Accounting Theory 6e is the new edition of this widely respected accounting theory textbook. The new edition has been updated in accordance with the new IASB Framework and addresses the differences in reported information as a consequence of international harmonisation of accounting standards and accounting choices. Throughout this edition, new developments in accounting theory are supported with links to professional experiences, both locally and internationally.
A Anybody can call themselves an accountant,
but a recognised qualification
generally guarantees proper training,
experience and professional standards.
5 Most accountants work in-house for
companies or organisations in the
private, public or voluntary sectors.
Those employed by accountancy firms,
on the other hand, usually specialise in
\0 very specific areas, such as auditing,
taxation, insolvency or forensic accounting.
Naturally, each specialism has
different training requirements.
Organisations develop out of the need to co-ordinate work, but this can be
achieved in different ways. In this chapter we identify the different types of
organisation (Section 1).
There are various influences upon organisational structure (Section 2). Most
firms have some sort of organisation hierarchy reflecting the levels of
strategy-making (Section 3). We can see the strategic apex (eg Board of
Directors) at the top, through ranks of middle managers to the operating core
where the work is done....
Troy Waugh, CPA, MBA, is a leading author, speaker, teacher, and consultant
to the accounting industry. Troy helps public accounting firms
grow. He and his experienced team of consultants have helped firms add
more than $500 million in new business through their consulting, training,
and alliance services.
Thomas Ahrens Ph.D., is a Senior Lecturer in Accounting at the London School of
Economics where he has been working since 1996. His research is mostly qualitative.
It is broadly concerned with accounting and organisational process. Thomas has
compared management accounting practices in contemporary British and German firms
and studied the uses of performance measurement systems in a large U.K. restaurant
chain. He has also written on comparative and case study research in accounting.
Thomas’ latest research project is investigating performance measurement in British and
How important is conflict of interest to the professions? The
answer is complex. Consider what recently happened to
PriceWaterhouseCoopers (PWC), the world's largest accounting firm.
PWC hired an outside investigator (at the urging of the Securities and
Exchange Commission) to determine whether the firm was observing its
own conflict-of-interest rules. The investigator reported that more than
three-fourths of PWC's partners, including thirty-one of the top fortythree,
had not properly sanitized their personal finances....
There is a major problem in writing this book. To tell the story fairly,
a very large number of complexities must be explained. For example,
Chapter 2 discusses Enron’s Year 2000 Annual Report. It is difficult
to study that report and conclude that the firm is heading toward
collapse. On the other hand, it is not difficult to identify footnotes that
are vague and incomplete (of course, the author also has the benefit
Why write a casebook describing and evaluating events about
which there have been criminal trials and extensive hearings?...
This monograph emerged from our efforts to study the behavior of the
households from the Townsend Thai Monthly Survey. This experience
convinced us that imposing an accounting framework and creating
financial statements would be a useful, indeed a necessary, first step
for the analysis of household finance, especially from high-frequency,
The Usefulness of Accounting and NonFinancial Information in Explaining Revenues and Valuations for Internet Firms Table 1.7 presents regression models for the average level of SAT scores across
MSAs. Column A includes only the choice index as a regressor. It enters with a positive
coefficient, implying that fully decentralized MSAs produce average SAT scores about forty
points higher than do those with only a single district.
The external audit is intended to enhance the credibility of the financial
statements of a firm. Auditors are supposed to verify and certify the quality
of financial statements issued by management. However, over the last several
decades, a substantial and increasing portion of an accounting firm’s total
revenues have been derived from consulting services of various kinds. Provision
of these nonaudit services can potentially hurt the quality of an audit
by impairing auditor independence because of the economic bond that is
created between the auditor and the client.
DaFIS is an electronic accounting system designed to achieve the objectives of the
University Accounting Program. Specific procedures in DaFIS ensure proper
accountability and compliance with university policies, and state and federal laws and
Academic dishonesty appears to be a growing problem throughout our educational
system. Collinson (1990), in a 1988 survey of college freshmen found that 37% admitted to having cheated on a test in high school, up from 30% in the previous
year. In addition, 57% of these students admitted to having copied another
student’s work, up from 52% in the previous year. These percentages are similar
to those in a poll cited by Nazario (1990), which indicated that 47% of the
undergraduates surveyed would cheat on an exam....
This chapter presents the following content: What are service organisations? differences between service and manufacturing businesses; value chains in service firms, retailers and wholesalers; service production environments; activity-based costing for services; case study: Service costing at Adelaide Bank; when should firms estimate their service costs? flow of costs in service firms; costing in retail and wholesale businesses.
(BQ) Chapter 10: Fundamentals of cost management. Upon completion of this chapter you should be able to: explain the concept of activity-based cost management; use the hierarchy of costs to manage costs; describe how the actions of customers and suppliers affect a firm’s costs; use activity-based costing methods to assess customer and supplier costs;...
(BQ) Chapter 14: Business unit performance measurement. We described the organization of the firm in Chapter 12 by referring to responsibility centers: cost centers, profit centers, and investment centers. In this chapter, we develop and analyze performance measures for investment centers. Recall that in an investment center, managers have responsibility for asset deployment in addition to revenue and cost responsibilities.
In this chapter, students will be able to understand: explain the concept of activity-based cost management; use the hierarchy of costs to manage costs; describe how the actions of customers and suppliers affect a firm’s costs; use activity-based costing methods to assess customer and supplier costs;...