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0 | I like how there are so many flaps for good air ... | How are airbags good? | This improvement allowed the flaps to be used more during takeoffs and landing . | Very nice people to work with. Flap wouldn't stay shut and they were very quick to resolve my issue. | High-lift device In the split flap, the lower surface hinges downwards while the upper surface remains either fixed to the wing or moves independently. Travelling flaps also extend backwards, to increase the wing chord when deployed, increasing the wing area to help produce yet more lift. These began to appear just before World War II due to the efforts of many different individuals and organizations in the 1920s and 30s. Slotted flaps comprise several separate small airfoils which separate apart, hinge and even slide past each other when deployed. Such complex flap arrangements are found on many modern aircraft. Large modern airliners | The paper describes experimental results of controlling flow separation by periodic excitation on the flap of a generic high-lift configuration. The single slotted flap of the two-dimensional test model is equipped with a robust and reliable actuator system that fits inside the flap. The flow is excited using a pulsed wall jet that emanates from the upper surface near the flap's leading edge through a small spanwise-oriented slot By preventing the flow from separating or by reattaching the separated flow, lift and drag are substantially improved, resulting in a lift-to-drag ratio enhancement of 20-25 %. Because of the actuator assembly with spanwise individually addressable segments, the separated flow can be forced to attach only to certain parts of the flap. Local spanwise excitation is thus used to generate a rolling moment without the need to deflect an aileron. | This is the flap I needed, it is as sturdy as it can be for the job it does. | Not a very good product. After a day of use, the magnetic bars that are supposed to move up and down to capture the flaps are sticking, leaving the flaps at the mercy of the wind.
UPDATE: This continues to be a piece of crap. Sadly once you have an opening of a certain size, you find yourself stuck with a certain product.
Don't waste your money. | The concept seemed to be really neat, and it appear to be truly a better, design. However in 3-4 weeks of operation it has stuck open 3 times. Since we have holding tanks, and have to pay for a pump truck this turned out to be a big deal! I could have replaced my conventional flapper 20 times for what this has cost me. So I lived and learned! In the garbage with this one, and back to the old faithful flapper. And just in case you are wondering, YES, I did install it correctly, it is simply a piece of junk. | 0 | Fit perfectly. I like how there are so many flaps for good air circulation. | fits good. Only problem is the straps are glued on ... | Fits perfectly. This is really not hugely important but ... | This bag fits perfect. Some of the reviewers complained about it not ... | Fit OK but the leg holes at the bottom have ... | Fits wonderfully. I hve purchased several of them and will ... | The fit is great and I am very happy with the product overall | Fits perfect and I'm very pleased with it | fit very nice only problem was that the strap popped and i ... |
1 | how many pages is rosette wolczak's file | Investigator Sheets, subtitled "Diabolical Dossiers of Doom", is published by Chaosium in 1993 for the horror role-playing game Call of Cthulhu.
Contents
Chaosium first published the Lovecraftian horror role-playing game Call of Cthulhu in 1981, and subsequently produced a number of editions, including the 5th edition in 1992. The following year, Chaosium produced two supplemental products for use with the 5th edition under the subtitle "Diabolical Dossiers of Doom": a package of various blank certificates called Dire Documents; and Investigator Sheets, a set of character sheets for the three standard eras used in the game: the 1890s, 1920s, and 1990s.
Reception
In the October 1993 edition of Dragon (#198), Rick Swan questioned why any player with access to a photocopier would need these.
Other recognition
A copy of Investigator Sheets is held in the "Edwin and Terry Murray Collection of Role-Playing Games, 1972-2017" at Duke University.
References
Call of Cthulhu (role-playing game) supplements
Character sheets | So yea there is this one book which used 2015 digits to print it's page numbers. Also on the first page, it start's with site 5; so we assume there are no other pages before page number 5.
What number is on the last page?
I came up with 705 but my friend says "You gotta add up the 4 missing pages in the beginning"
Whyyyy I really don't understand?
Edit: Also how would I search for this in WolframAlpha? | How many pages does Hoot by Carl Hiaasen have? | This is a waste of paper.. and money, but mostly paper. Every page has 2 words, she doesnt. Do not buy this it shouldnt even be sold. | How many pages is the fire Eternal hardback? | Assimil has four CD's with a work book. The work book is very small. The type is difficult to read. I don't understand why they did not make the work book with a font of normal size. I stopped using it after a few hours. I may return to use it again but have been disappointed so I cannot recommend. | The first hundred or so pages are great. Probably the rest are too but after the first hundred you get the idea. | The format was terrible and the pages turned sideways were impossible to follow. I would like my money back on this book!
Jean Wojakowski | 1 | Rosette Wolczak the files of more than 20,000 persons arrested between 1942 and the end of the war by the police. Rosette's file number is "CH.AEG Justice et police. Ef/2-041-No4928" and contains 30 pages. In 2007, following an inventory work of Jewish children deported during World War II, a memorial was inaugurated in Rosette's school in Paris in the 3rd arrondissement. Michel Beretti received funds from the "Foundation for the memory of the Shoah victims" to adapt Rosette's story for the theater in 2012. His work is archived under the tag ""4928 project"", a reference to the number of Rosette's administrative file | where are rosettes issued to soldiers | what is the population of rose hulman institute of technology | Memorializing the White Rose Resistance Group in Post-War Germany | what is the name of audrey rose's daughter | how many people are on the committee that discussed the future of the rose art museum | [The preservability of rosette-forming blood cells in various culture media]. | who identified the rosette in the retina | Rose Center & Neighborhood Women, Inc. : Project in CED final report |
2 | DESIGN AND CONSTRUCTION OF THE LA MAURICIE NATIONAL PARK SCENIC ROAD | Faro del Comercio Faro del Comercio is a monument designed by the accomplished Mexican architect Luis Barragán and constructed in 1984 by architect Raúl Ferrera. It is a recognizable sight in Monterrey among many other modern manmade landmarks, such as Neptune's Fountain (Fuente de la Vida), the Monterrey City Hall, the Papal Bridge (El Puente del Papa), and the Bridge of Unity (Puente de la Unidad) in San Pedro, connecting that municipality to Monterrey. These sites are intended on one hand to complement the city's few remaining traditional landmarks, such as, the Bishopric Palace (Palacio del Obispado) and Museum, the | Arví Park (in Spanish known as "Ecotourism Park Arví") is both an ecological nature preserve and Pre-Hispanic archeological site on the eastern slopes of Aburrá Valley, in the northeast area of Medellín, Colombia. The park covers several other municipalities of Antioquia, including Envigado, Bello, and Copacabana. It covers 16,000 hectares, 1,760 of which are in the state of natural forests. And it is equipped with 54 miles of walkable trails. It is a major tourist attraction, known for its wildflowers, butterflies and trails. Activities include hiking, nature tours, cycling, and outdoor adventure sports. An outdoor food market is located next to the gondola station. The Piedras Blancas Ecological Hotel and its private reserve are adjacent to the park.
The park can be reached from downtown Medellín via the metro station. Line L on the Medellín Metro goes to Arví station, where there is a direct link to the metrocables that go to the park.
Development
The investment in this huge park, the largest of its kind in the country, is made entirely by regional state agencies, and it has achieved the feat of offering 12 square meters of parkland for each resident of Medellin, where before it was only 4 meters.
Thanks to the joint efforts of many companies Antioquia (EPM, the Metro de Medellín, Comfenalco, and several others) the park is now a reality.
Pre-Hispanic constructions
The park features sections of prehispanic construction, including antique buildings, water works, platforms, roads, gardens and ditches. It has trail called "Camino Cieza de León" or the "Prehispanic Trail", which can be more than 1,500 years old. It is very wide, built of stone, and is still well preserved some of the original parts.
Access via Metrocable
Among the most featured attractions of Arví Park is its access system, which is realized through a metrocable that is oriented towards ecological tourism.
Cable Arví, also called Metrocable Line L, is a section of the cable cars that connects Santo Domingo Savio station with Arví Ecotourism Park. It is the first tourist line of the Metro and the third by cable car System, and began commercial operation in February 2010.
References
External links
Parque Arví website
Nature reserves in Colombia
Geography of Medellín
Parks in Medellín
Tourist attractions in Medellín | book published in 1880, gave one of the first descriptions of the area and referred to the three towers as "Cleopatra's Needles". She and her party are sometimes credited as being the first "foreign tourists" to visit the area that is now called Torres del Paine National Park. Several European scientists and explorers visited the area in the following decades, including Otto Nordenskiöld, Carl Skottsberg, and Alberto María de Agostini. Gunther Plüschow was the first person to fly over the Paine massif. The park was established in 1959 as "Parque Nacional de Turismo Lago Grey" (Grey Lake National Tourism Park) | Park Güell Park Güell The Park Güell ( ; ) is a public park system composed of gardens and architectonic elements located on Carmel Hill, in Barcelona, Catalonia, Spain. Carmel Hill belongs to the mountain range of Collserola – the Parc del Carmel is located on the northern face. Park Güell is located in La Salut, a neighborhood in the Gràcia district of Barcelona. With urbanization in mind, Eusebi Güell assigned the design of the park to Antoni Gaudí, a renowned architect and the face of Catalan modernism. The park was built from 1900 to 1914 and was officially opened as a | Grutas de Cacahuamilpa National Park The Grutas de Cacahuamilpa National Park in Guerrero, Mexico, is best known for the Grutas de Cacahuamilpa Caverns, which are one of the largest cave systems in the world. It is also home to the Grutas of Carlos Pacheco, a smaller system, as well as two subterranean rivers which have carved out tunnels in the rock. The park has outdoor pursuit attractions such as rappelling, and rock climbing in Limontitla Canyon. as well as the two underground rivers to explore. It also has a small botanical garden, a pool and places to camp. The park | Makati Park and Garden Rehabilitation Commission. It is also a bird sanctuary and one of five plant nurseries in Makati. A prominent feature of the park is the monument to Andrés Bonifacio located on the western side near the parking area. The monument, designed by Filipino sculptor Juan Sajid Imao, son of National Artist Abdulmari Imao, was erected in 1997 to commemorate Bonifacio's death centennial. The park also features a small lake, fountains, a man-made waterfall, an aviary, amphiteater, pavilion, and gazebos, including a floating octagonal gazebo. The park's Artist Pavilion serves as a function hall and is a favorite venue for social activities | half of the 2000s, there were efforts to build a 19 lane ski resort on the north side of the volcano itself. However these efforts have been resisted by local residents concerned about losing access to their lands. Nevado de Toluca National Park The Nevado de Toluca National Park is located southwest of the city of Toluca, Mexico State. It was decreed a park in 1936, primarily to protect the Nevado de Toluca volcano, which forms nearly the park’s entire surface and is the fourth highest peak in Mexico. It is 45 km from Toluca and 135 from Mexico City. | Cerro Sechín slabs at Cerro Sechin may represent the central Andes' oldest known monumental sculpture. Cerro Sechín sits on a granitic hill, in the Casma Valley. It is located east of the Pan-American Highway, from the provincial capital of Casma and north of Lima. It is situated from the Pacific Ocean, near the confluence of the Sechin and Moxeke Rivers at an altitude of above sea level. The site contains walled enclosures around dwellings as well as temple platforms. Although the archaeological site occupies approximately , the monuments are grouped in a single hectare. The Sechin Complex is made up of several | 2 | The "La Mauricie" National Park's scenic road is the first of its kind in Canada. It was built into an underdeveloped territory, where no other transportation facility existed. The 14 million dollar road covers 62.5 kilometres; the design and construction started in 1971 and was completed by 1980. The scenic road links the developed sectors of the park. This paper is a summary of the different steps in the design and construction of the road. Because Parks Canada's main goal is the protection of surrounding territory, many design and location criteria were added to current standards. These preservation criteria bring additional constraints for the execution. The methods of construction and some elements of design were modified so that the project could be both economical and practical. (Author/TRRL) | The Function Development of National Scenic Sites and Their Protection and Utilization | how much does the national scenic road fund | SOME PROBLEMS ABOUT THE CONSTRUCTION OF NATIONAL GEOLOGICAL PARK OF CHINA | who remodeled holyrood park in the late 17th century | A national park in alberta canada? | On the Mountain Park Planning and Constructions——Landscape Planning and Design of the Maanshan Park,Huadu,Guangzhou | Ideas on Zhenghe Park Design: The Integration of History, Reality and Future | A Study on Scientific Status of Tourism Resources and Conservation Action Plan of the Five-finger Peaks Geo-park |
3 | Primary Investigation on Spider Community in Konglin of Qufu of Shandong | Abstract Survey was conducted to determine the composition of the spiders in a grape vineyard by using pitfall traps in Sunggeo-eup, Chunan in 1999. Total 17 genera and 19 species belonging to 10 families of spiders were identified. The dominant family was Linyphiidae. Overall, the seasonal fluctuation of the spider population showed two peaks a year. The results showed that the composition of species was very poor and occurrence density was very low in a grape vineyard in this study. | Diversity and abundance of spider fauna at different habitats of Jahangirnagar University Campus, Bangladesh | The spider species in different period in transitional zone between cotton field and its near desert in Xinjiang was analyzed using Berger-Parker dominance index(d).The result showed that the dominant species of spider communities in cotton field were Philodromus xinjiangensis,Xysticus and Pardosa falcate,and the dominant species of spider communities in transitional zone were Philodromus xinjiangensis,Xysticus and Oxyopes sushilae.And also the comparison of their dynamics between Aphis gossypii in cotton field was made. | Diversity and Distribution of Spiders in Southwestern Nigeria | A large and dense population of over 500 burrows of Atypoides riversi in a 2 .0 x 3.2 m are a was monitored for two years to indirectly determine demographics, growth rates, survivorship and longevity o f the spiders . Twelve size classes of spiders were designated by correlating spider size to burrow size . All siz e classes were present simultaneously throughout the year . Variable growth rates were recorded for spiders in each size class, and survivorship was lowest for spiders in the smallest size classes . It is estimated, based in large par t on growth rates, that A. riversi can live at least 16 years in the field . | Daviesa is a genus of Australian tangled nest spiders first described by A. Ö. Koçak & M. Kemal in 2008. it contains only two species.
References
External links
Amaurobiidae
Araneomorphae genera
Spiders of Australia | Where garden spiders' habitat? | What is the scientific name for the garden spider? | 3 | The spiders were sampled by net-covering and trapping methods,the spiders in Konglin of Qufu of Shandong Province were investigated.In result,there were 1 562 sample spiders were collected totally and they belong to 42 species,35 genera,15 families,2 suborder.Among them,there were 7 species of spiders newly recorded in Shandong Province. | A Catalogue of Insects Investigation from Zhongshan Wugui Mountain Nature Reserve in Guangdong (II) | Species composition and seasonal occurrence of spider mites (Acari: Tetranychidae) and their predators in Japanese pear orchards with different agrochemical spraying programs. | ON THE SPIDER DIVERSITY IN AND AROUND DEEG- TOWN, BHARATPUR (RAJASTHAN) | Inter- and intra-population variations in diapause attribute of the two-spotted spider mite,Tetranychus urticae Koch, in Japan | what type of spider has matriphagy in it | Two new species of the trapdoor spider genus Conothele Thorell, 1878 (Mygalomorphae: Halonoproctidae) from China. | Study on Dynamics of Dominant Spider Species and Aphis gossypii in Transitional Zone Between Cotton Field and Its Near Desert In Xinjiang | how many genera are there of anapidae spiders |
4 | SOS BY ETHERNET : DUBLIN IS IMPLEMENTING AN AUSTRALIAN HI-TECH MOTORWAY SOS PHONE SYSTEM | Does your telephone voice communication share the fiber-optic cabel whit Internet data? | S-band is used in North America for a successful and growing satellite radio one-way broadcast system. It is currently being expanded and improved to provide localization, personalized and on-demand services. Two way capability to accomplish this will initially be through the internet accessed by cellular telephones, iphones and smartphones. Future improvement for high volume requested returns to the mobile subscriber may use Wi-Fi access to the internet. | Hello,
I'm traveling around Europe for a couple of months, and currently in Amsterdam. I was contacted by Facebook a few weeks ago, and we've had difficulties scheduling an interview due to the time difference between Central Europe and California. I was supposed to have an interview on Friday morning while in Paris, but our Skype call dropped four times in 10 minutes, I believe part of the problem was the flaky internet connection I was using though the interviewer said the problem was on his side, so we rescheduled for today.
I don't trust the internet connection at my hostel, and I'm looking for a quiet place with a fast and reliable internet connection for my call today at 5pm. I've found a few internet cafes online, but I'm not sure they'd be a good environment for an important call.
