Stakeholder Reporting Committee

• ‘Are we good? or do we need to keep going?’: unraveling auditors’ comfort with evidence sufficiency determinations

  Suppose you think of auditors’ work as completing a puzzle. Auditors can’t form a complete picture to conclude that the financial statements are “free from material misstatement” when evidence is missing or incorrect.

   

  Audit evidence, then, is the information the auditors rely on to form a sound judgment.

   

  But not all evidence is created equal. The standards emphasize two key qualities. First, the evidence must be appropriate, meaning it must be both relevant and reliable. Evidence must also be sufficient, referring to the quantity of evidence considered enough to convincingly support the auditor’s opinion.

   

  While audit standards state that evidence must be “sufficient and appropriate,” in practice, those standards rarely specify precisely how much evidence is enough.

   

  Drawing on interviews with 45 auditors from firms of varying sizes, we analyzed how professionals determine that they have collected sufficient appropriate evidence to conclude.

   

  We found that auditors typically begin with established guidance: predefined document lists, criteria, and clear sampling and testing thresholds. These structured tools offer initial certainty, but they often fall short in complex or ambiguous situations, where risk, estimation, or unusual transactions challenge expectations. In such cases, auditors described a shift from checklist-based reasoning to a more adaptive, fluid process of interpreting and contextualizing evidence.

   

  A central finding is that comfort drives many sufficiency decisions. Comfort reflects a provisional state that emerges through iterative judgment. When discomfort arises, auditors adjust expectations by revising thresholds, gathering incremental evidence, or forming new mental models. They also draw on prior experience, client history, and peer consultation to recalibrate what counts as enough evidence.

   

  This suggests that evidence sufficiency is not a one-time determination, but a recursive feedback loop between structured procedures, interpersonal interactions, and auditors’ affective sense of when evidence sufficiency has been achieved. In practice, the process is shaped by interpersonal interactions as much as technical standards: discussions with clients, specialists, and reviewers often tip the balance toward either “we’re good” or “we need to keep going.”

   

  Overall, the study contributes to a more realistic understanding of how sufficiency judgments are made. By uncovering how auditors blend procedural rules with evolving discomfort/comfort cues, our findings offer insights for standard setters, regulators, and practitioners seeking clearer guidance on evidence expectations, especially in complex areas involving estimates and uncertainty.

   

  The reference for this article can be found below:

  Altiero, E. C., Baudot, L., & Hazgui, M. (2025). ‘Are we good? or do we need to keep going?’: unraveling auditors’ comfort with evidence sufficiency determinations. European Accounting Review, 1–27. https://doi.org/10.1080/09638180.2025.2589183

• Expectation management through private interactions: evidence from in-house meetings

  We investigate how managers use private channels to adjust analysts’ forecasts, based on a unique dataset of firms’ private in-house meetings in China. For firms facing strong expectation management incentives, we find that compared to analysts who do not attend their private meetings, those who attend produce steeper forecast walkdowns, suggesting that managers with such incentives opportunistically exploit private interactions to dampen analysts’ forecasts. Moreover, this private guidance is more effective if the meeting attendees include both mutual funds and analysts or if meetings occur after the current fiscal year-end. Further analyses indicate that analysts’ incentives to gain better access to management information and secure underwriting business induce their cooperative behaviour. We further identify unique roles of private versus public guidance in managing expectations. Overall, we depict a dynamic and interactive process of private guidance.

  The reference for this article can be found below:

  Hu, J., & Li, T. (2025). Expectation management through private interactions: evidence from in-house meetings. European Accounting Review, 1–29. https://doi.org/10.1080/09638180.2025.2593373

• The Mediterranean Accounting Conference (TMAC 2026 – Call for Papers)

  CALL FOR PAPERS
  THE MEDITERRANEAN ACCOUNTING CONFERENCE (TMAC 2026)
  June 14–17, 2026, Minoa Palace Resort, Chania/Crete, Greece

  CALL FOR PAPERS AND PARTICIPATION

  THE MEDITERRANEAN ACCOUNTING CONFERENCE (TMAC 2026)
  DATE: June 14 – 17, 2026
  LOCATION: Minoa Palace Resort, Chania/Crete, Greece
  SUBMISSION DEADLINE: January 15, 2026
  WEBSITE: https://tmac2026.com/

  Invited Speakers
  Ronald A. Dye, Northwestern University
  Wayne Landsman, University of North Carolina at Chapel Hill
  Mohan Venkatachalam, Duke University
  Joanna Wu, University of Rochester

  Organizing Institutions
  Tel Aviv University, Israel
  University of Cyprus, Cyprus

  Conference Objective
  This conference seeks to bring together leading academics, researchers, and professionals to discuss the latest developments and innovative research in accounting and related fields.

