This paper discusses the assignment of audit staff personnel to audit engagements to conform to the limitations of an audit office and at the same time meet the unique professional and economic objectives of that office. A linear programming model of this assignment problem is being discusses which not only provides an assignment that maximizes a linear function describing the audit office's professional and economic objectives, but provides other useful information for decisions such as scheduling of professional development and education, etc. The proposed model has a significant potential limitation--the benefit--maximizing nature of linear programming. Auditors do not seek to maximize profits or billings but rather to serve the public as well as possible and earn a satisfactory compensation. Hence, the model cannot simply maximize office billings. The steps which have been taken to construct a useful measure of audit office benefits for maximization overcomes this limitation, and will be described in the paper.

Abstract The article represents a study of one effect on issuers of financial statements in the airline industry which the use of alternative reporting practices has had. A discussion of the results of the study briefly considers the consequences of being able to observe this effect for organized public accounting practice and authority. Capitalists, in such economy in which both good and bad financial statements circulate, face investment decisions in which the results of selecting given alternatives are known with more or less certainty depending on whether the related financial statements are good or bad. The degree of uncertainty can be affected by the form and content management chooses for the financial statements. The author states that firms with bad financial statements would be penalized because capitalists would require a higher return from their equities than from the equities of firms with good financial statements. Financial statements are surely among the devices available for the firm to minimize its purchase of capitalist ignorance within the meaning of the profit-maximization constraint.

Human resources, Input prices, Financial reporting, Accounting Choices

Abstract Reviews the book "Management Forecasts of Earnings: Issues and Practices," by D.H. Drury.

Reviews the book "Studies in the Recovery of Capital," by Shinkichi Minemura.

Abstract The objectives of this article are to supply a specific study, and to try to show some of the hazards that must be risked by any one attempting to define accounting principles logically. For many years accountants have sought to discover and state the principles on which the practice of their profession should be based. The latest such effort which is reasonably complete is accounting research study (ARS), "A Tentative Set of Broad Accounting Principles for Business Enterprises," by Robert T. Sprouse and Maurice Moonitz. Traditionally, the accounting profession has regarded economic theory as too subjective to apply to real situations in accounting. This judgment should not be extended to include ARS, which may be regarded as an attempt to reconcile accounting practice with an internally consistent theory of income determination. Although economists often construct different definitions of income to serve the requirements of the problem with which they are dealing, the most widely quoted one would define business income as the amount which could be distributed to the business' owners at the end of a period while permitting the business after the distribution to remain in the same condition as at the beginning of the period, with equivalent expectations.

Abstract There has been a great deal of interest expressed in the development of accounting curricula for students wishing to pursue a career in management accounting, as of April 1975. At University of Texas in Austin, Texas, it was felt that practitioners in the management accounting field should be consulted to determine their perceptions of the usefulness of various management accounting topics in their work experiences. A group of faculty met to consider what topics should be included in such a survey. A list of thirty-nine topics was chosen from consulting the indexes and table of contents in several managerial and cost accounting texts, as well as from discussion with a small group of management accounting practitioners. An analysis of the results of the survey indicated there were five major rank-order groups of topics, namely, performance evaluation, responsibility accounting, internal control, tax factors in business decisions and profit planning and control. These groups were determined by searching for gaps between topics in the scale-weighted averages.