CPA Australia is proud to support bold and innovative research which creates knowledge and drives innovation for the benefit of members, the wider profession, the global business community, and the public though our annual GRPP. The GRPP is a highly competitive grants program, attracting many bids each year, enabling CPA Australia to support only the most relevant and high-quality research.
The research of some of our successful recipients is showcased below.
An investigation into financial literacy needs for effective governance in Indonesian village
Lead researchers: Dr. Peter Graham, University of Canberra, Dr. Harun Harun, University of Canberra, Dr. Monir Mir, University of Canberra.
Since 1999 the Indonesian government has adopted a more democratic and autonomous political system to prevent national disintegration and reduce the economic gap within the society. To support the autonomy policy, the government introduced the Village Funds Initiative for 74,000 villages in the country in 2014. By employing a qualitative approach, the study interrogates how the initiative has been ineffective due structural challenges including low financial literacy in marginal provinces. This study offers a new sight regarding the limitation of NPM in the implementation of an autonomy policy aims to empower the economic progress of villages in Indonesia. In contracts to the stated outcomes of the policy – the way the autonomy policy is implemented ironically re-strengthens the power of the central government in determining every aspect of economic and development affairs at village level. The study further evidences the continued domination of NPM ideologies and their consequences beyond developed nations. The study reminds policy makers the danger of NPM ideology used in decentralisation programs without considering local issues within an individual country.
Regulating transparency and disclosures on modern slavery in global supply chains
Lead researchers: Justine Nolan, University of NSW, Jolyon Ford, Australian National University, Professor M. Azizul Islam, University of Aberdeen
Human rights are increasingly featuring in emerging corporate governance practices. Most notable in Australia has been the passing of the Modern Slavery Act 2018. Similar to overseas developments such as those in the UK, Australian companies with an annual turnover greater than $100 million will be required to prepare a modern slavery statement reporting on their operations and supply chain practices, including due diligence and remediation processes. Affecting an estimated 3000 entities, this new reporting regime is part of global efforts to relieve the plight of an estimated 40 million victims of modern slavery around the world. Effective reporting will require cross-disciplinary involvement across organisations, and this CPA Australia funded research project will serve as an important introduction for accountants on the rational, nature and implications of the modern slavery reporting regime.
It's your funeral: An investigation of price costing in the Australian death-care industry
Lead researchers: Professor Sandra van der Laan, University of Sydney and Associate Professor Lee Moerman, University of Wollongong
This research project developed a comprehensive overview of the funeral industry in Australia and the drivers of costs and prices in the current regulatory environment. Given the recent corporatisation and increasing concentration of the industry, the study reports on:
- the size and structure of the funeral industry in Australia, the social, cultural, regulatory frameworks and institutional impacts on the industry
- the cost and price drivers in the industry, and provides pricing information as at 2016, including the price of a direct committal (cremation) and a basic or essential services funeral
- the scope and regulation of other products that exist in the funeral industry (e.g. funeral insurance and funeral bonds).
Disclosures regarding pricing and costs of the various options for funerals and body disposal will enable consumers of these services to make more informed choices and address the concerns of predatory marketing and price gouging in the industry. Additionally, this report provides recommendations for policy makers and regulators in terms of promoting consumer choice and protecting vulnerable consumers by contributing to efforts to increase price transparency.
The effectiveness of undertaking due diligence prior to starting up or purchasing a small business or franchise
Lead researchers: Lorelle Frazer, Scott Weaven and Anthony Grace, Griffith University; Jenny Buchan and Binh Tran-Nam, UNSW Australia
This research investigated the amount and type of due diligence people undertake prior to starting up or purchasing a small business or franchise. Data were gathered from interviews with 60 current and former independent small business owners and franchisees, followed by an online survey with 610 respondents.
It was revealed that fewer than 20 per cent of small business owners and franchisees believed they had a clear understanding of due diligence before they purchased or established their business, with most relying on their "gut feel" when making pre-purchase decisions. Despite the considerable financial investment required to purchase or start up a small business or franchise only one third of respondents obtained professional advice from an accountant, lawyer or financial advisor. The research revealed that independent business owners spent significantly less money than franchisees when undertaking due diligence. Franchisees were also found to consult more widely than independents who spend more time on their own conducting due diligence. Overall, the perceived performance and satisfaction levels of franchisees exceeded those of independents.
Asset valuation by government trading enterprises: A re-evaluation of pricing issues
Lead researchers: Associate Professor Malcolm Abbott and Angela Tan-Kantor, Swinburne University
This project updates CPA Australia’s 1996 monograph and discusses techniques in which assets are valued and the implications for financial reporting, performance monitoring and price regulation. In the Australian context, different asset valuation techniques have been applied by Government Business Enterprises (GBEs) for several purposes including the basis for the determination of regulated prices, asset replacement and management programs, impairment testing and determination of carrying values for annual financial reporting. The different asset valuation techniques applied resulted in significantly different valuation figures for the same assets. A key concern addressed by this project is the reasonableness of the “reported” asset values. Accurate valuation of infrastructure assets and capital allowances are needed so that calculation of appropriate utility prices can be generated to ensure efficient cost of service provision and efficient investment in assets in medium and long term can be achieved.
