Knowledge that Transforms

The accuracy of forecasts of one-year-ahead current cost earnings using four component models is examined. ASR 190 data for 1976 to 1978 and FAS 33 data for 1979 to 1981 are used in calculating current cost earnings for a sample of 129 firms. The component forecasting models also incorporate forecasts of certain components of historical cost net income developed by Value Line financial analysts. The forecast accuracy of the component models is compared to four benchmark models. A component model that incorporates analysts' forecasts of sales and changes in (historical cost) margins provides the most accurate forecasts for the aggregate sample and for two subsamples. It also provides similar or more accurate forecasts than the other models in eight of the nine industries examined. Thus, researchers may consider using this model when examining the incremental information content of current cost earnings vis-a-vis that of historical cost earnings.

Reviews the book "Modern Auditing," 2nd ed., by Walter G. Kell and Richard F. Ziegler.

This article discusses several issues underlying a dispute between Aetna and the SEC about accounting for the tax benefits of loss carryforwards. We discuss current accounting requirements for these benefits, Aetna's accounting for its tax benefits, and the reaction of security markets to its dispute with the SEC. We believe that accounting for these tax benefits should be changed to reflect changes in the tax laws, current definitions of assets, and criteria for accounting recognition.

Reviews the book "Further Essays on the History of Accounting," by Basil S. Yamey.

This study applies citation analysis to evaluate the research contributions of accounting faculties, doctoral programs, and individuals to contemporary accounting research (CAR). A research contribution is measured as CAR citations to a journal article written by an accountant, and CAR is defined as all main articles published in The Accounting Review, Journal of Accounting Research, Journal of Accounting and Economics, and Accounting, Organizations and Society between 1976 and 1982. The advantages and disadvantages of the technique are discussed, and the sensitivity of the results to alternative citation measurement metrics is examined.

Reviews the book "Management of Public Sector and Nonprofit Organizations," by Leslie B. Grayson and C.J. Tompkins.

Reviews the book "Management Control Systems," by Joseph A. Maciariello.

This paper provides a description of recent authorship in The Accounting Review (TAR) in terms of authors' schools of affiliation and degree. The analysis is confined to American universities. Comparisons with similar studies in economics and finance, with previous studies of accounting journals, and with the Journal of Accounting Research (JAR) result in the following conclusions: 1) concentration of authorship in TAR is greater for degree school than school of affiliation, which is consistent with the experience in other disciplines; 2) the concentration by certain degree schools is persistent over time; and 3) certain degree schools have been dominant in both TAR and JAR through time. The general conclusion is that there is some evidence suggesting an institutional element that influences the accounting research published in TAR. Additional research projects are suggested which might answer why this institutional element is present and whether it contributes to the perceived decline in the epistemic quality of TAR.

Reviews the book "Incremental Information Content of Statement 33 Disclosures," by William H. Beaver and Wayne R. Landsman.

This article presents names of various members and officials of different committees of American Accounting Association during 1984-85. The executive committee comprises of Doyle Z. Williams as its president, Clarence Sampson as vice president, Donald L. Madden as director of education, William R. Kinney as director of research and Alvin A. Arens as secretary/treasurer. Sections and group representatives include Accounting, Behavior & Organizations Section represented by Ellen Cook and Administrators of Accounting Programs Group represented by Harold E. Wyman. Regional group representatives include Descom D. Hoagland of Northeast Regional Group, Michael Gallagher of Mid-Atlantic Regional Group, and Jack L. Krogstad of Mid-West Regional Group. Information Systems/Management Advisory Services Section is chaired by Gary Grudnitski. International Accounting Section is chaired by H. Peter Holier. Management Accounting Section is chaired by James M. Fremgen. Public Interest Accounting Section is chaired by Barbara D. Merino.