The growing reliance on non-governmental independent regulators in many social and economic domains, including corporate financial reporting, has brought to the fore concerns over their regulatory accountability. This study looks at one aspect of the regulatory due process-regulatory impact assessment (IA). Drawing on the analytical framework developed by Bovens (Public accountability: a framework for the analysis and assessment of accountability arrangements in the public domain. CONNEX papers, Research Group 2, Democracy and Accountability in the EU, 2006, Eur Law J 13(4): (...) 447–468, 2007), we evaluate the contribution of IA as an instrument for enhancing regulatory accountability in the context of the Financial Reporting Council, an independent regulator for the accountancy profession in the UK. The study’s findings suggest that, despite an increasing level of sophistication in the manner in which IA is used within FRC, the contribution of IA to regulatory accountability remains limited. Specifically, there are concerns as to whether IA is used to achieve a transparent and fair regulatory process or simply to maintain an image of good governance and justify policy decisions that would have been made even in the absence of IA. (shrink)

This article provides an analysis of the ethical behavior of managers making goodwill impairment decisions following the adoption of the International Financial Reporting Standard 3 on Business Combinations. Replacing the systematic amortization of goodwill with the impairment-only approach has been a highly controversial step. Although the aim of IFRS 3 was to provide users with more value-relevant information regarding the underlying economics of the business, it has been criticized for the potential earnings management inherent in impairment testing. This study is (...) based on a sample of Spanish-listed companies between 2005 and 2011, a period that embraces the economic crisis. After controlling for the underlying economic factors of the firms, the results suggest that managers are exercising discretion in the reporting of goodwill impairment losses, and big bath and smoothing strategies are influencing the decisions, whether or not to impair goodwill and about the magnitude of the impairment. Firm size is an attribute that appears significant in the analysis, suggesting that the cost and complexity of running the impairment test affect managers’ decisions. Additional analyses suggest that the macroeconomic environment influences opportunistic and unethical behaviors. (shrink)

Microfinance aims to better the livelihoods of the bottom of the pyramid by providing them with financial services. However, recent studies show that microfinance can have adverse effects, leading clients into over-indebtedness. This dissertation argues that microfinance clients are by default vulnerable and offers ways to rethink microfinance as client-centered, presuming a responsibility for client protection. Part I discusses the vulnerability of clients and the centrality of their protection. Part II analyzes the causes and consequences of overindebtedness and suggests state (...) regulations, financial literacy programs, and soft law standards for its mitigation. Part III introduces the concept of responsible microfinance, which claims that not only microfinance institutions but also other stakeholders, such as states and transnational and international organizations, have a responsibility to protect microfinance clients. Part IV accepts that over-indebtedness has to be addressed from several angles and considers how public and private actors may enhance its alleviation and develops an encompassing multi-stakeholder framework of responsible microfinance. Developing this framework includes a thorough evaluation of the suitability of ten novel strategies, such as behaviorally informed consumer protection regulations, educational soap operas, and Smart Campaign’s Client Protection Principles, to further the mitigation of overindebtedness. (shrink)