  Areas of Interest
  We invite submissions in all areas of accounting and closely related fields.

  Paper and Thesis Submission Guidelines
  Please visit the submission system here, to submit your paper or working paper by January 15, 2026.

  Registration Fee
  Early registration (until March 15, 2026): €450
  Late registration (from March 16, 2026): €550
  PhD student early registration (until March 15, 2026): €250
  PhD student late registration (from March 16, 2026): €300
  The registration fee includes conference participation, welcome reception (June 14), boat trip or afternoon excursion with dinner (June 15), conference dinner (June 16), coffee break, lunches.
  Accompanying persons may participate in social events for an additional fee.
  Register here.

  Important Dates
  Paper submission deadline: January 15, 2026
  Notification of decision: February 15, 2026

  Venue
  Minoa Palace Resort
  730 14 Platanias
  Chania, Greece

  Scientific Committee
  Aboody, David, University of California, Los Angeles
  Amihud, Yakov, New York University
  Amir, Eli, Tel Aviv University
  Amiram, Dan, Tel Aviv University
  Bar-Yosef, Sasson, The Hebrew University of Jerusalem
  Bilinski, Pawel, City, University of London
  Callen, Jeffrey, University of Toronto
  Cascino, Stefano, London School of Economics and Political Science
  Clatworthy, Mark, University of Bristol
  Correia, Maria, London School of Economics and Political Science
  Demers, Elizabeth, University of Waterloo
  Drymiotes, George, Texas Christian University
  Even-Tov, Omri, University of California, Berkeley
  Garcia Lara, Juan, Charles III University of Madrid
  Garcia Osma, Beatriz, Charles III University of Madrid
  Gox, Robert, University of Zurich
  Guttman, Ilan, New York University
  Hemmer, Thomas, Rice University
  Kartapanis, Antonis, Texas A&M University
  Kasznik, Ron, Stanford University
  Lambertides, Neofytos, Cyprus University of Technology
  Larocque, Stephannie, University of Notre Dame
  Lehavy, Reuven, University of Michigan
  Lev, Baruch, New York University
  Livnat, Joshua, New York University
  Livne, Gilad, Queen Mary University of London
  Loumioti, Maria, The University of Texas at Dallas
  Michaeli, Beatrice, University of California, Los Angeles
  Panaretou, Argyro, Lancaster University
  Panayides, Marios, The University of Oklahoma
  Pope, Peter, Bocconi University
  Prencipe, Annalisa, Bocconi University
  Ronen, Joshua, New York University
  Rothenberg, Naomi, University of Alberta
  Shakespeare, Cathy, University of Michigan
  Shin, Jee-Eun, University of Toronto
  Stolowy, Herve, HEC Paris
  Vasvari, Florin, London Business School
  Versano, Tsahi, Tel Aviv University
  Vyas, Dushyant, University of Toronto
  Wong, Franco, University of California Irvine
  Xin, Baohua, University of Toronto
  Yehuda, Nir, University of Delaware
  Yoon, Aaron, Northwestern University
  Zarowin, Paul, New York University
  Ziv, Amir, Columbia University

  Organizing Committee
  Eti Einhorn, Tel Aviv University
  Shai Levi, Tel Aviv University
  Dan Weiss, Tel Aviv University
  Andreas Charitou, University of Cyprus
  Irene Karamanou, University of Cyprus

• Institutional logics and IPSAS preparedness: evidence from Portuguese public sector entities

  Public sector accounting reforms are rarely linear or predictable. Our research investigates how competing institutional logics shaped the preparedness of 229 Portuguese public entities as they transitioned toward an IPSAS-based accounting system.

  We developed a novel diagnostic proxy to capture the critical “middle phase” between formal adoption and actual implementation—where intentions are translated into tangible actions. This approach enabled us to assess not only whether entities initiated the reform, but also how effectively they mobilized to carry it forward.

