We consider the univariate two-scale refinement equation phi (x) = Sigma (N
)(k=0) c(k)phi (2x - k), where c(0),..., c(N) are complex values and Sigmac
(k) = 2. This paper analyzes the correlation between the existence of smoot
h compactly supported solutions of this equation and the convergence of the
corresponding cascade algorithm/subdivision scheme. We introduce a criteri
on that expresses this correlation in terms of the mask of the equation. We
show that the convergence of the subdivision scheme depends on values that
the mask takes at the points of its generalized cycles. This means in part
icular that the stability of shifts of refinable function is not necessary
for the convergence of the subdivision process. This also leads to some res
ults on the degree of convergence of subdivision processes and on factoriza
tions of refinable functions.