TLDR: Need a quiet place with fast internet for a interview over Skype. | Device that connects a computer to a network via telephone line? | Bell Aliant High Speed Internet is the residential broadband Internet technology offered by Bell Aliant. It is available in Atlantic Canada.
Features
Bell Aliant High Speed Internet includes a wired modem, wireless internet, and Internet Security service options.
Bell Aliant has two stand-alone unlimited High Speed Internet options: High-Speed, which offers up to 1.5 Mbit/s download and up to 640 kbit/s upload and High-Speed Ultra, which offers up to 7 Mbit/s download and up to 640 kbit/s upload.
In a Bundle (with satellite or IPTV and home phone), Bell Aliant High Speed offers unlimited internet up to 7 Mbit/s download and up to 640 kbit/s upload.
References
Bell Aliant | AT&T Computer Systems the 3B5 and 3B15 computers for billing and telecom switching control applications. After divestiture, January 1, 1984, American Telephone & Telegraph was required to put its computer business into a fully separated subsidiary called AT&T Information Systems (ATTIS, without the ampersand or hyphen). Software was developed in New Jersey locations (Murray Hill, Summit, Holmdel, and Piscataway), and software, hardware, and system solutions were developed in Naperville and Lisle, Illinois. After a couple years of court hearings, AT&T was allowed to pull the business back into the mainstream corporate organization, and it was renamed AT&T Data Systems Group, consisting of 3 | In this paper, a third-generation universal mobile telecommunications system (UMTS) solution for the delivery of biomedical information from an ambulance to a hospital is presented. The joint transmission of voice, real-time video, electrocardiogram signals, and medical scans in a realistic cellular multiuser simulation environment is considered, taking into account the advantages and particularities of UMTS technology for such transmission. The accomplishment of quality of service constraints for different services is investigated and quantitative results are provided in order to demonstrate the feasibility of using UMTS technology for emergency care services on high-speed moving ambulance vehicles. | Like, could anyone just start up a phone company or dial-up ISP using the existing lines?
EDIT: In the USA | 4 | A new SOS phone system has been installed on the Southern Cross sector of the M50 ring road in Dublin, Ireland. The phone system was developed by Clearsonics, an Australian firm. It deploys innovative voice over Internet protocol (VoIP) call management technology activated from hands-free roadside phones | what type of switches were used to provide voice service in ireland | Challenges of 'VoiP' Communication Systems for Air Traffic Management | At the University of Applied Sciences, Bremen, we have developed a Crypto-Chip for real-time enciphering connections in any ISDN-net in close cooperation with an ISDN-component manufacturer. The chip is called "TELECRYPT", has less than 40 pads and is designed for the requirements of the telecommunication industry. Aside from the hardware implementation of the ciphering algorithm a new concept for the integration of a ciphering chip into telephones and telephone systems is proposed. The underlying technology can also be used for ciphering other serial datastreams. With the development of TELECRYPT it will be possible for the first time to set up telephones and telephone systems with minimum effort with one security module. | One of the several initiatives to bridge the digital divide in developing countries has been the deployment of information kiosks or knowledge centers in villages in rural parts of the country. These kiosks provide services ranging from email, chat and browsing to distance education programs, agricultural services and eGovernance services. A kiosk typically comprises of a computer with printer, web cam, multimedia system and Internet connectivity and is owned by a local entrepreneur. Moving away from the PC based kiosk model, we present an alternative platform to create and host such information kiosks in the telephony network. We call these as VoiKiosks and they are accessible through voice interaction over an ordinary phone call. | Design and Implementation of Telephone Integrated Information Management System | My company just put me in charge of converting our companies phone system to VoIP.. Can someone ELI5 what I need to know? | voicetree is a telephony provider based in which city | Cisco 8865 setup with voip.ms |
5 | Initial impression everything is laid out great. Cannot speak to durability new though | So far I have been extremely pleased with the product. It is easy to put on, fits perfectly and seems to be very durable. I have not had an occasion to verify the durability yet but I think it will be fine. | Oustanding quality. I used mine for two years and it still looks like new. | Nice product, I am not sure about durability because I just installed it but it has lifetime warranty so it does not really matter. So far so good | Very attractive out of the package. I do not know about durability yet. This is a gift and it has not been opened yet. | This is a Christmas present. It looks good but I really can't rate its durability. | UPDATE: I have been using this bench for two years now and it's still working as new. I was initially concerned with durability since the bench is somewhat wobbly, but it is really not an issue. I raised the rating to 5 stars from 4. Both myself and my wife really like it. It's a very good deal for the money.
This is good equipment for the money. It's not the same quality as what you see in a commercial gym, but it works well. | Have owned same before and my expectations of quality, durability, etc were met just as well as they were 30 years ago when I bought my first one as a gift for my father. | haven't had it long enough to comment on durability, ,but this is much thicker and sturdier than the tarp a recently bought from target which was just a few bucks less | 5 | Initial impression everything is laid out great. Cannot speak to durability new though. Price exceptional, $50 less than the local gun club. Looked at many before picking for husband as a gift (after he already said he would pick his own) and he is happy with it...which is a win here. Like that it has so many different compartments to separate gear rather than just junking it into a big pile in one slot. | and so far seems durable and is a great value. It met all my expectations | So far so good. Easy to clean & take apart/put together | So far it seems pretty durable & a great 1st backpack | ... I usually spend but the durability and flexibility is great. I do wish it had another internal and ... | Wow Great durable but the pistol is a little light but ... | To those who have had the Boosted Backpack for a while, how durable and well-made is it? | but for the price and portability it seems fine. Surprisingly durable too | It appears to be pretty durable and has more learning options than I expected |
6 | Is there a phobia for being scared of food with human faces on them. | Phobia for fear of being eaten alive? | What is the fear of touching your food with your hands? | I'm writing a short adventure where a wizard has hidden a key from a particular monster by hiding it in a place that the monster is afraid of. But I can only think of a few monsters with fears like this.
For example:
Vampires weakness to garlic
Cats afraid of dogs
It doesn't have to be something necessarily fantasy or magical, something that exists in the real world is fine too. | I thought it was a more common phobia, but i've never met anyone else with it and every time I explain it people look at me like I'm crazy.
Orangutans, chimpanzees, and gorillas specifically. I think it might have stemmed out of a nature documentary following chimpanzees when I was younger. | What the name for being scared? | Zoophobia Zoophobia or animal phobia is a class of specific phobias to particular animals, or an irrational fear or even simply dislike of any non-human animals. Examples of specific zoophobias would be entomophobias, such as that of bees (apiphobia). Fears of spiders (arachnophobia), birds (ornithophobia) and snakes (ophidiophobia) are also common. See the article at -phobia for the list of various phobias. Sigmund Freud mentioned that an animal phobia is one of the most frequent psychoneurotic diseases among children. Zoophobia is not the sensible fear of dangerous or threatening animals, such as wild dogs (example: wolves, dingoes, and coyotes), big | What phobia is the fear of speaking in front crowds? | Entomophobia Entomophobia (also known as insectophobia) is a specific phobia characterized by an excessive or unrealistic fear of one or more classes of insect, and classified as a phobia by the DSM-5. More specific cases included apiphobia (fear of bees), myrmecophobia (fear of ants), and lepidopterophobia (fear of moths and butterflies). One book claims 6% of all US inhabitants have this phobia. Lepidopterophobia can be developed in some ways. One of them by having a scary experience or if the person believes that the insect is dangerous. For example, if the person thinks a butterfly is poisonous, he/she will do | 6 | I remember my mom shown me this video for a birthday my cousin had and it was about these eggs with human faces screaming because they realised they were going to be used to make a cake.
I couldn't eat properly for two years straight because of that.
Anywho does a phobia like that exist? If not it should. | What is the phobia of cotton balls called? | What's the most strange or unusual phobia which you've actually seen affect someone in real life? | what is the more common name for the phobia of insects | The phobia of having a phobia? | Is anyone else terrified about Bumblebee? | what is the fear of children called in disney films | Phobias are too much for me, even in VR | Why are people scared of spiders but not octopi? |
7 | The Effects of Sarbanes‐Oxley on Auditing and Internal Control Strength | Information Security and Sarbanes-Oxley Compliance:An Exploratory Study | Section 404 of the Sarbanes-Oxley Act requires firms to assess the effectiveness of internal controls over financial reporting and auditors to express an opinion on the effectiveness of such internal controls. We examine whether the first-time inclusion of additional audited information in Section 404 company filings were associated with higher earnings response coefficients (ERC) for accelerated filers. We find that the ERCs of companies with clean internal control reports were greater in the SOX 404 year of adoption than in the previous year. However, there is no difference in the ERCs in the two years for companies with material weaknesses. We interpret these results as indicating that even clean Section 404 reports - which form a majority of all internal control reports - contribute positively to investor perceptions about the quality of financial reporting. | Sarbanes Oxley Section 404 Costs of Compliance: A Case Study | ABSTRACT: This study examines the association between internal control deficiencies (ICDs) reported under Section 404 of the Sarbanes‐Oxley Act (SOX, U.S. House of Representatives 2002) and the presence of former audit partners on the audit committee who are affiliated (AFAPs) and unaffiliated (UFAPs) with the firm's external auditor. We find a negative association between AFAPs and UFAPs on the audit committee and ICDs. We also find results that suggest the NYSE and NASDAQ three‐year “cooling‐off” rule applying to AFAPs may be unwarranted and deserves further empirical and regulatory attention. Further tests suggest AFAPs do not allow management to circumvent the disclosure of ICDs when conditions appear to suggest this may be so, and that AFAPs are negatively related to performance‐adjusted discretionary accruals. Collectively, we interpret these findings to suggest that AFAPs and UFAPs on the audit committee are associated with more effective monitoring of internal controls and financial reporting. |
received an "Ineffective" audit opinion and other firms that received clean audit opinion on the effectiveness of the internal control over financial reporting under Section 404 of SOX. Our analyses show the following. First, we find that auditors charge significantly higher audit fees for all firms in the post-SOX period than in the pre-SOX period. Second, we find that auditors' opinions on the weakness in internal control (WIC) are positively associated with audit fees, and that the positive association between the two is pronounced primarily in the post-SOX period, but not in the pre-SOX period. Third, we find that clients with WIC problems that are highly levered and/or report losses pay incrementally higher audit fees during the post-
INTRODUCTION
A series of corporate scandals that started with the Enron debacle and the subsequent collapse of Andersen LLP triggered the United States (U.S.) Congress to pass the Sarbanes-Oxley Act (SOX) of 2002 in an attempt to restore public confidence in the quality of audited financial statements. One of the most contentious measures mandated by SOX is related to the efficacy of a firm's internal controls over financial reporting (ICOFR). Section 404 of SOX mandates management to assess the effectiveness of a firm's ICOFR and to report its conclusion in the firm's annual reports for fiscal years ending after November 2004. Section 404 also requires the auditor to review management's assessment, and then, to report her own conclusion regarding the effectiveness of the ICOFR.
Corporate executives have increasingly voiced doubts about the net benefits of this controversial regulation, and have often claimed that the costs of Section 404 compliance are excessively high compared with the associated benefits alleged by regulators and lawmakers. For example, cross-listed foreign Securities and Exchange Commission (SEC) registrants often express that they are considering withdrawing their American Depository Receipts (ADR) listings from the US exchanges due to the high compliance cost. 1) Given that a non-trivial component of the Section 404 compliance cost is an in-1) See two recent speeches by SEC Commissioners (SEC 2005a(SEC , 2005b. crease in audit fees and that data on auditors' assessment of clients' internal controls have now become publicly available, it is interesting and timely to examine whether and how the auditor incorporates her own assessment of the strength or weakness of a client's internal control system into audit pricing.
In this paper, we first investigate whether the enactment of SOX lead to an increase in the level of audit fees for all firms, regardless of the effectiveness of their ICOFRs. As further explained in the next section, SOX caused not only an increase in audit work but also an increase in auditors' legal liabilities. We therefore predict that auditors charge higher audit fees for all firms in the post-SOX period than in the pre-SOX period to compensate for the additional audit effort to comply with the SOX requirements and to compensate for the expected increases in legal liability costs.
Second, we examine whether and how auditors' assessments of material weaknesses in internal controls (hereafter WIC) of their client firms are priced in the audit fee-setting process. In doing so, we analyze auditors' opinions on the effectiveness of the ICOFR that are reported in recently filed 10-K reports, and identify client firms that received an "Ineffective" opinion on the ICOFR from their auditors. We label these ' WIC clients.' 2) We predict that auditors charge higher audit fees for WIC clients than for non-WIC clients because clients with WIC problems are more likely to have accounting errors or irregularities and to engage in opportunistic earnings management, compared with clients without WIC problems (Ashbaugh-Skaife et al. 2007). Auditors must therefore exert more engagement efforts to audit WIC clients than to audit non-WIC clients. In addition, auditors are likely to be exposed to a higher litigation risk, other things being equal, when auditing WIC clients than non-WIC clients. As a result, auditors are likely to charge higher audit fees for WIC clients than for non-WIC clients -to compensate for the higher effort and/ or the increased litigation risk associated with the audits of WIC clients.
Third, we test whether the positive relation, if any, between WIC and audit fees emerged only after the passage of SOX. Thus, we pre-2) In fact, Section 404 of SOX does not require firms to improve the efficacy of their internal controls, but it does require management to assess it and disclose their assessment in the company's annual report. It further mandates auditors to report their opinions on management's assessment in their audit reports. In this sense, Section 404 can be viewed as a pure disclosure regulation.
dict that the effect of WIC on fees will be stronger in the post-SOX period than in the pre-SOX period. This test allows us to make inference on how the effect of auditors' WIC assessment on the audit fees interacts with a shift in the auditors' legal liability caused by the enactment of SOX. In addition to testing the above three predictions, we further examine whether SOX affected the audit fee structure. Specifically, we study the impact on audit fees of client-specific risk and auditor quality. Client-specific risk factors (e.g., leverage and loss) and auditor quality (Big 4 vs. non-Big 4 auditors) are likely to interact with WIC, and lead to high-risk clients with WIC problems and Big 4 auditors being even more exposed to potential legal liabilities subsequent to the enactment of SOX. We therefore examine whether and how the fee-increasing effect of client-specific risk and auditor quality differs systematically between the pre-and post-SOX periods, and this difference, if any, is greater for WIC clients than for non-WIC clients.
We test our hypotheses using audit fee data for the five-year period from 2000 to 2004 and data on auditors' opinions on WIC under Section 404 of the SOX that are recorded in recent 10K reports filed from February 2005 to May 2005. The results of our various tests reveal the following. First, we find that audit fees are, on average, significantly higher for all firms in the post-SOX period than in the pre-SOX period after controlling for all other factors that are deemed to affect audit fees, suggesting that SOX lead to increases in audit effort and/or auditors' legal liabilities. Second, we find that firms that received an "Ineffective" opinion on the ICOFR from their auditors in response to Section 404 of SOX (i.e., firms with WIC problems) pay higher audit fees, and that this positive association between audit fees and the weakness in internal control is pronounced primarily in the post-SOX period (2003~2004), but not in the pre-SOX period (2000~2002). This suggests that the effect of WIC on fees was driven by the upward shift in legal liability which resulted from the enactment of SOX. We also find that highly levered clients and/ or clients reporting losses with WIC pay higher audit fees, compared with i) not-highly-levered and/or profit-reporting clients with WIC and ii) clients without WIC during the post-SOX period. However, we find that Big 4 audit fee premium increased for all clients during the post-SOX period, irrespective of whether the clients had WIC problems.
Our study contributes to the existing literature in the following ways. Several studies have examined the issue of WIC in various contexts such as the relation with accrual quality or earnings management (Ashbaugh-Skaife et al. 2007;Hogan and Wilkins 2008), cross-sectional determinants of WIC (Doyle et al. 2007;Ge and McVay 2005), and stock market reactions to WIC disclosure (Beneish et al. 2008;DeFranco et al. 2005;Hammersley et al. 2008). Specifically, previous research of Hogan and Wilkins (2008) and Hoitash et al. (2008) examines the relation between WIC and audit pricing. Our study provides further evidence how WICs interacts with other client-specific risks and auditor quality. Simunic and Stein (1996) argue that audit fees reflect client-specific litigation risk. More recently, Choi, Kim, Liu, and Simunic (2008: hereafter CKLS) provide a theory and, using country-level litigation risk measures, suggest international evidence showing that audit fees reflect expected legal liability costs. However, prior research has paid little attention to the issue of how WIC influence an auditor's assessment of client-specific litigation risk because data on auditors' assessment of WIC for public companies became publicly available only after Section 404 were implemented. In short, our results provide useful insights into how the auditors, in terms of client risk assessment and pricing mechanism, respond to a shift in the legal liability regime associated with the enactment of SOX. The higher level of auditors' attention to the risky clients, as reflected in higher audit fees in the post-SOX period, could imply more audit effort, assignment of more experienced or expert auditors, and/or the increased fee per hour for the clients. To the extent that these changes lead to the higher audit quality, evidence provided in this study supports the view that the SOX enactment accomplished its regulatory objectives at least partially.
