Examines Watts and Zimmerman′s Positive Accounting Theoryas a literary narrative, as the “PAT story”, in an effort toexplain its success in light of the fact that it falls well…
Abstract
Examines Watts and Zimmerman′s Positive Accounting Theory as a literary narrative, as the “PAT story”, in an effort to explain its success in light of the fact that it falls well short of their professed methodological standards. Their use of the rhetoric of science is examined, with special attention to their projection of a “scientific persona”, their rhetorical construction of the legitimate” boundaries of accounting research, their use of metaphor and other literary devices, their rhetorical transport of “scientific authority” from other disciplines, and the circumstances that made their audience receptive to scientific rhetoric. Their use of conservative political rhetoric (the rhetoric of revolt against the interference of government in economic affairs) is also examined, with special attention given to the devices used to convey a normative message while maintaining a positive posture, and to the role of sociohistorical circumstances (the Reagan era) that encouraged their audience to overlook the story′s lack of scientific substance.
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Considers what role history plays in the US accounting standard‐setting process and how this role may be constrained by an emphasis on objectivity and an adherence to a…
Abstract
Considers what role history plays in the US accounting standard‐setting process and how this role may be constrained by an emphasis on objectivity and an adherence to a positivistic view of bureaucratic decision making. Explores the role history could play in the development and review of accounting standards and, in particular, how history might contribute to pluralizing the past, problematizing the present and revisioning the future.
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Addresses the lack of any coherent intellectual perspective forestablishing a theory of corporate accountability that is neitherextreme right‐wing nor anti‐liberal. Insights…
Abstract
Addresses the lack of any coherent intellectual perspective for establishing a theory of corporate accountability that is neither extreme right‐wing nor anti‐liberal. Insights derived from Rorty′s Contingency, Irony and Solidarity are employed to develop a new perspective on the relationship between corporate activities and the public interest. This perspective is then joined with Dewey′s view of social intelligence and Barber′s notion of Strong Democracy to argue for an expansion of corporate social accountability.
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Mohamed A. Omran and Ahmed M. El-Galfy
The purpose of this paper is to provide an extensive and critical overview of the theoretical perspectives used in the accounting disclosure literature including economic…
Abstract
Purpose
The purpose of this paper is to provide an extensive and critical overview of the theoretical perspectives used in the accounting disclosure literature including economic theories, political and social theories.
Design/methodology/approach
The paper reviews and discusses in details the positive accounting theory (PAT), agency theory, signalling theory, political economy theory (PET), stakeholder theory, legitimacy theory and contingency theory to identify the situations suit each of these perspectives.
Findings
The main finding shows that there is no universal theory applicable for all situations or societies. For example, PAT is probably used when a corporation believes that its primary responsibility is to use its resources and engage in activities designed to maximise its profits. On the other hand, the PET seems to better explain why some corporations appear to respond to government or public pressure for information about their social impact. The agency theory provides the required framework to evaluate accounting choices and disclosure decisions in market-based studies. While the legitimacy theory seems to be more suitable for multinational corporations working in developed/democratic countries, the stakeholder theory seems to be most suitable for multinational corporations working in developing/dictator countries; whereas a corporation can manage its stakeholders. The contingency theory supports our main finding that different theories are required for different situations, as it clearly indicates that management's preferences of reporting practices are related to the nature of environmental and organisational constraints rather than their relative income effects.
Originality/value
The paper contributes to the limited body of literature concerning the accounting disclosure theories and to identify the main theoretical perspective that can be used in the accounting disclosure research.
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Charles H. Cho and Dennis M. Patten
This investigation/report/reflection was motivated largely by the occasion of the first Centre for Social and Environmental Accounting Research (CSEAR) “Summer School” in North…
Abstract
This investigation/report/reflection was motivated largely by the occasion of the first Centre for Social and Environmental Accounting Research (CSEAR) “Summer School” in North America.1 But its roots reach down as well to other recent reflection/investigation pieces, in particular, Mathews (1997), Gray (2002, 2006), and Deegan and Soltys (2007). The last of these authors note (p. 82) that CSEAR Summer Schools were initiated in Australasia, at least partly as a means to spur interest and activity in social and environmental accounting (SEA) research. So, too, was the first North American CSEAR Summer School.2 We believe, therefore, that it is worthwhile to attempt in some way to identify where SEA currently stands as a field of interest within the broader academic accounting domain in Canada and the United States.3 As well, however, we believe this is a meaningful time for integrating our views on the future of our chosen academic sub-discipline with those of Gray (2002), Deegan and Soltys (2007), and others. Thus, as the title suggests, we seek to identify (1) who the SEA researchers in North America are; (2) the degree to which North American–based accounting research journals publish SEA-related research; and (3) where we, the SEA sub-discipline within North America, might be headed. We begin with the who.
This paper aims to argue that the principal components of the Resource‐Based View (RBV) as a theory of sustained competitive advantage are not a sufficient basis for a complete…
Abstract
Purpose
This paper aims to argue that the principal components of the Resource‐Based View (RBV) as a theory of sustained competitive advantage are not a sufficient basis for a complete and consistent theory of firm behaviour. Two missing elements are value theory and accountability mechanisms.
Design/methodology/approach
The paper proposes a link between value theory and accountability using a Resource Value‐Resource Risk perspective as an alternative to the Capital Asset Pricing Model. The link operates first from the labour process, where value is created but is imperfectly observable by intra‐firm mechanisms of organizational control and outside governance arrangements without incurring monitoring costs. Second, it operates through contractual arrangements which impose fixed cost structures on activities with variable revenues.
Findings
The paper thereby explains how value originates in risky and difficult to monitor productive processes and is transmitted as rents to organizational and capital market constituents. It then reviews recent contributions to the RBV, arguing that the proposed new approach overcomes gaps inherent in the alternatives, and thus offers a more complete and integrated view of firm behaviour.
Originality/value
The RBV can become a coherent theory of firm behaviour, if it adopts and can integrate the labour theory of value, associated measures of risk arising from the labour process and mechanisms of accountability.
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Rebecca Warren, David Bernard Carter and Christopher J. Napier
The purpose of this paper is to investigate an element of the internal politics of standard setting by reference to the International Accounting Standards Board’s (IASB) movement…
Abstract
Purpose
The purpose of this paper is to investigate an element of the internal politics of standard setting by reference to the International Accounting Standards Board’s (IASB) movement to the International Financial Reporting Standard for Small and Medium-Sized Entities (IFRS for SMEs). The authors examine the politics of the IASB’s expertise in technocratic governance by focussing on how the IASB defined SMEs, gave the standard a title and issued a guide for micro-entities.
Design/methodology/approach
The narrative case study focusses on central “moments” in the development of IFRS for SMEs. The authors employ Laclau and Mouffe’s condensation, displacement and overdetermination to illustrate embedded politics in articulating IFRS for SMEs.
Findings
The authors extend literature on the internal politics of standard setting, such as agenda setting, by examining the condensing of disagreements between experts and political pressures and processes into central decision moments in IFRS for SMEs. The authors illustrate these moments as overdetermined, manifesting in an act of displacement through the production of a micro-entity guide. This form of politics is hidden due to the IASB’s attempt to protect their technocratic neutrality through fixing meaning.
Originality/value
The authors make three contributions: first, overdetermination through condensation and displacement illustrates the embedded nature of politics in regulatory settings, such as the IASB. Second, the authors provide a theoretical explanation of the IASB’s movement from listed entities to IFRS for SMEs, drawing on Laclau and Mouffe. Third, the authors reinforce the necessity of interrogating the internal politics of standard setting to challenge claims of technocracy.