Search

In government, the challenges of governance and anti-corruption are exacerbated by accounting not being fit for purpose. In developing countries, many governments adopt accrual accounting as a panacea. Drawing on Goffman's frame analysis, and rhetorical appeals to logic, credibility and emotion, this paper examines the adoption of accrual accounting in Malaysia. It was found accrual accounting has potential for keying governance and anti-corruption. However, rhetorical appeals that attempt to legitimate neo-liberalism and engender public support in the name of progress were hindered by perceptions of endemic corruption and relatively weak democratic institutions of ‘good’ governance common to developing countries.

This paper explores the relationship between accounting and taxation through the recent proposals for curbing corporate tax avoidance advanced by the Organisation for Economic Co-operation and Development (OECD) and the European Union (EU). The OECD is content to tweak pricing and fails to address the faultlines of accounting. The EU is promoting ‘unitary taxation’ and advocates a major reform of the way taxable profits are to be calculated. As IFRSs have reduced the usefulness of accounting numbers for taxation purposes, the EU has sought to recalibrate basic elements of accounting. This has considerable implications for the development of accounting.

Based on a sample of 3207 firm-year observations for the years 2005–2013, we investigate how stock-listed companies in France, Germany and the UK use two discretionary choices in their accounting for defined benefit pension plans under International Accounting Standard (IAS) 19 Employee Benefits. We first analyse companies’ decision whether to voluntarily early adopt the equity method of accounting for actuarial gains and losses. Second, we analyse companies’ choice to present pension interest cost and expected return on plan assets, or, in 2013, net pension interest cost, in operating or financial income. Our findings provide evidence that companies’ decisions to early adopt the equity method in 2005, the first year this accounting choice was available, were motivated by short-term effects on equity. Our analyses also indicate that the choice regarding where to present interest cost and expected return on plan assets in the income statement is associated with the resulting effect on Earnings before Inter...

We study the historical development of Slovenian Accounting Standards (SAS) and their association with accounting quality (AQ). We focus on private firms where the financial reporting process is characterised by low demand for high-quality reporting. We investigate three distinct editions of SAS since 1994 and test how their development towards international standards is related to AQ. Aggregate earnings management measures indicate that the use of accounting discretion decreases with less earnings smoothing over time. The main features of AQ have been consistent throughout historical development. Asymmetric timeliness of earnings, the ability of earnings to predict future cash flows, and the ability of accruals to mitigate mismatching are all present throughout. We also document typical departures from properties of high AQ. For example, accruals do not (always) facilitate timely recognition of losses. However, these can be attributed to the overwhelming influence of reporting incentives (e.g. ta...

In this article, we demonstrate the relevance of eye-tracking experiments in social and environmental accounting (SEA) research. Up to now, this type of design has been used in some areas within ac...

Surprising correspondences emerge from the parallel investigation of fund accounting practices in Italian entities until the late nineteenth century and in the contemporary U.S. public sector. The ...

Drawing on Stones’ (2005) strong structuration theory, the paper unfolds why and how the key stakeholders of central government accounting in Nepal are involved in the reproduction of routinised accounting practices, resisting the externally-propagated changes. Government accountants (the agents-in-focus) through their capability to control the budget routines have enjoyed a powerful social position in their position–practice relations with the agents-in-context, i.e. professional accountants and international consultants, higher-level officers and administrators, auditors, and politicians. Social position along with historically-imbued dispositions and their conduct and context analysis have enabled government accountants to strategically exercise their agency. Government accountants have articulated duality and a dialectic relation with the agents-in-context, which have resulted in the reproduction of everyday accounting practice and the resistance to the World Bank-led reforms, such as accrual accounting and, more recently, the Cash-Basis IPSAS.

This research assesses what knowledge upper-level accounting students possess about the distinctions between the public and private branches of accounting, as well as the influence such knowledge might have on their accounting branch choice. Overall, the study concluded that, before they were aware of the pros and cons of each career path, students preferred a career in public accounting over private accounting. But upon learning the pros and cons of each career path, however, students showed a slight preference toward private accounting. The study suggests research on accountant personality be supplemented by research on the impact of practical knowledge about private versus public accounting work environments on accounting career choice. It suggests greater importance be placed in accounting education on instilling such knowledge.