The remainder of the paper is structured as follows. In section 2, we briefly discuss the new requirements for WIC disclosures and attestation under Sections 302 and 404 of SOX, and offer a review of prior studies related to WIC issues. Section 3 develops hypotheses while section 4 describes the sample, data sources and empirical procedures. Section 5 presents the results of our hypothesis testing. In section 6, we perform further analyses on the effect of the SOX and various sensitivity checks. The final section concludes the paper.
THEORY DEVELOPMENT Background
The summary of the major SOX provisions that are important to accounting and auditing areas are reported in Appendix. Among them, Sections 302 and 404 of SOX are concerned with the internal controls over financial reporting (ICOFR). In particular, Section 302, which became effective for quarterly and annual reports covering periods ending after August 29, 2002, requires that chief executive officers (CEO) and chief financial officers (CFO) evaluate the design and effectiveness of internal controls and disclose any known material weakness, fraud, or changes in controls that are likely to have a material effect on financial statements. Compared with the Section 404 requirements, however, Section 302 requires relatively less extensive investigations and assessments by management, and does not specify specific procedures that management and the auditor must follow.
Section 404, which became effective for fiscal years ending after November 15, 2004 for accelerated filers, 3) has two main parts. Section 404(a) describes management's responsibility for maintaining an adequate internal control structure and procedures for financial reporting as well as responsibility for assessing the effectiveness of ICOFR. Section 404(b) mainly describes auditors' responsibility for attesting to management's report on the WIC assessment and their own assessment on the effectiveness of ICOFR.
Along with Section 404, the Public Company Accounting Oversight Board (2004) has adopted Auditing Standard No. 2, An Audit of Internal Control over Financial Reporting Performed in Conjunction with an Audit of Financial Statements. The Standard requires an integrat-3) A non-accelerated filer (a U.S. company with market capitalization less than $75 million that has filed at least one annual report with the SEC) must first comply with the SOX 404 requirements for its first fiscal year ending on or after July 15, 2007. The extension does not apply to a foreign private issuer that is an accelerated filer and that files annual reports on Form 20-F or Form 40-F; such an issuer must begin to comply with the internal control over financial reporting and related requirements in the annual report for its first fiscal year ending on or after July 15, 2006. We exclude non-accelerated filers and foreign firms from our sample.
ed audit of both financial statements and ICOFR, and requires auditors to express two separate opinions on: (1) whether the financial statements are fairly stated; and (2) whether the ICOFR is effective. The auditor is not permitted to conclude that the company's ICOFR are effective if there are one or more material weaknesses in the registrant's internal controls. In the event of a material weakness, the auditor could express an unqualified opinion (i.e., "fairly stated") on management's assessment so long as management properly identifies the material weakness, and conclude in their assessment that the internal controls are ineffective. If the auditors conclude that a material weakness exists but management does not and therefore concludes in their assessment that internal control is effective, the auditors should render an adverse opinion on management's assessment. 4)
Literature Review
Since the passage of SOX in 2002, several studies have investigated various issues related to internal controls using the WIC data disclosed under Section 302. For example, Ge and McVay (2005) find that WIC are positively associated with business complexity but negatively associated with firm size and profitability. Doyle et al. (2007) report a similar set of WIC determinants. In addition, they find that WIC clients have lower earnings quality measured by the extent to which accruals map into cash flows. Ashbaugh-Skaife et al. (2007) document that clients with more complex operations, recent changes in organization structure, more accounting risk exposure and less investment in internal control systems are more likely to disclose WIC. They also find that clients with WIC tend to have greater abnormal accruals and more frequent restatements of financial statements relative to their industry peers, consistent with the notion that WIC contribute to lower quality accounting information. Using the data for the period prior to the enforcement of Section 302 of SOX, Krishnan (2005) finds that firms with an indepen-4) Among our 252 sample firms that received an "Ineffective" opinion on the ICOFR from their auditors, only two firms received "not fairly stated" opinion on management assessment of the effectiveness of ICOFR and all the others received an unqualified opinion. This suggests that prior to the issuance of the opinion, the auditor and management have agreed on significant deficiency or material weakness in ICOFR in most cases since Section 404 was enacted. dent audit committee with financial expertise are less likely to have WIC. 5) On the other hand, Beneish et al. (2008), DeFranco et al. (2005), and Hammersley et al. (2008 examine stock market reactions to management's disclosure of WIC under Section 302. Overall, these studies find that the market reacts negatively to WIC disclosures. 6) These findings support the view that information about WIC is value-relevant.
A few studies examine the effect of the WIC disclosure under Section 302 and/or Section 404 on audit pricing. Hogan and Wilkins (2008) examine the effect of WIC disclosure under Section 302 on audit pricing. They find that audit fees of clients that disclosed WIC under Section 302 are higher than those of other clients. Under Section 404, Raghunandan and Rama (2006) and Hoitash et al. (2008) similarly find that audit fees for fiscal year 2004 are higher for clients with WIC compared to clients without such a weakness. Hoitash et al. (2008) also report that the severity of the WIC influences the audit fees.
Our study also investigates the effect of WIC on audit pricing but differs significantly from prior studies in the following ways. First, while they investigate the relation between WIC disclosed under Section 302 or 404 and the audit fees in the fiscal year that WIC were disclosed, we use a longer period of audit fee data covering the year 2004 (when auditors were required to express their opinions on ICOFR for the first time) and previous four years. The use of a longer time-series of audit fee data allows us to investigate whether there are changes in the audit fee-WIC association from the pre-SOX to the post-SOX period. We also address the issues of the interactions between WIC and other client characteristics, and changes in Big 4 audit fee premiums for the comprehensive analyses of audit pricing mechanism changes caused by the enactment of SOX. 5) Before the enactment of the SOX, firms were required to publicly disclose information on the internal control weakness (if any) pointed out by the predecessor auditor when they file 8-K to the SEC, only if there was a change in auditor (SEC 1988
Hypotheses Development
The enactment of SOX in 2002 caused a substantial change in the duties and responsibilities of external auditors of public companies. Specifically, Section 404 requires auditors to conduct an integrated audit of the financial statements and the internal control systems. Anecdotal evidence to date indicates that the audit fees paid by SEC registrants increased substantially subsequent to the enactment of SOX. 7)
The audit fee literature dates back to Simunic (1980). In his model, audit fees (or total audit costs) are a function of the expected costs of conducting the audit including a normal profit margin plus the expected costs of audit risk or the expected legal liability losses associated with an audit failure. Formally, his model can be expressed as:
E(tc) = cq + E(d)* E(r)(1)
where E(tc) is the expected total cost to the auditor; c is per unit cost of resources; q is quantity of resources used by the auditor in performing the audit; E(d) is the expected present value of possible future losses due to undetected material misstatements in this period; E(r) is the likelihood that the auditor will be liable from future litigation associated with undetected material misstatements in this period. Previous audit fee research has relied on the above model when examining whether auditors price the expected litigation costs as well as their effort or resource costs when setting audit fees, and found a positive relation between audit fees and various proxies for litigation risk. 8) Recently, CKLS extend the Simunic model by developing a formal model in which the strength (or strictness) of legal regime plays a crucial role in determining auditor effort and thus 7) For example, Financial Executives International indicated, in its January 2004 survey, an increase in audit fees of $591,000 due to Section 404 compliance. This is equivalent to an increase of 38 percent over pre-Section 404 fee levels. In its July 2004 survey, FEI updated this figure to $823,200, or an increase of 92.5 percent over pre-Section 404 levels. 8) For more details, see Pratt and Stice (1994), Simunic and Stein (1996), Seetharaman et al. (2002), and Lyon and Maher (2005). audit fees. 9) The CKLS model predicts that audit fees increase monotonically with the strictness of legal regime, because as the legal regime becomes stronger, the auditor is more likely to suffer from legal liabilities in case of an audit failure, and thus charges a higher audit fee to compensate for the increased legal liability costs. The enactment of SOX and the implementation of other accompanying accounting and auditing regulations lead to not only an increase in audit effort to comply with the SOX and other related requirements but also a significant upward shift in what CKLS call "the strength of a legal regime" during the post-SOX period. 10) In a similar vein, Ijiri (2005) predicts that the civil or criminal litigation risk will increase significantly even for honest firms, and further argues that the SOX is likely to reduce investors' beta risk (the risk of a dishonest report being judged to be honest) at the expense of increasing firms' alpha risk (the risk of honest report being judged to be dishonest). We therefore predict that the enactment of SOX causes auditors to charge higher audit fees during the post-SOX period to compensate for the increases in their legal liabilities as well as audit efforts than during the pre-SOX period. To test this prediction, we hypothesize in an alternative form:
H1: Other things being equal, audit fees are higher in the post-SOX period than in the pre-SOX period.
To prevent or detect material misstatements, the auditor typically performs various internal control tests to assess whether the internal control system of the client firm is properly designed. If the auditor concludes that the internal control system is not appropriate, auditing standards require her to perform additional substantive 9) Using data from United Kingdom (UK), Seetharaman et al. (2002) also show that auditors of UK firms charge higher fees for their services when their clients are cross-listed on the U.S. market, suggesting that audit fees reflect country-level litigation risk. 10) If we name a few examples, by Title VIII, "Corporate and Criminal Fraud Accountability Act of 2002," auditors are required to maintain all audit or review work papers for five years. Title IX, "White Collar Crime Penalty Enhancements" increased the maximum criminal penalty for mail and wire fraud from 5 to 10 years. For the comprehensive summary of the SOX provisions and legal requirement changes that are important to auditor/auditing, please refer to the Appendix. For the review of the legislation process of the SOX and the environmental changes in the US accounting, please refer to Ijiri (2005).
tests, and such additional tests may increase her effort or resource costs (the first component in Eq.
(1) or cq). Moreover, the auditor may use an engagement team with more industry-specific expertise if any WIC in complex situations requires a high level of industryspecific knowledge in detecting material misstatements (Johnstone and Bedard 2003). Such an audit team may charge a higher billing rate to the client, which leads to an increase in the first component in Eq.
(1) or cq. Alternatively, the greater risk related to an ineffective internal control system may cause auditors to charge an insurance premium to cover possible future losses associated with undetected misstatements (Bell, Landsman, and Shackelford 2001). 11) Previous research on audit fees finds that audit fees are sensitive to conditions that increase the overall audit risk. 12) To the extent that auditors' effort costs and/or expected litigation costs are greater for clients with WIC than for clients with no WIC, auditors are likely to charge a higher fee for clients with WIC than for clients with no WIC. We therefore hypothesize in alternative form:
H2: Other things being equal, audit fees are positively associated with material weaknesses in internal controls (WIC).
This hypothesis H2 is equivalent to those in the prior studies of Hogan and Wilkins (2008) and Raghunandan and Rama (2006). Using H2, we would like to show that the characteristics of our sample are not different from those used in prior studies.
In the context of the Simunic's model in Eq. (1), the enactment of SOX caused an upward shift in an auditor's assessment of E(d) and E(r), and thus lead the auditor to charge even higher audit fees for clients with WIC in the post-SOX period than in the pre-SOX period. 13) We therefore predict that the fee-increasing effect of WIC is more pronounced in the post-SOX period than in the pre-SOX period. To provide evidence on the above prediction, we test the follow-11) Charging an insurance premium may also be combined with additional substantive tests. 12) Experimental work by Houston et al. (1999) find that the presence of accounting choices reflecting higher risks of accounting irregularities leads to higher litigation risk assessments and fee premiums. 13) In addition, additional audit effort required to attest to the effectiveness of the client's internal control system will be another possible reason for the audit fee increase.
ing hypothesis in an alternative form:
H3: Other things being equal, the positive association, if any, between audit fees and WIC is more pronounced in the post-SOX period than in the pre-SOX period.
TEST PROCEDURES Empirical Model
Building upon previous research on audit fee determinants (Chaney et al. 2004;CKLS;Craswell et al. 1995;DeFond et al. 2002;Francis and Stokes 1986;Frankel et al. 2002;Sankaraguruswamy and Whisenant 2003;Simunic 1980;Simunic and Stein 1996), we posit the following audit fee model to test our hypotheses H1, H2 and H3: In the above, all the independent variables are measured as of the end of fiscal year unless otherwise noted. The variables, LNTA and EMPLOY, are used as proxies for client size, while the variable, NBS, NGS, INVREC, FOREIGN, EXORD, and RNDTA as proxies for the scope and complexity of the client's business. The demand for audit services is likely to increase with firm size (LNTA and EM-PLOY) and the extent of business diversification (NBS and NGS). We expect audit fees to be positively associated with these variables. Furthermore, audit fees are likely to be higher for clients with more complex business operations, so we expect the variables representing client complexity (i.e., INVREC, FOREIGN, EXORD, and RNDTA) to be positively associated with audit fees. In short, all coefficients on the aforementioned variables are expected to be positive.
AFEE = α 0 + α 1 YR0304 + α 2 WIC + α 3 (YR0304*WIC) + β 1 LEVE + β 2 LOSS + β 3 BIG4 + γ 1 LNTA + γ 2 NBS + γ 3 NGS + γ 4 EMPLOY + γ 5 INVREC + γ 6 ISSUE + γ 7 BTM (2) + γ 8 FOREIGN + γ 9 EXORD + γ 10 AUDCHG + γ 11 LAMDA + industry dummies +
We also include AUDCHG to control for possible low balling by new auditors (Sankaraguruswamy and Whisenant 2003). A negative sign on AUDCHG is consistent with the low balling hypothesis. We include ISSUE and BTM to capture the effect of the client's growth potential on audit fees. Growing firms are more often involved in external financing activities such as equity and bond offerings, and the demand for both audit and non-audit services is greater for high-growth firms than for low-growth firms. In addition, firms with equity and debt offerings in the recent past are in a need of more extensive audit services (Reynolds et al. 2004). We therefore expect a positive (negative) coefficient on ISSUE (BTM). In Eq.
(2), we also include LOSS and LEVE, to proxy for a client's risk characteristics. Since auditors charge higher fees for risky clients (Simunic and Stein 1996), we predict the coefficients on LOSS and LEVE to be positive. We include BIG4 to capture the effect of audit quality differentiation on audit fees. A positive coefficient on BIG4 suggests the existence of a Big 4 fee premium.
Our variables of interest are YR0304, WIC, and the interaction between YR0304 and WIC (i.e., YR0304*WIC). We measure WIC in three different ways. The first measure (WIC_D) is a dummy variable that equals 1 if a client receives a weakness-in-internal control opinion (hereafter WICO) on the effectiveness of ICOFR from the auditor in fiscal year 2004, and 0 otherwise. The second measure (WIC_C) is a continuous variable, measured by the natural log of one plus the number of categories of WIC cited in the auditor's report in the same year. The third measure (WIC_P) is the predicted value of WIC_C. We include the predicted value to control for the possible self-selection problem by using an instrumental variable approach. 14) It is possible that firms may have had greater internal control problems in the pre-SOX period than in the post-SOX period because WIC did not receive serious attention in the pre-SOX period. The use of WIC_P at least partially solves this problem by using year-by-year data to independently predict the value of WIC_C or WIC_D for each year.
If auditors charge higher audit fees in the post-SOX period than in the pre-SOX period as predicted in H1, the coefficient on YR0304 should be positive (i.e., α 1 > 0). 15) Similarly, if firms that receive WICO 14) WIC_D and WIC_C assume that a firm receiving a WICO in 2004 has the same problem from 2000 to 2004 inclusive. This is a strong assumption and is a limitation of our work, necessitated because of data availability.
15)
We choose year 2003 as the cut-off year to make the dummy variable YR0304. Even though the SOX was enforced from November 2002, the year-by-year analy-pay higher audit fees as predicted in H2, the coefficient on WIC should be positive (i.e., α 2 > 0). In addition, if the fee-increasing effect of WIC is more pronounced during the post-SOX period as predicted in H3, the coefficient on YR0304*WIC, should be positive (α 3 > 0). Hoitash et al. (2008) report that audit fee structure with respect SOX changed from year 2003 even though auditors are required to follow section 404 from year 2004. Thus, we choose year 2003 as a cut-off year. As explained later in Table 4, our empirical analyses also support this prediction.
In our regression specification in Eq.
