Corridor Method Research Articles

Motivation on accounting choice of actuarial gain (loss)

This research aims to test whether there is any motivation from the management to choose their accounting policy in recognizing actuarial gain (loss) related to the defined benefit plan between corridor method and full recognition through OCI method based on IAS 19 (2004). Motivation theories in this research are asset pricing motivation, contracting motivation, and influencing external parties’ motivation. The research was done by using logit model and cross-section. The sample was taken from listed companies in 17 Europe’s Premier Indices from 2005 to 2012. The result shows that there are debt covenant motivation and these affect external parties motivation from management to recognize actuarial gain or loss. This result also shows that risk that affects management decision to switch from corridor method to full recognition through OCI method at which companies having high risk tend to avoid full recognition through OCI method to prevent fluctuation on financial statements. This research conclusion confirms previous research that there are management motivations in selecting accounting method.

A corridor method based hybrid algorithm for redundancy allocation

In this paper a hybrid algorithm for the redundancy allocation problem is presented. The problem is the allocation of redundant components within series-parallel systems. We present an algorithm that deals with the classical formulation, where at least one component per subsystem must be included in the final configuration, as well as the $$k$$k-out-of-$$n$$n formulation, in which at least $$k$$k components per subsystem must be included in the final network configuration. We propose a three-phase scheme in which the cross entropy method, the corridor method and a dynamic programming-based scheme are effectively intertwined. Computational results on well-known benchmark instances as well as on randomly generated large scale instances are presented, proving the effectiveness and robustness of the proposed algorithm.

Value relevance of alternative methods of accounting for actuarial gains and losses

In 2010, IASB published an exposure draft about defined benefit plans where it proposed to eliminate the deferred recognition of actuarial gains and losses. IASB aimed to make fundamental improvements to the recognition, presentation and disclosures of defined benefit plans by mid-2011. To shed light on the debate on the recognition of actuarial gains and losses of defined benefit plans, this paper investigates the value relevance of financial information under three alternative methods of recognising actuarial gains and losses allowed by IAS 19: employee benefits (2004): the profit or loss method, the equity recognition method and the corridor method. Findings suggest that the equity recognition method, i.e., the recognition of all actuarial gains and losses in equity, best reflects the market’s valuation of actuarial gains and losses of defined benefit plans.

Judging Anomalies at the 2010 Olympics in Men's Figure Skating

The purpose of this study was to determine if the 2010 Olympic figure skating judges had trouble scoring Plushenko and the transitions program component, and if the International Skating Union's (ISU) “corridor” method flagged the same judging anomalies as the Rasch analyses. A 3-facet (skater by program component by judge) Rasch rating scale analysis was conducted on nine judges' free skate scores for five program components for each of 24 skaters. A principal components analysis of the residuals, and the ISU corridor method were also performed. Some judges were not internally consistent in scoring Plushenko (estimated discrimination index = −0.69; MNSQs ≥ 2.66). The unusual scoring patterns for Judges 1 and 2 warrant further investigation whereas the ISU corridor method did not flag any judges for the way they scored Plushenko and Lysacek. The Rasch analyses appear to be more sensitive to judging anomalies than the ISU corridor method.

Actuarial gains and losses: the determinants of the accounting method

PurposeThe purpose of this paper is to investigate the determinants of the choice of the accounting method for recognising actuarial gains and losses of defined benefit plans.Design/methodology/approachIn the paper, a logit model is estimated in order to relate the dependent variable (actuarial gains and losses method) with some explanatory variables (size, industry, leverage, profitability, size of pension funds and the existence of actuarial gains or losses).FindingsThe results of this study indicate that size, industry, profitability and the existence of actuarial gains or actuarial losses are important determinants in the choice of the accounting method for actuarial gains and losses.Research limitations/implicationsThe study only addresses the choice between the equity recognition method and the corridor method due to the small number of companies that adopted the profit or loss method (only eight observations).Originality/valueThis paper examines the recognition of actuarial gains and losses which can have an economically significant impact on companies' financial position and financial performance. This paper contributes to the accounting choice literature by exploiting the determinants of the choice of the accounting method for recognising actuarial gains and losses under IAS 19.

