Reviews the book "Preparing Federal Estate and Gift Tax Returns," 2nd ed., by John E. Williams.

Since 1948, the American Institute of Certified Public Accountants has published an annual edition of Accounting Trends and Techniques. This has been a most useful indicator of current accounting practices. Although the practicing accountant can thus be well aware of what others are doing, the accounting educator as a rule is aware of the current practices in accounting education at only a small handful of other educational institutions. Because of the rather limited information currently available about accounting educational practices in the nation's colleges and universities, it was felt that additional information on these subjects would be of value and interest not only to accounting educators because of their direct concern with these subjects but also to employers and training directors because of their interest in the formal accounting education which their new employees have received. There was no single elementary textbook which has had many more adoptions than others. Even the three most widely adopted texts are in use in slightly less than half of the schools surveyed.

This article focuses on the relation of taxation to the history of the balance sheet. The census which was introduced by the Emperor Augustus at the time of the birth of Christ was of great importance, for it was intended to obtain a firm financial basis for expenses; consequently, it laid the foundation of a budget and the proportional distribution of taxes among those who were liable to pay. The first entries were made upon wooden boards coated with wax, which were put together in the shape of a book, originally being called "caudex" and after the introductions of parchment, "charta." The taxpayer had then to declare upon oath that he had made no false entries. Citizens shared political authority according to the amount of property declared and the Roman, therefore, kept not only exact accounts of their daily receipts and expenditures, but also exact statements of their property. The relation between balance sheet and taxation can best be explained by. an examination of the business books and tax returns of the great Florentin banking house of the Medici.

Views Icon Views Article contents Figures & tables Video Audio Supplementary Data Peer Review Share Icon Share Facebook Twitter LinkedIn Email Tools Icon Tools Get Permissions Search Site Cite View This Citation Add to Citation Manager Citation Gregory B. Waymire; Neuroscience and Ultimate Causation in Accounting Research. The Accounting Review 1 November 2014; 89 (6): 2011–2019. https://doi.org/10.2308/accr-50881 Download citation file: Ris (Zotero) Reference Manager EasyBib Bookends Mendeley Papers EndNote RefWorks BibTex toolbar search Search Dropdown Menu toolbar search search input Search input auto suggest filter your search All ContentThe Accounting Review Search Advanced Search

Views Icon Views Article contents Figures & tables Video Audio Supplementary Data Peer Review Share Icon Share Facebook Twitter LinkedIn MailTo Tools Icon Tools Get Permissions Cite Icon Cite Search Site Citation Gregory B. Waymire; Exchange Guidance is the Fundamental Demand for Accounting. The Accounting Review 1 January 2009; 84 (1): 53–62. doi: https://doi.org/10.2308/accr.2009.84.1.53 Download citation file: Ris (Zotero) Reference Manager EasyBib Bookends Mendeley Papers EndNote RefWorks BibTex toolbar search Search Dropdown Menu toolbar search search input Search input auto suggest Search

This study examines whether straight-line depreciation, relative to accelerated depreciation, causes non-executive managers to make non-value-maximizing capital investment decisions. To do this, I conduct experiments in which managers must decide whether to continue using an existing asset or invest in a replacement asset. By design, replacing the existing asset yields higher cash flows and managers are aware of this fact. However, if the asset is replaced, then the greater remaining book value under straight-line depreciation relative to accelerated depreciation causes earnings to be lower. Lower earnings and psychological forces may push managers of firms that use straight-line depreciation away from making the economically efficient capital investment decision. The results suggest that managers of firms that use straight-line depreciation are less likely to invest in a replacement asset than are managers of firms that use accelerated depreciation. Further, the results suggest that managers perceive that an asset depreciated using straight-line depreciation has provided less retrospective utility than an asset depreciated using accelerated depreciation. In turn, I find that depreciation method-induced differences in managers' retrospective utility perceptions influence their prospective utility perceptions, which, in turn, influence managers' asset replacement decisions. By theoretically and empirically linking firms' depreciation method choice to managers' capital investment decisions, I provide evidence that a seemingly innocuous choice made for external financial reporting purposes can cause managers to make non-value-maximizing capital investment decisions.

This paper reports the results of an experiment that examines how incentive-based compensation contracts compare to flat-wage compensation contracts in motivating individual learning and performance. I use a multiperiod cognitive task where the accounting system generates information (feedback) that has both a contracting role and a belief-revision role. The results suggest that incentives enhance performance and the rate of improvement in performance by increasing both: (1) the amount of time participants devoted to the task, and (2) participants' analysis and use of information. Further, I find evidence that incentives improve performance only after considerable feedback and experience, which may help explain why many prior one-shot decision-making experiments show no incentive effects. Collectively, the results suggest that incentives induce individuals to work longer and smarter, thereby increasing the likelihood that they will develop and use the innovative strategies frequently required to perform well in complex judgment tasks and learning situations.

Reviews the book "Comparative International Accounting Educational Standards," by Belverd E. Needles and Vernon K. Zimmerman.

[Studies in psychology have reported that subjects tend to overestimate the likelihood of a hypothesized cause because they do not generate or consider an adequate set of alternative explanations. These findings have been reported in non-auditing domains. This study investigates the effect of alternative explanations on experienced auditors' analytical review judgments. In this article, I view analytical review as a diagnostic process that involves the generation and evaluation of hypothesized causes of unusual fluctuations in financial statement relations. In this diagnostic process, hypothesized causes are used to direct auditors' search for information. Auditors from two Big Eight accounting firms participated in two experiments conducted to examine whether making alternative explanations available to auditors reduces their initial assessments of the likelihood of a hypothesized cause. The effect of varying the number and strength of alternatives was also examined. The results of the first experiment show a decrease in the assessed likelihood of a hypothesized cause when alternative explanations are provided to auditors. Results of the second experiment show that varying the number of alternative explanations influenced the degree of reduction in such likelihood assessments, but varying the strength of alternatives had no effect. Overall, the results of this study could lead to improved audit efficiency and effectiveness.]

Discusses auditors' assessments of the likelihood of error explanations in analytical review of financial statement relations. Role of alternative explanations; Number and strength of alternatives; Errors used as alternative explanations; Strength-ranking tasks.