The article focuses on the fund-flow problems which cause the student to think about the interrelationships existing between balance-sheet accounts and income-statement accounts. As a result of this thinking, the student develops a workable understanding of the whole process of accrual accounting. Problems requiring a statement of working-capital flow or a statement of cash flow are excellent devices for teaching accounting. There is a method applicable to solving fund-flow problems which provides some of the advantages of both the worksheet approach and the T-account approach. This method requires the construction of a form which may be thought of as a quasi worksheet or working paper. Through the use of this form the student can see the intermediate steps necessary to solve the whole problem, and he can sense the advantages of a well-organized solution. A completed working paper includes a well-designed working copy of the fund-flow statement. A formal fund-flow statement can be copied directly from the working paper without extensive interpretation of the data.

The purpose of this article is not to discuss the arguments for or against the use of direct costing. It is instead to locus attention on some of the legal implications a company should keep in mind with respect to taxation, securities regulation, and antitrust and other legislation if it is considering the use of direct costing as an all purpose accounting technique. Advocates of direct costing maintain that it simplifies the interpretation of financial results and that it is particularly useful for profit planning, pricing decisions, and cost control. Opponents do not generally deny that the system has advantages, they are more concerned with its application to external reporting. The National Association of Accountants reported that seventeen of the fifty companies participating in a research study report used direct costing in preparing financial statements for stockholders. In none of these cases had auditors given a qualified opinion or taken exception to the practice. Apparently the CPAs performing the examination believe that the use of direct costing results in financial statements which present fairly both the financial positions of their clients as well as the results of operations for the periods under review.

The purpose of this article is (1) to propose a point of view for defining and applying objectivity and (2) to demonstrate the acceptability of the view and the definition when related to the needs of the profession. If researchers really wish to obtain greater objectivity in accounting, they will not do so either by eliminating the use of judgment or by permitting each individual to exercise his judgment freely. Instead, what researchers must have are (1) standards of competence and ethics, many of which they already do have, to assure that individual practitioners are capable of exercising professional judgment in an objective manner, and (2) reference points such as generally accepted objectives and principles, most of which researchers do not have in really explicit form. Even when researchers do finally develop these standards and reference points in a more adequate manner, researchers will not be eliminating the use of judgment. Instead, researchers will be making judgment more effective, more controllable, in attaining a desirable state of objectivity. It seems clear, therefore, that their task is to enhance the prestige and effectiveness of professional judgment in order to achieve greater objectivity, rather than to eliminate judgment in the mistaken notion that it is necessarily in conflict with the goal of objectivity.

The purpose of this article is to outline some significant changes which have occurred during this period with particular reference to the accountant's duties arising from the Companies Acts in Australia. A recent survey of members indicated that about 21 per cent of the society members are in public practice or employees in public practice, while 3,300 of the members of the Institute of Chartered Accountants are in practice. So there would be approximately 8,500 members of the various professional bodies engaged in public practice. While the majority of accountants are affiliated with one or more of these bodies there remain a number outside. In the public practice area these persons are pre-dominantly involved in certain classes of taxation return preparation, the uniform companies acts. Under the Australian Constitution the Commonwealth Parliament can legislate only on matters expressly delegated in the Constitution. The powers of the Commonwealth with respect to companies are incomplete and the framing of companies legislation has remained a matter for the States.

The most recent statement of basic postulates of accounting is contained in Accounting Research Study #1, prepared under the auspices of the American Institute of Certified Public Accountants. The 14 postulates presented therein have been grouped under three headings namely environment, field of accounting and imperatives. The attempt to present succinct descriptions of the basic postulates for accounting is meritorious. The philosophy underlying such a project would appear to be directed toward the establishment of a sound foundation for the advancement of accounting theory. However, continued analysis of these and alternative postulates must be undertaken to avoid the creation of a mausoleum from which there could be no escape. A chart has been developed which attempts to depict the interrelationship that appears to exist between these postulates. The heavy reliance upon the deductive process evidenced by this study suggests that a comparable exercise utilizing inductive reasoning should be undertaken for a verification or repudiation of these postulates.