  Entities guided by a strong financial accounting logic were significantly more prepared, and this effect was amplified when combined with a market-oriented mindset. However, once external compliance pressures subsided, so did reform momentum—suggesting strategic compliance rather than deep institutional commitment. Contrary to prevailing assumptions, entities primarily motivated by IPSAS logic did not exhibit higher engagement, challenging the notion that legitimacy-seeking alone drives reform. In contrast, group logic played a constructive role by prompting earlier preparation.

  Our findings also underscore the importance of people and context. Entities led by individuals with higher academic qualifications demonstrated greater preparedness, indicating that formal education enhances the capacity to manage complex reforms. Variation across public subsectors further influenced reform trajectories.

  Overall, the study advances our understanding of how institutional logics shape reform readiness. It shows that preparedness cannot be reduced to technical compliance alone. The proxy we introduce offers regulators and policymakers a practical tool to monitor progress and anticipate implementation challenges—especially relevant for countries embarking on IPSAS or similar reforms.

  For the full study, see our article in Accounting in Europe: https://doi.org/10.1080/17449480.2025.2585795

   

• 2025 Junior Network Virtual Workshop

  The EAA is pleased to announce that the 2025 Junior Network Virtual Workshop will be held on Zoom, on December 18th, starting at 10 am. 

   

  The submissions were invited by the EAA Virtual Activities Committee in collaboration with the Editors of the PMI and the Chairs of the EAA Doctoral Colloquium, in an effort to further support students who submitted to the PMI in the past or applied to the EAA DC. 

   

  We hope this initiative in the future may prompt more interest in the PMI and EAA DC as presentation at the workshop is intended to be only accessible to students who have tried to engage with the EAA initiatives in support of junior scholars. We welcome the attendance of all EAA members. The program is available here and registration is open at this link.

• Researcher Exposure to Political Risks

  The year 2025 will likely be remembered as the moment where politics and academia became deeply divided. Universities are increasingly under scrutiny for allegedly advancing partisan research agendas. To safeguard their credibility and autonomy as well as to protect their academics, universities should strive to minimize their exposure to politically charged research priorities. Individual researchers, too, benefit from steering clear of such topics—but they cannot achieve this independence alone.

  The danger of political bias arises when researchers feel pressurized to pursue topics or draw conclusions aligned with the ideological preferences of university leadership—whether left- or right-leaning. This pressure can intensify when editorial boards of academic journals and government funding bodies share similar biases. The resulting distortion is rarely the fault of individual researchers. The structural environment often makes neutrality difficult. The following sections explain why.

   

  Conscious or Unconscious Bias?

  Consider a social science study conducted by two researchers: one who, consciously or unconsciously, views a lack of diversity as problematic, and another who does not. Both examine how a specific intervention affects the academic success of particular groups. How can the research process ensure that personal bias does not influence the results?

   

  Correcting Bias Through Systemic Safeguards

  If a researcher manipulates data to produce results that align with their beliefs—a practice known as “p-hacking”—they are guilty of statistical misconduct. Manipulating samples similarly violates research ethics. Fortunately, most reputable journals now require access to raw data to prevent such abuses. Moreover, designs such as registered reports, where researchers predefine their analyses before data collection, significantly reduce the likelihood of bias.

  Further safeguards include peer review and editorial oversight. Other scholars and editorial boards assess whether the study follows sound methodological principles and whether the conclusions are supported by the data. As long as these checks function properly, the researcher’s personal beliefs have little impact on the published outcome.

   

  The Role of University Administrators, Editors, and (government-)funders

  It is understandable that researchers’ values influence the selection of their topics. However, problems arise when universities hire or promote scholars whose views align with institutional preferences. Similarly, journal editors and funding agencies can be susceptible to (un)conscious biases, threatening the independence of research through topic selection rather than methodology.

  A striking example appeared in The Wall Street Journal in early February. It reported that the number of papers accepted by top U.S. journals on the positive effects of corporate sustainability reporting declined as the sitting president’s popularity rose. As the political climate shifted, support for such topics waned—and by January, publications advocating ESG (Environmental, Social, and Governance) benefits had nearly disappeared. It is highly damaging to the individual academic and to the university as an employer if a researcher has produced a set of papers that will never by published while they were written on instigation of the institutional leadership.

  The Dutch research Associations (NOW) highlights several research priorities—such as inclusion—that are not entirely politically neutral. While it is important to study participation in society, framing the issue immediately in terms of “inclusion” introduces a politically charged premise. Earlier studies from the 1980s and 1990s approached similar questions through the lens of “affirmative action,” assessing whether such measures held social value without embedding ideological assumptions.