(2), audit fees are linked to WIC and many other control variables. Previous research suggests that clients who receive WICO may be inherently different from those who do not (Ashbaugh-Skaife et al. 2007;Doyle et al. 2007). Suppose that clients who have the ability to pay high audit fees tend to keep weak or strong internal control systems. In such a case, the error term in Eq. (2) is likely to be correlated with the WIC variable and coefficient estimate is likely to be biased. To address this potential self-selection bias, we estimate the two-stage treatment effect model (Greene 2000). In the first stage, we estimate the probit WICO model with WIC_D as the dependent variable and obtain the inverse Mills ratio. 16) We then include the inverse Mills ratio, denoted 2007) and Doyle et al. (2007), we run the following probit model. WIC_D = a + β 1 LNTA + β 2 GROWTH + β 3 INVTA + β 4 LOSS + β 5 ROA + β 6 NBS + β 7 NGS + β 8 FOREIGN + β 9 MA + β 10 RESTRUCT + β 11 BIG4 + β 12 AUDCHG + β 13 OWNERSHIP + β 14 LITIG_IND + error terms where, GROWTH is the assets growth from year t -1 to year t scaled by the assets of year t -1; INVTA is inventory divided by total assets, MA is merger and acquisition dummy that has a value of 1 if the firm has any merger and acquisition activity in the year, and 0 otherwise; RESTRUCT is dummy variable if the firm's restructuring cost is higher than 1 percent of the sales; OWNERSHIP is a measure of ownership concentration (1 -[1,000 * (# of shareholders / # of outstanding shares)]); LITIG_IND is the litigious industry dummy variable. The definitions of other variables are the same as before. We also repeat the tests (i) after removing insignificant independent variables, and (ii) after removing the variables that are already included in Eq. (2), but the results are always similar. We also perform the OLS regression for the same equation as in the above with WIC_C as the dependent variable instead of WIC_D and with the same set of independent vari-by LAMDA, in Eq. (1) when we use WIC_D as a variable of interest in our analyses. Instead, when we use WIC_C, we repeat the test using WIC_P, which is the predicted value of WIC_C using an instrumental variable approach.
Sample and Data Sources
We obtain audit fee data from the 2005 Audit Analytics database. We retrieve all other financial data from the 2005 Compustat Industrial annual file. Our sample period is restricted to the five-year period from 2000 to 2004 because Audit Analytics includes audit fee data starting in 2000,17) and the current version of the database includes the data only up to fiscal year 2004. We exclude the data in the financial service industry because the audit fee determinants of firms in this industry may differ from those in other industries.
We hand-collected the data on WICO from recently filed 10-K reports. Because Section 404 of SOX applies to annual reports for fiscal year ending November 2004, we search the EDGAR database for all firms in our sample with fiscal years ending between November 2004 and February 2005 (inclusive) that filed their 10K reports from February 2005 to May 2005. To supplement our initial EDGARbased sample, we also refer to the PricewaterhouseCoopers (PwC) database that collected and compiled auditors' internal control reports from all SEC filings in 2005, and then classified each WIC cited in auditors' reports into 1 of 26 categories, based on the nature of the WIC.
In Panel A of Table 1, Section A reports the number of firms in our sample that received WICO from their auditors, while Section B reports the number of firm-year observations with WICO. As mentioned earlier, we hand-collected information on WICO for firms with fiscal years ending between November 2004 and February 2005. Assuming that WIC were constant for each sample firm over the fiveyear sample period, 2000-2004, we construct a sample of firm-year observations with WICO by including the same firms with WICO ables. Using the OLS estimates of regression parameters, we obtain the predicted value of WIC_C, namely WIC_P.
17) The SEC's Final Rule S7-13-00 (Revision of the Commission's Auditor Independence Requirements) requires registrants to disclose information about fees paid to the auditor in proxy statements filed on and after February 5, 2001. Table 1 reports the number of firm-year observations by each category of WIC. We collect a total of 26 different categories of WIC mentioned in the audit report. Among them, the most frequently mentioned WIC is related to the 'application of GAAP and accounting policies' which comprises 32.61 percent of all WIC. 19) The next most frequently mentioned WIC is related to 'review of transactions' which comprises 32.42 percent of all WIC. Because some categories of WIC are rarely mentioned, we group WIC into 15 different categories as reported in Panel B, and combine all other 11 categories to the 'Others' category. This final category comprises 31.47 percent of all WIC. One may argue that auditors charge higher audit fees for clients that receive multiple categories of WICO. As mentioned earlier, we therefore measure WIC by using the continuous variable (i.e., WIC_C) which is defined as natural log of one plus the number of WIC categories, in addition to the dummy variable (i.e., WIC_D).
18) Implicit here is the assumption that clients that receive WICO in 2004 have a similar level of WIC problems in 2000-2003 as well. This is a reasonable assumption in that, as pointed out in footnote 2, Section 404 of SOX does not require management to improve the effectiveness of ICOFR, though it requires management to disclose its assessment on the effectiveness of ICOFR. The findings of Ghosh and Rubberink (2006) also support this assumption. They report that companies with WIC have lower earnings response coefficient and less favorable common stock rating and debt ratings even before the firms disclose the WIC problems. However, as an alternative way to analyze the data without the assumption, we use the predicted value of the WIC (WIC_P) for our variable of interest in the analyses. 19) The sum of the percentage (%) in Panel B of Table 1 is greater than 100 percent because many client firms receive WICO with multiple categories of internal control weakness as reported in Panel A of Table 1.
MAIN RESULTS
Descriptive statistics
Table 2 presents descriptive statistics for the variables used in this study. With respect to the results in Table 2, the following are noteworthy: First, the mean AFEE, measured by natural log of audit fees in thousand dollars, over the five-year sample period is 6.0235 which translates into $ 413,022. The median AFEE is 5.9319 with a standard deviation of 1.2757, suggesting that AFEE is reasonably distributed. Second, the mean WIC_D of 0.1167 indicates that 11.67 percent of our sample clients received a WICO from their auditors in fiscal year 2004. The mean WIC_C is 0.1635 with a relatively large standard deviation of 0.4731, suggesting that the WIC_C distribution is skewed. Finally, the distributional properties of all other variables (that are used as control variables in our regressions) are, overall, comparable with those reported in previous research on audit fee determinants (e.g., CKLS; Frankel et al. 2002;Ashbaugh-Skaife et al. 2007). Note that LEVE is windsorized at 5 (approximately one percent of observations were extremely large) in order to alleviate the influence of a few extreme outliers on our results. Similarly, the BTM is winsorized at 0 and 4. Table 3 presents the correlation matrix for the variables included in Eq. (2). As shown in Table 3, WIC_D and WIC_C are highly correlated (ρ = 0.948), suggesting that both capture the same underlying construct (i.e., WIC). Consistent with H2, both measures are significantly and positively correlated with audit fees (AFEE). With respect to the correlation among our explanatory variables, the following are apparent: First, our two proxies for client-specific litigation risk (i.e., LEVE and LOSS) are significantly and positively correlated with each other (ρ = 0.106). Second, firm size (LNTA) is significantly and negatively correlated with the two proxies. Third, none of the control variables are highly correlated with two measures of WIC (i.e., WIC_D and WIC_C). Fourth, the inverse Mills ratio (LAMDA) is highly correlated with several other control variables. Thus, we perform analyses with and without the LAMDA variable. Finally, except for the correlation between LNTA and EMPLOY (ρ = 0.687), the magnitude of pairwise correlations among other explanatory variables (except for the correlation with LAMDA) does not exceed 0.5, suggesting that our multivariate regressions are unlikely to suffer from multi-collinearity problems. 20)
Pairwise Correlation among Research Variables
Univariate Analyses on Audit Fee Changes around the SOX Enactment
Panel A of Table 4 reports average audit fees by each year for the total sample, for the sample of firms that receive WICO (WIC_D = 1), and for the sample firms that do not receive WICO (WIC_D = 0). As shown in the table, audit fees for all three samples increase monotonically over the sample period, 2000-2004. Consistent with hypothesis H2, audit fees are greater for the WIC sample than for the non-WIC sample in all years.
To assess the effect of SOX on audit fees, we further examine changes in audit fees from the pre-SOX period to the post-SOX period. In Panel B of Table 4, we present the change in AFEE from 2002 (the year in which SOX was enacted) to 2003 for the WIC sample and for the non-WIC sample, and test for differences in means and medians between the two samples. In doing so, we include only those firms that are included in our dataset for both 2002 and 2003 in our WIC and non-WIC samples.
As shown in Panel B, the mean and median changes in AFEE changes from 2002 to 2003 are 0.3335 (a 7.76% percent increase) and 0.2571 (a 4.34 percent increase), respectively, for the WIC sample, and 0.2468 (a 5.63 perecent increase) and 0.1942 (a 3.15 percent increase), respectively, for the non-WIC sample. 21) Both the mean and median differences are significant, as reported in the bottom two rows of Panel B. These results suggest that SOX caused 20) In performing regression analyses, we also measure the VIF values to test for potential multi-collineraity problems. But none of the VIF values are high enough to cause the problem. Thus, we do not separately report the values in the paper.
As a robustness test, we also drop all the control variables or one of the control variables that are highly correlated with other control variable (one by one) and perform regression analyses with variables of interest. The results are qualitatively similar. 21) In dollar values, the median audit fee changes from $399,076 to $557,721 (a 40 percent increase) during the period for the clients with WIC, and $334,932 to $422,581 (a 26 percent increase) for the clients without WIC. The amount of change represents the change of the log value of audit fees (in thousand of dollars) and the percentage change represents the change in the log value of audit fees scaled by the log value of the audit fees at the start of the period. *, **, and *** denote p-value < 10%, p-value < 5%, and p-value < 1%, respectively with one-tailed tests. audit fees to increase more for firms that received WICO than for firms that did not, consistent with hypotheses, H1 and H3.
In Panel C of Table 4, we present the amount by which AFEE changes from the two-year pre-SOX period (i.e., 2001 and 2002) to the two-year post-SOX period (i.e., 2003 and 2004) for the WIC sample and for the non-WIC sample, along with the results of tests for the mean and median differences between the two samples. Here, the WIC and non-WIC samples consider only those firms included in our dataset for both two-year periods.
As shown in Panel C, the mean and median changes in AFEE are 0.9408 (a 17.70 percent increase) and 0.9571 (a 16.76 percent increase), respectively, for the WIC sample, and 0.6988 (a 12.49 percent increase) and 0.6943 (a 12.02 percent increase), respectively, for the non-WIC sample. Both the mean and median differences are highly significant, as reported in the bottom two rows of Panel C. Similar to the results reported in Panel B, these results reconfirm that SOX caused audit fees to increase more for firms which received WICO than for firms that did not.
Results of Multivariate Tests for H1, H2, and H3
To examine the effect of auditors' opinions on internal control weakness (WICO) on audit fees, we estimate various regressions for Eq. (2). Table 5 report the regression results. In Table 5, reported t-values are on an adjusted basis using White's (1980) heteroskedasticity-consistent covariance matrix. 22) To verify whether our dataset produces the coefficient estimates that are comparable to those reported in previous research in terms of their signs, significance, and magnitude, we first estimate model 1 which excludes our test variables, namely WIC, YR0304, and YR0304*WIC from Eq. (2). In models 2 (3), we include only one test variable, YR0304 (WIC). In models 4 and 5, we include both YR0304 and WIC. We also estimate models 6 to 9 with all three test variables, YR0304, WIC, and YR0304*WIC, included for our hypotheses, H1, H2, and H3, respectively. In models 3 to 7, the WIC variable is measured us-22) We repeat all the regression tests performed in this study by adjusting standard errors with a clustering procedure that accounts for serial dependence across years of a given firm. Because most of the results are qualitatively identical, we do not report them separately, except an exceptional case when the result is different. All t-statistics in parentheses are calculated using White's (1980) consistent standard error estimates to correct for heteroskedasticity. *, **, and *** denotes p-value < 10%, p-value < 5%, and p-value < 1%, respectively with two-tailed tests. WIC_D: Table 1 for the definitions of other variables.
ing the dummy variable, WIC_D, while in model 8, it is measured by the continuous variable, WIC_C, which is natural log of one plus the number of WIC categories. In model 9, the WIC variable is measured by WIC_P, which is the predicted value of WIC_C. Finally, models 5 and 7 include LAMDA (inverse Mills ratio), while all other models do not.
The results for models 1, 2 and 3 show that all explanatory variables except ISSUE and AUDCHG are highly significant with expected signs for all specifications, and the explanatory power of all three models is very high as reflected in the adjusted R 2 of about 71 to 78 percent. This suggests that a set of audit fee determinants included in Eq. (2) as our control variables explain a large portion of crosssectional variations in audit fees.
As shown in Table 5, the coefficient on YR0304 is highly significant across all specifications, which strongly supports H1. The result indicates that auditors charge higher audit fees in the post-SOX period than in the pre-SOX period, which is consistent with the CKLS prediction and anecdotal evidence 23) as well as the findings in Table 4. In model 3 to 5 where the interaction term YR0304*WIC is omitted, the coefficient on WIC is significantly positive, which is consistent with H2. This suggests that clients with WIC problems pay higher audit fees than do clients without WIC problems. However, when we estimate regressions with the interaction term YR0304*WIC included, as in models 6 to 9, the WIC-coefficient becomes insignificant, but the coefficient on the interaction term, i.e., YR0304*WIC, becomes significantly positive in all cases. This indicates that firms with WIC problems in fiscal year 2004 began to pay higher audit fees only in the post-SOX period (but not in the pre-SOX period). The results are robust to whether we use WIC_D, WIC_ C, or WIC_P. 24) Thus, it seems that the differences in the audit fees between WIC clients and non-WIC clients, as reported in Table 4, during the pre-SOX period simply reflect the different firm-specific characteristics of the clients rather than the audit fee effect of WIC.
To examine the economic significance of the results, we set all variables except WIC to their sample medians and calculate average 23) See footnote 7 for anecdotal evidence.
24) When we perform analyses with individual categories of WIC mentioned in
Panel B of Table 1, we find that segregation of duties and property/equipment/ lease are not significantly related to audit fees, while all the other categories are significantly associated with audit fees with positive signs. audit fees. Using the estimated coefficients from model 4, this procedure yields average audit fees of $548,986 for non-WIC firms during the post-SOX period. This indicates that WIC firms pay higher audit fees than do non-WIC firms by $58,952 (or 10.74 percent of audit fees). This suggests that the increase in audit fees for WIC firms is economically significant as well.
FURTHER ANALYSES The Effect of the Enactment of SOX on the Audit Fee Structure
The regression results in Table 5, overall, reveal that auditors charge higher audit fees for WIC clients than for non-WIC clients during the post-SOX period but not during the pre-SOX period. In this section, we further investigate whether and how the legal regime shift caused by SOX affects the structure of audit fees, in particular, the audit fee effects of client-specific risk and auditor quality.
To do so, we first examine whether the incremental fees that auditors charge for clients with WIC to compensate for the increased legal liability associated with SOX varies systematically across clients, depending on client-specific risk characteristics proxied by LEVE and LOSS. Auditors' assessment of the legal liability is likely to be greater when clients are exposed to a higher level of litigation risk. Auditors are likely to be exposed to a higher litigation risk during the post-SOX period, in particular, for the audits of WIC clients. We therefore predict that the fee-increasing effect of clientspecific risk (i.e., LEVE and LOSS) is pronounced during the post-SOX period, and the effect is even more pronounced for clients with WIC problems than those with no WIC.
Previous research shows that the potential legal liability cost is greater for Big 4 auditors than for non-Big 4 auditors, because Big 4 auditors have greater reputation losses at stake (DeAngelo 1981) as well as "deeper pockets," and thus they have more to lose in case of an audit failure (Dye 1993;Khurana and Raman 2004;Kim et al. 2003). To minimize this legal liability cost, Big 4 auditors have a greater incentive to increase audit effort, for example, by conducting more substantive tests than non-Big 4 auditors, which in turn leads to Big 4 auditors charging higher audit fees than non-Big 4 auditors (CKLS; Craswell et al. 1995;DeFond et al. 2000). This leads us to predict that the differences in audit fees charged by Big 4 auditors vis-à-vis non-Big 4 auditor (i.e., Big 4 fee premiums) are greater in the post-SOX period than in the pre-SOX period.
To test the above two predictions, we posit the following regression model which is an augmented version of Eq. (2): AFEE = α 0 + α 1 YR0304 + α 2 WIC + α 3 (YR0304*WIC) + β 1 LEVE + β 2 (LEVE*YR0304) +β 3 (LEVE*YR0304*WIC) + β 4 LOSS + β 5 (LOSS*YR0304) + β 6 (LOSS*YR0304*WIC) + β 7 BIG4 + β 8 (BIG4*YR0304) + β 9 (BIG4*YR0304*WIC) (3) + γ 1 LNTA + γ 2 NBS + γ 3 NGS + γ 4 EMPLOY + γ 5 INVREC + γ 6 ISSUE + γ 7 BTM + γ 8 FOREIGN + γ 9 EXORD + γ 10 AUDCHG + γ 11 LAMDA + industry dummies + error term where all variables are as defined earlier. Compared with Eq.
