Misstatements Of Fact Research Articles

THE IMPACT OF THE SUPREME COURT’S OMNICARE DECISION ON AUDITED FINANCIAL STATEMENT DISCLOSURE

Since the enactment of the Securities Act of 1933 and 1934, both the legal system and the accounting profession have struggled with the question, “to what extent accountants should rely on the statements of other accounting and non-accounting experts and when should they include parts of expert’s written statements in financial statement disclosures.” The Supreme Court considered this issue in Omnicare v. Laborers District Council Construction Industry Pension Fund (2015) (hereafter, Omnicare). The Omnicare decision refined the expectations of preparers and external auditors working on prospectuses for U.S. registrants. Omnicare considered disclosures in Omnicare’s registration statement regarding their opinions of their perceived compliance with federal regulations and laws. After Omnicare was charged with violations, the Court considered when opinions in registration statements could be treated as misstatements of material fact that could lead to accountant liability. The clarification to accounting disclosures is important for limiting liability for future registrants as well as for auditors who express an audit opinion on financial statements contained in registration statements. Omnicare created a new rational basis test which is precedential to future cases deciding whether an opinion statement included in a registration statement becomes a misstatement of fact or the lack of an opinion statement constitutes a material omission. Therefore, the rational basis test should be considered by accountants in preparing and auditing registration and post-registration statements, and this article contributes to the accounting and auditing literature by providing new suggested language for incorporation into SEC guidelines and/or PCAOB standards going forward.

Laboratory Test UtilizationThe Authors’ Reply

To the Editor In an otherwise excellent review of laboratory test utilization by Kim and colleagues,1 there is a misstatement of fact. In the last section of this article in which the authors address “investigational testing technologies,” they discuss thromboelastography, specifically TEG (TEG Thromboelastograph Hemostasis Analyzer, Haemonetics, Braintree, MA), as an example …

In Response to Drs. Patton and Scriven

Empowerment evaluation (EE) is conducted throughout the United States and countries around the world, including Japan, Brazil, the United Kingdom, Finland, Canada, and South Africa. EE scholarship is borne out of practice (and often necessity) by dedicated coaches and critical friends. When advances are made in the development of EE scholarship, there is cause for celebration. When setbacks and mistakes occur, these must be corrected. When misstatements and misunderstandings are disseminated, it is important to set the record straight. In this brief response, I offer my appreciation of the reviewers, address what I believe are misstatements of fact regarding the book, and identify directions for the nature of future dialogue. (A detailed response to their reviews is available at http://homepage.mac.com/ profdavidf/eeresponse.)

Judicial Review and the Power of the Purse

Howard Gillman is unconvinced by my argument that New Deal lawyers turned to the history of federal disaster relief in support of key spending measures, such as the Social Security Act. Likewise, he is unpersuaded by Justice Stone's suggestion to Frances Perkins that she could “do anything under the taxing power.” I understand why Stone's comment grates on Gillman's modern ear; it grated on mine too. What is Stone talking about, and how could his comment be squared with our understanding of the pre–New Deal period as one of sharp limits to federal power imposed by the courts? Gillman's conviction that, in this era, the Supreme Court exercised substantial veto power over federal spending leads him to some critical misreadings of key cases and misstatements of fact. I appreciate the opportunity to respond to his comments and, in particular, to include some details regarding Supreme Court developments for which there was no space in the article itself.

Creationism's Propaganda Assault on Deep Time and Evolution

The creationist Bible-based onslaught against science in general and evolution in particular has been reasonably effective in present-day America. Propaganda methods include partial truths and gross misstatements of fact. For scientific teaching and lecturing, many of these distortions can be exposed using a chart of creationists' Noah's flood-based, force-fitted version of geologic time, rates, and events. In addition, the creationist dichotomy of choice between their version of faith and their distorted cartoon of science can be countered by a diagram showing the large spectrum of possible religious beliefs about evolution.

