The article’s target audience includes accounting professionals, users of accounting information, and setters of accounting standards. The author considers the distinct audiences as separately concerned with using accounting to measure the “bottom line” of organization performance without first considering the limitations of the accounting (Moore, 2009). While addressing the distinct audiences, the author pinpoints the failure of each group to recognize that economic reality that surrounds the concept of organizational “bottom line.” The author addresses the standard setters in accounting as having come up with the consistent conceptual frameworks that do not last long enough to streamline the accounting sector. The author contends that each consistent framework that was introduced in the accounting profession was as problematic as the one that preceded it.
The article will be helpful to the audience because it provides an alternative to dealing with accounting problems that may not require the application of vigorous and inaccurate conceptual frameworks in accounting. For instance, the author cites allocation and boundary problems as items that should not be alleviated using the traditional accounting conceptual frameworks. The author suggests that organizations should have users that have the sophistication to facilitate the differentiation and understanding of different elements of accounting reports that are objective and those that are arbitrary. The author also compares the accounting profession with other professions. The other questions is why the accounting professions keep changing its standards after every criticism, but other professionals still retain their traditional standards. In the author’s view, the accounting profession is weaker in standard setting than other professions such as law, medicine, and nursing. Even if the alternatives provided by the author may not be definitive, they have the potential to provoke research and deliberations that can compel the accounting profession across the world to adopt strong standards that will induce confidence. Accounting bodies can invoke the assertions of viewers to commission research that will ultimately identify innovative ideas to be included in accounting practices. Furthermore, the accounting profession may identify items that require flexibility when making economic judgment.
There are many ways through which the article is related to the accounting profession. First, the author bases the research on the observations of other authors in the past, who have had divergent views about the effectiveness of the accounting profession. For example, the author cites Ketz and Wyatt (1983), renowned authors who were among the first accounting professionals to criticize the conventional methods measuring market efficiency. In their submissions, they cautioned accounting bodies, including FASB, against emphasizing that accounting standards should be based on the measures of market efficiency (Glaeser & Ward, 2005). The second issue is that the article’s direct relationship with the accounting profession is the direct comparison of accounting concepts. For example, the author mentions the asset-liability model in accounting, replacement value, discounted cash flows, realizable value, and cost realizable value, which are vital concepts in accounting.
Practicing accountants have a lot to benefit from the thought-provoking findings in the article. The first benefit is a basis to engage FASB and other professional bodies review accounting standards with the sole objective of making them more flexible than they are now. Secondly, the author commences a journey of incisive research that will compare the dynamics of professional standards in other professional fields and the accounting profession. Based on the author’s assertions, it is evident that the accounting professional bodies have not resolved disparities in accounting standards.
References
Glaeser, E. L., & Ward, B. A. (2005). Myths and realities of American political geography (No. w11857). National Bureau of Economic Research.
Moore, L. (2009). Economic “reality” and the myth of the bottom line. Accounting Horizons, 23(3), 327-340.
