The paper examines the need for introduction of the materiality limits for actuarial calculations; it discusses the different needs for reports users. Author in details outlines the issues linked with the services of the independent actuary for derivatives users of the actuarial calculation

This paper examines the association between audit-firm characteristics and audit-related litigation risk. Previous litigation risk studies have been limited to examining audit-client characteristics, as audit-firm data has generally been unavailable, or available only for a very small set of...

The purpose of this paper is to provide a descriptive analysis of companies' previously uncorrected financial statement misstatements using disclosures recently mandated by Staff Accounting Bulletin No. 108 (SAB 108). We analyze 355 companies that disclose and correct 792 misstatements in their...

Positioned in a lively current debate concerning how to design auditor incentives to optimize financial statement auditing, this Article presents the more ambitious financial statement insurance alternative. This breaks from the existing securities regulation framework to draw directly on...

We investigate the effect of line-of-business diversification on asset risk-taking in the U.S. property-liability industry. The coordinated risk management hypothesis (Schrand and Unal, 1998) implies a negative relation between underwriting risk and investment risk. Consistent with this...

The largest corporate bankruptcy filed in the U.S., that of Enron in 2001, was preceded by a string of disclosures about errors in and corrections to their financial statements. The presence of such errors creates uncertainty about the quality of the financial statements, can lead to pricing...

In the current global economy, the survival of insurance companies depends on its ability to respond to the customer demands, which are settlements of the insurance claims. All insurance companies face the conflicting goals of settling claims quickly and authenticating the claims. The increasing...

A new method of forecasting the pricing kernel, i.e., stochastic claim inflation or link ratio function, of incurred but not reported (IBNR) claims (in property-casualty insurance) from residuals in a dynamic claims forecast model is presented. We employ a pseudo Kalman filter approach by using...

Mispricing and risk have both been suggested as explanations for the cross-sectional relation between stock returns and firm characteristics such as accruals. As emphasized by Ferson and Harvey (1998) and Berk, Green and Naik (1999), it is difficult to evaluate these competing explanations...

Using a simulation analysis based on historical U.S. stock market returns, we assess the total tax burden (federal plus state) of active portfolio management. Our results show that taxes can erode a large portion of the profits, even for moderately intense trading strategies where the capital...