AccountingandCybersecurityEconomicsEducationandResearchLab
TheAccountingandCybersecurityEconomicsEducationandResearchLab,hereafterreferred
toastheACEERLab,isavirtualeducationandresearchendeavorthatfocusesonaccounting
andeconomicaspectsofcybersecurity.Thetypesofissuesexaminedbytheindividuals
involvedintheACEERLabinclude,butarenotlimitedto:
q Howmuchshouldanorganizationinvestincybersecurityactivitiesandwhatisthemost
efficientwaytoallocatesuchinvestments?
q Whatistheeconomicimpactofcybersecuritybreachesoncorporations?
q Howcancybersecurityactivitiesenhancethevalueoffirmsintheprivatesector?
q Whatincentivesand/orregulationsarerequiredtoencourageorganizationstoinvestan
appropriateamountincybersecurity?
q Whateffecthasthe2011SEC’sDisclosureGuidanceonCybersecurityRisksandCyber
Incidentshadoncorporations?
q Howcaninformationsharingofcybersecurityactivitiesimproveeconomicandnational
security?
q WhatisthebestwaytoconductCybersecurityRiskManagement?
q Whatistheroleofanefficientcybersecurityinsurancemarketplace?
q HowdovariousaccountingtreatmentsaffectincentivesforcybersecurityInvestments?
TheACEERLABconsistsofavirtualgroupofindividualswhohaveacommoninterestinthe
effectofaccountingandeconomicsoncybersecurityrelatedissues.TheACEERLabhasits
originsinaneducationalprojectdesignedbyDr.LawrenceA.GordonforhisMBAstudents
duringthespringof1998attheUniversityofMaryland’s(UMD’s)RobertH.SmithSchoolof
Business.Bythesummerof1999,ProfessorMartinP.LoebjoinedProfessorGordonona
researchprojectinitiallyfundedbyUMD’sSmithSchoolofBusiness.TheSmithSchoolof
Businesscontinuestoprovidegenerousdirect,aswellasindirect,supportfortheactivitiesof
theACEERLab.
Inthespringof2000,throughthespringof2006,theU.S.NationalSecurityAgencyprovided
supportfortheACEERLabresearchactivitiesbeingcarriedoutbyDrs.GordonandLoeb(both
ProfessorsintheSmithSchoolofBusiness).Withinafewyears,Dr.LawrenceBodin,Mr.
WilliamLucyshyn,Dr.LeiZhouandDr.TashfeenSohailbecamekeymembersofthisinformal
groupofeducatorsandresearcherswhoworkonvariousissuesrelatedtoaccountingand
economicaspectsofcybersecurity.Sinceitsinception,membersoftheACEERLabhave
collaboratedwitheducators,researchers,businessexecutives,andgovernmentofficialsfrom
aroundtheworld.InOctoberof2007,Dr.GordonwasinvitedtoprovideCongressional
1
TestimonyconcerningcybersecurityeconomicsbeforeaSubcommitteeoftheU.S.House
CommitteeonHomelandSecurity.
OthersignificantactivitiesrelatedtotheACEERLabincludethefollowing.TheWorkshopon
EconomicsandInformationSecurity(WEIS)wasestablishedin2002,withDrs.Gordonand
LoebbeingamongthefoundingorganizersofWEIS.Anannualforumentitled“Financial
InformationSystemsandCybersecurity:APublicPolicyPerspective,”co-sponsoredbyUMD’s
SmithSchoolofBusinessandtheSchoolofPublicPolicy,wasstartedin2004(Drs.Gordonand
Loeb,andMr.Lucyshyn,aretheCo-Coordinatorsofthisforum).Researchfundingwas
providedbytheU.S.DepartmentofHomelandSecurityfromthefallof2012throughthe
springof2015toDr.Gordon(asPrincipalInvestigator),Dr.Loeb(asCo-PrincipalInvestigator)
andMr.Lucyshyn(asCo-PrincipalInvestigator).Dr.GordonbegananewHonorsSeminar
entitled“AccountingandEconomicAspectsofCybersecurity,”inthespringof2014,aspartof
theAdvancedCybersecurityExperienceforStudents(ACES)living-learningprogramofferedby
UMD’sHonorsCollege.
TheactivitiesoftheACEERLabhaveresultedinalargenumberofpublicationsinavarietyof
academicandprofessionaljournals.OneofthesepublicationsincludestheGordon-Loeb
Model(publishedinACMTransactionsonInformationandSystemSecurity,2002),whichis
oneofthemostwellacceptedanalyticalmodelsintheeconomicsofcyber/information
securityliterature.In2006,Drs.GordonandLoeb,authoredthehighlyacclaimedbookentitled
MANAGINGCYBERSECURITYRESOURCES:ACost-BenefitAnalysis(publishedbyMcGraw-Hill,
Inc.).In2008,Dr.GordonestablishedanEndowmentFundatUMD(withaninitialgiftof
$25,000,aspartofUMD’sGreatExpectationCampaign)tosupportTheGordonPrizein
ManagingCybersecurityResources.
AfundamentalfocusoftheACEERLabhasalwaysbeen,andcontinuestobe,providingafree
servicetoorganizationsconcerningpotentialwaysofimprovingtheefficiencyoftheir
activitiesrelatedtomanagingcybersecurityrisks.Alargenumberofbusinessesand
governmentagencieshavealreadytakenadvantageofthisservice.
Individualsandorganizationsinterestedinbecomingaffiliatedwith,orobtainingmore
informationabout,theACEERLabshouldcontactDr.LawrenceA.Gordon
(lgordon@rhsmith.umd.edu),EYAlumniProfessorofManagerialAccountingandInformation
Assurance,ACEERLabCoordinator,RobertH.SmithSchoolofBusiness,Universityof
Maryland.
2