Academy of Medical Royal Colleges has its own, independent secretariat

EDITOR,—Richard Smith's editorial on the proposed academy of medicine for Britain contains a misstatement of fact that may lead to a misunderstanding of the role of the Academy of Medical Royal Colleges and its relations to the Royal Society of Medicine.1 Furthermore, the Academy of Medical Royal Colleges was not party to the consultation paper on a possible academy of medicine in Britain. …

The crisis in Babi and Baha'i studies: part of a wider crisis in academic freedom?

Bad reviews, like death and taxes, come to us all. But whereas we can hire undertakers to box up our mortal remains and accountants to plead with the faceless minions at Cumbernauld, it falls to ourselves to respond to the bad reviews. Good manners and, indeed, self-interest-for which of us has not written our share?-suggest that it is better, on the whole, to ignore them: there are better things to do with one's time. But sometimes the bad reviews are just a bit too unfair or misleading to be left alone. For someone like myself, working in an apparently esoteric but increasingly important field, the dilemma is particularly sharp. The bulk of my academic work has been concerned with two religious movements originating in IranBabism and Baha'ism. Not vastly important topics in themselves, I hear you say. But with the recent burgeoning of interest in Iranian Shi'ism, they seem likely to attract more and more attention from Islamicists. Baha'ism in particular is a growing movement, whose size and paradigmatic qualities recommend it as a fruitful field of study for sociologists of religion and scholars in religious studies generally. The biggest problem with BabT/Baha'I studies at the moment is that the entire field is dominated by practising adherents of the Baha'i movement. All the big names-Momen, Smith, Amanat, Cole, Lambden-are Baha'is of long standing. Not that that is a bad thing in itself: the work of all these individuals is, broadly speaking, of a very high standard. Where the problem comes in is that, myself excepted, there are no non-Baha'Ts writing seriously on the subject. This means that there are few balances or objective criteria operating within the field. More narrowly, it means that there is no-one out there capable of making intelligent and informed estimates of the accuracy, originality, controversiality, or significance of the work that is being produced. Unconscious (and conscious) distortions, diplomatic silences, woolly generalizations, plain exaggerations, misstatements of fact, significant omissions-all can (and often do) pass unobserved and uncommented. This can be particularly frustrating for the lone wolf like myself on whose shoulders falls the responsibility to challenge received opinion. The field of Babi and Baha'i historical and textual studies is one in which controversies abound. Inevitably, the non-Baha'i researcher will disagree with at least some Baha'i accounts or interpretations of the movement's history and doctrine (otherwise, he would, presumably, join the movement). If there were dozens of non-Bahia's working in the field, some sort of broad consensus would no doubt emerge. But, as a solitary worker, I cannot create a consensus of one. My fellow-workers in the field-the Baha'is, that is-by virtue of their allegiance to a single ideology, have their own ways of arriving at a consensus. And it takes little imagination to see what sort of problems that may lead to.

Effect of the Hyde Amendment

<h3>To the Editor.—</h3> The article by Willard Cates, Jr, MD, "The Hyde Amendment in Action" (1981; 246:1109), represents a common misuse of statistical analysis and abuse of scientific "objectivity" to support a clearly political position. To his credit there is no misstatement of fact in the article, but there is a subtle distortion of data presentation that facilitates a misleading conclusion. Given the data as presented, it is easy to follow Cates' conclusion that the Hyde Amendment has had only a "minor impact on Medicaid-eligible women who wanted to terminate their pregnancies." Dr Cates has based his conclusion on an analysis of the total population of Medicaid-eligible women with unwanted pregnancies. However, 85% of these women were unaffected by the Hyde Amendment because they lived in states that continued to provide funding for abortion. If, as Cates did, one includes these women with the 15% who did not have access

FACT AND FALLACY IN LABOUR MARKET ANALYSIS: A REPLY TO MR. LANDO*

Mr. Mordechai E. Lando has devoted his entire ‘Comment’ to one paragraph in my article, ‘Full Employment and the New Economics’, which ran to 36 paragraphs. Despite this rather narrow concentration, Mr. Lando has seriously misstated my argument in that one paragraph, and he has supported his criticisms by misstatements of fact and errors in analysis. Since his criticisms go to the heart of a thesis that I have developed in some detail during the past decade, I think that I should answer them rather fully.