This study examines the Chinese accounting reformation of the 1930s. The reformist work of Xu, the 1929 Company Law and the rapid expansion of Chinese commercial activity allowed a melding of the Westernised debit-credit model with the Chinese traditional accounting model. The fusion was complex, partly because two competing groups – reformationists and transformationists – had a different sense of scientific accounting development. What transpired, however, was a clinging by small to medium-sized entities to the Chinese traditional indigenous bookkeeping system, a preparedness by other small to medium-sized entities to take on Xu’s reformed Chinese-style method, and a willingness by large entities to engage with Western forms of accounting.

Following a highly disordered series of reforms, Italian universities will adopt accrual accounting by the end of 2016. This article studies the case of two universities where the new accounting system was introduced early (2013). The aim is to identify the main drivers of resistance to change and determine the types of organizational behavior that can counter this resistance. The results show a positive correlation between overcoming resistance to change and implementing specific organizational practices that may soften its effect. Surprisingly, the article found that resistance was stronger in the university where the situation was less complex.

We examine the extent to which International Financial Reporting Standards (IFRSs) are used as a reference point and as a basis for the development of accounting standards in the Republic of Irelan...

A primary goal for professors in academia is to facilitate the career success of their students by providing them with the necessary subject knowledge, skills, experience, and confidence. In this p...

This study investigates whether the ability to choose simplified methods of tax accounting is an important consideration in legal form decisions. Most European countries provide simplified, cash-ba...

This article picks up a discussion in international business accounting about the appropriate definition and use of conservatism (or prudence) and calls for a similar discussion in public sector accounting. If financial reports present an overly optimistic situation, politicians might use them to justify spending public money that is not there, risking the sustainability of services and ‘borrowing’ from future generations.

A central tenet of critical accounting research maintains the need to challenge and change existing social relations; moving towards a more emancipated and equitable social order. The question of how critical accounting research upholds this principle has been intermittently discussed. This paper aims to engage with, and further, this discussion by contributing to research linking accounting information to social movements.\ud \ud The paper reviews the literature on accounting and social movements, central to which is the work of Gallhofer and Haslam; using their work as a departure point we discussion the nature of accounting information and focus on social movement unionism (SMU). Drawing on Bakhtinian dialogics and classical Marxism we develop an alternative theoretical framework to analyse an example of accounting information and social movements, covering a trade union pay dispute. The paper concludes with a discussion of the class nature of accounting information, including an exploration of the implications for accounting praxis and agency in the struggles for an emancipated world.\ud \ud The paper builds on the limited amount of existing work in this area; exploring the ‘class belongingness’ of accounting information and developing an understanding which can help guide the praxis of critical accounting researchers.

Malta is an example of an EU member state that is implementing governmental accounting reform in anticipation of the EU requirements. The proposed outcome from the new accounting system is examined and compared with the government reporting of another EU member state that has an established accrual accounting system, namely, the UK. The influence of national accounting rules on UK's financial reporting and budgeting is now pervasive, especially for consolidation. The proposed accounting system in Malta emphasises the reconciliation of the cash deficit with the accrual deficit, however, more influence of national accounting rules is expected as the system develops.

This article provides a theoretical view on European general government accounting, focusing on overarching accounting principles and models, as well as their consequences on the working and the very existence of public service activity. Our analysis applies to illustrative cases concerning: meaning of public deficit on accruals basis with a view to nature and use of public debt for redistributive purpose; the strange case of taxation on public sector employees’ remunerations and benefits; accounting for employees benefits provisioning; and measurement of public debt and deficit following European Union fiscal supervision of Member States, with specific attention to the Excessive Debt Procedure (EDP). This analysis develops a framework to assess the consistency of accounting models with non-lucrative missions of general interest that belong to public administration. It shows how budgetary accounting does (and should) complement accruals-based accounting in public sector accounting systems, asking to embed public sector accountability in a public service institutional order that is specific to public administration.