(2), we add the interaction terms between YR0304 and two firm-specific risk variables (i.e., LEVE and LOSS) as well as the BIG4 dummy variable.
In addition, we also add the variables representing the three-way interactions among the three variables representing client-specific risk and auditor quality (LEVE, LOSS, and BIG4), the dummy variable representing the post-SOX period (YR0304) and the weakness in internal control variable (WIC). The positive coefficients on LEVE*YR0304 and LOSS*YR0304 in Eq. (3) (i.e., β 2 , β 5 > 0) are consistent with the fee-increasing effect of client-specific risk (i.e., LEVE and LOSS) being greater in the post-SOX period than in the pre-SOX period. Moreover, the positive coefficients on the three-way interaction terms, LEVE*YR0304*WIC and LOSS*YR0304*WIC (i.e., β 3 , β 6 > 0), support the view that the incremental fee-increasing effect of client-specific risk (i.e., LEVE and LOSS) arising from SOX is greater for clients with WIC than for those with no WIC. In a similar vein, the positive coefficients on BIG4*YR0304 and BIG4*YR0304*WIC (i.e., β 8 , β 9 > 0) are consistent with the view that Big 4 auditors charge higher audit fees during the post-SOX period and, in particular, for the audits of clients with WIC, compared with non-Big 4 auditors. Table 6 presents the results of various regressions for Eq. (3). In Table 6, we report the results using WIC_D only, for brevity, because the results using WIC_C or WIC_P are qualitatively identical with those using WIC_D. With respect to the effect of LEVE on audit fees, the coefficient on LEVE is significantly positive in all cases, while the coefficient on the two-way interaction term, i.e., LEVE*YR0304, is insignificant in all cases. In addition, the three-way interaction term, i.e., LEVE*YR0304*WIC, is significant with a positive sign (as in models 2, 5, and 7). The above results, taken as a whole, suggest that highly levered firms pay higher audit fees in general, and the highly levered firms with WIC problems paid additionally higher fees during the post-SOX period, while the firms without WIC problems did not pay such incremental fees during the post-SOX period after an overall shift in audit fees in the post-SOX period is controlled for by YR0304.
With respect to the effect of LOSS on audit fees, the coefficient on LOSS itself is significantly positive at the 1% level, while the coefficient on LOSS*YR0304 is insignificant across all cases. The coefficient on LOSS*YR0304*WIC is significantly positive. These results, taken as a whole, suggest that firms that report losses generally paid higher audit fees. In addition, the loss firms with WIC began to pay even higher fees in the post-SOX period, while the loss firms without WIC problems paid no marginally higher fees in the post-SOX period.
With respect to the effect of BIG4 on audit fees, we find that the coefficient on BIG4 itself is significantly positive across all cases, suggesting the existence of a Big 4 audit fee premium. Furthermore, the coefficient on BIG4*YR0304 is also significant with a positive sign in all cases, suggesting that Big 4 audit fee premium increased significantly for both clients with and without WIC during the post-SOX period. However, the coefficients on the three-way interaction term, i.e., BIG4*YR0304*WIC, are insignificant across all cases, suggesting that Big 4 audit fee premium increased by the similar magnitude for both clients, or equivalently WIC clients pay a similar level of the Big 4 premium as do non-WIC clients.
Finally, as shown in Table 6, the coefficients on the WIC variable (i.e., α 2 ) are significant in models 1 and 6. When we add the interaction term, YR0304*WIC, as in models 2 to 7, however, the coefficient on WIC becomes insignificant and only the coefficient on the interaction term (i.e., α 3 ) is significantly positive. These results are consistent with those in Table 5 that clients with WIC began to pay higher fees from year 2003. 25) Also similar to the results reported in 25) When we estimate clustered standard error by each firm, the weakly significant results in models 5 and 7 for the coefficients on YR0304*WIC becomes marginally insignificant. All t-statistics in parentheses are calculated using White's (1980) consistent standard error estimates to correct for heteroskedasticity. *, **, and *** denotes p-value < 10%, p-value < 5%, and p-value < 1%, respectively with two-tailed tests. Table 1 for the definitions of other variables. Table 5, the coefficients on all the control variables except BTM are highly significant with expected signs. One may argue that the significant correlations among three variables of interest (LEVE, LOSS, and BIG4) as reported in Table 3 and the correlations among the associated interaction terms lead to some of their coefficients being insignificant as reported in Table 6. To examine this possibility, we estimate Eq. (3) after including only one variable of interest and its interaction terms. For example, we examine the audit fee effect of BIG4 using the following specification which excludes all the variables that contain LEVE and LOSS. AFEE = α 0 + α 1 YR0304 + α 2 WIC + α 3 (YR0304*WIC) + β 1 BIG4 + β 2 (BIG4 * YR0304) + β 3 (BIG4 * YR0304 * WIC) + γ 1 LNTA + γ 2 NBS + γ 3 NGS + γ 4 EMPLOY + γ 5 INVREC + γ 6 ISSUE + γ 7 BTM + γ 8 FOREIGN + γ 9 EXORD (4) + γ 10 AUDCHG + γ 11 LAMDA + industry and year dummies + error term
Table 6. OLS Regression analyses on interactions with firm-specific risks and internal control weakness
AFEE = α 0 + α 1 YR0304 + α 2 WIC + α 3 (YR0304*WIC) + β 1 LEVE + β 2 (LEVE*
The regression results for Eq. (4) reveal that the coefficient on BIG4*YR0304*WIC is not significantly different from zero, while the coefficient on BIG4*YR0304 is significant at 1 percent level. For example, we find that β 2 is 0.3044 with t = 6.81 and β 3 is -0.0812 with t = -0.73. Overall, the regression results for Eq. (4) are consistent with those presented in Table 6.
Similarly, to examine the LEVE (LOSS) effect, we estimate Eq. (4) after replacing BIG4 with LEVE (LOSS). Because the results are not qualitatively different from those reported Table 6, we do not separately report them for brevity. 26) In short, the above results indicate that our results reported in Table 6 are robust with respect potential problems of multi-collinearity among the three variables of interest, namely, LEVE, LOSS, and BIG4 and the interaction terms associated therewith.
Sensitivity Checks
We perform a variety of sensitivity analyses to check the 26) For example, if we replace BIG4 in Eq. (4) for LEVE (LOSS), the value of β 3 is 0.2528 (0.1412) with t = 3.30 (2.37). These results are qualitatively similar to those in Table 6.
robustness of our findings. First, given that the SOX was enacted in 2002, it is unclear whether or not the SOX influenced an auditor's pricing behavior in 2002. As a sensitivity check, we repeat our regression analyses after excluding the 2002 data. We find that the exclusion of the 2002 data does not alter our statistical inferences on the variables of interest. Second, the SOX specifically states that companies that are not required to file annual and quarterly reports on an accelerated basis (i.e., U.S. companies with market capitalization below $75 million) must comply with the Section 404 requirements starting the fiscal year ending on or after July 15, 2007. As explained before, our sample therefore does not include any firms that belong to this category because auditors are not required to report any WICO on these firms in 2004. We notice, however, that for some of such firms that belong to this category, auditors voluntarily report their opinions on WIC. As a sensitivity check, we expand our sample by including all firms regardless of their size. Using this expanded sample of 12,403 firm-year observations, we repeat our regression analyses. Though not reported, overall, the results using this expanded sample are qualitatively similar to those reported in the paper.
Third, we construct a balanced-panel sample by including the same set of sample firms throughout the five-year sample period, 2000 to 2004. Though not reported, the results using the balanced panel data are qualitatively identical to those reported in the paper.
Fourth, we perform tests using the following regression specification (with YR0304 excluded) after restricting the data period to the post-SOX period (year 2003 and 2004). AFEE = α 0 + α 1 WIC + β 1 LEVE + β 2 (LEVE*WIC) + β 3 LOSS + β 4 (LOSS*WIC) + β 5 BIG4 + β 6 (BIG4*WIC) + γ 1 LNTA + γ 2 NBS + γ 3 NGS + γ 4 EMPLOY + γ 5 INVREC (6) + γ 6 ISSUE + γ 7 BTM + γ 8 FOREIGN + γ 9 EXORD + γ 10 AUDCHG + γ 11 LAMDA + industry dummies + error term Consistent with the results reported in Table 6, we find that the coefficient on WIC is not significant, while the coefficients, β 1 to β 6 are all significant with positive sign except the insignificant coefficients of β 6 . This indicates that all the major inferences we made in Table 6 remain unaltered.
Finally, in an attempt to check whether our sample is comparable with the samples used in previous research, we replicate Hogan and Wilkins (2008). Consistent with their findings, we find that performance-matched discretionary accruals (Kasznik 1999or Kothari et al. 2005 are not significantly related to WIC. When our sample firms with WIC are matched to non-WIC firms in the same industry (2-digit SIC code) and the same year which have the closest return on assets, there is no significant difference in terms of the level of absolute discretionary accruals in both univairate and multivariate tests. The above results suggest that the characteristics of our dataset are not different from those used in previous related research.
CONCLUSION
The SOX requires the implementation of many new rules and procedures. In particular, Section 404 of SOX mandates management to assess the effectiveness of a firm's internal control in financial reporting (ICOFR) and to report its conclusion in the firm's annual reports for fiscal years ending after November 2004. Section 404 also mandates the auditor to review management's assessment, and then, to report her own conclusion regarding the effectiveness of the ICOFR.
Using a sample of 252 firms that received an "Ineffective" audit opinion on the effectiveness of the ICOFR under Section 404 of SOX, this study investigates the effect of the enactment of SOX in year 2002 on audit pricing. The results of various tests reveal the following. First, we find that audit fees were, on average, significantly higher in the post-SOX period than in the pre-SOX period after controlling for all other factors that are deemed to affect audit fees. This suggests that SOX lead to an upward shift in the strength of the US legal environment, which in turn increased an auditor's legal liability. This increased legal liability caused the auditor to charge higher audit fees and/or work harder. Second, we find that firms that received an "Ineffective" opinion on the ICOFR from their auditors in response to Section 404 of SOX paid higher audit fees for their financial statement audits. In other words, auditors' opinions on WIC are positively associated with audit fees. We also find that this positive association between audit fees and WIC is pronounced primarily in the post-SOX period (years 2003 and 2004), but not in the pre-SOX period (years 2000 to 2002). The above results, taken as a whole, suggest that auditors either worked more or charged higher risk premiums to compensate for the increased legal liability cost associated with the audits of clients with WIC during the post-SOX period.
Further analyses reveal that clients with WIC that are highly levered and/or report losses paid higher audit fees during the post-SOX period, compared with not-highly-levered and/or profitreporting clients with WIC and clients without WIC. However, we find that Big 4 audit fee premium increased for both clients with and without WIC during the post-SOX period, whether or not the clients had WIC.
Overall, our results suggest that the SOX is successful in changing auditors' behavior by motivating them to focus more on the WIC. To the extent that this change results in the higher audit quality, evidence provided in this study supports the view that the enactment of SOX accomplished its regulatory objectives at least partially. In conclusion, given the scarcity of empirical evidence on the issue, our results provide useful insights into how the auditors, in terms of client risk assessment and pricing mechanism, respond to the legal regime shift caused by the enactment of SOX.
This study has some limitation. First, the higher audit fee does not necessarily imply the higher audit quality, although the fee is frequently used as a proxy for the quality. Second, Ge and McVay (2005) and Doyle et al. (2007) classify the WIC to different types. Due to time limitation, we do not follow the classifications. Future studies should investigate this issue.
Section/Title number Key provisions
Section 206: Conflicts of Interest.
The CEO, Controller, CFO, Chief Accounting Officer or person in an equivalent position cannot have been employed by the company's audit firm during the 1-year period preceding the audit.
Section 301: Public Company Audit Committees.
Each member of the audit committee shall be a member of the board of directors of the issuer, and shall otherwise be independent. The audit committee of an issuer shall be directly responsible for the appointment, compensation, and oversight of the work of any registered public accounting firm employed by that issuer.
Section 302: Corporate Responsibility For Financial Reports
The CEO and CFO of each issuer shall prepare a statement to accompany the audit report to certify the "appropriateness of the financial statements and disclosures contained in the periodic report, and that those financial statements and disclosures fairly present, in all material respects, the operations and financial condition of the issuer."
Section 304: Forfeiture of Certain Bonuses and Profits
If an issuer is required to prepare a restatement due to "material noncompliance" with financial reporting requirements, the chief executive officer and the chief financial officer shall "reimburse the issuer for any bonus or other incentive-based or equity-based compensation received" during the twelve months following the issuance or filing of the non-compliant document and "any profits realized from the sale of securities of the issuer" during that period.
Section 402: Enhanced Conflict of Interest Provisions.
Generally, it will be unlawful for an issuer to extend credit to any director or executive officer.
Section 404: Management Assessment Of Internal Controls
Requires each annual report of an issuer to contain an "internal control report", which shall: (1) state the responsibility of management for establishing and maintaining an adequate internal control structure and procedures for financial reporting; and
(2) contain an assessment, as of the end of the issuer's fiscal year, of the effectiveness of the internal control structure and procedures of the issuer for financial reporting. Each issuer's auditor shall attest to, and report on, the assessment made by the management of the issuer. An attestation made under this section shall be in accordance with standards for attestation engagements issued or adopted by the Board.
Section/Title number Key provisions
Section 407: Disclosure of Audit Committee Financial Expert.
The SEC shall issue rules to require issuers to disclose whether at least 1 member of its audit committee is a "financial expert."
Title VIII: Corporate and Criminal Fraud Accountability
It is a felony to "knowingly" destroy or create documents to "impede, obstruct or influence" any existing or contemplated federal investigation. Auditors are required to maintain "all audit or review work papers" for five years. The statute of limitations on securities fraud claims is extended to the earlier of five years from the fraud, or two years after the fraud was discovered, from three years and one year, respectively. Employees of issuers and accounting firms are extended "whistleblower protection" that would prohibit the employer from taking certain actions against employees who lawfully disclose private employer information to, among others, parties in a judicial proceeding involving a fraud claim. Whistle blowers are also granted a remedy of special damages and attorney's fees. A new crime for securities fraud that has penalties of fines and up to 10 years imprisonment.
Title IX: White Collar Crime Penalty Enhancements.
Maximum penalty for mail and wire fraud increased from 5 to 10 years. SEC is given authority to seek court freeze of extraordinary payments to directors, offices, partners, controlling persons, agents of employees. SEC may prohibit anyone convicted of securities fraud from being an officer or director of any publicly traded company. Financial statements filed with the SEC must be certified by the CEO and CFO. The certification must state that the financial statements and disclosures fully comply with provisions of the Securities Exchange Act and that they fairly present, in all material respects, the operations and financial condition of the issuer. Maximum penalties for willful and knowing violations of this section are a fine of not more than $500,000 and/or imprisonment of up to 5 years.
Reference: the American Institute of Certified Public Accountants, Summary of the Provisions of the Sarbanes-Oxley Act of 2002 (http://www.aicpa.org)
error term where, for each firm and in each year: AFEE = natural log of fees paid to auditors for their financial statement audits (i.e., audit fees) in thousand dollars; YR0304 = 1 if the fiscal year is 2003 or 2004 and 0 otherwise; WIC = A weakness of a client's internal control variable measured by either WIC_D, WIC_C, or WIC_P where WIC_D equals 1 if a client receives an internal control weakness opinion from its auditor and 0 otherwise; WIC_C equals natural log of one plus the number of categories of internal control weakness cited in the auditor's report; WIC_P is the predicted value of WIC_C. The WIC_ D and WIC_C are measured in 2004 and assumed to remain the same during the five-year sample period, 2000-2004, while WIC_P is measured for each firm-year observations.
