase the relevance and reliability of reported earnings, as reflected by the extent to which the earnings-return relation is contemporaneous. We find that when the auditor reviews interim earnings on a timely basis, the association between quarterly returns and earnings (and between quarterly returns and unexpected earnings) is predominantly contemporaneous. When the auditor reviews interim earnings retrospectively, however, the association between quarterly returns and earnings is not entirely contemporaneous; with retrospective reviews, returns lead interim earnings. We conclude from these findings that timely reviews increase the likelihood that accounting earnings reflect economic events contemporaneously with returns.

The article presents a report on teaching methods and programmed instructions in the U.S. During the past few years, in the process of continuing search to discover means for increasing instructional efficiency and for developing new materials to cope with the rapidly expanding demands for additional education and training by a burgeoning number of learners, the experimentation and development of programed learning has received the attention of educators and training directors across the country. Programed instruction has found wide-spread usage in industry and in the armed forces in various aspects of training for specific assignments or tasks, in which predetermined performance levels or behavioral patterns had been established. In numerous situations in both education and industry, programed instruction has proved to be effective, and under some circumstances more so than conventional methods. However, at this time research findings, especially at the college level, are totally inadequate to serve as a basis for making decisions on the adoption of programed learning for use throughout any specific course or program.

The path leading to a degree with a major in accounting is a rugged one at best. Obstacles are to be encountered at every turn. Many an eager student has dashed confidently down this path only abruptly to encounter a sizeable obstacle known as partnership dissolution resulting from the admission of a new partner. Managerial Accounting as a course of study represents a recent addition to the accounting curriculum of many schools of higher education. The addition of this course reflects the current demand for an approach to accounting that emphasizes the utilization of accounting data for management planning and control. At the present time many accounting departments are in the process of reevaluating their entire accounting curriculum to determine to what extent present offerings may continue to serve their traditional purpose as well as fulfill the need for an approach which takes into greater consideration the managerial aspect. The non-accounting major terminates his study of accounting with the Managerial Accounting course. The accounting major, almost without exception, takes the same Managerial Accounting course as the non-major which means that he takes the course between Introductory Accounting and Intermediate Accounting.

This article presents a report of the Task Committee, American Accounting Association on the standards of accounting instruction. From its inception, the American Accounting Association has been concerned with accounting education. This interest has been manifested in various projects and special committee activities undertaken by the Association, alone and jointly with other groups. One of the Association's special task committee in the area of education is the Committee on Standards of Accounting Instruction. It operates in cooperation with, and as a task force of, the Joint Committee on Education. The first project of the Committee on Standards of Accounting Instruction was a questionnaire study of the undergraduate courses taken by accounting majors. The questionnaire was carefully prepared and tested before being released. It was sent to most of the colleges and universities in the U.S. , which offered a major or concentration in accounting in an undergraduate program. The study indicated that the largest school in the sample graduated 837 students in 1954 with bachelor degrees in business. It was notable that 1954 saw less than half as many accounting majors graduating as in 1950. The decline in degrees in business was considerably sharper than for all bachelor degrees. The Committee felt that course work in cost accounting is properly required by nearly all schools

This article comments on inventory pricing and changes in price levels. Ideally, the measurement of accounting profit involves the matching precisely of the identified costs of specific units of product with the sales revenues derived there from. Secondly, where conditions are such that precise matching of identified costs with revenues is impracticable, identified cost matching may be simulated by the adoption of an assumed flow of costs. Also, a flow assumption can be realistic, in that it reflects the dominant characteristics of the actual flow of goods; thus it may reflect an actual dominance of first-in, first-out, average, or last-in, first-out movement. A flow assumption can be artificial, on the other hand, in that it premises a flow of costs that is clearly in contrast with actual physical movement. However, the periodic income of a business enterprise is computed by deducting from the revenues of the period the costs which are properly associated with those revenues. In the case of certain costs, for example sales commissions, the relationship to the revenues of a period is quite direct and the matching process is accomplished with a minimum of uncertainty.

This article discusses the information on the paragraph no. 5. The Paragraph No. 5 under "Expense" in the 1948 Revision of Accounting Concepts and Standards Underlying Corporate Financial Statements of the U.S. reads that An assignment of all or a portion of the cost of an asset to expense, made in good faith after considered judgment and after competent review, in accordance with the accounting concepts and standards of the time, is not subject to reversal in a later period. Errors of a mechanical and non-judgment nature should be corrected in the period of their discovery. The Committee on Concepts and Standards is in agreement with the apparent basic purpose of this statement to reduce the possibility of manipulation of the net income calculation through reversals, revisions and reaccounting of past depredation charges and other amortizations. At the same time it recognizes that a position unalterably opposed to the correction of errors of judgment is both arbitrary and difficult to defend.