Remember me on this computer. Enter the email address you signed up with and we'll email you a reset link. Need an account? Click here to sign up. Download Free PDF. Charizza Fe Malonzo. A short summary of this paper. Download Download PDF. Translate PDF. This study summarizes the extant accounting research into six major areas and is among the few to recapitulate most important current accounting research topics with a synthetic framework as well as some critiques on missed pieces of the current research.
As research indicated, academia closely serves the purpose of accounting practices, which prominently shows in accounting research. Key words Accounting research;Internal control; Accounting quality; Auditing; Accounting internationalization 1 Introduction After the Sarbanes-Oxley Act was passed in that intended to revolutionize accounting reporting and auditing in response to accounting reporting debacles like Enron, Global Crossing, and WorldCom, top-rated accounting academic journals have published most articles on corporate governance, internal control, accounting irregularities and restatements or aggressive accounting, earning management, accounting transparency, auditing quality and audit independence, and auditor conservatism, among others.
All these topics not only bear practical weights and signify implication for regulations and policy settings, but also have much academic indications and propositions. The present research could be classified into the following six critical topics, offer some critiques, and discuss missed pieces.
The issues are in the matter of fact interlinked, and thus studies are seen likely to cross the classifications. To elaborate the inter-linkage of the classification, eventually outline a framework that delineates the relationship of the components among themselves and with the outside world. As one of the major functions in an organization, accounting must operate in unison with the surrounding environment, and institute well in the organizational environment to maintain high quality of accounting functioning.
A number of articles published in recent years investigate the effects of corporate governance and organizational environments on accounting system and accounting reporting functioning and quality. The general findings are that an independent corporate governance structure and healthy organizational environments can significantly improve and maintain accounting system and reporting quality Givoly, et al, ; Campbell, et al, ; Magilke, et al, ; Katz, ; Kho, el al, Public ownership, institutional ownership transient or otherwise , and even managerial ownership can influence accounting conservatism and reporting quality.
Lafond and Roychodhury, ; Dikolli, et al, ; Givoly, et al, The eventual effects of healthy environments can transfer into smooth internal controls, the corporate transparency, and efficient company resource allocations.
Francis, et al, ; Hoitash, et al, For instance, one such corporate governance is incentive compensations for management. Another example is the audit committee of the board of directors. Why is independence and technicality of the committee members so important, and can they be objectively and independently enough to help to maintain internal control systems, and deter violations to internal control functioning? Naiker, et al , and Magilke, et al are among the first to examine the correlation.
In short, the environmental factors can contribute significantly to the effectiveness of accounting functioning, and the quality of accounting reporting.
The irregularities and aggressive accounting are likely to incur if the environments are weaken, and deteriorate in the aspect of supports and monitoring.
These issues will be picked up in a later section. The second issue is accounting system and internal control systems. Except organizational guarantee, the typical divisions and segregations of accounting functions supply accounting internal checks and balances, which is the first and foremost important front-line of prevention against potential violations and frauds, though collusions and management overrides can easily break down the frontline.
According to the current research, professional training, including accounting ethics and professional moral and independence education, can help to but cannot prevent frauds Prawitt, et al, ; Earley, et al, The implementation of accounting functions is not as evident until the accounting reports are produced and rendered to the public.
If we bring in more restrictive requirements of the Sarbanes-Oxley Act, and functioning of internal and external auditing, we would see dramatically more new research topics on their effects on accounting in recent years Earley, et al, ; Badertscher, et al, However, many studies touching upon the corporate governance and business environments have more or less investigate on the accounting internal system functions.
The one main reason is that effectiveness of accounting functioning can be derived from its outcome of financial reports and quality accounting information Lee and Masulis, Thus, it is easier to study the outcome of the process, which is often not directly observable or viewable to outsiders, than to investigate the process itself.
In general, this area is not yet as much studied as other topics, especially as those discussed below. The third critical issue emphasizes the accounting measurement and estimations, and the outcome of accounting works: financial reports and their quality.
This is the core of accounting research. It is in fact a group of research topics that are composed most of advanced and pioneer studies in modern accounting research. Financial Accounting Standard Board FASB , accounting academia, and accounting professions have been spending years on testing various possible techniques and ways to improve accuracy of accounting measurements and functionality, and accounting information quality.
Accounting publications have been mainly on the various slices of accounting problems that may be raised and warrant answers. Detail splits of this topic can note three typical areas or layers of accounting research: Accounting estimations and measurements, accounting reporting quality, and accounting irregularity and related restatements.
Researches on this area were, have been, and will be the main themes of accounting. Accounting estimations and measurements. Accounting regulations and pronouncements, like those issued by FASB, allow for various methods and estimations for accounting for a type of transactions, say inventories and marketable securities.
