Postauditing capital expenditures and firm performance: the role of asymmetric information

Article Abstract:

The relationship between firm performance and the level of sophistication of its control or postauditing system is examined. The results indicate that the effect of a firm's capital investment postauditing procedures on its performance depends on the following factors: capital intensity and expenditures, insider ownership and asymmetric information. The level of capital expenditures is operationalized by using a three-year average of expenditures, while capital per unit labor is used to measure capital intensity. Insider ownership is the extent of outstanding share ownership by officers and directors, while asymmetric information denotes the situation wherein either the agent or principal has information the other does not. Effective matching between the above variables with the appropriate complexity of postauditing procedures is the key to better firm performance.

Methods, Management, Internal auditing, Managerial accounting

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Information overload: a temporal approach

Article Abstract:

Information overload occurs within organizations when individuals receive more demand for information processing than time available for that processing. The reasons information overload has concerned accountants include that it reduces their decision-making effectiveness and that of other management, and affects the application of financial accounting standards. The steps organizations can take to avoid or reduce the effects of information overload include decreasing information processing related to interaction and internal calculation time, reducing the number of tasks to be performed, and increasing the availability of time for interactions and internal calculations.

Accounting, Business communication, Human information processing

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Benefit-cost analysis and resource allocation decisions

Article Abstract:

The effects of the Office of Management and Budget's requirements that federal government managers use benefit-cost analysis techniques for evaluating and preparing requests for major capital expenditures are examined. The results indicate that the use of benefit-cost analysis techniques have differing effects on the allocation of resources at different levels of the government.

Laws, regulations and rules, National government, Federal government, Cost (Economics), Costs (Economics), United States. Office of Management and Budget

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