An investigation into the role of educators, employers and the accounting profession in providing opportunities for Indigenous Australians to enter the field of accounting
Lead researchers: Luisa Lombardi and Barry J Cooper, Deakin University
This comprehensive study by Luisa Lombardi and Barry J Cooper from the Deakin Business School has considered the key barriers that have resulted in the virtual exclusion of Aboriginal and Torres Strait Islander peoples from the Australian accounting profession. The issue is a complex one and the data collected from interviewing Indigenous and non-Indigenous participants in this study has provided insights into recognising the key issues and finding a way forward. Lombardi and Cooper have suggested fifteen recommendations that they believe will provide much needed support for Aboriginal and Torres Strait Islander peoples to become members of the accounting profession.
Shaping the future of accounting in business education in Australia
Lead researchers: Professor Garry Carnegie and Professor Brendan O’Connell, RMIT
It has been more than 20 years since accounting education in Australia was comprehensively reviewed. A confluence of forces, including globalisation, digitisation and increasing consumerism, means that it is timely to pose the question "What is the future of accounting in business education in Australia?" The research by highly regarded accounting academics investigates this question, led by RMIT and drawn from across Australia. Their research includes interviews with key business, government and education stakeholders. It assesses the current state of play, identifies the challenges and opportunities, and provides advice on how the sector can leverage these opportunities to take greatest advantage and shape its own future.
The influence and impact of sustainability issues on capital investment decisions: Case studies
Lead researchers: Albie Brooks, Judy Oliver and Dr Gillian Vesty, RMIT
This report is the culmination of a series of research projects the author conducted over a period of several years. Following initial calls from The Accounting Bodies Network – a group of accounting bodies established by The Prince’s Accounting for Sustainability Project (A4S) in 2008 and supported by CPA Australia – the authors began with a small study of Australia’s G100 companies, enquiring about how they accounted for sustainability in their capital investment appraisal. This led to a second study, a survey of large companies to highlight the variety of appraisal methods in use. With findings that highlighted emergent integrated thinking (through senior management commitment to sustainability; sustainability devolved throughout the organisation; and sustainability embedded in management control systems designs) the need for further in-depth case analysis to better understand the way sustainability is embedded in long-term resource commitments and decision making became evident.
Engaging with digital technologies that enhance student learning
Lead researchers: Dr Jade McKay, Dr Leanne Ngo and Professor Kim Watty, Deakin University
This national project has explored the innovative work with digital technologies that is taking place in accounting education. The project has produced key findings and recommendations relevant to academics and institutional leaders and policy makers. It has also developed an exciting iResource showcasing innovation in the accounting space.
The role of accounting in work health and safety
Lead researchers: Dr Sharron O'Neill, Professor Nonna Martinov-Bennie, Angela Cheung, International Governance and Performance (IGAP) Research Centre, Macquarie University; Ms Karen Wolfe, Safety Institute of Australia
The Work Health and Safety Act (NSW) 2012 imposes work health and safety (WHS) due diligence obligations on all officers, including those in accounting and finance roles. These WHS requirements have potentially important implications for all accounting professionals, as traditional providers of the performance information that guides strategic and operational decisions.
This study examines the role of traditional accounting processes (resourcing, measuring, reporting and assurance) in informing WHS risk management and supporting officers’ WHS due diligence. Four critical areas of accounting engagement in WHS due diligence and risk management were examined via the following research discussion papers:
- Issues in the measurement and reporting of WHS performance
- Issues in audit and assurance of WHS information
- The business case for safe, healthy and productive work: Implications for resource allocation
- Performance management, incentives and organisational culture: Implications for leading safe and healthy work
Case studies in eight dissimilar organisations revealed important insights, including:
- Efforts underway in most medium and large sized entities to integrate WHS risk into broader corporate risk mapping and risk management systems.
- WHS due diligence training for most “finance-oriented” officers was heavily focused on legal requirements, exposure and penalties, yet failed to inform a general understanding of WHS or explain how day-to-day accounting activity influences WHS risk and WHS outcomes.
- WHS assurance practices vary widely. Many organisations are struggling to address the due diligence requirement relating to verification.
- Most accounting practices lacked adequate internal controls or the consultation mechanisms needed to ensure due consideration of likely WHS impact.
- Importantly, WHS performance data is generally inadequate for effective decision-making, yet accountants do not lend their expertise to much needed innovation in non-financial WHS performance indicators for verification, guide strategy and better inform WHS risk management decisions.
The research was co-funded by CPA Australia, Safe Work Australia and the Safety Institute of Australia.
