Texas A&M University-Kingsville

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Dr. Paul E. Holt, Research Spotlight

Business faculty conduct three types of research.  The most popular is referred to as “contributions to practice,” which is the study of data in an attempt to assess the importance of a given variable, such as return on equity or sale force compensation.   Another common type of research is referred to as “pedagogical research,” which studies the learning arising from different teaching techniques.  Much less common is the type of research referred to as “discipline-based scholarship,” or the creation of new knowledge.   A very small fraction of business faculty are engaged in expanding the core knowledge in their discipline.

Professor Paul Holt, CPA, a member of Texas A&M-Kingsville’s Accounting and Finance Department, is a rare find.  He is at the forefront of a key area of accounting research focused on foreign currency translation.  Given the global aspect of our economy, one would expect an enormous amount of research would have been conducted in this arena.  Furthermore, across the years, a number of major changes have occurred in the way that generally accepted accounting principles allow businesses to translate foreign subsidiary account balances into the reporting currency (i.e., U.S. dollars).  Nonetheless, the translation literature is spotty at best, with Professor Holt’s research being some of the precious little available.


Professor Holt’s undergraduate degree in mathematics and foreign language (Kansas) is a natural lead-in to a career focused on translation.  After receiving an MBA degree (Oklahoma City University), Professor Holt earned a Ph.D. (Oklahoma State University) in accounting.  His doctoral dissertation was in international accounting, where one will find the concentration of his research.   Professor Holt’s “International Accounting” textbook has gone through six editions and is still available on line.  The seventh edition is under development.

Another driver in selection of Professor Holt as the CBA faculty member in the research spotlight during the Fall of 2012 is his ongoing effort to expand our knowledge of the importance of translation methodologies.  In 2005, Professor Holt examined the comparative information content of return on assets across translation methods.  In 2006, he compared reported earnings arising from eight different translation methods.

In brief, Professor Holt’s current research considers the possibility that purchasing power parity (PPP) might be superior to exchange rates in foreign currency translation. The research so far indicates that the use of PPP for this purpose would significantly increase the information content and usefulness of consolidated financial statements of multinational companies. Therefore, switching accounting rules from the use of exchange rates to PPP should increase the effectiveness of investments made across the globe. 

Professor Holt’s research is gaining a wider following, with three different articles by him being published during the 2011-2012 academic year.  As an example of core research, in “Estimation of Temporal Characteristics of Accounts for Empirical Research,” (2011) Professor Holt presents a method for estimating the temporal characteristics of the financial accounts of companies being researched.  In “Some Effects of Alternative Foreign Currency Translation Methodologies on two Short-term Liquidity Ratios,” (2012) Professor Holt tests the statistical significance arising from the use of various translation methodologies when translating U.S. dollars to British pounds. 

We are fortunate to have this respected core knowledge researcher on our faculty.

This page was last updated on: November 11, 2013