18 Questions
What is a main reason why managers support certain accounting standards?
To minimize information costs
What is the concept of 'accounting as a mythology' used to?
Justify and rationalize managerial decisions
What is a purpose of preparing accounting reports?
To communicate financial information to users
What is 'accounting as a magic' comparable to?
A magician's tricks
What is an example of 'accounting as a magic'?
Using accounting techniques to disguise loss-making investments
What is 'accounting as economic goods' part of?
A wider information set
What are the two components of accounting as a language, according to Hawes (1972)?
Symbols and grammatical rules
What is the primary purpose of accounting in the context of intra-corporate politics?
To shape company policies and further management's aims
What drives the accounting standard setting process, according to the text?
Political process and special interest groups
What is the role of accounting in the context of communication?
To translate economic events and transactions into words and numbers
What can be inferred about accounting reports in the context of intra-corporate politics?
They are used to convince management to allocate resources
What can be inferred about the selection of accounting techniques in the context of accounting standard setting?
They are selected to maximize the utility of special interest groups
What is the primary role of accounting according to the Committee on Terminology of the American Institute of Certified Public Accountants?
To record, classify, and summarize financial transactions and events
What period of accounting history saw managers being given initiative and insights on how to use assets?
Asset-utilisation period
What is the role of accounting in intra-corporate politics?
To exercise power and influence within the organization
What is the concept of accounting as mythology?
The idea that accounting is a neutral and objective practice
What is the role of accounting in communication?
To provide financial information to stakeholders
What is the potential consequence of accounting being used as a tool for manipulation?
Misleading financial information
This text explores the relationship between accounting and management systems, discussing how they support standards that lower taxes, reduce costs, and increase management compensation. It also touches on the concept of professionalism in accounting and its impact on decision-making.
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