LEVE
= leverage measured by total liabilities divided by total assets; windsorized at 5; LOSS = 1 if the firm reports net loss and 0 otherwise; BIG4 = 1 if the auditor is one of Big 4 and 0 otherwise; LNTA = natural log of total assets in thousand dollars; NBS = natural log of one plus number of business segments; NGS = natural log of one plus number of geographic segments; EMPLOY = square root of the number of employees; INVREC = inventory plus receivables, divided by total assets; ISSUE = 1 if the sum of debt or equity issued during the past 3 years are more than 5 percent of the total assets and 0 otherwise; BTM = book-to-market ratio, windsorized at 0 and 4; FOREIGN = 1 if the firm pays any foreign income tax and 0 otherwise; EXORD = 1 if the firm reports any extraordinary gains or losses and 0 otherwise; RNDTA = research and development expenditure (Compustat data item number 46) divided by total assets; AUDCHG = 1 if the incumbent auditor is different from the last year's auditor and 0 otherwise; LAMDA = inverse Mills ratio.
ses reveal that there exist clear coefficients differences between the period until 2002 and the period after year 2002. The results for year 2002 are more similar to those of year 2000 or 2001 in the year-by-year analyses than those of year 2003 or 2004. Thus, we select year 2003 as the cut-off year. This result suggests that it took about 1 year for the SOX to change the pricing mechanism of the auditors. 16) Following Ashbaugh-Skaife et al. (
identified in our 2004 sample into the 2000-2003 sample as long as the data requirements for estimating our regression models are satisfied. 18) As shown in Panel A ofTable 1, our final sample consists of 2,437 client firms or 9,067 firm-year observations. As shown in Section A, 252 of the 2,437 clients (or 10.27 percent of the sample) received WICO from their auditors in 2004. Similarly, 88.33 percent of the observations have WIC_D that equals 0 and the remaining 11.67 percent of our sample have WIC_D that equals 1. Panel A also reports the number of the categories of WIC cited on the auditor's report. Twenty-eight firms (121 observations) receiving WICOs from their auditors have only one category of WIC, whereas 6 firms (25 observations) have 10 different categories of WIC.Panel B of
Definitions of Variables AFEE = natural log of audit fees in thousand dollars; WIC_D = 1 if the auditor of the client firm receives internal control weakness opinion in fiscal year 2004, 0 otherwise; WIC_C = natural log of one plus the number categories of internal control weakness cited in the auditor's report for fiscal year 2004; LEVE = leverage (total liabilities divided by total assets); LOSS = 1 if the firm reports a loss during the year, 0 otherwise; BIG4 = 1 if the auditor is a Big 4 or predecessor auditor, 0 otherwise; LNTA = natural log of total assets in thousand dollars; NBS = natural log of one plus number of business segments; NGS = natural log of one plus number of geographic segments; EMPLOY = square root of the number of employees; INVREC = inventory and receivables divided by total assets; ISSUE = 1 if the sum of debt or equity issued during the past 3 years are more than 5% of the total assets, 0 otherwise; BTM = book-to-market ratio, windsorized at 0 and 4; FOREIGN = 1 if the firm pays any foreign income tax, 0 otherwise; EXORD = 1 if the firm reports any extraordinary gains or losses, 0 otherwise; RNDTA = research and development expenditure divided by total assets; AUDCHG = 1 if auditor is in the first year of audit engagement, 0 otherwise; LAMDA = inverse Mills ratio for the receipt of endogenous weak internal control opinion.
receives internal control weakness opinion in fiscal year 2004 and 0 otherwise. WIC_C: natural log of one plus the number categories of internal control weakness cited in the auditor's report of fiscal year 2004. WIC_P: predicted number of internal control weakness categories. YR0304: 1 if the fiscal year is 2003 or 2004 and 0 otherwise. See
WIC = WIC_ D. WIC_D: 1 if the company receives internal control weakness opinion in fiscal year 2004 and 0 otherwise. YR0304: 1 if the fiscal year is 2003 or 2004 and 0 otherwise. See
Table 1 .
1Statistics on weakness in internal control Panel A: Number of internal control weakness opinions Panel B: Categorization of the weakness in internal controlNumber of
weakness in
internal control
Section A
No. of Firms
Section B
No. of firm-year observations
Number
%
Number
%
0
1
2
3
4
5
6
7
8
9
10
2,185
28
73
48
43
20
17
9
3
5
6
89.73
1.14
2.97
1.96
1.75
0.82
0.69
0.37
0.12
0.20
0.24
8,009
121
311
209
178
76
65
41
11
21
25
88.33
1.33
3.43
2.31
1.96
0.84
0.72
0.45
0.12
0.23
0.28
Total
2,437
100.00
9,067
100.00
Category
Number of
observations
%
Application of GAAP/accounting policies
Review of transactions
Tax-related issues
Staffing issues (levels, training, or expertise)
Property, equipment, lease
Policies/documentation issues
Financial statement closing process/controls
Control environments
International operations/subsidiaries
IT & applications
Merger/acquisition-related issues
Inventory management
Revenue/billing
Segregation of duties
Employee benefit/pension
Others
345
343
319
293
277
241
233
198
172
138
136
113
101
93
74
333
32.61
32.42
30.15
27.69
26.18
22.78
22.02
18.71
16.26
13.04
12.85
10.68
9.55
8.79
6.99
31.47
Table 2 .
2Distributions of variablesVariable
Mean
Std. Dev.
1%
50%
99%
AFEE
WIC_D
WIC_C
LEVE
LOSS
BIG4
LNTA
NBS
NGS
EMPLOY
INVREC
ISSUE
BTM
FOREIGN
EXORD
RNDTA
AUDCHG
LAMDA
6.0235
0.1167
0.1635
0.5293
0.4028
0.8894
12.7669
1.0029
0.9833
64.5678
0.2393
0.4872
0.5686
0.4773
0.2296
0.0679
0.0867
1.7863
1.2757
0.3211
0.4731
0.4776
0.4905
0.3137
2.0210
0.4830
0.6315
76.5885
0.1818
0.4999
0.6146
0.4995
0.4206
0.1417
0.2814
0.2378
3.2048
0
0
0.0451
0
0
7.3265
0
0
2.2360
0
0
0
0
0
0
0
1.3580
5.9319
0
0
0.4791
0
1
12.7305
0.6931
1.0986
38.9101
0.2114
0
0.4078
0
0
0.0039
0
1.7588
9.2003
1
2.0794
2.1748
1
1
17.2799
2.0794
2.3026
370.1351
0.7613
1
3.5834
1
1
0.7812
1
2.6232
Table 3 .
3Pearson correlations among variablesVariable AFEE
WIC_D WIC_C
LEVE
LOSS
BIG4
LNTA
NBS
NGS
EMP-
LOY
INV-
REC
ISSUE
BTM
FOR-
EIGN
EXORD RNDTA
AUD-
CHG
WIC_D
0.057
(<0.001)
WIC_C
0.061
(<0.001)
0.948
(<0.001)
LEVE
0.027
(0.011)
-0.018
(0.092)
-0.017
(0.092)
LOSS
-0.230
(<0.001)
0.036
(0.001)
0.048
(<0.001)
0.106
(<0.001)
BIG4
0.359
(<0.001)
0.037
(<0.001)
0.031
(0.003)
-0.157
(<0.001)
-0.126
(<0.001)
LNTA
0.800
(<0.001)
0.027
(0.009)
0.022
(0.040)
-0.041
(<0.001)
-0.334
(<0.001)
0.441
(<0.001)
NBS
0.227
(<0.001)
0.028
(0.007)
0.029
(0.005)
0.039
(<0.001)
-0.096
(<0.001)
0.056
(<0.001)
0.216
(<0.001)
NGS
0.407
(<0.001)
0.060
(<0.001)
0.075
(<0.001)
-0.034
(0.001)
-0.140
(<0.001)
0.157
(<0.001)
0.335
(<0.001)
0.119
(<0.001)
EMP-
LOY
0.594
(<0.001)
-0.008
(0.433)
-0.019
(0.074)
0.083
(<0.001)
-0.258
(<0.001)
0.197
(<0.001)
0.687
(<0.001)
0.140
(<0.001)
0.187
(<0.001)
INVREC
0.031
(0.003)
0.003
(0.812)
-0.003
(0.798)
0.078
(<0.001)
-0.231
(<0.001)
-0.071
(<0.001)
-0.040
(<0.001)
0.074
(<0.001)
0.148
(<0.001)
0.083
(<0.001)
ISSUE
-0.043
(<0.001)
-0.012
(0.255)
-0.014
(0.182)
0.123
(<0.001)
0.125
(<0.001)
-0.046
(<0.001)
-0.052
(<0.001)
-0.032
(0.002)
-0.111
(<0.001)
-0.068
(<0.001)
-0.111
(<0.001)
BTM
-0.067
(<0.001)
0.019
(0.070)
0.021
(0.049)
-0.117
(<0.001)
0.061
(<0.001)
0.015
(0.142)
0.020
(0.052)
0.068
(<0.001)
0.004
(0.735)
-0.014
(0.181)
0.126
(<0.001)
-0.111
(<0.001)
FOR-
EIGN
0.482
(<0.001)
0.054
(<0.001)
0.065
(<0.001)
-0.021
(0.043)
-0.208
(<0.001)
0.179
(<0.001)
0.406
(<0.001)
0.137
(<0.001)
0.594
(<0.001)
0.268
(<0.001)
0.157
(<0.001)
-0.118
(<0.001)
-0.024
(0.021)
EXORD
0.225
(<0.001)
0.024
(<0.024)
0.028
(0.008)
0.122
(<0.001)
0.035
(<0.001)
0.054
(<0.001)
0.221
(<0.001)
0.136
(<0.001)
0.074
(<0.001)
0.172
(<0.001)
-0.026
(0.015)
0.018
(0.083)
0.073
(<0.001)
0.082
(<0.001)
RNDTA
-0.253
(<0.001)
-0.039
(<0.001)
-0.024
(0.022)
0.046
(<0.001)
0.366
(<0.001)
-0.074
(<0.001)
-0.392
(<0.001)
-0.168
(<0.001)
-0.167
(<0.001)
-0.251
(<0.001)
-0.219
(<0.001)
0.116
(<0.001)
-0.180
(<0.001)
-0.164
(<0.001)
-0.122
(<0.001)
AUD-
CHG
-0.104
(<0.001)
0.021
(0.045)
0.020
(0.054)
0.045
(<0.001)
0.048
(<0.001)
-0.155
(<0.001)
-0.090
(<0.001)
-0.012
(0.263)
-0.019
(0.077)
-0.065
(<0.001)
0.006
(0.599)
-0.013
(0.235)
0.040
(<0.001)
-0.045
(<0.001)
0.018
(0.083)
0.008
(0.441)
LAMDA
-0.598
(<0.001)
-0.092
(<0.001)
-0.092
(<0.001)
0.330
(<0.001)
0.013
(0.235)
-0.639
(<0.001)
-0.711
(<0.001)
-0.216
(<0.001)
-0.469
(<0.001)
-0.383
(<0.001)
-0.019
(0.067)
0.055
(<0.001)
-0.080
(<0.001)
-0.516
(<0.001)
-0.133
(<0.001)
0.241
(<0.001)
-0.023
(0.029)
Table 4 .
4Audit fee difference between the pre-SOX and post-SOX periodsPanel A: Mean audit fees by year for the total sample, the WIC sample,
and the non-WIC sample
Year
N
Total sample
WIC sample
(WIC_D = 1)
Non-WIC sample
(WIC_D = 0)
2000
2001
2002
2003
2004
1,626
1,740
1,868
1,941
1,892
5.5856
5.6589
5.8200
6.0791
6.8787
5.5984
5.7522
6.0080
6.3239
7.2209
5.5840
5.6483
5.7956
6.0464
6.8304
Panel B: Average audit fee changes from 2002 to 2003 for the WIC and
non-WIC samples
N
Amount of
change
Percentage change
(%)
WIC sample
(WIC_D = 1)
228
Mean
Median
0.3335
0.2571
7.76
4.34
Non-WIC sample
(WIC_D = 0)
1,689
Mean
Median
0.2468
0.1942
5.63
3.15
Test for mean differences
Test for median differences
t value
z value
2.38***
2.61***
1.56*
3.05***
Panel C: Average audit fee changes from years 2001 and 2002 to years
2003 and 2004 for the WIC and non-WIC samples
N
Amount of
change
Percentage change
(%)
WIC sample
(WIC_D = 1)
215
Mean
Median
0.9408
0.9571
17.70
16.76
Non-WIC sample
(WIC_D = 0)
1,378
Mean
Median
0.6988
0.6943
12.49
12.02
Test for mean difference
Test for median differences
T value
z value
7.47***
4.59***
7.35***
6.47***
Table 5 .
5OLS Regression analyses on determinants of audit feesAFEE
= α
0 + α
1 YR0304+
α
2 WIC
+ α
3 (YR0304*WIC) + β
1 LEVE
+ β
2 LOSS
+ β
3 BIG4
+ γ
1 LNTA
+ γ
2 NBS
+ γ
3 NGS
+ γ
4 EMPLOY
+ γ
5 INVREC
+ γ
6 ISSUE
+ γ
7 BTM
+ γ
8 FOREIGN
+ γ
9 EXORD
+ γ
10 AUDCHG
+ γ
11 LAMDA
+ industry dummies
+ error term
Variables
Predicted
sign
Model 1
Model 2
Model 3
Model 4
Model 5
Model 6
Model 7
Model 8
Model 9
With both WIC
and YR0304
excluded
With WIC
excluded
WIC = WIC_D
With YR0304
excluded
WIC = WIC_D
With Lamda
excluded
WIC = WIC_D
With Lamda
included
WIC = WIC_D
With Lamda
excluded
WIC = WIC_D
With Lamda
included
WIC = WIC_C
With Lamda
excluded
WIC = WIC_P
With Lamda
excluded
Table 5 . (Continued)
5Variable
Pred.
sign
Model 1
Model 2
Model 3
Model 4
Model 5
Model 6
Model 7
Model 8
Model 9
ISSUE
+
0.0097
(0.65)
0.0176
(1.34)
0.0096
(0.64)
0.0175
(1.35)
0.0356
(2.70***)
0.0176
(1.35)
0.0356
(2.70***)
0.0174
(1.33)
0.0177
(1.35)
AppendixSummary of the major SOX provisions that are important to Auditor/ AuditingSection/Title number Key provisionsSection 101: establishment; Administrative Provisions.The Public Company Accounting Oversight Board (The Board) is established as an independent non-profit corporation which shall oversee the audit of public companies that are subject to the securities laws and related matters.Section 103: Auditing, Quality Control, And Independence Standards And Rules.The Board must require registered public accounting firms to "prepare, and maintain for a period of not less than 7 years, audit work papers, and other information related to any audit report, in sufficient detail to support the conclusions reached in such report."The Board must require a 2nd partner review (concurring review) and approval of audit reports registered accounting firms must adopt quality control standards.Section 104: Inspections of Registered Public Accounting Firms.Annual quality reviews (inspections) must be conducted for firms that audit more than 100 issues, all others must be conducted every 3 years. The SEC and/or the Board may order a special inspection of any firm at any time.Section 201: Services Outside The Scope Of Practice Of Auditors.It shall be "unlawful" for a registered public accounting firm to provide any non-audit service to an issuer contemporaneously with the audit, including: (1) bookkeeping or other services related to the accounting records or financial statements of the audit client; (2) financial information systems design and implementation; (3) appraisal or valuation services, fairness opinions, or contribution-in-kind reports; (4) actuarial services; (5) internal audit outsourcing services; (6) management functions or human resources; (7) broker or dealer, investment adviser, or investment banking services; (8) legal services and expert services unrelated to the audit; (9) any other service that the Board determines, by regulation, is impermissible.Section 203: Audit Partner RotationThe lead audit or coordinating partner and the reviewing partner must rotate off of the audit every 5 years.
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Audit Committee Quality and Internal Control: An Empirical Analysis. J Krishnan, The Accounting Review. 802Krishnan, J. (2005), "Audit Committee Quality and Internal Control: An Empirical Analysis," The Accounting Review, 80(2), 649-675.
The Importance of Business Risk in Setting Audit Fees: Evidence form Cases of Client Misconduct. J D Lyon, M W Maher, Journal of Accounting Research. 431Lyon, J. D., and M. W. Maher (2005), "The Importance of Business Risk in Setting Audit Fees: Evidence form Cases of Client Misconduct," Journal of Accounting Research, 43(1), 133-151.
Error Cost and Auditors' Termination Decisions. K Menon, D D Williams, Journal of Accounting, Auditing & Finance. 142Menon, K. and D. D. Williams (2001), "Error Cost and Auditors' Termination Decisions," Journal of Accounting, Auditing & Finance, 14(2), 95-123.
Section 404 Reporting on Internal Control: Our Early Experience. Moody's Investor Service. Special CommentMoody's Investor Service (2005), "Section 404 Reporting on Internal Control: Our Early Experience," Special Comment (April).
Who Got Sued?. Z Palmrose, Journal of Accountancy. 1833Palmrose, Z. (1997), "Who Got Sued?," Journal of Accountancy, 183(3), 67- 69.