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Mohammad Azim. A short summary of this paper. Investors, regulators and other user groups are concerned about these crisis situations and demand that different regulatory thresholds be implemented to avoid the repetition of these scenarios.
This paper discusses all these recent changes and attempts to provide some useful thoughts that will assist the Australia accounting profession in the future.
Like other professions, accounting has evolved over time. The key elements of the accounting process are still the identification, measurement and communication of economic information of an entity. Over the last half century accounting has widened its focus beyond technical skills, to incorporate the social implications of accounting practice. In the last decade, major advances in information technology, the globalisation of businesses, increased public awareness of global environmental change and rising community educational awareness have required accountants to develop a wider range of skills and to consider the social as well as financial responsibilities of business organizations.
The accounting profession is an important part of society and over the years there have been many changes in the profession Wyatt, In particular the adoption of the International Accounting Standard has made the profession more challenging.
Accounting is an extremely complex activity with substantial ethical implications which have changed over the last century. Reporting is also necessary as it can allow companies to minimise the dangers and maximise the opportunities which are associated with these challenges KPMG, The financial collapses have not only caused many billions of dollars to be lost by shareholders, but have led to more unemployment and social instability.
Companies are now under increased scrutiny due to these corporate scandals. An analysis of the problems experienced by the accounting profession in Australia is of interest for two important reasons. There is relatively less research in other countries like Australia which has a significantly different institutional environment compared to those countries. Conclusions reached in previous studies may not be applicable to Australian accountants because its capital market is small and less active compared to the United States and United Kingdom, and has different monitoring structures and governance compared to Japan and Germany Farrar, Second, there has been an increasing degree of intervention by the Australian government in the affairs of the accounting profession.
This paper will add value to the body of literature by exploring the challenges face by the profession and provide some real life examples in the Australian context. This paper uses a structural functionalist approach and also provides a critical, social and contextual perspective of the important issues.
This research uses contemporary literature text-books, professional journals, web publications , and official documents decrees and laws as sources of evidence. In terms of organisation this paper is as follows.
Section 2 reviews the literature on the emergence and development of the accounting profession. Section 3 discusses accounting as a profession in Australia. Finally the authors discuss and summarise the identified differences, and propose issues for future research. Accountants wanted to unite into one body to ensure their legal and actuarial work was completed by appropriately qualified individuals for the benefit of the public.
A different type of professional accountant emerged in the USA in the late s, which reflected the economic and social conditions in that country between and This period witnessed population expansion and in particular the drift from country to city, industrialization, railroad competition, rising agricultural projects, and the emergence of a professional middle class.
In the UK, economic opportunities for investment by companies and individuals in the USA opened up the way for a significant influx of experienced Scottish and English chartered accountants Lee, They quickly organized as firms of accountants and sought the professional credibility to which they were accustomed in the UK.
They found no institutionalized bodies in the USA devoted to public accountancy, and began to form institutions similar to those existing in Scotland and England.
In the Institute of Accountants was the first American body of professional accountants. The Institute was open to all professional accountants and its main purpose was to educate accountants. In the American Association of Public Accountants was founded which was concerned solely with a public accountancy membership.
In and the Institute and the Association sought to create legislation in the state of New York to license professional accountants who met prescribed educational and residential requirements. With the passage of the first CPA law in the state of New York in to recognize the qualification known as Certified Public Accountant and the subsequent passage of similar laws, demand arose for qualified individuals to attest or audit services for businesses Previts and Merino, Prior to the s, no laws or regulations obliged corporations to have their financial statements audited Zeff, By the beginning of the twentieth century, the accounting profession worldwide had laid its institutional foundations and established a relationship with the state Germanou et al.
The number of accountants employed at the professional level has risen sharply over the past decade, from around , in to just over , in These professional bodies have a professional obligation to take all reasonable steps within their power to ensure that entities with which they are involved comply with Australian Accounting Standards when preparing their general-purpose financial reports.
The Institute of Chartered Accountants in Australia the Institute is the professional body representing chartered accountants more than 43, Institute members work in diverse roles across commerce and industry, academia, government, and public practice throughout Australia and in countries around the world.
CPA Australia has more than , finance, accounting and business professional members across the globe. CPA Australia is the sixth largest accounting body in the world. Ramneet Parmar. Michelle Mcmillan. Aqsa Butt. Hakim Jan. George Buliki. Anuj Dubey. Neha Kumari. Hay Jirenyaa. Navin Joshi. Miguel Combs. Carl Adrian. Isaac Gabriel Kuruw. Juma Mdaki. Muhammad Mudassar. Petros Gavai. Shajahn Shaik. Rodeth Cea.
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