A Note on the History of Janua Linguarum

THIS WRITER DISCOVERED recently that a 1624 edition of Isaac Habrecht's Janua Linguarum Quadrilinguis was bought by the University of Pennsylvania from the collection of Professor Paul Monroe of Columbia University in 1928. Unfortunately, the volume was catalogued under the wrong author, John Amos Comenius, for forty years. While determining certain facts about Habrecht's volume, it was discovered that all editions of Paul Monroe's A Cyclopedia of Education contained some misleading information and misstatements of fact about the history of Janua Linguarum in lexicography. In view of the importance of the research volume, it is instructive to point out where error exists to aid the student of the history of education. Although the author of the article Comenius in the Cyclopedia is not given, the contributors for the philosophy of education were Eduard F. Buchner, Johns Hopkins University, and John Dewey. Dewey edited the sections dealing with educational philosophy. It is easy to see that one or both read and paraphrased John Amos Comenius, 1887, S. S. Laurie, listed as a source for the article. (Compare Monroe, A Cyclopedia of Education, 1918, p. 136, and Laurie, John Amos Comenius, 1887, pp. 32-33.) It is evident that the author of Comenius in A Cyclopedia did not report accurately what Laurie stated in his account. Writes Laurie, This book (meaning the Janua Linguarum of Bateus an Irish monk at Salamanca) was in Latin-Spanish, and was shortly after, in 1615, published in Latin-English in London. author of Comenius in A Cyclopedia states, The Janua Linguarum of

BACTERIAL INTERFERENCE-Reply

REPLY TO DOCTOR GODDARD To the Editor: Doctor Goddard's letter contains misstatements of fact which we should like to correct. First, we refer to Dr. Goddard's allegation that the paper as published contained errors in the text and inaccuracies in the figures and which required revision of the basic tables and text. We have furnished the editor of the American Journal of Diseases of Children with a copy of the that Dr. Goddard refers to as a revised manuscript. This was prepared eight months after our paper as published was completed. A careful study of this revised manuscript simply does not support the implication in Dr. Goddard's letter that the tables and text required extensive revision or indeed that the text as published was radically revised. We are gratified that Dr. Goddard acknowledges that the conclusions in the revised manuscript are similar to the

Physician Participation in Olympic Game Planning

<h3>To the Editor:—</h3> This letter is written in reply to the editorial, "Physician Participation in Olympic Game Planning" (<i>JAMA</i><b>189:</b>233 [July 20] 1964). The editorial is full of inaccuracies, misstatements of fact, and unfair innuendos. As one of the physicians who was present with the Olympic team in Rome, I would like to correct the statement, "They were not involved in comprehensive planning and did not have the time at the site of competition to overcome the resulting difficulties." We were involved in the planning for the trip to Rome and, since 1962, have been involved in the planning for the trip to Tokyo. And, as far as "time at the site of competition" goes, we lived at the Olympic Village and a physician was on duty at all times, 24 hours a day. I saw no medical "difficulties" that were not overcome. The statement that there were "several

