Abstract Presents a reply to Bart Ward's commentary on the assessment of prior distributions for applying Bayesian statistics in auditing. Assumption regarding the problem of obtaining prior distributions of good quality; Fallacy of Ward's reasoning.
Abstract Reviews the book "Normative Audit Control for On-Line/Real-Time Systems: A Feasibility Study," by Maxwell E. Aiken, Kevin G. Hulme and Phillip J. Grouse.
Abstract This article presents a comment on the study of some observations on student values and their implications for accounting education in the U.S. If accounting majors are less concerned with wisdom and beauty than other students it may be incumbent upon accounting educators to raise the consciousness level of their students. This could be done by pointing out the scholarly background of accounting and the infinite complexities of designing a useful and reliable method of measuring economic and financial transactions.
Abstract Presents a reply to comments made on the article "Some Observations on Student Values and Their Implications for Accounting Education," by Vincent Brenner. Relationship between attitudes and values; Reason for the adoption of the measurement technique; Need for awareness on the difference in attitudes or values between accounting students and non-accounting majors
Abstract This article focuses on the attitude of business students towards social problems. This paper reports comparisons which were made of entering freshmen who have elected a field of business at Virginia Tech with the national average for all curriculums. Of the business students 97.9% believed that the Federal government should do more about pollution, but this percentage was below the national average. Overall, the data indicated that entering business students seem to be strongly concerned about our social and economic problems. Accounting students were found to have positive attitudes toward parents, people in general, and authority, whereas creative writing students displayed negative attitudes. On the basis of this and other research, it seems logical to infer that accounting students are deeply concerned with social and economic problems. The challenge for accounting educators is to promote student interest in social and economic affairs and to assist the student in implementing his skills in a constructive manner toward a solution to these problems.
Abstract The article discusses the controversy over accounting for goodwill. Such issue has been existing for many years, and the recurrence of the problem shows that goodwill is indicative of a more fundamental problem in financial accounting theory. In an attempt to explore the goodwill phenomenon, financial accounting was analyzed from a systems-theoretic perspective. The article explains that accounting entities can be and are usefully conceived as open systems. The concept of open systems indicates the desirability of financial accounting theory being brought more in line with the emergence of management information systems.
Abstract The article discusses assessing prior distributions for applying Bayesian statistics in auditing. The results of this study suggest that auditors are willing to specify information from which prior distributions can be constructed. The prior distributions which were obtained, had most of the probability concentrated on small amounts of error, but there was considerable variability among them. It was found that there were substantial inconsistencies in the way some auditors specified information about the prior distributions. These inconsistencies and the variability among the prior distributions indicate that at least some of these distributions do not accurately reflect the auditors' beliefs about audit populations. Therefore, it is concluded that auditors should proceed with caution in relying on their prior distributions. To apply Bayesian techniques, the auditor subjectively evaluates the non-sampling evidence and expresses his belief about the audit population as a prior probability distribution. A likelihood function is then obtained by statistically evaluating the sample result.