This article aims to identify the factors influencing the use of creative accounting in the public sector. Its distinctive feature is that it sheds light on creative accounting when used, not to hide public deficits, but to conceal surpluses. It especially explores the impact of the finance minister’s (FM)’s background on the phenomenon. We take advantage of the quasi-experimental settings of the Swiss cantons in which the financial management act sets out the possibility of implementing certain accounting gimmicks, including mainly additional ‘depreciation’ charges. These charges, which are depreciations in name only, enable the FM to artificially inflate expenses, thus increasing the deficit or reducing the surplus. Our panel data set of the 26 cantons over the period 1980–2012 includes a new data set of creative accounting and of 116 cantonal FMs. Our results indicate that the FMs cook the books irrespective of their personal or ideological background with the exception that trained economists ...

Our study charts the development of the accounting community by tracing publication trends and changes in methodology, including a major shift towards positive and neoclassical economics, multi-authorship and the prevalence of particular institutions, as reflected in The Accounting Review (TAR) between 1926 and 2014. Using network analysis, we identify distinct networks in this community and show that while the network of the institutions to which TAR authors were affiliated in the analysed period became diverse, the network of the institutions from which TAR authors received their doctorate remained dominated by a relatively small group of elite US universities.

EU Regulation requires that any international accounting standards (International Financial Reporting Standards, IFRS) and interpretations (IFRIC) pronounced by the International Accounting Standards Board (IASB) meet three sets of criteria before they become binding for EU-based companies: a ‘true and fair view’ criterion, a list of qualitative criteria, and a ‘European public good’ criterion. During the endorsement process, EU institutions evaluate each standard or interpretation’s compliance with these three criteria. Nevertheless, despite plenty of past endorsement decisions, there is still disagreement about a unanimous interpretation of the criteria in the literature. In this study, we interpret all three criteria against the background of European accounting law and academic accounting research. Then, the paper illustrates for the case of the new IFRS 9 standard on accounting for financial instruments how these criteria can be applied in the endorsement practice. We conclude that the standa...

Research documenting professionalisation in the accounting domain is, with few exceptions, restricted to accounts in which the meaning of profession is defined and understood through membership rules of professional accounting associations. Researchers studying profession in postcolonial societies have argued that sociopolitical factors linked to elitism, the presence of British public accountants, and British-affiliated professional associations, have contributed to restricting public accounting opportunities to a privileged group. While this acknowledges the role of colonisation in the emergence of profession, what remains unclear is to what extent are occupational field self-regulations and exclusionary mechanisms present in the absence of British affiliated professional associations. This paper analyses perceptions of corporate accountants to show how profession in a postcolonial environment can be enacted with Western categories constituting cultural capital. ‘Corporate accounting’ in this pa...

The paper discusses the role of hope in the construction of an accounting technology to realize a program, by looking at a process of choosing non-financial indicators in an effort to achieve healthier workplaces. By exploring the literature dealing with the concept of hope and by drawing on the debate on the relationship between accounting and action, we highlight the features of three hope-related concepts (hopelessness, naïve hope, and reflective hope). We also highlight how these concepts relate to different areas of uncertainty (validity, accuracy, and relevance) in the development of accounting technologies. Evidence collected through particiapant observation of a team involved in the construction of indicators offers empirical material to investigate the interplay between hopelessness, naïve hope, and reflective hope in relation to uncertainties concerning the link between accounting and action. Beyond analyzing how team members move from a naïve to a reflective hope in making the accounting–action link, the paper shows that among practitioners it is accepted that unintended consequences constitute the rule rather than the exception in the accounting–action link.

Public accounting firms emphasize the importance of accounting graduates being proficient in Excel. Since many accounting graduates often aspire to work in public accounting, a question arises as to whether there should be an emphasis on Excel in accounting education. The purpose of this paper is to specifically look at this issue by examining accounting faculty's perceptions of Excel in public accounting and accounting education. We survey 245 faculty members at over 100 accounting programs. We find that a majority of faculty incorporate Excel in their accounting classes consistent with their perception of Excel importance. However, we find that students are not fully proficient in Excel based on faculty's perceptions. This study contributes to the accounting education literature by identifying possible disconnections between Excel skills faculty include in the accounting curriculum and specific Excel skills faculty believe new hires (i.e. recent accounting graduates) most often use in public acc...