Cloos on Reference Dates and Leading Indicators: A Comment

THE rejoinder by George W. Cloos to my paper On Dating of Business Cycles' repeats some of his allegations made earlier in January issue of this Journal; introduces fresh batch of quotations bearing on current interpretation of leading indicators by business press, though not on original issue of accuracy of NBER reference dates; protests number of my statements, hardly ever bothering to document their incorrectness; and ends up on note of skepticism regarding date of December, 1854, peak in Bureau's chronology.2 Since Cloos's new paper does not produce any new evidence pertinent to main point in debate, that issue can be left for reader to judge on its merits. However, paper contains some mistaken interpretations of Bureau's procedures and of my own views and some misstatements of fact. The following comments are addressed solely to these selected points. 1. My paper On Dating of Business Cycles3 is not publication of National Bureau and is in no sense an official NBER statement (p. 352). 2. I am not at all sure that my article reinforces Cloos's views on 1949 and 1954 revivals (p. 352). What much too late means is not well defined, but I do not believe to have implied that Bureau's dates for these turns are to be so described. Further may, of course, demonstrate need to shift back by few months one or both of these dates. If so, this will be due mainly to revision of old and appearance of new data, factor which Cloos continues to gloss over. 3. I did not suggest that inspection of clusters is a basic principle or 'concept' (p. 353) but that there exists a basic view of business that underlies Bureau's measurements.4 One may wish to regard NBER method as but, so, it is proxy for an ideal (a single precise measure of aggregate economic activity) which is not obtainable. 4. The limitations of for purpose of reference dating were, I think, sufficiently discussed in my paper in April issue of this Journal. They have nothing to do with fact, of which I hope everyone is aware, that includes change in inventories. Although Cloos admits that GNP and its components must be supplemented by other data in analysis (p. 354), he still believes that movements of should be accepted as the cycle (p. 353). In doing so, he largely ignores my argument and evidence, except when asking if quarterly peaks and troughs remain uncertain, what reliance can be placed upon monthly dates? (p. 353). But it is surely possible that sufficiently large and representative sample of monthly series may give more dependable information on turning point than quarterly GNP, and Cloos never proved contrary. * Associate professor of finance, Graduate School of Business, University of Chicago, and member of research staff, National Bureau of Economic Research.

Editorial Responsibility

It is well known that publication of erroneous statements about an individual, particularly if they are of a scandalous or spectacular nature, can work irreparable harm. Retractions or corrections may be published later, but they are generally in fine print and usually are overlooked by the reading public, so that the evil effect is never entirely erased. It is not as generally appreciated that the publication in a medical journal of an article containing misinterpretation or misstatement of fact, and the drawing therefrom of unsubstantiated and unjustified conclusions, can work a much greater degree of harm, for it may influence adversely the diagnosis and treatment of thousands of patients. This is more than ever the case today, when the better American medical journals are read throughout most of the free world and it is customary to abstract articles in dozens of other publications and to reproduce them in capsule form in one or more of the many pocket-sized digest journals which have become so popular with practicing physicians and specialists. Even if the misinformation should be corrected in the journal of origin, this correction is not likely to be repeated in the abstract journals. There has recently come to the writer's attention a case report affording a striking illustration of just such an error and its perpetuation. In his opinion, not only was the pathological diagnosis wholly erroneous, but it was supported by a reference to the literature in which a similar error had been made. Editors of the various reputable general and specialty medical journals make honest efforts to winnow the heterogeneous material submitted to them for publication and, in so far as their knowledge goes, they succeed very well. Realizing that medicine is a cooperative effort and that one specialty must make use of numerous ancillary ones concerning which the editor-in-chief is not an expert, it is a usual but by no means a universal practice to have an advisory editorial board of experts in these other fields. The publication in each issue of the journal of the names of these consultants, who are usually men and women of national reputation, strengthens the confidence of the reading public in the reliability of the papers published in that journal. This is excellent in theory, but often it has only the value of window dressing. In some instances the advice of the advisory board members may never be sought ; in others only once in two or three years. I wonder if these gentlemen and ladies realize that by permitting the publication of their names as editorial consultants they give tacit approval to everything published in the journal. It seems to the writer that editors-in-chief should make more use of their advisory board members ; both the authors and the journal itself could profit by expert criticism, and certainly the reading public would benefit. Further, the editor-in-chief could insist that, when a diagnostic procedure or a form of treatment is dependent upon the opinion or the work of an individual who is not a co-author, the name and perhaps the title of that individual should be stated, so that the reading public can form their own idea about reliability. It is a common practice for authors in all fields to make some such statement as "the pathologist reported . . .". It would be astonishing if all pathologists had an equal skill and experience in interpretation, and of course it is not true. Yet the authors, the editor, and the unsuspecting reading public accept the word of this anonymous individual as if it were infallible. In this and similar situations, the editor should request that the author name this remarkable person. If he is not well known and his diagnosis is new or unusual, the editor should call upon his consultants for aid. The writer does not object to publication of material which is believed by the author to be new or to be contrary to generally accepted opinion. The objection is to an editor permitting an author to conclude dogmatically that his conception is true because he says it is true. No purely scientific journal would tolerate such a thing, and there is no reason that a clinical or specialty medical journal should do so.

