Using "statement of intermediate balances" as tool for international financial statement analysis in airline industry

H. STOLOWY, Y. DING, C. Richard Baker

Advances in International Accounting

2005, vol. 18, pp.169-198

Départements : Comptabilité et Contrôle de Gestion, GREGHEC (CNRS)

Since September 11, 2001 and during the ensuing economic slowdown, a number of airline companies have experienced significant financial difficulties, including bankruptcies and near bankruptcies. In an economic setting where many airlines are struggling to achieve or maintain profitability, it is important for accountants, auditors, and financial analysts to be able to analyze the relative performance of such companies. In this industry, income statements are normally prepared “by nature” rather than “by function.” This differs from the usual presentation found in the income statements of many companies around the world, in particular most American companies. This paper demonstrates how to perform a comparative financial statement analysis when an income statement is prepared “by nature,” through application of a tool called the “Statement of Intermediate Balances.” This tool is illustrated using three companies chosen from different continents: Southwest Airlines, a low cost U.S. air carrier, Air France, the leader in Europe, and China Eastern Airlines, one of the biggest Chinese air carriers

Using Capital Markets as Market Intelligence: Evidence From the Pharmaceutical Industry

D. G. MARKOVITCH, B. Yeung, J. Steckel

Management Science

octobre 2005, vol. 51, n°10

Départements : Marketing

Financial theory posits that capital markets convey through stock prices their expectation of the firm's future performance. We use concepts from Principal-Agent Theory and Prospect Theory to provide a theoretical explanation for the role stock price variation plays in managerial decision-making. We then empirically investigate what specific decisions managers undertake in response to stock price variation. We perform our empirical analyses in the context of the pharmaceutical industry. We find that drug firms whose stock under-performed the industry react differently than drug firms with high performing stocks. Specifically, laggards tend to implement more changes to their current product portfolio and distribution than high performing firms. And, the more laggards under-perform, the more they implement acquisitions aimed to produce immediate improvement in the firm's product portfolio. In contrast, drug firms whose stocks out-perform the industry tend to make fewer changes to their current portfolio and distribution. Instead, they focus more on long-term R&D and marketing of existing products. We interpret these findings in light of industry key success factorsmarketing-finance interfaces; marketing strategy; stock returns; feedback efforts STOCK-MARKET; QUALITY; FIRM

Voting in Assemblies of shareholders and Incomplete Markets

M. Tvede, H. CRES

Economic Theory

novembre 2005, vol. 6, n°4, pp.887-907

Départements : Finance

An economy with two dates is considered, one state at the first date and a number of states at the last date. Shareholders determine production plans by voting one share, one vote and at majority stable stock market equilibria, alternative production plans are supported by at most 100% of the shareholders. It is shown that a majority stable stock market equilibrium exists if S J S J +1,where S is the number of states at the last date and J is the number of rms. Moreover, an example shows that majority stable stock market equilibria need not exist for smaller'sStockholders, Studies, Securities markets, Equilibrium, Economic models, Voting

Vulnerable Women on Screen and at Home: Soap Opera Consumption

C. A. RUSSELL, B. Stern

Journal of Macromarketing

décembre 2005, vol. 25, n°2

Départements : Marketing

Daytime television soap operas primarily appeal to women, providing emotional release, personal gratification, companionship, and an escape from reality. This article reviews the extant literature on soap opera consumption to reveal a vulnerability system in which industry profits flow from a genre that specializes in conveying images of vulnerable women living in luxury to downscale viewers living in constrained circumstances and repeatedly exposed to unrealistic and inappropriate role models. The soap industry has recently acknowledged its audience's vulnerability and has attempted to bring together producers, writers, and network executives to encourage awareness of the industry's role in shaping consumers' attitudes and behaviortelevisionvulnerabilityproduct placementwomensoap opera

When is an invention really radical? Defining and measuring technological radicalness

K. B. DAHLIN, D. Behrens

Research Policy

2005, vol. 34, pp.717-737

Départements : Stratégie et Politique d’Entreprise

Why Do National GAAP Differ from IAS ? The Role of Culture


International Journal of Accounting

2005, vol. 40, n°4, pp.325-350

Départements : Comptabilité et Contrôle de Gestion, GREGHEC (CNRS)

Mots clés : International accounting harmonization, Culture, Hofstede, Schwartz

In this paper, we investigate the role of culture to explain differences between national GAAP and international accounting standards (IAS). National GAAP can differ from IAS in two ways: (1) divergence: both national GAAP and IAS cover a specific accounting topic but prescribe different methods; or (2) absence: national GAAP do not cover an accounting issue regulated by IAS. On the basis of Nobes' (2001) data, we construct a measure for the level of divergence of national GAAP benchmarked on IAS. We also create a measure (labeled absence) to assess the scope of national accounting rules compared to IAS. After controlling for institutional differences, we show that culture matters more to explain divergences with IAS in common law countries than in code law countries. This result is robust to alternative proxies for culture. Our sample is made up of 52 countries. These results contribute to the ongoing debate on accounting harmonization. More specifically, our findings suggest that the technical and/or political dimensions of the debate, although essential, are not the only ones involved. Opposition to IAS is not exclusively driven by contractual motives or a claimed technical superiority but also by diversity in cultural factors. Another contribution of this paper is the development of a two-dimension score to measure the differences between national GAAP and IASKey words: culture, international accounting, IAS

Word-of-Mouth in Virtual Communities: A Netnographic Analysis


Advances in Consumer Research

2005, vol. 33, pp.573-575

Départements : Marketing, GREGHEC (CNRS)

Virtual consumption communities provide consumers worldwide with the ability to share their knowledge, experiences and opinions. Marketers are challenged to cater to this development of increasing consumer interaction, which generates substantial WOM. This study examines online forum discussions by means of a netnographic analysis. The main goal is to analyze how the discussants communicate with and influence each other. The second goal is to gain insight in their discourse with respect to the community's focal consumption activity. The overall objective is to present an illustration of discussion practices and WOM processes within virtual communities of consumption