This paper explains the Chinese government's decision to adopt accrual accounting by referring to an ancient Chinese strategy of governing. It also provides a rationale for whole-of-government financial reports in China's current fiscal context. The nature of the existing government accounting system is described and the technical and implementation challenges in achieving the goals of the ambitious reform agenda are identified. The country's unique institutional structure makes it necessary to craft a system of government accounting and reporting with Chinese characteristics.

Since the 1990s, UK has been progressively adopting a governmental accounting reform purporting to interpret and mimic accounting standards and practices from the private sector. Since 2009, the UK set of accounting standards applicable to the whole of governmental entities is based upon the HM Treasury's official interpretation of the international accounting standards initially designed for commercial enterprises, the latter standards having extensively inspired the International Public Sector Accounting Standards. This article analyses some representational concerns raised by its application of a balance sheet accounting approach to the public administration, pointing to consolidation perimeter, current value measurement of assets and liabilities and the case of public–private partnerships. This theoretical analysis develops relevant implications for representation and control of public spending and borrowing in UK and in general.

This essay adopts an interpretive methodology of relevant literature to explore the limitations of accounting education when it is taught purely as a technical practice. The essay proceeds from the assumption that conventional accounting education is captured by a positivistic neo-classical model of decision-making that draws on economic rationale to inform and report on corporate activities and make value judgements about accounting. Accounting with its emphasis on transactions and recording makes little sense unless accountability and stewardship objectives are effective. This essay calls for an increased use of active learning strategies (experiential and in-context activities) to connect students to the social realities of accounting. Cognitive dissonance, as an explicit objective of accounting education, provides the means to challenge accounting as a rational stage of endeavour through critical and dialogical perspectives in accounting. Two types of learning pedagogies based on ‘in’ and ‘out...

This paper examines the history of financial accounting in American hospitals from the turn of the twentieth century to the present. It argues that, prior to the 1970s, the financial accounting practices of hospitals differed significantly from their counterparts in the business world as health-service organisations, institutions and legislation rather than accounting bodies and standards were the principal influence on their development. The paper moreover argues that the increasing influence of the Financial Accounting Standards Board on financial accounting in American hospitals has resulted in a growing convergence between accounting practices in hospitals and the wider economy since the early 1970s.

In late 2013, China's political leadership decided to require the government to practice accrual accounting and prepare whole-of-government financial reports. This decision was codified in the new budget law and followed up by a State Council directive endorsing the reform proposal of the Ministry of Finance. Some basic government accounting standards have been made public for comment. In the same timeframe, the ministry also decided to promote management accounting in order to raise the competency and contributions of China's millions of accounting personnel.

This paper provides a web-content analysis of the curriculum and subjects of the top accounting and auditing masters identified in the Eduniversal 2012–2013 ratings of the best business schools in the world. The main aim of this study is to analyze the influence exerted by different factors on the extent to which accounting programs are incorporating ethics and corporate social responsibility (CSR) stand-alone courses. The findings of this study do not offer a very optimistic outlook on the extent to which the accounting and auditing top masters ranked by the Eduniversal ratings are offering stand-alone courses related to ethics and CSR. Also, the findings suggest that the presence of ethics and CSR stand-alone subjects in the accounting and auditing masters analyzed is partially explained by the size and the cultural influence exerted by the geographical location.

Singleton-Green [2010. The communication gap: Why doesn't accounting research make a greater contribution to debates on accounting policy? Accounting in Europe, 7(2), 129–145] argues that a communication gap between researchers and those involved in public debates on accounting problems significantly reduces the impact of accounting research. A new ICAEW report, The Effects of Mandatory IFRS Adoption in the EU: a Review of Empirical Research, tries to bridge the communication gap on the subject that it covers. The report found not only a significant amount of relevant research, but also that its usefulness was limited in various ways. The paper makes a number of recommendations to researchers: they should point out any biases in the data they use, address some issues through field work, not assume that surrounding institutions are unchanged, be careful to understand the specific features of the countries they cover, investigate differences in previous research, and state the economic significance ...