Diabetes and Its Treatment

To the Editor:— I wish to call your attention to the content of the book notice published inThe Journalof August 27 on my book Diabetes and Its Treatment. The review of the medical matter begins by saying that diabetic acidosis and coma and pregnancy are discussed thoroughly and in the following sentence says that the treatment of acidosis is given in a decidedly empiric fashion. This is a contradiction in itself and a misstatement of fact. Chapter VIII, pages 165 to 188, is devoted to the treatment of acidosis and coma, beginning with the origin of our ideas concerning coma, and a step by step description of the evolution of knowledge concerning its treatment. Credit is given to the workers who have laid the foundation for present day treatment. This has not been done as completely or as carefully in other books on the treatment of diabetes. The

DIABETES AND ITS TREATMENT

To the Editor:— I wish to call your attention to the content of the book notice published inThe Journalof August 27 on my book Diabetes and Its Treatment. The review of the medical matter begins by saying that diabetic acidosis and coma and pregnancy are discussed thoroughly and in the following sentence says that the treatment of acidosis is given in a decidedly empiric fashion. This is a contradiction in itself and a misstatement of fact. Chapter VIII, pages 165 to 188, is devoted to the treatment of acidosis and coma, beginning with the origin of our ideas concerning coma, and a step by step description of the evolution of knowledge concerning its treatment. Credit is given to the workers who have laid the foundation for present day treatment. This has not been done as completely or as carefully in other books on the treatment of diabetes. The

An Introduction to Personal Hygiene.

This book is designed as a text for a one semester introductory course for college students. The author is an experienced teacher in this field, and the subjects covered are those which he has found to be of greatest interest to his students. The scope of the coverage in such a small volume is amazing. Nevertheless, the reader does not feel that the author has anywhere been too brief. The chapters are logically arranged with the exception of a chapter on cancer, which occurs early in the book and which might more reasonably have come toward the end. Each chapter is preceded by a brief, informative and well written historical summary of the subject under consideration. Discussions of every subject are clear and accurate. No misstatements of fact are found. This book is clear and concise and admirably covers the subject matter. It is well printed and bound. Dr. Chenoweth

Atomic Artillery and the Atomic Bomb

TO the serious student of science this is a disappointing book. It is essentially a reprint of the author's “Atomic Artillery” with two added chapters on nuclear fission and the atomic bomb. The additional material is very slight and contains at least one unfortunate misprint, and several misstatements of fact. Atomic Artillery and the Atomic Bomb By John Kellock Robertson. Pp. xii + 173 + 8 plates. (New York: D. Van Nostrand Co. Inc.; London: Macmillan and Co. Ltd., 1945.) 12s. 6d. net.

Infra-Red Absorption Spectrum of Diamond

ONE of the crucial arguments put forward by Raman in support of 'tetrahedral' and 'octahedral' diamonds being associated with the Type I and Type II diamonds of Robertson, and Fox and Martin, was that the tetrahedral form should have a certain fundamental vibration frequency active in infra-red absorption and also in scattering, while for the octahedral form this same frequency should be inactive in absorption. Raman identified this frequency with the well-known scattering line at 1,332 cm.-1 and claimed that this frequency coincided with the infrared absorption “between 1350 and 1300 cm.-1” on Type I diamonds. One of the purposes of the paper by Willis and myself was to point out that this last was a serious mis-statement of fact, since the principal infra-red absorption maxima in this region of the spectrum lie at 1,286 cm.-1 and 1,376 cm.-1, of which the former is much more intense than the latter.

Justice: Distributive and Corrective

In this paper I shall explain what I take to be the nature of justice; and the method which I shall follow is that of attempting to infer the essential nature of justice from an examination of its actual practical operation. Perhaps the reader will be able to follow the drift of the argument more easily, and be more on his guard against possible misstatements of fact or erroneous inferences, if I mention at the outset the main conclusions to which I hope to lead him.