Richard Mattessich

Conditional-normative accounting methodology: Incorporating value judgments and means-end relations of an applied science☆

Abstract The growing interest in ethical and other normative aspects of accounting promotes the search for an empirical-scientific methodology capable of handling normative issues. On the one side, traditional normative accounting theories have been rejected as unscientific, on the other side, “positive accounting theory” emphasizes the positive instead of the normative aspects of our discipline. Thus accounting possesses only a well-publicized positive methodology but no equally recognized normative counterpart (as has positive economics in normative economics, physics in engineering, biology in medicine, etc.). This expository paper attempts to fill the gap by outlining the methodological basis for a conditional-normative accounting theory which recognizes different information goals (norms) but enables the formulation of empirically confirmable relations between those goals and the means to achieve them. Such a theory is objective insofar as it 1. (i) discloses the underlying value judgments and 2. (ii) empirically tests whether the recommended means lead to the desired ends. The paper discusses past efforts and the present status of this methodology as well as future requirements. It not only draws attention to the relative neglect of policy analysis and purpose-oriented thinking, but shows the way to a synthesis of the normative and the positive approach to accounting.

Accounting representation and the onion model of reality: a comparison with Baudrillard's orders of simulacra and his hyperreality

Abstract Baudrillards “order of simulacra” and his notion of “hyperreality” are attempts of a postmodern author to deal with (or possibly reject) the problems of representation and ontology. These attempts were applied to accounting by Macintosh et al. [Accounting, Organizations and Society 25 (2000) 13–50] with the conclusion that our present notions of income, capital, etc. no longer refer to real objects or events, and that “accounting no longer functions according to the logic of transparent representation, stewardship or information economics”. The current paper presents the authors own ontological and epistemological theory in reference to accounting representation (particularly to such notions as income and capital). These results are then juxtaposed to and compared with Baudrillards view and its application to accounting by the Macintosh team. The conclusions are: (1) Baudrillards approach is not suitable to accounting research or any scientific analysis; (2) the notions of income and capital still have referents in reality; (3) for accounting valuation a purpose-oriented representation is required; (4) the “clean surplus model” harbours some hope for future improvement of accounting. While Macintosh et al. (2000) and I disagree on the first two points, the last two items seem to be the major points of agreement between us.

Twentieth century accounting research in the German language area

Abstract This paper consists of two parts. Part I, dealing with the first half of the twentieth century, begins with some introductory words on the pre-eminence of German accounting research during the first half of the twentieth century, and offers a survey of the most important theories of accounts classes that prevailed during the first two decades or longer. Following World War I, the issue of hyperinflation in Austria and Germany stimulated a considerable amount of original accounting research. Afterwards, a series of competing Bilanztheorien (accounting or balance sheet theories), discussed in the text, dominated the scene. Separate sections or sub-sections are devoted to charts and master-charts of accounts in German accounting theory, as well as to cost accounting and the writing of accounting history. Part II offers a survey of the second half of the twentieth century (occasionally with comparisons to research in the English language literature). Dynamic accounting, developed during the first half of the twentieth century, became the basis of a pagatoric (cash-based) accounting theory. In the 1970s and early 1980s relatively little attention was paid to inflation accounting, apart from research in capital maintenance. Accounting theories shifted towards the present value approach, and empirical studies began in the early 1960s and gathered momentum in the last two decades of the century. German accounting legislation was strongly influenced by the dominance of codified law, and by the standardization attempts within the European Economic Community. Consolidated statement presentation and auditing research also became prominent, while cost and managerial accounting continued to be major research areas. Competing costing approaches dominated the field, often based on production theoretical concepts. Marginal costing (occasionally together with mathematical programming) was further developed and a closer connection between cost accounting and investment theory was established. The introduction of information theory (and the closely related agency theory) into the German literature greatly influenced recent German accounting research. Historical research was, in contrast to the first half of the century, of minor importance.

Accounting research and researchers of the nineteenth century and the beginning of the twentieth century: an international survey of authors, ideas and publications

At the beginning of the nineteenth century the former glory of Italian accounting was overshadowed by its decline during the eighteenth century, and literature from France, England, Germany, America and other countries took centre-stage. ‘Theories of accounts’ (rather than ‘accounting theories’) dominated not merely the early but also the later part of this century when Italian accounting had regained a prominent position beside other countries. The relation of those theories to the ‘charts of accounts’-which later became so prominent in Continental Europe is historically important. The controversies over personalistic versus materialistic accounts and that between entity versus proprietary theories, as well as the emergence of other theories are discussed with reference to individual authors. Diverse topics from railroad accounting and auditing to various aspects of cost accounting are investigated. Particularly important are the pioneering efforts of this period that anticipated further developments. These manifested themselves in the following ideas: entity theory, flow of funds statement, matrix accounting, different aspects of valuation, allocation and depreciation, price-level adjustments and indexation, current values, exit values, residual income valuation, managerial control, the emergence of competing accounting (and Bilanz) theories, the separation of fixed from variable costs, fixed and flexible budgeting, zero-based budgeting, PERT, transfer prices, break-even charts, variance analysis, job-order costing, labour and machine hour rates, standard costing, price determination, integrating financial and cost accounting, clean surplus theory, agricultural accounting, holding gains, and other topics. Appendix A offers an overview of Nineteenth century scholars concerned with accounting history (together with one representative work of each), and Appendix B lists the nationally (and often internationally) prominent names of accounting authors born in the nineteenth century but also or exclusively active during the twentieth century. The paper integrates approximately 400 publications of which less than half are of the English tongue.

