Does Big 4 Affect the Earnings Response Coefficient （ERC）？ Evidence From Malaysia

This study examines the effect of audit quality （AQ） on the earnings response coefficient （ERC） based on a sample of 1,884 firm-year observations comprising 471 firms listed on the Bursa Malaysia from 2007 to 2010. This study tests whether AQ affects ERC after controlling the established determinants of ERC： beta, growth, earnings persistence, and size. Using reverse regression, the study confirms that Big 4 is significant and positive to ERC. Auditor switching from non-Big 4 to Big 4 indicates the same results; however, the switching of auditors among Big 4 is not significant. The study thus provides systematic and comprehensive additional evidence on the effect of AQ via the measurement of Big 4; and auditor switching from non-Big 4 to Big 4 and switching among Big 4 on ERC. This is an important contribution to the literature but especially so given that the evidence comes from Malaysia, an emerging economy, whereas the existing empirical literature relates mainly to the developed countries.

Using a process-oriented methodology to precisely evaluate temperature suitability for potato growth in China using GIS

A process-oriented methodology to conduct precise evaluation temporally and spatially on temperature suitability for potato growth was applied in China. Arable lands in China were gridded with 1 km×1 km geographic units, and potential potato phenology in each unit was automatically identified in terms of the potato planting initial temperature and effective accu- mulated temperature. A temperature thermal response coefficient model was used to compute a temperature suitability value for each day of potato phenology in each geographic unit. In addition, five temperature suitability ranking methods were applied to define suitable areas： （1） upper fourth quantile, （2） median, （3） expected value＋1/4 standard deviation, （4） expected value＋1/2 standard deviation, （5） expected value＋1 standard deviation. A validation indicator was innovated to test the effectiveness of the five ranking methods. The results showed that from a strict degree point of view, the five methods sequence was as follows： 1=3〉4〉2〉5, with a and c determined as the two best ranking methods. For methods 1 and 3, the suitable potato growing area was 1 of 57.76× 10^4 km2. In addition, the suitable, areas were spatially coincident with the main potato producing counties. The study output technically supports the proposal from China＇s government that there is a large potential area to grow winter-ploughed potato in South China because the potential suitable area for growing potato is approximately 2×10^7 ha. In southeast Heilongjiang and east Jilin, where it is hilly and mountainous, there are still some potentially suitable areas for potato growing accounting for nearly 2.32×10^6 ha. The authors suggest to optimize the agricultural regionalization and layout in China and to adjust the cropping pattern structure.

Banks＇ Earnings, Risks and Returns in China

This study aims to find the effect of financial risks, price risks and market risks on the Earning Response Coefficients （ERC） for China Commercial Banks. The research methodologies use the traditional cumulative abnormal returns and the unexpected earning as the main dependent and independent variables. The evidences show that： （1） There is a strong returns-to-earnings relation for banks; （2） The liquidity risk has information content beyond earnings changes in the returns-to-earnings relation. This probably due to the reason that managers of banks find the level of liquidity that fulfilled the need of investors and at the same time earns good profits for the banks.

Auditor Switching and Investors＇ Reliance on Earnings： Evidence From Bursa Malaysia

This study provides some insights of investors＇ view on auditor independence focusing on auditor switching. Hence, the purpose of this study is to examine the effect of appointing a new auditor on investors＇ reliability on reported earnings in financial accounts. Analyses are based on a matched-pair sample of 162 listed companies in the Bursa Malaysia for the year 2011. The results of the ordinary least squares （OLS） regression show that earnings response coefficients for auditor switching companies are significantly higher than for non-auditor switching companies. The results provide support for the contention that investors place greater reliability on the financial accounts audited by newly appointed auditors. This finding is consistent with the Malaysian audit market where long audit tenure is a common practice and auditor switching is considered rare. Findings provide support for the long discussed issue of the importance of auditor rotation in maintaining auditor independence.

Are Islamic incomes relevance to commercial banks in Malaysia？

A significant price-to-earnings relation is evident in many research findings, which includes study on Malaysia Stock Markets, that the strength, consistency and magnitude of the relation are not as large as those reported in institutionally more developed markets. However, the price adjustment is stronger if price reaction is measured over a long periods, which is consistent to speculative trading. Firm-specific variables such as revenue, firm size and debt-equity have no incremental information content beyond earnings implies that the market monitoring process in an emerging market focuses on earnings only during financial announcement. Therefore, this paper revisited the study on the relevant of accounting banks in Malaysia using the earnings response coefficients, earnings by looking at Islamic Income for commercial which are the earnings-to-share return coefficients that are estimated for sub earnings components by including Islamic banking incomes in the analysis. This paper discovered that though there is a positive effect, the earnings from Islamic banking operation are small. Thus, the total earnings as well as the sub-categories of earnings of banks appear to enter the pricing considerations of investors.

