Abstract The Committee on Research of the American Association of University Instructors in Accounting has assembled certain material on the subject of appreciation for review by the membership at large. Thus, an opportunity will be afforded for criticism, and for the expression of any opinion which any one may have to offer. Appreciation, because of conflicting theories and opinions held by various parties at interest, presents one of the most trying problems with which business men, lawyers and accountants have to deal. Much of the difficulty probably results from the failure to make a thorough study of the subject from all its angles. Certain graduate students at the University of Illinois, under the direction of professor A. C. Littleton, have prepared a report on a survey made by them on the subject of appreciation. This material appears in the article under the main headings and is followed in each instance by the comments of certain members of the association. In seeking a definition of appreciation, an extensive search through the accounting literature fails to yield a very rich return. The fundamental idea of an increase in values is, of course, always present.

Abstract Accountancy practice in this country has grown from a theoretical zero to an institution comprising, probably, 25,000 public accountants, and gross annual earnings estimated at from $ 350,000,000 to $100,000,000. Twenty-five years ago engagements were taken, work was performed, reports were prepared and rendered, bills were paid, and few, if any, questions were asked by clients. This condition may be attributed largely, perhaps, to the fact that clients had little knowledge of accounting, or of auditing, or of what the accountants were supposed to do. Today, the accountant's relation to business, and to the personnel of business is quite different. For twenty-five years university schools teaching accounting and other subjects have been pouring their products into the business world. These men have taken positions as accountants, company auditors, treasurers, comptrollers, and credit men. Some of them have risen to the ranks of presidents, vice presidents, secretaries, and chairmen of finance committee. Not a few have become substantial shareholders.

Abstract The certified public accountant's interest in the subject of appreciation is a practical one. He is forced to consider the matter in connection with his review of accounting and his certification of financial statements. The facts are, whether or not such procedure is justifiable, that physical property and intangible frequently are revalued by, or at the instance of, the owners of such possessions who attempt, in various ways, to give expression to the estimated increases in value. The certified public accountant, therefore, is confronted primarily with a condition; not a theory. The authority for the restated value may be either a report of independent appraisers, or a resolution of corporation directors. In as much as the certified public accountant does not attempt to act as an appraiser, to pass judgment on the work of such persons, or to assume responsibility for the values which they fix, he accepts their judgment and qualifies his statements accordingly. The occasions for revaluations which give rise to estimated increases in values are various.