The use of accounting expertise to shape voluntary sustainability reporting has been interpreted as an implicit form of ‘financialization’ whereby technical debates that promote profit maximization are privileged over corporate accountability. Research has yet to assess empirically how accounting expertise is deployed as a ‘public practice’ to influence sustainability reporting. To address this gap, I explore the emergence of the Climate Disclosure Standards Board (CDSB), and the way it uses accounting expertise to shape climate change risk reporting. While it is clear that professional accountants are playing a more significant role in risk disclosure, the CDSB is a form of ‘experimental governance’ that exposes accounting expertise to uncertainty and contestation. Indeed, the CDSB reconstitutes a ‘public space’ within the field of accounting where the link between accounting standards and sustainability reporting is exposed to environmental politics rather than subverted into market-friendly debate.

I explore the evolving role of accounting information in allocating capital. Accounting arose to control conflicts of interest in organizations (stewardship role). The industrial revolution spawned capital-intensive firms and public capital markets with dispersed shareholders to finance these firms. The regulation of these public capital markets shifted the role of accounting toward providing investors with information for making informed investment decisions (valuation role). With the advent of the semiconductor and global competition, emerging and public firms today differ from their predecessors in fundamental ways. Exploiting the information technologies created by the semiconductor, twenty-first century firms are now more knowledge based, have more intangible assets, are more reliant on their employees’ human capital, confront increased competition, and face diverse conflicts of interests and hence different challenges accessing capital than their forerunners. Responding to the demands of twenty-firs...

Journal rankings lists have impacted and are impacting accounting educators and accounting education researchers around the world. Nowhere is the impact positive. It ranges from slight constraints on academic freedom to admonition, censure, reduced research allowances, non-promotion, non-short-listing for jobs, increased teaching loads, and re- designation as a non-researcher, all because the chosen research specialism of someone who was vocationally motivated to become a teacher of accounting is, ironically, accounting education. University managers believe that these journal ranking lists show that accounting faculty publish top-quality research on accounting regulation, financial markets, business finance, auditing, international accounting, management accounting, taxation, accounting in society, and more, but not on what they do in their ‘day job’ – teaching accounting. These same managers also believe that the journal ranking lists indicate that accounting faculty do not publish top-quality research in accounting history and accounting systems. And they also believe that journal ranking lists show that accounting faculty write top-quality research in education, history, and systems, but only if they publish it in specialist journals that do not have the word ‘accounting’ in their title, or in mainstream journals that do. Tarring everyone with the same brush because of the journal in which they publish is inequitable. We would not allow it in other walks of life. It is time the discrimination ended.

The higher education environment in which academics currently find themselves is one characterised by corporatisation and commodification. The pursuit of scholarly academic research is increasingly...

Taking Sven Modell’s (2014, pp. 83–103) “societal relevance of management accounting” agenda forward, and based on a cost accounting initiative in a Sri Lankan hospital, this paper examines how management accounting is implicated in societal relevance. It reports on a postcolonial neoliberal state’s use of cost-saving experiments and the resultant emancipation of the individuals involved. It runs a bottom-up analysis, from micro events in the hospital to policymaking at the level of the Provincial Council. This analysis suggests that cost accounting acts as a mediating instrument: it begins to loosen the old Keynesian postcolonial bureaucratic budget confinements, creates a social space for individuals to consider cost-saving experiments, and addresses wider policy concerns about hospital resource management. The story is illuminated by Gilles Deleuze’s and Zigmund Bauman’s ideas on post-panoptic societies: old confinements are being problematized and new flexible, “liquid” spaces created, in which individuals are emancipated in terms of their ability to influence resource management within and beyond the organizational constituency.

This paper explores the concept of open-book accounting. It illustrates the benefits of open-book reporting policies in terms of their potential ability to correct informational asymmetries, and it sets out some ideas for a future research agenda centred around the concept. The discussion is grounded in large part in the experiences of employee-owned businesses because such organisations are at the forefront of informational transparency innovations in social accounting. But the broader principle of sharing organisational information with employees and training them to process financial and strategic information is applicable to any organisation. It is argued that open-book accounting, especially in the context of employee-owned businesses, provides an exciting alternative to mainstream accounting and financial controls and a welcome addition to the social accounting literature. Postprint

This paper investigates the reform of public accounting in Portugal through the IPSAS adoption highlighting the perception of different stakeholders. Two competing theories (NPM and the institutional theory) are used to understand public accounting changes within the Portuguese context. In general, different stakeholders agree with the favorable moment and the context of the reform. The context of financial crises and the great external pressures to cut public deficits and to improve the quality of financial information seem to be the most important factors to stimulate changes in public accounting. In addition, stakeholders recommend the use of different strategies to ensure success.