The Value Relevance of Pension Fair Values and Uncertainty

This study examines the value relevance of fair-value-based pension information using data from German companies that have adopted IFRS or US-GAAP. German companies do not tradition-ally fund pension plans externally. They therefore report large net pension obligations on their balance sheets. This provides an interesting setting to study the effects of uncertainty on the value relevance of pension-obligation fair values. We find that information related to financial positions is more closely associated with stock prices than pension-cost information. Second, fair-value estimates of companies’ pension obligations are more value relevant than the recognized net pen-sion liabilities that are smoothed because of the application of the corridor method. Third, actuar-ial gains and losses that under the current smoothing-oriented pension accounting standards re-main unrecognized in balance sheets have value relevance beyond that of recognized net pension liabilities. Fourth, we find that the value relevance of pension amounts is affected by the degree of uncertainty surrounding their estimation. Specifically, fair-value estimates seem to be more value relevant than smoothed estimates when the uncertainty surrounding the estimation is rela-tively high and thus information asymmetries and estimation risks are high. Not much difference exists in the value relevance of both types of estimates when the uncertainty is less pronounced.

Applying the corridor method to a blocks relocation problem

In this paper, we present a corridor method inspired algorithm for a blocks relocation problem in block stacking systems. Typical applications of such problem are found in the stacking of container terminals in a yard, of pallets and boxes in a warehouse, etc. The proposed algorithm applies a recently proposed metaheuristic. In a method-based neighborhood we define a two-dimensional "corridor" around the incumbent blocks configuration by imposing exogenous constraints on the solution space of the problem and apply a dynamic programming algorithm capturing the state of the system after each block movement for exploring the neighborhoods. Computational results on medium- and large-size problem instances allow to draw conclusions about the effectiveness of the proposed scheme.

Smoothing Mechanisms in Defined Benefit Pension Accounting Standards: A Simulation Study*

ABSTRACTThe accounting for defined benefit (DB) pension plans is complex and varies significantly across jurisdictions despite recent international convergence efforts. Pension costs are significant, and many worry that unfavorable accounting treatment could lead companies to terminate DB plans, a result that would have important social implications.A key difference in accounting standards relates to whether and how the effects of fluctuations in market and demographic variables on reported pension cost are “smoothed". Critics argue that smoothing mechanisms lead to incomprehensible accounting information and induce managers to make dysfunctional decisions. Furthermore, the effectiveness of these mechanisms may vary.We use simulated data to test the volatility, representational faithfulness, and predictive ability of pension accounting numbers under Canadian, British, and international standards (IFRS). We find that smoothed pension expense is less volatile, more predictive of future expense, and more closely associated with contemporaneous funding than is “unsmoothed” pension expense. The corridor method and market‐related value approaches allowed under Canadian GAAP have virtually no smoothing effect incremental to the amortization of actuarial gains and losses. The pension accrual or deferred asset is highly correlated with the pension plan deficit/surplus. Our findings complement existing, primarily archival, pension accounting research and could provide guidance to standard‐setters.

The using of neuronavigation in vestibular schwannoma surgery

We described the experience of a microscope-based navigational system for opening of the posterior wall of the internal auditory canal (IAC) via the retrosigmoid route. Computed tomographic findings for 47 acoustic neuroma cases were divided into three groups, on the basis of the relationship between the labyrinth and the sigmoid-fundus line (medial,on the line,or lateral). The shortest distances between the most medial labyrinthine extension (MMLE) and the resection line were measured. In 20 acoustic neuroma operations, the different features and the practicality of the microscope-based navigational system for opening of the IAC were evaluated.The mean anatomic localization errors were (0,67 ± 0,2) mm for navigation to the IAC and (0,71 ± 0,37) mm for navigation to the posterior semicircular canal. The average distances between the MMLE and the resection line were 3,65; 3,36, and 2,0 mm for the lateral, on-the-line, and medial groups, respectively. Direct contouring of structures at risk does not take into account the localization error, nor does it provide reliable navigational information. A novel indirect contouring concept that takes into account the localization error (the safety corridor method) was therefore introduced.

