Knowledge that Transforms

The writer has no quarrel with cost accountants and their methods, nor is it implied that cost figures, because of their imperfections, are hopelessly useless. By and large, the cost accountant performs well a function that is essential to carrying on accounting in general and basic to the furtherance of intelligent management. There are, however, three general conclusions that may be drawn from the exposition presented in the article; these should be emphasized. First, there is a real need for research directed toward the establishment of principles for cost allocation, especially with regard to the allocation of overhead costs. Second, there is good reason for broadening the concepts that have been applied to the field of cost accounting, to embrace techniques of statistical and mathematical analysis. Third, and most important, the limitations of available methods, the compromises of expediency, and the conflicting objectives that enter into cost calculations should make the accountant more careful as to his terminology with respect to unit costs.

The American Accounting Association held its annual convention in the Palmer House in Chicago on September 8 and 9, 1945. The change from the holiday season to the earlier date was made so that the problem of transportation and hotel accommodations would be less acute. On the evening of September 8, 1945 the regular business meeting of the Association was held in connection with the usual banquet. More than one hundred persons attended. Edward Kracke and William Charles, representatives of the American Institute of Accountants, spoke briefly. It was announced that more than hundred and fifty people were in attendance at the convention. The secretary-treasurer gave an interim financial report and announced that approximately two hundred and fifty new members had been secured in 1944. The chairman, presented a slate of officers for the calendar year 1945. The following were some of the members elected by the members present: professor Harvey G. Moyer, professor Geoffrey Carmichael, professor Ernest C. Davies. Copies of the financial report for the calendar year 1944 will be mailed to the members after it has been audited early in 1945.

Reviews the book "Industrial Accounting, War and Post-War Problems."

The article presents information on accounting in the war program. War demands have made necessary central planning and control for the materials of war. Intelligent planning and control are dependent on accounting data. To obtain accounting data, recourse has been had to formal reports, questionnaires, surveys, telephone calls and conferences. Information secured has covered production, stocks, consumption, population and labor figures, costs and other financial and accounting statistics. In the stabilization and procurement programs, many new applications of accounting techniques have been devised. It is the purpose here to review a number of the more important accounting developments in the war program and to consider some of the possible long-range effects, particularly the use of accounting in establishing social controls. There have been long-standing requirements for accounting reports in income tax laws and various regulatory enactments. In addition, permissive legislation such as the Federal Trade Commission Act 2 demonstrates that Congress years ago had become aware of the necessity of financial reporting in the establishing of even the most general business controls.

Reviews the book "Handbook of Tabular Presentation," by Ray Ovid Hall.

The article presents problems of the second half of the November 1944, C.P.A. examination prepared by the Board of Examiners of the American Institute of Accountants. The examinee was given four and one-half hours to solve both problems. The problems were given a weight of twenty-five points each.

How can accounting teachers, individually and through the activities of the American Accounting Association, cooperate most effectively in turning the attention of promising students toward the possibilities existing in an accounting career? The columns of the periodical "The Accounting Review" are open to those who have ideas to contribute and questions to raise. The usefulness to an individual of knowing something of his aptitudes for accounting work is easily appreciated. But the teacher faces certain problems in that connection. It will be particularly difficult to advise those students who are highly capable, since they probably can succeed in any one of a number of occupations. In all fields the most capable newcomers are the most desired. Therefore each teacher may be expected to favor his own field of specialization. Is there any danger that teachers may fall into competitive counseling? Will it be necessary to develop a wide series of aptitude tests pointed toward the various careers visualized in the program of a college of commerce? May it not be that counseling directed toward superior students will result in ignoring the slower students? The advantages of education should not be reserved for an intellectual aristocracy; possibly the best students need the least advice.

Reviews the book "What the Figures Mean," by Stephen Gilman.

Accounting training for the government service seems to be headed for a much larger role in the accounting curriculum than it had before the war. Most of the reasons for this trend existed before the war, although wartime problems have reinforced them. The problems of accounting training for the government service are not peculiar to the government service except in the case of fiscal operations. In general, the requirements of government and the parallel requirements of industry present an excellent opportunity for a dynamic accounting program in universities. As a result of the experience afforded by the war, the changes, which may be required, can be made more easily. Accountants have more information in a great many fields than ever before. There is a growing feeling in all walks of life that the professional groups must break out of their insulated pigeonholes. Many people in other fields are aware of this situation and are making plans to correct it. The accounting group has an interesting time ahead of it.

The article presents a report of a joint meeting of the American Institute of Accountants and the American Accounting Association on June 22 and 23, 1945. The purpose of the meeting was stated to be to lay the groundwork for permanent cooperation in the education field by the two organizations, to discuss common problems, and to appoint subcommittees to work out possible solutions. The meeting was then devoted to a discussion of the following subjects on the agenda. In discussing the need for more collateral reading it was recognized that colleges are often handicapped by the time factor in covering many courses within the time available and, consequently, must attempt to stimulate interest to the extent that students will voluntarily do outside reading. There was general agreement that training in auditing should be improved, but that the possibility for improvement was limited by the unavailability of instructions, manuals, and questionnaires used by public accounting firms and of records and documents used in ordinary commercial operations, which would give the students the opportunity to become familiar with the detail usually encountered in business and to learn to organize a volume of work.