During the past 30 years, an elaborate literature has developed to integrate the concepts about social norms with the concepts of law. During that same period, climate change impacts became more pronounced and citizens became aware of and concerned about those impacts. This paper explains how the rules governing corporate accounting need to be revised in order to change the accounting systems of production corporations, so those systems reflect social norms and climate change impacts. The paper uses the social fabric approach to explain why the accounting change is needed and how it should be organized in order to allow public agencies to effectively carry out environmental rules and regulations. The double-entry accounting system currently used by production corporations is not structured to record the contribution of their investment and production activities to climate change. The Federal Reserve and US Treasury, as the world's most powerful monetary authorities, need to be involved in bringing about c...

The international accounting classification literature emphasises the importance of understanding how institutional factors shape accounting regulations and practices. With the mandatory adoption of International Financial Reporting Standards (IFRS) in the European Union and Australia in 2005, our empirical study examines whether three international accounting classification systems relating to equity financing, law and culture still had merit as measured on transition to IFRS and explore whether they are effective in grouping accounting systems. Using IFRS as the yardstick, we find statistically significant differences in the measurement of shareholders’ equity as between strong (Class A) versus weak (Class B) equity financing systems, common law versus code law systems and cultural systems based on ‘Anglo’, ‘Nordic’ and ‘More Developed Latin’ cultural groups. With regard to the measurement of net income, however, we find statistically significant differences only in respect of strong (Class A) versus weak (Class B) equity financing systems. Our findings demonstrate that traditional international accounting system differences still persisted at the time of IFRS adoption even after long periods of harmonisation and growing international accounting convergence.

We examine the impact of managerial financial reporting incentives on accounting quality changes around International Financial Reporting Standards (IFRS) adoption. A novel feature of our single-country setting based on Germany is that voluntary IFRS adoption was allowed and common before IFRS became mandatory. We exploit the revealed preferences in the choice to (not) adopt IFRS voluntarily to determine whether the management of individual firms had incentives to adopt IFRS. For comparability with previous studies, we assess accounting quality through multiple constructs such as earnings management, timely loss recognition, and value relevance. While most existing literature documents accounting quality improvements following IFRS adoption, we find that improvements are confined to firms with incentives to adopt, that is, voluntary adopters. We also find that firms that resist IFRS adoption have closer connections with banks and inside shareholders, consistent with lower incentives for more compr...

In this paper, we investigate the impact of accounting standards on the information content of stock prices using a sample of 44 countries from around the world. We find that the adoption of International Financial Reporting Standards or US Generally Accepted Accounting Principles per se does not make stock prices more informative, but that better accounting standards are helpful only in countries having effective legal environments. In particular, we find a significantly negative relationship between stock price synchronicity and the quality of accounting standards in countries with a common-law legal origin and generally better shareholder protection. Our findings are consistent with the theoretical prediction in Zhang [(2013). Accounting standards, cost of capital, resource allocation, and welfare in a large economy. The Accounting Review, 88(4), 1459–1488] that improving accounting standards effectively would increase social welfare in general.

This study offers a unique interdisciplinary perspective on fair value accounting. The growing influence of esoteric financial instruments whose valuation is becoming increasingly complex makes it necessary to focus on actual valuation practices. Based on an extensive review, this paper regards fair value accounting for complex financial instruments as involving processes distributed among actors located inside and/or outside a reporting entity. It also draws attention to collaboration by organizations that apply their external and internal resources to perform complex financial valuations. Furthermore, it demonstrates that cases involving unusual market conditions underline the importance of human interactions to the valuation process.