PREHISTORIC ACCOUNTING AND THE PROBLEM OF REPRESENTATION: ON RECENT ARCHEOLOGICAL EVIDENCE OF THE MIDDLE-EAST FROM 8000 B.C. TO 3000 B.C.

Recent archeological research offers revolutionary insight about the precursor of abstract counting and pictographic as well as ideographic writing. This precursor was a data processing system in which simple (and later complex) clay tokens of various shapes were aggregated in hollow clay receptacles or envelopes (and later sealed string systems) to represent symbolically assets and economic transactions. Scores of such tokens (the recent explanation of which is due to Prof. Schmandt-Besserat) were found by archeologists all over the Fertile Crescent in layers belonging to the time between 8000 B.C. to 3100 B.C. — after this date cuneiform clay tablets emerged. The economic-philosophic implications of this discovery are important. First, it suggests that accounting preceded abstract counting as well as writing. Second, it suggests that conceptual representation emerged gradually. Third, it confirms the previous hypotheses that counting emerged in several stages. Fourth, it reveals the existence of an abst...

Accounting research in Italy: second half of the 20th century

Purpose - The purpose of this paper is to offer a concise survey and comparison of Italian accounting research and academic publications during the second half of the 20th century. Design/methodology/approach - The paper discusses the special relation between Findings - The paper reveals the changing international position of Italian accounting research. Research limitations/implications - The paper is limited by selecting the most prominent and relevant contributions among a host of pertinent publications. Originality/value - In contrast to previous research, the paper offers an integrated survey of major Italian accounting publications of the entire second half of the 20th century.

Archaeology of accounting and Schmandt-Besserat's contribution

The publication of Denise Schmandt-Besserats book Before Writing (1992, vols I and II) is the occasion for first reviewing her archaeological work (see Part I), and then interpreting and commenting on it from an accountants point of view, emphasizing further evidence that a kind of double entry recording existed 5,000 years ago (see Part II). Schmandt-Besserat recognized that ‘tokens’ (small clay counters) constitute an accounting system, widely used in the Near East from about 8,000 BC to 3,000 BC, that existed for five millennia. She also drew parallels between the shapes of the tokens and those of the first signs of writing, establishing accounting as the prerequisite and impetus to writing and abstract counting. A third part offers (in addition to the notes for Parts I and II) a summary of the ‘Stages in the Evolution of Accounting and Symbolic Representation in the Prehistoric Middle East’ (Appendix A) and of ‘Major Steps and Publications Toward an Archaeology of Accounting’ (Appendix B), as well a...

An axiomatic basis of accounting: A structuralist reconstruction

Set-theoretic axiomatizations are given for a model of accounting with double classification, and a general core-model for accounting. The empirical status, and “representational” role of systems of accounts, as well as the problem of how to assign “correct” values to the goods accounted, are analyzed in precise terms. A net of special laws based on the core-model is described.

The Systems Approach: Its Variety of Aspects.

This article offers a concise survey and glimpse of the vast literature presently available in the field of systems thinking and cybernetics. The first part discusses the areas of systems philosophy, systems analysis (mathematical systems theory), empirical systems research, and systems engineering, while the second part offers some details about the contributions of the following selected scholars: von Bertalanffy, Bogdanov, Ackoff, Churchman, and Herbert A. Simon. A bibliography of some 150 books and papers closes the article.

RECENT INSIGHTS INTO MESOPOTAMIAN ACCOUNTING OF THE 3RD MILLENNIUM b.c. — SUCCESSOR TO TOKEN ACCOUNTING

This paper examines from an accounting perspective recent work by Nissen et al. [1993], here regarded as an extension of the archaeological research of Schmandt-Besserat [1977, 1992] and its analysis by Mattessich [1987, 1994]. The transition from the 4th millennium b.c. to the 3rd millennium b.c. featured the use of protocuneiform and cuneiform accounting techniques to replace the older token accounting. This research reinforces the previously made hypothesis [Mattessich, 1987] that the inserting of tokens into a clay container during the last phase of token accounting corresponded to debit entries, while the impressing of tokens on the surface of the container was meant to convey the credit total of an equity. Similarly, in proto-cuneiform bookkeeping, debit entries appear again on one side while the credit total appears on the reverse side, but this time on the clay tablets. Yet, the research also leads to the hypothesis that the “closed double-entry system” of token accounting could not be maintained ...