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Accounting Theory
and Accounting
Research
Nyoman Ardiantha Putera R.M./344132
Muhammad Heickal Pradinanta/350168
Scientific Method
• A body of technique for investigating
Phenomena, acquiring new knowledge, or
correcting and integratin...
Research Approaches
• Deductive Reasoning: Logical reasoning is
used.
eg: Premise 1= Snakes are reptiles
Premise 2= Reptil...
• Inductive Reasoning: analyzing the logic of a
set of sentences not simply by its internal
logic.
Eg: The cost of goods w...
Normative (prescriptive)
Theory
• Employ a value judgement, containing at least
one premise saying that this is the way th...
Descriptive Theory
• Attempt to find relationships that actually
exist. Inductive approaches usually attempt to
be descrip...
Global and Particularistic
Theories
• Global (macro) theories
 Deductive reasoning
• Particularistic (micro) theories
 I...
Directions in Accounting
Research
1. Decision-model approach
2. Capital market research
3. Behavioral research
4. Agency t...
The Decision-Model
Approach
• Asks what information is needed for making decisions
• Does not ask what information users w...
Capital Market Research
• Efficient-Markets Hypothesis (EMH) : market
prices reflect fully all publicly available
informat...
Behavioral Research
• Focus on how users of accounting information
make decisions and what information they
need
• This ap...
Agency Theory
• Deductive/Inductive
• Enterprise as the locus or intersection point
for contractual-relationships
(eg: man...
Information Economics
• Analytical/deductive
• To determine how contractual arrangement
incentives and risk sharing can be...
Critical Accounting
• Concerned with the active social role of
accountant
• An Amalgamation of public interest accounting
...
THANK YOU!
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Accounting theory and accounting research

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this presentation is about accounting theory and accounting research (chapter 2) from accounting theory book, eight edition (conceptual issues in a political and economic environment) by Harry I. Wolk, James L. Dodd and John J. Rozycki

Published in: Economy & Finance
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Accounting theory and accounting research

  1. 1. Accounting Theory and Accounting Research Nyoman Ardiantha Putera R.M./344132 Muhammad Heickal Pradinanta/350168
  2. 2. Scientific Method • A body of technique for investigating Phenomena, acquiring new knowledge, or correcting and integrating previous knowledge. A theory, that must contain a basic set of premises (assumptions or postuiates)
  3. 3. Research Approaches • Deductive Reasoning: Logical reasoning is used. eg: Premise 1= Snakes are reptiles Premise 2= Reptiles are cold-blooded Conclusion= Snakes are cold-blooded
  4. 4. • Inductive Reasoning: analyzing the logic of a set of sentences not simply by its internal logic. Eg: The cost of goods was $2.00. The cost of labor was $1.00. The sales price is $6.00 per unit; so the item always provides good profit.
  5. 5. Normative (prescriptive) Theory • Employ a value judgement, containing at least one premise saying that this is the way things should be eg: Conceptual framework Deductive system are often normative.
  6. 6. Descriptive Theory • Attempt to find relationships that actually exist. Inductive approaches usually attempt to be descriptive
  7. 7. Global and Particularistic Theories • Global (macro) theories  Deductive reasoning • Particularistic (micro) theories  Inductive reasoning
  8. 8. Directions in Accounting Research 1. Decision-model approach 2. Capital market research 3. Behavioral research 4. Agency theory 5. Information economics 6. Critical accounting
  9. 9. The Decision-Model Approach • Asks what information is needed for making decisions • Does not ask what information users want • Orientation is normative and deductive The main decisions embraced by the decision-model approach: 1. Enabling the user to better predict future cash flows 2. Analyzing the efficiency and effectiveness of management
  10. 10. Capital Market Research • Efficient-Markets Hypothesis (EMH) : market prices reflect fully all publicly available information • EMH has significant implications for accounting • Difficult
  11. 11. Behavioral Research • Focus on how users of accounting information make decisions and what information they need • This approach is descriptive or positive Divided into 2 types: 1. Behavioral 2. experimental
  12. 12. Agency Theory • Deductive/Inductive • Enterprise as the locus or intersection point for contractual-relationships (eg: management, owners, creditors, and government). • Concerned with various cost of monitoring and enforcing relations among the group.
  13. 13. Information Economics • Analytical/deductive • To determine how contractual arrangement incentives and risk sharing can be negotiated
  14. 14. Critical Accounting • Concerned with the active social role of accountant • An Amalgamation of public interest accounting and social accounting
  15. 15. THANK YOU!

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