This paper critically explores knowledge/professionalization relationships in a jurisdictional context characterized by shifting standards of practice. Focusing on the growing movement toward fair value within accounting standards, we examine practitioners' reactions to the growing compulsory application of fair-value accounting standards. To make sense of these reactions, we introduce the notion of epistemic commitment, that is to say one's degree of allegiance to a given knowledge template. Utilizing 27 interviews with Canadian experienced accountants, we rely on epistemic commitment to analyze the extent of variability in practitioners' reactions to the standardization movement toward fair-value accounting. Our analysis demonstrates an important level of variability in practitioners' epistemic commitment toward fair-value accounting, highlighting a lack of cognitive unity in the field. Our findings point to other important professionalization issues: practitioners' inclinations to refer to profitabilit...

In July 2013, the International Accounting Standards Board (IASB) welcomed comments to their discussion paper A Review of the Conceptual Framework for Financial Reporting. We argue that the IASB should revisit its decisions about the concepts of reliability and prudence, to address the inherent accounting issue of moral hazard. Within the contexts of goodwill and securitization accounting, we illustrate how reliability and prudence can help standard-setters to identify standards that can address moral hazard. We further illustrate the pervasiveness of moral hazard, using the context of executive compensation arrangements. Ultimately, we conclude that a strong conceptual framework should enhance the credibility of financial reporting. We view this as the fundamental role of accounting.

This article discusses the role of GAAP accounting from an investor's perspective. For all its flaws, a historical-based system of accounting is vital to the investment community, and I believe the moves toward fair value accounting should proceed with great caution. Framing the discussion in terms of valuation theory, I argue that investors are typically more interested in assessing the present value of residual income than the value of assets-in-place. I also provide examples of how historical accounting numbers can be (and are being) used by professional investors. A simple residual-income framework succinctly captures the essence of value investing. In fact, what academics have learned about fundamental investing in recent years dovetails nicely with the strategies used by legendary investors such as Ben Graham, Warren Buffett, and Joel Greenblatt.

Social and environmental accounting (SEA) research has experienced significant developments over recent decades. Based upon Lee Parker's published study (2011. “Twenty-One Years of Social and Environmental Accountability Research: A Coming of Age.” Accounting Forum 35 (1): 1–10), this paper reviews and critiques 21 years of research in the field published in four leading interdisciplinary accounting research journals in the years 1988–2002. It considers a number of seminal papers on the field, and offers an analysis of SEA publication that extends Parker's earlier findings (2005. “Social and Environmental Accountability Research: A View from the Commentary Box.” Accounting, Auditing & Accountability Journal 18 (6): 842–860). Social and environmental research now show signs of a more even balance in researcher attention to these two subject areas. Additionally methodological approaches have been exhibiting content analysis/statistical relationships research and case/field/action/ethnograpic tendenc...

This essay introduces the special issue of Accounting and Business Research exploring the societal relevance of management accounting and locates the individual contributions within this research agenda. In contrast to prevailing, managerialist conceptions of relevance, the discussion is guided by an over-riding ambition to turn management accounting research “inside out” to examine the effects of management accounting practices on a broader range of constituencies and interests in society and the formation of such practices beyond individual organisations. I start by charting the development of extant and emerging debates on the relevance of management accounting research and practice and then outline some pertinent research themes worthy of further exploration. In doing so, I pay particular attention to emerging research illustrating how management accounting becomes implicated in the external regulation and governance of organisations, the shaping of markets and the wider, societal consequences of such...

The accounting treatment of purchased goodwill under IFRS has been severely criticized due to the extensive use of fair value accounting. The purpose of this study is to enrich the ongoing debate upon this issue by drawing attention to the market valuation implications of goodwill in a country outside the Anglo-Saxon accounting paradigm, where the application of fair value accounting has been seen as more problematic. The results indicate that, in the case of purchased goodwill, fair value accounting generates relevant accounting numbers but only in companies that comply highly with IFRS disclosure requirements.

Discussions around career pathways have gained momentum in the field of career development to assist young people in mapping out their career choices in order to achieve meaningful and productive f...

We report that International Financial Reporting Standards (IFRS) are inconsistent with respect to the recognition and measurement of liabilities, both in the conceptual framework for financial rep...