Earnings disaggregation and analysts＇ forecasts

Accounting concepts dictate that separately disclosed components should contain separate useful information. This paper examines the relations between income statement components and analysts＇ earnings forecasts and forecast errors. Regressions explaining earnings forecasts using earnings components provide a better fit than regression using just aggregate income to explain forecasts. We interpret this as consistent with the hypothesis that analysts use incremental information in components not available in aggregate income. However, additional tests based on predictability of forecast errors indicate that analysts do not incorporate all information available in components into earnings forecasts. In addition, this inefficiency appears to increase at longer forecast horizons.

Time-domain hydrodynamic analysis of pontoon-plate floating breakwater

The hydrodynamic behaviors of a floating breakwater consisting of a rectangular pontoon and horizontal plates are studied theoretically. The fluid motion is idealized as two-dimensional linear potential flow. The motions of the floating breakwater are assumed to be two-dimensional in sway, heave, and roll. The solution to the fluid motion is derived by transforming the governing differential equation into the integral equation on the boundary in time domain with the Green＇s function method. The motion equations of the floating breakwater are established and solved with the fourth-order Runge-Kutta method to obtain the displacement and velocity of the breakwater. The mooring forces are computed with the static method. The computational results of the wave transmission coefficient, the motion responses, and the mooring forces of the pontoon-plate floating breakwater are given. It is indicated that the relative width of the pontoon is an important factor influencing the wave transmission coefficient of the floating breakwater. The transmission coefficient decreases obviously as the relative width of the pontoon increases. The horizontal plates help to reduce the wave transmission over the floating breakwater. The motion responses and the mooring forces of the pontoon-plate floating breakwater are less than those of the pontoon floating breakwater. The mooring force at the offshore side is larger than that at the onshore side.

Numerical analysis of elastic coated solids in line contact

A line contact model of elastic coated solids is presented based on the influence coefficients(ICs) of surface displacement and stresses of coating-substrate system and the traditional contact model. The ICs of displacement and stresses are obtained from their corresponding frequency response functions(FRF) by using a conversion method based on fast Fourier transformation(FFT). The contact pressure and the stress field in the subsurface are obtained by employing conjugate gradient method(CGM) and discrete convolution fast Fourier transformation(DC-FFT). Comparison of the contact pressure and subsurface stresses obtained by the numerical method with the exact analytical solutions for Hertz contact is conducted, and the results show that the numerical solution has a very high accuracy and verify the validity of the contact model. The effect of the stiffness and thickness of coatings is further numerically studied. The result shows that the effects on contact pressure and contact width are opposite for hard and soft coatings and are intensified with the increase of coating thickness; the locations of crack initiation and propagation are different for soft and hard coatings; the risk of cracks and delaminations of coatings can be brought down by improving the lubrication condition or optimizing the non-dimensional parameter h/bh. This research offers a tool to numerically analyze the problem of elastic coated solids in line contact and make the blindness and randomness of trial-type coating design less.

Ultrasonic Pulse Signal Resonance Features in Layered CFRP Within Voids

The ultrasonic pulse signal resonance features in layered carbon fiber reinforced plastic（CFRP） within voids were researched. The frequency domain model of acoustic wave propagation in multilayered medium was established. Then the reflection coefficient of multilayered CFRP within voids was numerically calculated. The results are as follows. When the CFRP laminate is tested by ultrasonic whose center frequency is close to the CFRP inherent resonant frequency, the ultrasonic may generate resonance phenomenon in CFRP. If CFRP contains evenly distributed voids, the frequency of resonant signal and its amplitude all decrease with the increase of porosity. For the thick section CFRP within local concentrated voids, the local concentrated voids near testing surface will cause signal frequency reduction and the decrease of its amplitude. But the voids which exist in layers far away from testing surface almost have no influence on signal resonance. The ultrasonic pulse echo testing was conducted for thick section CFRP specimen. The analysis results of testing signals were in accordance with the results of the numerical calculation, showing that the reflection coefficient frequency response model can effectively explain the ultrasonic resonance phenomenon in layered CFRP within voids.

Optimization of vinegar-steaming process for Wuweizi (Fructus Schisandrae Chinensis) with response surface method

OBJECTIVE:To optimize the vinegar-steaming process of Wuweizi(Fructus Schisandrae Chinensis)using the response surface method(RSM)based on the Box-Behnken design.METHODS:A regression model was constructed with the response variables,the content of Deoxyschizandrin,and the three explanatory factors:length of steaming time,the quantity of vinegar and length of moistening time to evaluate the effects on the processing of Wuweizi(Fructus SchisandraeChinensis).RESULTS:There was a linear relationship between the content of Deoxyschizandrin and the three explanatory factors.When the steaming time was5.49 h,with 2.365 g of vinegar added and a moistening time of 4.13 h,the content of Deoxyschizandrin reached the maximum predicted value of0.1076%,and under the conditions the average content of Deoxyschizandrin was 0.1058%.CONCLUSION:The correlation coefficient of thenonlinear mathematical model was relatively high and the model matched the data well,potentially providing a method for the study of the steaming process.