The article presents a simple procedure for teaching accounting adjustments. The use of this procedure will result in better student comprehension of adjustments and provide him with a device for consistently doing adjustments correctly. The article informs that present methods of teaching adjustments account by account, one adjustment at a time, is poor utilization of time and abilities. The procedure to be presented, when initiated on the accounting level detailed below, requires a minimum of memorization and class time. The student's accounting knowledge should have progressed through a simple accounting cycle of recording, posting, closing, and statement preparation. This presumes an elementary knowledge of the various accounts: statement classification, normal balance debit or credit, an account description of what it represents, the basic business transactions that increase or decrease the account balance, and the closing entry if applicable. In addition to the accounting cycle and account characteristics above, knowledge of the procedure to balance a ledger account is needed to present programmed adjustments.

In recent years the California State Board of Accountancy has devoted considerable time to various problems that are involved in improving reporting standards. The California Board of Accountancy consists of eight members comprising of five certified public accountants, two public accountants and one public member not licensed or registered by the Board. The Board has only those powers and duties conferred on it by the Accountancy Act. These powers and duties are required in the administration of the Act. The Accountancy Act empowers the Board to adopt the rules and regulations necessary to carry out its responsibilities. Upon analysis it is obvious that the rule involves almost all of the basic background in the theory of auditing. Thus, accountants must be familiar with the literature of the American Institute of Certified Public Accountants to understand the meaning of auditing standards and to keep abreast of the changing concepts related to these standards. Rules of professional conduct that have been established as a result of the authority vested in the Board, are found in Article 9, Chapter 1, Title 16 of the California Administrative Code.

The article presents a discussion on the topic related to direct costing, which appeared in the January 1964 issue of the journal The Accounting Review. The paper, like most of its predecessors, had used two opposite poles of inventory and cost measurement, full absorption cost and variable cost. While certainly not the burden of the paper, the impression was left with the reader that these are the two relevant valuation measures to discuss. The author of this article differs with this view. The aim of this paper has been to focus attention on the forgotten third man in the direct versus absorption cost controversy. Standard cost, used with a meaningful fixed overhead application base, can supply useful information, and realistic inventory and income statement values. For many internal management purposes it may also be more useful than the standard cost utilized above. For external reporting, and for other internal management purposes, standard cost, as illustrated in this article, presents possibly more relevant and useful balance sheet inventory value and income statement emphasis.

The article focuses on the determination of goodwill and bonus on admission of partner. It focuses on an understanding of the logic involved in various methods of admitting partners. Partnership change problems (withdrawal, admission, substitution, and dissolution) can be among the most challenging, thought-provoking and interesting experiences in the introductory accounting course. In fact, the values to be derived from thinking through such problems greatly outweigh the transient value of getting the correct solution to a particular problem. The article emphasizes that the more that problems such as partnership capital changes are presented by means of routine mathematical formulae, the more harm is done to the thinking process. The logic underlying solution to admission problem should be stressed. For a number of years the following simple outline form has been used in presenting partnership changes. There are only so many possibilities inherent in a situation; once a person understands the problem at hand he has won the battle.

The modern business-oriented computer is an adaptation, with minor modifications, of the earlier and more general notion of a stored-program, digital computer. Business-oriented computers have been developed largely as a result of a concerted effort on the part of computer manufacturers to develop equipment, which would be suitable to the requirements of business data processing. For the most part, however, accountants have had very little to say about the kind of equipment which has been made available to the business firms. Consequently, each installation has been approached on an ad hoc basis, and there appears to be a wide divergence in accomplishment. Business-oriented computer should be taken as a frame of reference, and instead of superimposing the computer on the business information system of the firm, that the systems designer should build or rebuild the entire system based upon the theoretical concepts inherent in the computer itself. Business-oriented computer becomes an adequate frame of reference for exploring the possibilities and ramifications of a normative business information system for the firm.