Knowledge that Transforms

In spite of the multiplication of schools of accountancy during the last twenty-five years, a relatively small percentage of the men who enter the profession have graduated from the recognized schools. This is no doubt due in large part to a lack of cooperation between the school and the profession for a purpose which would be mutually advantageous. Some progress is this respect has been made in the last few years by the establishment of a Bureau of Placements by the American Institute of Accountants, but the conditions of employment laid down there in leave much to be desired, and seem designed rather to give the student control of his position instead of permitting the employer to control the student. To illustrate how important is the correlation of theory with practice, it is only necessary to point out that in any given piece of work it would be practically an endless task to carry out in full every operation and every test which the theory would make possible. An audit carried out along these lines would be prohibitive in cost, and its result would be no more certain.

Reviews the book "Consolidated Balance Sheets," by George H. Newlove.

Reviews the book "Inventory Practice and Material Control," by Frederic W. Kilduff.

This article presents proceeding of the eleventh annual convocation of the organization American Association of University Instructors in Accounting, which held during December 28-29, 1927 at St. Louis, Missouri. Program meetings were held in morning and evening sessions. A brief verbal report was presented for the Committee on Membership in which members were asked to furnish a list of accounting teachers in their institutions and also endorsed the secretary's recommendation for a large membership committee. A report from the Committee on Cooperation with the American Institute of Accountants was read by professor J. H. Jackson and is appended to these minutes. No report was furnished by the Committee on Cooperation with the National Association of Cost Accountants. The president furnished a brief verbal report for the Committee on Cooperation with the American Society of Certified Public Accountants, reporting progress and expecting continuation of the work. A similar report was also furnished for the Committee on Research.

During the past few years there has been a considerable amount of writing and discussion in the accounting and engineering field on the subject of the valuation of assets, and especially has the valuation of fixed plant assets come in for much analysis and study. The increasing interest in this problem has been doubtless due, in no small measure, to the attention directed toward it by the income tax regulations and by the marked upward swing of prices from the prewar to the postwar level-a fact which has been of considerable importance and annoyance in numerous public utility valuations incident to the regulation of their rates. However, it may be said without fear of serious contradiction that, as a practical matter, the accountant in the past has not given sufficient consideration to this important problem. This article sets forth the various methods by which the facts of such a policy may be expressed in the accounts and operating statements, assuming that the policy has been decided upon.

Reviews the book "Accounting for Surplus," by Paul W. Pinkerton.

Reviews the book "Accounting--Its Principles and Problems," by Henry Rand Hatfield.

The article comments on the article by Professor Chapman in the December, 1926 issue of "The Accounting Review" ominously entitled, "The Administration of College Courses in Accounting." It was indeed with surprise and perturbation that the writer attempted to digest the list of administrative problems; he was surprised at the number presented and perturbed by the fact that in nearly fifteen years of contact with school accounting curricula he had not even imagined that the problems were as difficult and far-reaching in effect as intimated. Basically, the questions raised by Professor Chapman may be answered from the point of view of two considerations: money and results. Money greases the wheels of accounting departments as well as those of any other department. The more lubricant, the less the squeaking on antiquated axles. What can be done as against what is done, too, frequently resolves itself into a matter of dollars. If the writer had all the funds he believed he needed, he would gather together the best C.P.A. talent in the country as a staff, or "bust" in the attempt. Perhaps, however, such a situation would lead to problems more involved and even more troublesome than those suggested, if that be possible. Results count, nothing else. If results are secured, acceptable to the department head, to the dean, to the general administration, and to the practicing brethren, it would seem that the work accomplished is beyond criticism, regardless of course content or department organization.

Reviews the book "The Retail Method of Inventory," by Malcolm P. Mcnair.

Standard costs are the natural outgrowth and development of budgetary accounting, which, curiously enough, warn first used by industry in connection with factory burden. Gathering refinements along its path, the system has reached its present stage of development in connection with manufacturing after a complete circuit of functional application. That the subject is an important one is evidenced by the fact that considerable time has been devoted to it at each of the last five annual meetings of the National Association of Cost Accountants. That it presents many controversial features is likewise apparent from even a brief study of the limited available literature, and the ultimate solutions of these problems -as the thought and effort in the field progress-will doubtless differ considerably from many of the current practices. In the next decade, unquestionably, a great impetus will be given this subject by practicing cost accountants; and university instructors in this field must be prepared not only to discuss standard costs intelligently, not only to enlighten students as to the present development of the subject, but to lead the way to scientific and practical perfection of this method of cost accounting.