Mattesich (1995) explains that hollow clay tokens were transferred in and out of a clay envelope. This practice originated over 8,000 years ago and evinces a form of double-entry recording (Mattessich, 1995)
Research by Watts and Zimmerman (1978) concluded that individuals acted to maximize their own utility, and that managers have greater incentives to choose accounting standards which report lower earnings, thereby increasing cash flows, firm value, and their welfare. Watts and Zimmerman's research was based on three main hypotheses: 1) Managers of firms with bonus plans are more likely to choose accounting procedures that shift reported earnings from future periods to the current period, 2) the larger a firm's debut/equity ratio, the more likely the firm's manager is to select accounting procedures that shift reported earnings from future periods to the current period, and 3) the larger the firm, the more likely the manager is to choose accounting procedures that defer reported earnings from current o future periods (Milne, 2001)
This practice originated over 8,000 years ago and evinces a form of double-entry recording (Mattessich, 1995). Other researcher's attribute the origins of accounting to the 1914 work of John Dewey's "pragmatic" educational philosophy that led to both the laboratory method and the case method used to study accounting (Mitchell, 2005)
As accounting theory has developed, debates have emerged regarding the manner in which financial theory should be developed and applied in the accounting profession. This has been essentially a normative, philosophical exercise, imposing a view of how actuarial practice should progress (Thomas & Smith, 1997)
A similar accounting practice is that of relational exchange theory. Incident in this theory is the belief that "the sociological characteristics of exchange relationships…are argued to be critical determinants…[because they] evolve over time as exchange partners become increasingly familiar with each other and establish behavioral rules for such processes as conflict resolution, monitoring and joint problem solving" (Artz & Norman, 2002)
This means that every person is likely to be opportunistic when it comes to contractual obligations because the individual wants to make the best deal they possibly can. Since a firm is made up of people, it can be said that an organization is a "nexus" of these self-serving contracts (Gaffikin, 2007)
These methods are calculating, although they do not overlook relational theories. The reason for this is that positive accounting theory is "based on the notion that theory should seek to explain and predict accounting practice" (Gomes, 2008)
In business, this is also the same. Firms "can benefit, ex-ante, because they get something…valuable… -- the ability to recruit and retain talented managers and employees, and to inspire them to far greater effort and investment in the firm than any formal contract could" (Stout, 2002)
Although this theory is more about gathering hard data and being able to make the right accounting decisions based on that data, there is also a part of the theory that looks at the opportunism aspect ex-post. One researcher says "Looking at revenue models, it may be true that on an ex-post basis, better statistical estimates can be found, but that does not necessarily imply that ex-ante forecasts are irrational or inefficient" (Swidler, 2007)
The integrated reporting framework was designed to address this and "is organized around the concept of reporting on 'capitals,' including financial, manufactured, intellectual, human, social and relationship, and natural capital. Under each of these headings are a series of disclosures that a company might make" (Cohn 2013)
Regulation in balancing some of the social inequalities and ensuring the survival of capitalism In the recent political debates within the country and across the globe, two issues continue to raise heated confrontations. These issues dominate the debates due to the weight they bear on the social, economic and political continuity of the world (Babones, 2009, p
However, interest of capitalism divide the society into what it is today. Capitalism is that is a characteristic of an economic system in terms of its production aspects (Bratton, Denham & Deutschmann, 2009, p
These impacts may negatively inflict ache into the corporate featured in those regulations. However, despite the connection between politics and regulations in place with accounting, they still do not explain the systematic changes accounting practice (Butler & Watt, 2007, p
Lastly, there is the issue of whom to produce the goods and services for within this market. The challenges in the economy and the increased demands push the prices of commodities to higher levels (Deegan, 2009, p
These methodologies of the natural life activity are evolving and are creeping into the world of accounting. These methodologies have developed into full concepts that are applicable in accounting practice (Davis & Feng, 2009, p
Lastly, there is the issue of whom to produce the goods and services for within this market. The challenges in the economy and the increased demands push the prices of commodities to higher levels (Deegan, 2009, p
Lastly, there is the issue of whom to produce the goods and services for within this market. The challenges in the economy and the increased demands push the prices of commodities to higher levels (Deegan, 2009, p
The society is a vast market for most of the world's largest economies and companies to invest. The world market eludes the understanding of the business people as they try to capitalize on profits (Gaffikin, 2008, p
Inequality creates notable problems in the society. The existence of economic inequality in the society results to problems such as social degradation (Neckerman, 2004, p
Lastly, there is the issue of whom to produce the goods and services for within this market. The challenges in the economy and the increased demands push the prices of commodities to higher levels (Deegan, 2009, p