   

  Creating Conditions for Independent Research

  Concerns about diversity in universities should primarily be directed at administrators, funding bodies, and journals—not at the researchers themselves.

  To truly depoliticize scientific inquiry, reforms must begin with university administrators, research funders, and journal editorial boards. Administrations that prioritize politically fashionable themes—such as sustainability or inclusion—risk compromising research freedom and diversity of thought.

  Rather than promoting specific viewpoints, university leaders, funders, and editors should focus on creating the optimal conditions for rigorous, independent, and world-class research.

   

  Brodeur, A., Carrell, S., Figlio, D., & Lusher, L. (2023). Unpacking p-hacking and publication bias. American economic review, 113(11), 2974-3002.

  Holzer, Harry, and David Neumark. 2000. “Assessing Affirmative Action.” Journal of Economic Literature 38 (3): 483–568.DOI: 10.1257/jel.38.3.483

  Harvard stands up to Trump, in The Economist, Apr 15th 2025

  What Donald Trump is teaching Harvard in The Economist, Jul 30th 2025

   

  Jan Bouwens

  Professor of Accounting

  Amsterdam Business School/University of Amsterdam

  Research Fellow at Judge Business School

  University of Cambridge

   

• Access to ACCA’s Certificate in Data Analytics (Cert DA) and Certificate in Sustainability for Finance (Cert SF)

  Exclusive access to ACCA certificates 

  In celebration of recently signed Memorandum of Understanding (MoU) between Association of Chartered Certified Accountants (ACCA) and the European Accounting Association (EAA), EAA member universities can take advantage of exclusive free of charge access to the following ACCA certificates: 
  
  Certificate in Data Analytics (Cert DA) – up to 150 certificates on first come first serve basis.

  Certificate in Sustainability for Finance (Cert SF) -up to 150 certificates on first come first serve basis)

  This initiative reflects ACCA’s and EAA’s shared commitment to supporting professional development and lifelong learning. Please complete follow the steps outlined below to receive instructions and access details. 

   

  To take advantage of this offer, please follow these steps:

  1. Complete this form: Exclusive access to ACCA certificates
  2. On completion of the above form, links to access the courses and appropriate access codes use will be displayed on the browser. This information should be saved before closing the browser (please use copy and paste functionality to capture the relevant codes).
  3. Access the certificates (as described in step 2). Users who do not yet have an ACCA Learning account, will need to create one as part of the checkout process. When proceeding to the checkout, the full price will initially be displayed, however, once the relevant code has been entered, a 100% discount will be activated.

   

• Call for Papers: Executive Personality and Management Accounting

  Narcissistic executives perform better under bonus- than under penalty-framed contracts. Overconfident managers often weaken the effectiveness of firms’ budgeting processes. These findings show that executives’ personalities shape both the design and the effectiveness of management accounting and control systems (MACS).

  Understanding this link helps us design MACS more effectively. We therefore draw your attention to a new Call for Papers in the Journal of Accounting & Organizational Change entitled “Bright Minds, Dark Shadows: Executive Personality and the Role of Management Accounting.”

  This special issue invites scholars to explore how personality interacts with accounting practice and how executive traits influence the design, use, and impact of MACS.

  We welcome both conceptual and empirical contributions that bridge management accounting with psychology and behavioral theory.

  Submission deadline: 16th August 2026
  Guest Editors: Philipp Richter (TU Dresden) and Aline Grahn (Freie Universität Berlin)

  Learn more about our special issue here: Bright Minds, Dark Shadows

• What Do You Recommend? Communication in Autonomous Teams and (Dis)Honest Reporting

  As more firms empower autonomous teams to plan work and report results, a natural question arises: what happens to honesty when teammates start talking? This study explores whether, and through which mechanisms, team communication nudges budget reports toward truth-telling or toward misreporting. We draw on social norm theory to argue that communication between team members with different reporting preferences can shift what teammates believe others do and expect them to do. Because initially honest members are more likely to adjust their behavior based on these beliefs than initially dishonest members, collective reporting choices are at the risk of drifting toward misreporting.

