Municipal OPEB Contributions: The Roles of Governance Structure, Fiscal, and Socioeconomic Factors During and After the Great Recession

Many governments offer other postemployment benefits (OPEB) to their employees, and discretionary contributions to OPEB plans are important to plan financial well-being. This paper reports a study of municipalities' actual annual contributions to their OPEB plans from fiscal year 2008 through 2015, a time span encompassing the Great Recession and subsequent gradual recovery. Giving effect to cities' governance structure (form of organization and extent of employee unionization) and certain fiscal and socioeconomic variables, we estimate a model of plan contributions normalized by the related actuarially required contributions. We find that Mayor-Council (MC) cities are associated with comparatively higher OPEB plan contributions relative to Council-Manager cities. We control for MC cities' discount rates to address the consequences of optimistic rate assumptions. The effect of unionization on contributions is evident directly, but unionization is not noteworthy when conditioned on form of government. This suggests that MC cities manage their OPEB plans in a fiscally accountable manner.

DATA Act Dashboard: An Instructional Case Using Data Visualization

This case instructs students on how to extract, transform, and load (ETL) data from disparate sources to perform analysis on Federal Government agency spending transactions: the financial statements of the U.S. Government Accountability Office, DATA Act spending data, and Office of Management and Budget object class definitions. Students also learn to construct an interactive dashboard to allow uses to routinely discover and investigate agency spending data and to drill down to specific dimensions, such as program activity or object classification, and to specific general ledger ledger accounts used by the Federal Government. This is accomplished by using parameters created in the ETL portion of the case. This case is designed to be flexible so that it can be implemented in any undergraduate or graduate accounting course from government accounting and auditing to data analytics based on the instructor’s preference.

Health Information Technology Investments, Patient Experience, and Hospital Bad Debt

In this study, we examine the effect of health information technology (HIT) investments on hospital bad debt via improved patient experience. Using data from California Hospital Reports and Definitive Healthcare, we first predict and find that HIT investments decrease hospital bad debt. Next, following Baron and Kenny's (1986) approach and the bootstrap approach of Zhao, Kynch, and Chen (2010), we study whether patient experience mediates the relationship between HIT investments and hospital bad debt. We find that HIT improves patient experience which, in turn, reduces bad debt at hospitals. Taken together, our findings provide evidence that patient experience is important as a means to affect the relationship between HIT investments and hospital bad debt.

Hospital Lobbying and Performance

Lobbying is a primary avenue through which business organizations attempt to influence legislation, regulations, or policies. In this study, we examine the association between lobbying and hospital performance and find that the effects of lobbying activities on hospital performance vary according to the distinct types of hospital ownership. Specifically, we find that lobbying raises employee salaries in not-for-profit (NFP) hospitals, reduces uncompensated care costs in both for-profit and NFP hospitals, and increases return on assets (ROA) in for-profit hospitals. We also find that the effects of lobbying on employee salaries, uncompensated care costs, and ROA are not significant in government hospitals. Taken together, our findings suggest that NFP hospitals lobby to protect employees’ interests, while for-profit hospitals lobby to maximize investors’ interests. Our paper provides evidence to illustrate that the goals and effects of hospital lobbying vary according to hospital ownership types.

Integrated Business Intelligence and Analytics: The Case of the Department of the Navy

From a stakeholder perspective, this study explores the viability of data analytics as a tool in government fraud prevention. Using an interview methodology, we analyze the implications of business intelligence and analytics fraud tools on procurement stakeholders. We find that implementing and integrating business intelligence and fraud program streamlines processes by consolidating information and presenting data within a unique program. The functioning data analytics program increases our stakeholders' confidence level without alleviating their responsibility to perform due diligence in their management functions. Our stakeholders recognized a potential increase in workload; however, they acknowledged no perceived increase in undue administrative burden.

Internal Controls and Operational Performance of Nonprofit Organizations

This study examines the impact of auditor-reported internal control deficiencies (ICDs) on operational performance within nonprofit organizations. Contemporary studies in the for-profit environment document evidence that poor internal controls over financial reporting (ICFR) cause suboptimal operational performance. While these analyses are restricted to ICFR, the nonprofit environment allows external stakeholders to observe the effectiveness of both ICFR and internal controls over compliance. We find robust evidence of negative associations between both ICD types and two key measures of nonprofit operational performance: surplus and the charitable expense ratio. Our findings are relevant to multiple nonprofit stakeholders, demonstrating that the control environment has a pervasive impact on a nonprofit's ability to effectively execute its charitable mission.

Biased Actuarial Assumptions and SFAS 132R: The Not-for-Profit Response

In 2003, the FASB issued an accounting standard (132R) requiring defined-benefit pension plan sponsors to disclose in the notes the asset allocations of their sponsored pension plans. A motivation for this requirement was to help users evaluate a plan's expected rate of return (ERR) assumption which is supposed to be determined by the allocation of plan assets to risky investments. All else being equal, the higher the assumption, the lower is the pension expense and the higher are reported profits of plan sponsors. We hypothesize that not-for-profits used the ERR to inflate these earnings by reducing pension expenses. Using a dataset of audited financial statements and a difference-in-differences design, we find that not-for-profits significantly decreased their ERRs post-SFAS 132R. The results suggest that opportunistic actuarial assumptions by not-for-profits were reduced following the implementation of SFAS 132R.

Understanding Factors that Influence Information System Effectiveness in Higher Education

Facing a more competitive environment, institutions in the higher education sector increasing deploy Enterprise Resource Planning (ERP) systems to facilitate better decision-making. Of more recent origin, business analytics approaches are supplementing this technology. However, based on anecdotal accounts, many of these organizations have not reaped the advantages that were sought from these advances. The current research explores this conundrum by proposing and testing a model of perceived ERP effectiveness. Using data collected in a survey of colleges in the US, the results show that although distinctions between information quality and systems quality tend not to be made, overall perceived input quality is associated with ERP effectiveness. ERP effectiveness is only indirectly effected by general information technology competence. Here, perceived organizational support exists as an important mediating construct but business analytics are not perceived to play a consequential role.

The Association between Board Composition, Board Governance, and Charity Care Provided by Nonprofit Hospitals

In this study, we examine the association between board composition, board governance and charity care provided by nonprofit hospitals. Using nonprofit hospitals' 990 tax return data, we first investigate whether the composition of nonprofit hospital boards of directors is associated with board governing decisions related to patients' eligibility for charity care. Then, we examine whether these same board governing decisions are associated with the reported amount of charity care provided by hospital management. These research questions are motivated by legislators' and regulators' interest in understanding how nonprofit hospitals behave in terms of their charitable missions (Kennedy, Burney, Troyer and Stroup 2010). Overall, at the board governance level, we find the percentage of medical doctors on the board is positively associated with governing decisions affecting patients' eligibility for free charity care. Related, we find that percentage of healthcare administrators on the board is also positively associated with governing decisions affecting patients' eligibility for both free and discounted charity care. At the social performance level, we find that board governing decisions related to patients' eligibility for free and discounted charity care are both positively associated with the amount of charity care provided by hospital management.