Gale E. Newell

Accounting Faculty Profiles: Demographics and Perceptions of Academia

Abstract In this study, we compared profiles of doctoral degree holders in accounting from the 1970, 1980, and 1990 graduating classes to determine differences among graduating classes. Our results indicate that most accounting doctoral graduates pursued an academic career primarily for lifestyle preferences and initially joined the faculty of an academic institution offering a masters and/or doctoral degree. Though satisfaction levels were high, most respondents encountered moderate to much stress in their current positions and believed that there are fewer opportunities in higher education now than when they received their doctoral degrees. The more recent doctoral graduates were more likely to have nonbusiness undergraduate majors, were older when they received their degrees, and took longer to finish the doctoral program. Moreover, recent graduates had fewer professional certifications, perceived greater stress levels in academia, and placed greater emphasis on publication and research.

Corporate Pension Plans: How Consistent are the Assumptions in Determining Pension Funding Status?

With the bankruptcy of Enron and the accompanying loss of pension benefits of its employees, pensions have recently received significant press. Accounting for pension plan obligations, for defined benefit plans in particular, requires companies to make assumptions regarding discount rates, projected salary increases, and expected long‐term return on plan assets. Such assumptions, in turn, determine the funding status of the pension plan and the annual pension expense. Higher assumed discount rates reduce the pension obligation, enhance the funding status of the plan, and reduce any lump‐sum payments. Higher expected return on assets reduces the current pension expense. This study investigates the relationship between pension plan assumptions and the funding status of a pension plan. The results reveal that companies with pension plans that are more fully funded assume higher discount rates and expected long‐term return on assets than do companies with less funded plans. The effect of these assumptions is that higher discount rate assumptions lead to better funding status, and higher expected long‐term rates of return on assets partially offset the pension expense impacts of these higher discount rate assumptions. We are doubtful that more funded plans collectively should be assuming higher discount rates and expected long‐term return on plan assets, especially since the actual return on plan assets investigated did not correlate with these assumptions.

Student ratings of accounting instructors a search for important determinants

Abstract Student ratings of accounting instructors are commonly used in determining promotion, tenure, salary, and merit increases. This paper reports the results of a study conducted to determine which attributes (factors) of teaching behavior are especially important in explaining the overall rating of accounting instructors. Two factors, teacher presentation and grading system, had a significant influence on, and were highly correlated to, the overall instructor evaluation. Instructors interested in improving student satisfaction should, therefore, ascribe higher priority to those two factors of teaching behavior. As a result, student satisfaction of the course and the instructor should increase.

The Relationship of Net Income to Comprehensive Income: An Analysis of Fortune 500 Companies

The Financial Accounting Standards Board (FASB) has recently issued Statement of Financial Accounting Standards, (SFAS) No. 130, Reporting Comprehensive Income. That Statement requires companies to report a comprehensive income measure, which includes net income and net‐of‐tax adjustments for changes in unrealized gains/losses on securities, foreign currency gain/loss adjustments, and minimum pension liability adjustments.These latter adjustments were previously reported directly in the stockholders’ equity section of the statement of financial position. This paper analyzes the effects of comprehensive income disclosures for 100 randomly selected Fortune 500 companies. Comprehensive income was computed for these companies and compared with re‐ported net income to determine the number and significance of these other comprehensive income adjustments.The results indicate that a large number of firms may report a comprehensive income amount different from reported net income. Although these differences may be significant for some firms, the majority of these adjustments will not cause comprehensive income to be materially different from reported net income for most firms.

Accounting for Nonpension Postretirement Benefits: Analysis of Lobbying Activities

The objective of this paper is to analyze the lobbying activities of the Financial Accounting Standards Board’s (FASB) constituents to the Exposure Draft of Statement 106, “Employer’s Accounting For Postretirement Benefits Other Than Pensions.” Specifically, the association between the provisions which changed between the Exposure Draft and Statement 106 and the comments received in the 477 comment letters was investigated. The results indicate that the four issues (out of 21 issues) that were modified in whole or in part were strongly opposed by the majority (90%: or greater) of respondents. None of the issues favored by respondents were modified. Opinions among respondent types (industrialists, actuaries, public accountants, insurance representatives, and other), while generally quite similar, did vary on certain issues. Since the FASB did modify issues strongly opposed by respondents, the results provide some faith in FASB’s due process procedure and should encourage constituents to participate in future FASB decisions.

Self-insurance: Should corporations make disclosures?

More companies are self-insuring to cut costs. But what are the advantages and disadvantages? And should corporations make disclosures for self-insurance?

A Strategy for Improving the Quality of Entry-Level Management Accountants.

Abstract Recently, the education of accounting students has been a topic of discussion. In particular, accounting students appear to be deficient in managerial accounting topics, such as budgeting, asset management, and product costing. This article investigates possible causes of these educational shortcomings and suggests a strategy for improving the quality of entry-level management accountants. Managerial accounting will only be emphasized when accounting faculty become convinced of its importance. A greater number of CMA certified faculty, practicing accountants serving on advising boards and as guest lecturers, and corporate field trips for students and faculty can help to impress the importance of managerial accounting on faculty.

Environmental Commitments and Liabilities of U.S. Corporations: Disclosures and Implications

Liabilities associated with environmental matters have become a major concern worldwide. Clearly, environmental impact must be a major element of a corporation’s decision process and should be timely reported in its financial statements. The SEC intensely reviews the adequacy of the environmental disclosures of its registrants. This review covers both required environmental disclosures and the adequacy of financial disclosures ingeneral. Despite this scrutiny, SEC Commissioner Roberts believes that accruals of environmental liabilities do not appear in financial statements quickly enough.This study reviewed the annual report environmental disclosures of 645 Forbes 500 firms. The study results revealed that the majority of firms provide no disclosure of environmental issues. The environmental disclosures that are included tend to be limited in terms of their informational content. It is also apparent that certain industries are more likely to include environmental disclosures than are other industries. Giv...

Postretirement health benefits: How have early FAS 106 adopters handled them?

Despite efforts to contain corporate health care costs, they continue to rise—notably for retirees. How have early adopters of FAS 106 accounted for postretirement health benefits? A study by the authors shows wide variations in assumptions and economic effects.