  This research uses three incentivized experiments that adapt classic participative budgeting games with a single responsible manager to an autonomous team setting with shared decision rights and shared economic stakes. In Experiment 1, two team members observe actual project costs, exchange nonbinding numerical recommendations for the team’s cost report, and then each provide a final input, with one input selected as the team’s report. Budget slack, if any, is shared equally. Experiment 2 adds freeform communication between the recommendation and decision stages. Experiment 3 keeps the same mechanics as Experiment 1 but makes the consequences for the firm’s owner more salient to the team by recruiting a third participant to bear the profit consequences of the team’s report.

  Across the first two experiments, communication tends to create an asymmetric pull: Initially honest members are more likely to become more dishonest when a partner suggests misreporting, whereas initially dishonest members rarely change when a partner advocates honesty. In other words, communication can become a conduit through which misreporting spreads within autonomous teams.

  Allowing free-form communication in Experiment 2 sheds light on the process. When teammates can explain and persuade, initially honest members are more prone to go along with a partner’s suggestion to misreport. Experiment 3, however, shows that making the owner’s losses more salient changes the picture because communication loses its asymmetric power to pull honest members toward creating budget slack.

  These findings have important implications for practice. If your organization relies on autonomous teams, internal conversations around reporting can unintentionally drift toward slack creation even without explicit coercion. Designing communication and reporting routines that highlight the negative consequences of budgetary slack, for example, by making them salient in dashboards, reviews, or debriefs, can counteract that drift. At the same time, be mindful that transparency tools and mutual monitoring can cut both ways, sometimes easing coordination on misreporting; guardrails that elevate honesty cues without enabling collusion are essential.

  The reference for this article can be found below:

  Ressi, A., Schaupp, D., & van Pelt, V. (2025). What do you recommend? The effects of communication on misreporting in autonomous teams. European Accounting Review, 1–25. https://doi.org/10.1080/09638180.2025.2563512

• Bonus or penalty contracts in relative performance schemes: a question of regulatory focus

  In many organizations, incentive systems are designed with the simple assumption that offering bonuses or threatening penalties will automatically improve employee performance. However, businesses often overlook how differently people respond to these incentives based on their individual motivations. As a result, some incentive schemes fail to deliver the expected boost in performance, or even lead to stress and disengagement. There is still limited understanding in practice about when a particular type of contract—such as a bonus or a penalty—works best, and for whom. Our study addresses this issue by examining how contract framing interacts with individual motivational styles in competitive work settings.

  Specifically, we investigate how presenting contracts that emphasize either bonuses or penalties affects employee performance in relative performance schemes—settings where outcomes depend on how well one performs compared to others. These schemes are common in workplaces such as sales teams or customer service departments, where employees compete for commissions, performance ratings, or career advancement. By exploring both the framing of the incentive and the employee’s personal motivation, our study seeks to understand when and for whom a particular contract type is most effective.

  Our research is based on a psychological concept called regulatory focus theory, which explains that people are motivated in different ways. Some individuals have a promotion focus, meaning they are driven by hopes, aspirations, and the desire to achieve ideal outcomes. Others have a prevention focus, meaning they are motivated by duties, responsibilities, and the desire to avoid failure.

  The situation itself can also shape these mindsets, such as through the way contracts are framed. A bonus contract, which highlights potential rewards, encourages a promotion-oriented mindset, while a penalty contract, which emphasizes avoiding failure, promotes a prevention-oriented mindset. Relative performance schemes, because they involve social comparison and create high psychological pressure, also tend to trigger a prevention focus.

  We expected that when a person’s natural motivation matches the mindset encouraged by the situation—a concept known as regulatory fit—they would perform better. To test this, we conducted an experiment examining how different combinations of regulatory focus (promotion vs. prevention) and contract framing (bonus vs. penalty) affected performance.

  Our findings confirmed our expectations. Individuals with a strong prevention focus performed better under a penalty contract, showing a positive association between prevention orientation and performance. Under a bonus contract, an individual’s regulatory focus did not significantly influence performance, because the bonus framing created a mismatch with the situational prevention focus induced by relative performance schemes.

  The study highlights the limitations of “one-size-fits-all” incentive designs, showing that they can be ineffective. By understanding how personality and contract framing interact, organizations can design better motivational systems that align with employees’ natural tendencies, leading to improved performance and more sustainable motivation.

   

  The reference for the paper is found below:

  Altenburger, M., & Mauser, S. (2025). Bonus or penalty contracts in relative performance schemes: a question of regulatory focus. European Accounting Review, 1–21. https://doi.org/10.1080/09638180.2025.2567384