Accounting Theory ACNE 3306

Course description:

This course include theory development in accounting, normative accounting theories, positive accounting theory, accounting regulation, ethics in accounting, behavioral accounting, social and environmental accounting issues, and professional judgment in accounting.Financial reporting and qualitative characteristics of accounting information are discussed in this course, alsoother fields of study, particularly economics and finance, to examine the efficient markets hypothesis and its implications for financial reporting. Applications of the present value model in accounting, agency theory and its implications for financial reporting, the accounting standard-setting process, and the economic consequences of accounting decisions are also discussed.

Course Aims:

  • Develop an understanding of accounting principles and postulates.
  • Understand the effect of financial reporting on decision making.
  • Understand how to distinguishing between more useful information from less useful information.
  • Develop an understanding of accounting policy choices available or under consideration for application within International Financial Reporting Standards.
  • Be able to think critically about underlying theories, concepts, assumptions and arguments in accounting.
  • Be able to apply understanding of accounting principles and knowledge of accounting techniques to solve financial reporting problems.

Course outcomes:

At the completion of the subject, students should be able to: 
  • Explain the concept of decision usefulness approach to financial reporting.
  • Critically evaluate the efficient securities market theory and its implications for financial reporting.
  • Understand management's interest in financial reporting and concerns about disclosure, choice of accounting policy, and risk reporting.
  • Contrast the application of information perspective and measurement perspective on financial reporting.
  • Identify conflicts of interest amongst stakeholders and apply models of conflict resolution.
  • Demonstrate knowledge of the complexity of measuring the costs and benefits of information.
  • Identify the elements of the standard-setting process and discuss the influence of political and economic consequences of regulation.