The Effects of Client Characteristics on Auditor Litigation Risk Judgments, Required Audit Evidence, and Recommended Audit Fees. J Pratt, J D Stice, The Accounting Review. 694Pratt, J., and J. D. Stice (1994), "The Effects of Client Characteristics on Auditor Litigation Risk Judgments, Required Audit Evidence, and Recommended Audit Fees," The Accounting Review, 69(4), 639-656.
An Audit of Internal Control over Financial Reporting Performed in Conjunction with an Audit of Financial Statements. K Pcaob Raghunandan, D V Rama, SOX Section 404 Material Weakness Disclosures and Audit Fees. Washington, D.C25Auditing StandardsPublic Company Accounting Oversight Board (PCAOB) (2004), "An Audit of Internal Control over Financial Reporting Performed in Conjunction with an Audit of Financial Statements," Auditing Standards No. 2. Washington, D.C.: PCAOB Raghunandan, K., and D. V. Rama (2006), "SOX Section 404 Material Weakness Disclosures and Audit Fees," Auditing: A Journal of Practice and Theory, 25(1), 99-114.
. J L Reynolds, D Deis, J R Francis, Professional Service Fees and Auditor Objectivity. 231Auditing: A Journal of Practice and TheoryReynolds, J.L., D. Deis, and J.R. Francis (2004), "Professional Service Fees and Auditor Objectivity," Auditing: A Journal of Practice and Theory, 23(1), 29-52.
Pricing Initial Audit Engagements: Empirical Evidence Following Public Disclosure of Audit Fees. S Sankaraguruswamy, S Whisenant, Working paper, University of HoustonSankaraguruswamy, S., and S. Whisenant (2003), "Pricing Initial Audit Engagements: Empirical Evidence Following Public Disclosure of Audit Fees," Working paper, University of Houston.
Available at www.sec.gov/news/speech/sp-ch021605psa.htm. Securities and Exchange Commission (SEC) (2005b), "Remarks Before the European Corporate Governance Summit: An SEC Commissioner's View: The Post-Sarbanes-Oxley Environment for Foreign Issuer. Speech by SEC Commissioner. Washington, D. C., SEC; Memphis, Tennessee; London, England31Securities and Exchange Commission (SECSpeech by SEC CommissionerSecurities and Exchange Commission (SEC) (1988) "Disclosure Amendments to Regulation S-K, Form 8-K and Schedule 14A Regarding Changes in Accountants and Potential Opinion Shopping Situations," Financial Reporting Release No. 31 (April), SEC Docket 1140-1147, Washington, D. C., SEC. Securities and Exchange Commission (SEC) (2005a), "Remarks Before the Economic Hub of Memphis," Speech by SEC Commissioner (February 16), Memphis, Tennessee, Available at www.sec.gov/news/speech/sp- ch021605psa.htm. Securities and Exchange Commission (SEC) (2005b), "Remarks Before the European Corporate Governance Summit: An SEC Commissioner's View: The Post-Sarbanes-Oxley Environment for Foreign Issuer," Speech by SEC Commissioner (March 2), London, England. Available at www.sec.gov/news/speech/spch030205cag.htm.
Litigation Risk and Audit Fees: Evidence from U.K. Firms Cross-listed on U.S. Markets. A Seetharaman, F A Gul, S G Lynn, Journal of Accounting and Economics. 331Seetharaman, A., F. A. Gul, and S. G. Lynn (2002), "Litigation Risk and Audit Fees: Evidence from U.K. Firms Cross-listed on U.S. Markets," Journal of Accounting and Economics, 33(1), 91-115.
The Effects of Auditor Change on Audit Fees: Tests of Price Cutting and Price Recovery. D Simon, J Francis, The Accounting Review. 63Simon, D. and J. Francis (1988), "The Effects of Auditor Change on Audit Fees: Tests of Price Cutting and Price Recovery," The Accounting Re- view, 63(2), 255-269.
| Factors influencing the effectiveness of internal audit on organizational performance | Institute of Internal Auditors owes much to Sawyer's vision. With the implementation in the United States of the Sarbanes-Oxley Act of 2002, the profession's exposure and value was enhanced, as many internal auditors possessed the skills required to help companies meet the requirements of the law. However, the focus by internal audit departments of publicly traded companies on SOX related financial policy and procedures derailed progress made by the profession in the late 20th century toward Larry Sawyer's vision for internal audit. Beginning in about 2010, the IIA once again began advocating for the broader role internal auditing should play | This paper examines the responses of the government, the AICPA, and the FASB after the Enron and WorldCom accounting scandals. The major failures of these companies center on their creative accounting and bad corporate governance. The Congress responded to these issues with the Sarbanes-Oxley Act of 2002. The SEC responded with a variety of measures to restore confidence in the accounting profession; expand the role of management; improve disclosures and financial reporting; improve the performance of audit committees; and enhance enforcement tools. The Auditing Standards Board of the AICPA responded by issuing SAS No. 99, which provides auditors with additional guidance for detecting material fraud. The FASB has been slower to respond due to its lengthier due process rules. The paper discusses whether those responses would have been enough to prevent the Enron and WorldCom financial disasters, and whether they are ample now to prevent corporate failures in the future. | 7 | We provide a theoretical investigation of the effects of the Sarbanes‐Oxley Act of 2002 on auditing intensity and internal control strength. We propose a model of strategic auditing in which the auditor can use resources for both internal control tests and substantive tests, while the manager can choose the strength of internal controls and the amount of fraud. We find that control tests are a valuable tool for the auditor when control strength is informative about the likelihood of fraud. We find that Sarbanes‐Oxley has the desired effect of inducing stronger internal control systems and less fraud, but does not necessarily induce higher levels of control testing. Our model suggests that audit risk increases as a result of the Sarbanes‐Oxley Act. | Internal Control and Audit Program Effectiveness: Empirical Evidence from Jordan | Auditability in public procurement: an analysis of internal controls and fraud vulnerability | Strengthening of the Internal Control and Risk Management Audit in Universities | The effect of management change, audit opinion, and financial distress on auditor switching | The recent revelation of the misleading audited accounts of several big companies in the US has heightened public concern about the integrity of a firm’s financial reporting processes. The management of the accounts is commonly known as accrual management as it is effectively accomplished through manipulation of discretionary accruals. A firm’s internal corporate governance systems should be able to constrain the extent of earnings being managed. To this end, this paper investigates one important aspect of the internal corporate governance, namely the independence of the board of directors and the audit committee. It is argued that the extent to which the board and the audit committee are independent of management determines their ability to constrain the management of discretionary accruals. Using data from the Kuala Lumpur Stock Exchange (KLSE) non-financial Main Board listed companies in 1998 evidence showed that neither board independence nor the audit committee independence effectively constrained the accrual management level. The interactive effects of board independence and audit committee independence were also found to be insignificant. Evidence in this paper, therefore, casts doubt that the independence of boards and the audit committee can lead to high quality accounting information, which is thereby useful to users. JEL classification: G34, M41 Key words: Accrual management, Audit committee independence, Discretionary accruals | The aim of this paper is to investigate the effects of management entrenchment on research and development business decisions in the French listed companies and to detect these effects when we test simultaneously the impact of the board of directors' characteristics and the external audit quality. Using data from the French listed companies on the SBF 120 index during the period 2003-2011, this paper statistically tests the hypotheses on the relationship between corporate R&D intensity and managers' entrenchment indicators associated with two types of corporate governance mechanisms: the board of directors' characteristics and the external audit quality. Our results show that R&D intensity is affected by most of management entrenchment indicators (the age, the career, the stock ownership, the education and the firm's past performance), the external audit quality and some control variables (the size and the industry). | Locus Of Control And Dysfunctional Audit Behavior | The Empirical Research on the Relationship Between the Effectiveness of Internal Control and Financial Fraud ——Based on the Data of Chinese Listed Companies |
8 | When did it cease being important that a woman should be a virgin untill marriage? | the young couple were expected to marry. Marriage and birth records from the late 1700s reveal that between 30 and 40 percent of New England brides were pregnant before marriage. The growing popularity of the automobile, and corresponding changes in dating practices, caused premarital sex to become more prevalent. Alfred Kinsey found that American women who became sexually mature during the 1920s were much less likely to be virgins at marriage than those who became mature before World War I. A majority of women during the 1920s under the age of 30 were nonetheless virgins at marriage, however, and half | It is necessary to a nun to be a virgin? | What percentage of men are virgins on the day they got married? | ordered for women who go against traditional societal notions of "public morality and rules of modesty", though in 1999 the Turkish penal code was altered to require a woman's consent prior to performing such an examination. Notes Further reading Virginity Virginity is the state of a person who has never engaged in sexual intercourse. There are cultural and religious traditions that place special value and significance on this state, predominantly towards unmarried females, associated with notions of personal purity, honor and worth. Like chastity, the concept of virginity has traditionally involved sexual abstinence. The concept of virginity usually involves moral | I'm sure there's a more formal term to the era I'm referring to but I'm no expert. I'm thinking of a time period such as the 1200-1500's of Europe, a time where a show like Game of Thrones would apply. In entertainment today they make it seem like sex was as promiscuous as it is today, but that era's law was also very ecclesiastical so pre-marital sex seems as though it wouldn't have as much of a presence as it's being portrayed. Was everyone just swiping right back then? | I'm wondering if marriage would be trickier if one spouse was a virgin while the other wasn't prior to the marriage. Any church teachings on this? | Are you still considered a virgin if you were raped? | Fornication indictable offence at common law. Prior to the passing of the Marriage Act 1753, laws against bastard children became more strict during the 1730s and 1740s. In the Victorian era, however, the English working class continued to have a different set of sexual mores from the upper-middle and upper classes. Premarital intercourse was considered acceptable for the working class but only after an extended period of courtship and occurred infrequently even then. The couple were expected to marry, though. Disgrace only arose if the female became pregnant and the couple did not marry. Ethical issues arising from sexual relations between | 8 | Throughout history we've seen how important it was for a woman to be *unspoiled* untill she married and found a husband. At what point in history did it stop being important that the woman should be a virgin? | who was the founder of the rule for virgins | who would have a kept woman as a mistress | The Importance of Marrying a Virgin Woman | Is there a religion that conclusively established women's rights long before the modern world did? | Saving virginity until marriage | the unibrow is associated with virginity in which country | Cheating - Society made women permanent victims | what has virginity traditionally involved |
9 | On general periodic time-varying bilinear processes | The paper gives sufficient conditions for the absolute regularity of bilinear models. Our approach is based on their Markovian representation. The above property is a direct consequence of the geometric ergodicity of the Markovian process in this representation. The latter process belongs to what we call the generalised random coefficients autoregressive models. Conditions for the geometric ergodicity and also for the existence of moments for this model are given. Our results generalise that of Feigin and Tweedie. | On The Response of Linear Time-Periodic Systems Subjected to Deterministic and Stochastic Excitations | A weighted occupation time is defined for measure-valued processes and a representation for it is obtained for a class of measure-valued branching random motions on Rd. Considered as a process in its own right, the first and second order asymptotics are found as time t→∞. Specifically the finiteness of the total weighted occupation time is determined as a function of the dimension d, and when infinite, a central limit type renormalization is considered, yielding Gaussian or asymmetric stable generalized random fields in the limit. In one Gaussian case the results are contrasted in high versus low dimensions. | We consider the invariant measure of a homogeneous continuous- time Markov process in the quarter-plane. The basic solutions of the global balance equation are the geometric distributions. We first show that the invariant measure can not be a finite linear combination of basic geometric distributions, unless it consists of a single basic geo- metric distribution. Second, we show that a countable linear combina- tion of geometric terms can be an invariant measure only if it consists of pairwise-coupled terms. As a consequence, we obtain a complete characterization of all countable linear combinations of geometric dis- tributions that may yield an invariant measure for a homogeneous continuous-time Markov process in the quarter-plane. | Temporal aggregation in a periodically integrated autoregressive process | Continuous-time linear stochastic processes A(t)= -f'f(tu)dX(u) where X( ) is a homogeneous additive process, are examined. The result of Westcott (1970) that A( ) and f determine X( ) uniquely is generalised slightly. It is shown that if essentially distinct pairs fi, X1( ) and f2, X2(. ) give rise to the same linear process A, then X( -) and X2( ) are Gaussian, and that if a process A is time-reversible then X( ) is Gaussian. These results are continuous-time analogues of Rao (1966) and of Weiss (1975) respectively. | We consider the concepts of continuous Bernoulli systems and non-commutative white noises. We address the question of isomorphism of continuous Bernoulli systems and show that for large classes of quantum L{\'e}vy processes one can make quite precise statements about the time behaviour of their moments. | In this paper, general periodic ecosystems are discussed. Through studying of the fixed point behaviours to the mixed monotone operator, we obtain some results about the existence and uniqueness, and attraction of the positive periodic solution for general periodic ecosystems. Our results unify and improve some known results. | 9 | We study in this note the class of bilinear processes with periodic time-varying coefficients. We give necessary and sufficient conditions ensuring the existence of strict and second order stationary solutions (in periodic sense) and for the existence of higher order moments. The given conditions can be applied to periodic ARMA or periodic GARCH models. The central limit theorem and the law of iterated logarithm (LIL) for higher order sample moments are showed. | A characterization of vector autoregressive processes with common cyclical features | Almost Periodic Solutions for Limit Periodic Systems | Abstract In this paper we prove the existence and uniqueness of C ( n ) -almost periodic solutions to the ordinary differential equation x ′ ( t ) = A ( t ) x ( t ) + f ( t ) , t ∈ R , where the matrix A ( t ) : R → M k ( C ) is τ -periodic and f : R → C k is C ( n ) -almost periodic. We also prove the existence and uniqueness of an ultra-weak C ( n ) -almost periodic solution in the case when A ( t ) = A is independent of t . Finally we prove also the existence and uniqueness of a mild C ( n ) -almost periodic solution of the semilinear hyperbolic equation x ′ ( t ) = A x ( t ) + f ( t , x ) considered in a Banach space, assuming f ( t , x ) is C ( n ) -almost periodic in t for each x ∈ X , satisfies a global Lipschitz condition and takes values in an extrapolation space F A − 1 associated to A . | Evidence of quasi-biennial oscillations in a general circulation model | In this note the almost sure convergence of stationary, ϕ-mixing sequences of random variables with values in real, separable Banach spaces according to summability methods is linked to the fulfillment of a certain integrability condition generalizing and extending the results for i.i.d. sequences. Furthermore we give via Baum-Katz type results an estimate for the rate of convergence in these laws. | Second-order properties of multivariate stationary time series | The Stepanov almost periodic solution of a certain second-order differential equation in a reflexive Banach space is shown to be almost periodic. | Existence and Stability Properties of Almost Periodic Solutions in Discrete Almost Periodic Systems |