Regulatory standards vs non-regulatory guidelines: Financial stakeholders’ perspectives on the appropriate route to effective integrated reporting
Lead researchers: Dr Colin Higgins, Deakin University and Dr Wendy Stubbs, Monash University
This study focused specifically on the views of financial stakeholders – and what they felt would deliver effective integrated reporting (IR). IR is the latest development in attempts spanning more than 30 years to broaden organisational non-financial reporting and accountability to include the wider social and environmental impacts of business.
These findings – based on 22 interviews with a wide range of financial stakeholders – revealed there was little appetite for mandatory integrated reporting per se as the majority of participants thought that it was too early for regulatory reform. Nevertheless, some level of reform was seen as desirable. Regulatory change was desirable to remove duplication and some unnecessary reporting regulations, clarifying which types of organisations should produce integrated-type reports (publicly list companies or all incorporated companies), clarifying materiality (whether companies should undertake a materiality process or whether particular issues should be required to be disclosed), and issues associated with assurance and Director’s liability.
Australian-Chinese business: Developing skills for accountants and establishing linkages with Australian-Chinese businesses through a MOOC (Part 1)
Lead researchers: Samantha Sin (Chief Investigator), Nick McGuigan and Philomena Leung, Macquarie University; Babak Abedin, UTS
This project is a direct response to the growing Australian-Chinese business opportunities for accountants. The project has a three-pronged aim. The first is to research Australian-Chinese business cultures, issues and successes of reciprocal business and relationships (Part 1). The second is the production of a massive open online course (MOOC) for honing Australian-Chinese business and professional skills. The third is to position CPA Australia and Macquarie University as leaders of high impact educational courses for Asia-capable accountants and business professionals through targeted professional and social engagements and networking facilitated by the MOOC.
Five core themes were identified in our research and they are categorised functionally as follows:
- Drivers for Chinese investment and business in Australia go beyond making profit.
- There are strong cultural manifestations in business engagements and relationships.
- Productive business is complex and challenging.
- Guanxi: Build relationship first then do business.
- Effective communication: Far more than a common language.
A key contribution of the research is the insights into the nature of the skills that are valued and the successful manifestations of these skills. These insights were inferred from the detailed descriptions by participants obtained by the phenomenographic interview method and also from case examples of complex transcultural business relationships and situations provided by the participants.
Public Sector Performance Audit: A Critical Review of Scope And Practice in the Contemporary Australian Context
Lead researchers: Professor Lee Parker RMIT University and Professor Kerry Jacobs UNSW Canberra
This study critically investigates the current conception and practice of performance auditing in the Australian public sector and its focus on the execution of performance accountability by public sector entities. The project investigated Auditor General reports to parliament, their performance audit reports, and their perceptions and intentions through interviews with Auditor Generals and their senior officers across all the Australian jurisdictions. The study scope focused upon the 2001-2012 period, examining both auditor intentions and auditee responses to the contemporary public sector audit process and report. The study addresses emergent performance audit concepts and definitions including economy, efficiency, effectiveness, compliance, accountability and value for money, and considers the performance audit focus on “outcomes or controls”. Attention is also paid to performance audit resourcing and focus as well as stakeholder targeting.
The study reveals public sector performance audit as a high profile, high volume activity consistently producing a large volume of reports over the past decade. While issues of accountability and compliance emerge as important, they remain secondary to the key performance audit focus on efficiency. While in general there is a focus on auditing the controls necessary to ensure efficiency, some jurisdictions combine this with a program focus so that this study detects a trend towards a greater focus on actual outcomes rather than just the controls. In pursuing performance auditing, Auditor Generals show signs of wishing to engage the public more directly and improve their consultation, communications and relations with auditees. In addition, the performance audit appears set to increasingly address issues that impact on policy areas of government, thereby being positioned to occupy a more central role in political and public discourse and deliberations.
Strategising for social media: A public accounting practice perspective
Lead researchers: Sumit Lodhia and Gerard Stone, University of South Australia (UniSA) and Lee Parker, RMIT University
This study focused on social media use by accounting firms in Australia. We investigated the social media philosophies, operationalisation and strategic intentions of public practice accounting firms in Australia. A case study approach was undertaken. The research context for this study included two “Big Four” accounting firms and three small-to-medium sized enterprises (SMEs). The websites and social media platforms for these firms were analysed, and interviews were undertaken with their employees.
Our research found that the commonly used social media platforms were Twitter, LinkedIn and Facebook and their use was indeed guided by specific philosophies. The benefits of social media use informed these philosophies but at the same time, their critical challenges had to be managed to ensure successful social media use. Even though the large accounting firms had extensive planning and use of social media, the smaller firms were also quite active in the social media space relative to the scale of their operations. The assessment of the strategic outcomes of social media use was problematic but our study found increasing use of both quantitative (number of followers, connections and likes, retweets, formal reporting on social media use) and qualitative indicators (anecdotal feedback, case studies, public interest, staff involvement).