Actuarial Gains and Losses: the Choice of the Accounting Method

IAS 19: Employee Benefits (2004) enables a choice between three accounting methods of recognising actuarial gains and losses: profit or loss, equity and corridor methods. The objective of this paper is to identify the accounting method of actuarial gains and losses followed by companies after the mandatory adoption of International Accounting Standards Board (IASB) standards. Information was collected about that accounting method adopted by 523 European companies, in the first year of mandatory IASB standards adoption. It was found that most of European companies included in the sample adopted the corridor method or the equity recognition method. The results also show that the equity recognition method is more used in the United Kingdom (UK) and Ireland and the corridor method is more used by financial companies.

Value Relevance of Alternative Methods of Accounting for Actuarial Gains and Losses

The adoption of IAS 19: Employee benefits (2004) provided managers with an important accounting choice affecting the time and placement of actuarial gains and losses recognition. IAS 19 enables a choice between three major accounting methods related to the recognition of actuarial gains and losses of defined benefit plans: profit or loss method, equity recognition method and corridor method. The objective of this paper is to compare the ability of the three alternative methods for recognising actuarial gains and losses to reflect companies' value. We manually collect information about the accounting method of recognising actuarial gains and losses adopted by 91 European companies listed in EURONEXT100, in 2005, 2006 and 2007. We applied regression analysis to investigate the value relevance of financial information under equity recognition method, profit or loss method and corridor method. Findings suggest that the recognition of all actuarial gains and losses in equity best reflects the market's valuation of actuarial gains and losses.

Navigation-guided opening of the internal auditory canal via the retrosigmoid route for acoustic neuroma surgery: cadaveric, radiological, and preliminary clinical study.

We investigated the usefulness of a microscope-based navigational system (Multi Koordinaten Manipulator; Zeiss, Oberkochen, Germany) for removal of the posterior wall of the internal auditory canal (IAC) via the retrosigmoid route. A cadaveric study was performed to assess the navigational localization error for the retrosigmoid approach to the IAC. Computed tomographic findings for 47 acoustic neuroma cases were divided into three groups, on the basis of the relationship between the labyrinth and the sigmoid-fundus line (medial, on the line, or lateral). Furthermore, the shortest distances between the most medial labyrinthine extension and the resection line were measured. In 20 acoustic neuroma operations, the different features and the practicality of the microscope-based navigational system for opening of the IAC were evaluated. The mean anatomic localization errors were 0.67 +/- 0.2 mm (95th percentile, 1.32 mm) for navigation to the IAC and 0.71 +/- 0.37 mm (95th percentile, 1.68 mm) for navigation to the posterior semicircular canal. The average distances between the most medial labyrinthine extension and the resection line were 3.65, 3.36, and 2.0 mm for the lateral, on-the-line, and medial groups, respectively. Direct contouring of structures at risk does not take into account the localization error, nor does it provide reliable navigational information. A novel indirect contouring concept that takes into account the localization error (the safety corridor method) was therefore introduced. The value of navigational assistance for opening of the IAC is promising but still limited. Further development is required before the clinical effects of this navigational approach can be evaluated.

L'affaire de la délimitation maritime Canada/France

SummaryThe authors contend that the ad hoc Court of Arbitration established by Canada and France to delimit the maritime boundary off the French islands of St. Pierre and Miquelon has come up with an equitable solution, fully consistent with the applicable international law. They argue that the decision of June 10, 1992 properly rejected the extreme claims of the Parties, and correctly applied the law in adopting a method that gave predominance to geographical factors, in particular the enormous disparity in the lengths of the Parties' coasts, with a view to arriving at a proportionate result. Although the decision leaves the bulk of the fisheries resources under Canadian control, with a view to arriving at a proportionate result. Although the decision leaves the bulk of the fisheries resources under Canadian control, the authors consider this to be commensurate with the relative interests of the Parties in the area, and suggest that the judgment has facilitated the ongoing management of both the resources and Franco-Canadian relations. In their view the emphasis in the judgment on the tendency of coasts to project in the direction in which they face, and the application of the corridor method to allow a full 200-mile zone to the French islands, finds support in both the jurisprudence and in State practice.