10 | We report on the generation of mid- and far-infrared radiation using periodically poled materials. In particular, cw mode-locked fs optical parametric oscillators based on (PPLN) periodically poled LiNbO/sub 3/:MgO with strongly reduced photorefractivity and optical rectification in PPLN for the generation of tunable narrowband THz radiation will be discussed. | We report on all periodically-poled crystals based singly-resonant optical parametric oscillator (SRO) generating continuous-wave, single-frequency, tunable UV radiation with maximum output power of 336mW in 18.5 MHz line-width at 399.2nm. It has tunability of 18nm. | Temperature-tunable nanosecond optical parametric oscillator based on periodically poled MgO:LiNbO3 | Single-cycle THz radiation was generated by optical rectification of Yb-fiber laser pulses with 250 fs duration and 10 muJ energy. We obtained an average power of 0.5 mW at 1 MHz repetition rate. | By using a short-pulse field, periodically poled grating (A = 29 μm) was successfully fabricated in a 1.0 mm-thick MgO:LiNbO3 (mole fraction of doped MgO is 5%). A high-repetition-rate optical parametric generation (OPG) based on periodically poled MgO:LiNbO3 (PPMgLN) was pumped by a 1.064 μm acousto-optically Q-switched Nd:YVO4 laser. With 3 W of input pump power, 44 mW of output signal power was obtained at a conversion efficiency of 1.5%. Tunable infrared (IR) output from 1.4538–1.4750 μm was also obtained by tuning the temperature of PPMgLN, which is 45°C–160°C. | The operating principles and a practical demonstration of surface-emitted THz waves via difference frequency mixing are discussed. We developed periodically poled lithium niobate (PPLN) THz-wave generators and an optical source based on 1.5-/spl mu/m diode lasers. | We present a continuous-wave dual-crystal optical parametric oscillator that generates signal waves of about 1.4??m wavelength with a tunable difference frequency ?? between 0.64 and 5.3?THz. A model of the parametric gain in such a system indicates that the lowest reachable value for ?? depends on the refractive index dispersion of the nonlinear material used. As a proof of principle, we demonstrate the generation of terahertz radiation by photomixing the signal waves. Frequencies between 0.64 and 0.85?THz are created and detected coherently with ion-irradiated InGaAs interdigitated photomixers. | We demonstrate a compact and cost-effective setup to generate broadband THz radiation. As pump source we use a diode-pumped solid-state femtosecond oscillator or a femtosecond fiber laser system, partially in combination with an optical parametric oscillator. For the THz generation we utilize optical rectification in gallium phosphide (GaP) and gallium arsenide (GaAs). The THz power is on the order of 1 μW and we demonstrate imaging and spectral measurements with this setup. | The authors analyse harmonic mode-locking at (sub)terahertz frequencies in linear Fabry-Perot compound-cavity laser diodes (theoretically), and in ring structures (experimentally and theoretically) and compare these lasers with other constructions used for harmonic mode-locking. | 10 | We demonstrate a promising technique for generating narrow-band terahertz electromagnetic radiation. Femtosecond optical pulses are propagated through a periodically poled lithium-niobate crystal, where the domain length is matched to the walk-off length between the optical and THz pulses. The bandwidth of the THz wave forms is 0.11 at 1.7 THz. Optical rectification gives rise to a THz wave form which corresponds to the domain structure of the periodically poled lithium niobate. | Power-scalable narrowband terahertz pulses generated by periodically-poled LiTaO3 based on backward rectification | Characterization of High-power Narrow-band Terahertz Radiation Generation Using Large-aperture Photoconductive Antennas | Generation of tunable continuous-wave terahertz radiation by photomixing the signal waves of a dual-crystal optical parametric oscillator | Terahertz Photonics: Optoelectronic Techniques for Generation and Detection of Terahertz Waves | Generation of continuous-wave terahertz radiation using a two-mode titanium sapphire laser containing an intracavity Fabry–Perot etalon | Optical rectification for terahertz generation | The magnetic field dependence of terahertz radiation from InAs excited by femtosecond laser pulses has been measured with the time-domain spectroscopy up to 10 T. The magnetic field dependence of n-InAs shows a radiation power minimum around 5 T whereas p-InAs does not show such a minimum. Additionally, it is found that the polarity of the amplitude of terahertz radiation is reversed at 5 T for n-InAs. This polarity reversal is attributed to a crossover of the radiation mechanism from the photo-Dember effect to magnetoplasma oscillations with increasing magnetic field. | Generation of terahertz pulses by photoionization of electrically biased air |
11 | when was the clavius crater on the moon created | Clavius Base Clavius Base is a fictional lunar settlement in the "Space Odyssey" literary universe created by Arthur C. Clarke. The base, located at Clavius crater, is featured in both the novel and film versions of "". According to the novel, the base was finished in 1994 by United States Astronautical Engineering Corps. If necessary, the base can be self-sustaining. As depicted on screen, Clavius Base features some surface features (a landing pad and control tower, together with other ancillary support structures), but the vast majority of the base is located beneath the Lunar surface to protect it from micro-meteoroid | one of the few craters on the Moon that was not created as a result of an impact, and is instead believed to be volcanic in origin. It lacks the raised outer rim that is typical with impact craters. Hyginus was also considered a possible landing site during the Apollo Program, because it was thought to possibly be a site of active volcanism. By convention these features are identified on lunar maps by placing the letter on the side of the crater midpoint that is closest to Hyginus. Hyginus (crater) Hyginus is a small lunar caldera located at the east | Flag (crater) Flag crater is a small crater in the Descartes Highlands of the moon visited by the astronauts of Apollo 16. The name of the crater was formally adopted by the IAU in 1973. Geology Station 1 is adjacent to Flag, at the much smaller Plum crater. On April 21, 1972, the Apollo 16 lunar module (LM) "Orion" landed about 1.5 km east of Flag, which is between the prominent North Ray and South Ray craters. The astronauts John Young and Charles Duke explored the area over the course of three EVAs using a Lunar Roving Vehicle, or rover. | Why have observers on earth never seen the craters on the back side of moon? | Impact event Moon were ascribed to volcanism. It was not until 1903–1905 that the Barringer Crater was correctly identified as an impact crater, and it was not until as recently as 1963 that research by Eugene Merle Shoemaker conclusively proved this hypothesis. The findings of late 20th-century space exploration and the work of scientists such as Shoemaker demonstrated that impact cratering was by far the most widespread geological process at work on the Solar System's solid bodies. Every surveyed solid body in the Solar System was found to be cratered, and there was no reason to believe that the Earth had somehow | crater midpoint that is closest to Cleomedes. Cleomedes (crater) Cleomedes is a prominent lunar impact crater located in the northeast part of the visible Moon, to the north of Mare Crisium. At this location, on Earth, the crater appears oval due to foreshortening, but the crater is nearly circular. It is surrounded by rough ground with multiple crater impacts. The irregular crater Tralles intrudes into the northwest rim. To the east is Delmotte. North of Cleomedes is a triple-crater formation with Burckhardt occupying the center. The outer wall of Cleomedes is heavily worn and eroded, especially along the southern part | Why might more craters be present on the far side of the moon than on the side of the moon facing earth? | What was the first foot neil armstrong put on the moon? | 11 | Clavius (crater) as a prominent notch in the terminator about 1–2 days after the Moon reaches first quarter. The crater is one of the older formations on the lunar surface and was likely formed during the Nectarian period about 4 billion years ago. Despite its age, however, the crater is relatively well-preserved. It has a relatively low outer wall in comparison to its size, and it is heavily worn and pock-marked by craterlets. The rim does not significantly overlook the surrounding terrain, making this a "walled depression". The inner surface of the rim is hilly, notched, and varies in width, with the | how long was clavius base on the moon | what shape is cleomedes crater on the moon | Stress systems in the vicinity of lunar craters | Small lunar craters at the Apollo 16 and 17 landing sites - morphology and degradation | A global inventory of lunar craters: identification, classification, and distribution | why do crater rims on the moon have greater height | why has clavibacter michiganensis been classified into other genera | LUNAR FLOOR-FRACTURED CRATERS: INTRUSION EMPLACEMENT AND ASSOCIATED GRAVITY ANOMALIES |
12 | Cirroc Lofton and Aron Eisenberg (Jake and Nog) have a podcast where they talk about DS9? | I know the "what podcasts does everyone recommend" topics come up often, so I'll apologize upfront for yet another podcast recs post. However, with a bunch of my DS9-specific podcast subscriptions coming to an end this past year (Upper Pylon 2, Reopening the Wormhole), nearing the ends of their DS9-specific run (The Pensky File), or essentially abandoned (The Orb has been a no show for pretty much the entire 25th Anniversary year, the documentary, and the passing of Aron Eisenberg), I'm looking to add in some fresh DS9-specific chat into the rotation - ideally ones that have started up recently. Any suggestions are welcome.
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And yes, I already have Mission Log in the rotation, although - as someone who has been listening to and enjoying Ken and John's Trek talk since it was still on Nerdist - I haven't liked their DS9 run so far so, while it'll be weird with Ken leaving, I'm looking forward to seeing how the vibe changes with the new co-host hopefully. But, as a Niner, I also don't want the lone DS9 podcast in my rotation to be one I'm just not that into. | The cold open for the DS9 episode where Jake and nog try to get Benjamin the baseball card, it’s Ben having the ops crew over for dinner and trying to talk about anything BUT the impending war, and they can’t cause nothing else is happening. It really hit me hard today, because same.
Edit : The episode title is In The Cards, I should’ve put that in the title. | I just got into this podcast, it's been both very good background noise and a very informative look into the minds of half the american voting population. But right now I'm on episode 9, the one talking about Alex's first JRE appearance, and Dan mentioned that Jones' crunken ramble about interdimensional energy vampires was lifted from an anonymous internet post, and I'm curious if anyone has tracked it down. I know I'm way late to the party here, but I like knowing where some of these crazy ideas first show up, and what they were before being filtered through the mind of Jones. | Are the commentators of Jomez Productions, specifically the guys in this ( video Chuck Bryant and Josh Clark from the Stuff You Should Know Podcast (
If not, they sure do share a lot of the same podcast personality traits. | So I figured I would watch some DS9 and then I thought...."Why not just stream it?" So I am starting with season 1 episode 5 (random I know). Come watch, I should be around for a few hours.
| Hey guys, here's an interview with Ross Atkins from TSN 1050 from yesterday, he talks about Vlad Jr, JD and Tulo. Thought I would share it with all since these are some hot topics at the moment.
I believe the Interview starts at 22:15:
| I'm trying to compile a the best 10 episodes of both for a few friends to watch, but I am unable to choose only ten especially from DS9.
Any help is greatly appreciated!! | 1999 was the last year of the 1990s as well as the penultimate year of the 20th century and the 2nd millennium.
1999 may also refer to:
NGC 1999, a dust filled bright nebula
Film, TV and entertainment
1999 (film), a 2009 Canadian crime drama film
Space: 1999, a 1975–1977 British television series
1999: Hore, Mita koto ka! Seikimatsu, a Famicom game released only in Japan
In 1999, a 1912 vaudeville sketch
Archer: 1999, the tenth season of the animated television series, Archer
Music
Albums
1999 (Prince album), 1982
1999 (Cassius album), 1999
1999 (Joey Badass album), 2012
Ratt (album), album by Ratt often referred to as "1999"
Songs
"1999" (Prince song), 1982
1999: The New Master, a 1999 EP containing remixes of the above song
"1999" (Charli XCX and Troye Sivan song), 2018
"1998" (instrumental), a track by Binary Finary also known by its remix/reissue name "1999" | 12 | It's called The 7th rule and it's fairly interesting. I've only listened to the first few, but they talk about DS9 and discovery with some guests like jg hertzler and Armin shimerman. the episodes aren't all on YouTube, so you'll have to find them on iTunes or iHeartRadio, but they provide some good banter about DS9 and disco. Might be worth a listen if you like some behind the scenes talk. | I watched the first 10 episodes of DS9 and don't know if I want to keep watching | Must see episodes of DS9 season 2. | What are the best Episode guides for TNG and DS9? | DS9 - Never Liked it? Want to Try it? Here's a minimalist ESSENTIAL episode list! | [CHAIN] TS9 into Fulltone OCD, or OCD into TS9? Seeking a John Mayer tone | when did the show the nine come back | DS9 has become my new favorite series. | Best episodes to listen to while camping in the woods? |
13 | I'm new to sashiko. When you guys are doing single rows, do you prefer to knot off each row, or do multiple rows at a time with the same thread? | If you were to do miter squares in stockinette rather than garter, would you be doing the pattern on both rows? i.e. k2tog, ssk for knit rows and p2tog, ssp for purl rows
Thanks! :] | Anglo concertina of each row are on each side. The two rows are musically a fifth apart. For example, if the row closest to the player's wrist is in the key of G, the next outer row is in the key of C below. An advantage of the Richter tuning is that pressing three adjacent notes in one row produces a major triad. Also, because the travel direction inverts as you progress up the scale, at the point where the scale crosses from one side of the concertina to the other octaves can be played in the home keys. A third row | This is so handy. I've never used one and was always ha long to go back and count my rows. This is very helpful. | I'm knitting the Jay sweater pattern.
I'm having trouble with the increase rows in the yoke, the whole row is either too tight or too loose. I really need to frog it but I was wondering if there were any tips for the increase rows? Or just for color work in a top down in general? | I just got into cross stitching a couple of weeks ago, and after doing a few tiny warm-up projects, I'm tackling this one.
The thing I've had the hardest time with is always what path to follow when stitching - where to start, which way to go, all of that (this is hard to describe!). The hardest part on this one is the half stitches.
With a full stitch, I can do a row in half stitch and cross back to the beginning, making doing rows pretty simple. But this pattern has lots of rows of half stitches, and I don't know how to handle that. Should I restart the thread with each row? Work in different directions? Hiding the thread underneath is also a big concern, as there's a lot of the aida exposed in the finished design.
Any advice would be gratefully soaked up. | Is the boarding group (6, 7, 8, etc) tied to the row #?
If you sit more in front, will you be in an earlier group? | Does anybody know how to unravel a row of double stockinette. I’ve accidentally picked up a stitch and so now my rows are out of line. Having trouble unravelling the normal way as double stockinette is almost two sheets of knitting back to back. Fairly new to knitting so need help! | I have a table that is 12 rows and 4 columns; however, I would like to add a row that is only one column (but spans the width of the table). I know it's possible but I can't seem to figure out how to do it. | 13 | Just trying to figure out the most practical way to go about this in my endeavor to learn sashiko.
Also do your approach/preferences change when it comes to cross stitches? | Question regarding Asian Stitches | Help with an Asian/Mooshu stitch | Advice on single stitches? | Shish Kabob on Stitches counteracts his entire being and turns Stitches into a detriment for his team. It is a dead talent and I think you can do something better Blizzard! (Statistics and Suggestions Included!). | Another piece of information I found out in making beautiful stitches is if you unwind the tension knob to ... | Motifs for cross stitch | Embroiderer's Handbook : The Essential Step-by-step Guide to Creative Stitches and Versatile Techniques | What knitting stitches would you recommend a beginner learns? |
14 | The region of russia known as Russia's freezer and sleeping land is? | What is the region of russia? | What country is russia was found? | What is the name of th esea that separates Russia and Japan? | What country is bigger russia or china in terms of land? | What is the name of the mountain range that seperates the european part of russia from theasian part of russia? | What are the 3 major geographic regions of siberia? | Which continent does Russia belong to? Russia is part of both Europe and Asia. | Which island is located in the arctic region but belongs to a country located outside the arctic region? | 14 | What region is known as russia's freezer? | What region is it in and what conns it to that region in russia? | Border between europe and siberia? | On Thin Ice? (Mis)Interpreting Russian Policy in the High North | How did the country Russia get its name? | What conintent is russia found? | mainly covers 'European' Russia | What is the name of the mountain range that sepsrates European part of Russia and the Asian part of Russia? | Is russia have states in it? |
15 | Horribly written and deleted it from my library post haste | The wrong folder opened when I was uploading my answers. Great way to assert dominance. Not sure how my prof's gonna like it though. | I typed a whole essay last night and saved it on onedrive. When I went back to print it today it opened the first paragraph (my first save) and said failure to upload or something. Being confused I went to the online version of the software and checked to see if all my work from last night was there. It was (*few*) so I decided to open it in word and it prompted me to update the upload. I thought "yes perfect upload and save my work, which I thought was your job to automatically do." Then like a rusted knife into my back word uploaded the first paragraph over the finished copy of the document. I was so angry I debated committing suicide and/or finding a random microsoft employee and murdering them.
Moral: OneDrive, no matter how convenient it is is still a microsoft product and will fuck up your good day any chance it gets.
This was just a rant, don't do what I said if you don't want.
Oh and it is not in the Onedrive recycling bin. I checked | I'm trying to improve my English by posting what I wrote and getting feedback from others. Could someone please proofread what I wrote?
This is a Reddit post sharing my thoughts. Nothing serious.
To make it easy to edit, I post what I wrote as a first comment. In this way, it is easy to copy and edit it. | I just started reading the physical copy of Watts's *Freeze Frame Revolution* and noticed that there's occasionally letters printed in red instead of black. Looking at the first few, it seems like they're spelling something. So, questions to anyone who's taken the time to figure out the message:
Is it something that should be done before, while or after reading the story?
Does it spoil anything?
Does jotting-it-down-as-you-read add anything to the reading experience?
Am I going to miss anything if I ignore it for now and just go back and figure it out later?
I'm NOT asking anyone to reply with the message. If you feel compelled to do so, please wrap it with a spoiler tag. | This is the third copy for my library. I keep lending this out and it never comes back. I highly recommend this along with The Unthinkable by Amanda Ripley. | HELP I [REDACTED] [REDACTED] [REDACTED] [REDACTED] poop [REDACTED] [REDACTED] [REDACTED]
I [REDACTED] have much more time | Written weird. Had to look up every other word, which is ok, but sure slowed the reading process. Still never really understood a single word it said. | Too many miscellaneous small errors. Just too many. The contents are great. | 15 | Must have been written by an 9-year old. Horribly written and deleted it from my library post haste. (No offense to 9-year olds) | a 9 year old made me read it! | We started trying to read this with my 9yr old ... | My 9 year old son begged me to read a ... | I gave this book as a gift to a 9 ... | An 8 year old's Minecraft Q&A blog - please help encourage my boy to write <3 | The quality of the writing made it sound like a 10 year old had written it | My 8 year old son read this in a day ... | Well written and Fun to read - even my 9 year old with ... |
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