Abstract In June 1936, the executive committee of the American Accounting Association published "A Tentative Statement of Accounting Principles." Accounting theory has been debated in the Association's annual meetings and in accounting periodicals with an energy never before displayed. From the beginning the Committee recognized the tentative nature of the statement of principles and looked forward to the time when revision would be undertaken. The appearance of revenue marks the accomplishment of the principal objective of business, namely, placing new utilities in the hands of consumers. The tests by which the reality of the profit or loss that may be embedded in revenue has been judged are as follows, economic tests, service has been rendered by a producer, utility has been accepted by a purchaser, a price has been determined by independent bargaining; legal tests, delivery has been completed, title to product has been passed, producer's claim for payment in due course is "property." Since the association of revenue and performance is basic to the concept of revenue, accounting standards should direct the preservation of that association; recognition of revenue should neither anticipate performance nor be delayed beyond performance.

Abstract This article focuses on governmental accounting education in the U.S. The position of the 1937 Committee on Education of the American Accounting Association appears to have been so widely misunderstood that a brief statement of clarification seems proper. Particularly, the failure of the committee to include governmental accounting in the syllabus, except under the Maximum Program, has been rather sharply criticized. An elaboration of such additional graduate work was not attempted at that time and no further statement has been made since. It was the opinion of the committee, however, that the place of governmental accounting lies somewhere in the senior elective area or in the graduate years. It is hoped that a further development will come through a study of offerings of universities and colleges whose graduates are presumed to have been prepared for the profession of accountancy. A grading, and classifying of curricula of various educational institutions should be undertaken, and the committee doing such work should be widely representative. It would, however, be futile to attempt such a task until the syllabus has been subjected to the most severe criticism.

Reviews the book "How to Operate under the Wage-Hour Law," by Alexander Feller and Jacob E. Hurwitz.

Abstract Although auditing, in varying forms, has been practiced for a long time, little attempt has been made to formulate a theory regarding the subject. Accounting is a process of keeping records of current business facts according to a system of theory and practice suitable to the circumstances. The auditor is a critic and auditing is an analytic, retrospective process of examining the system of accounting theory and practice of a specific enterprise. Although many audits fall into the same general class as to purpose, in no two cases are all the conditions identical. Every audit is an individual problem the solution of which requires a thorough understanding of the particular circumstances obtaining in that case. Since the auditor must judge the validity of the evidence supporting the transaction it is necessary for him to be able to recognize what is valid and what is not valid. Verification by impartial testimony based on information in the possession of persons outside the business is the most valid evidence that can be obtained to support any given item or transaction. An auditor must decide whether to secure confirmations from all or only a portion of the customers. In addition he must decide whether to ask each customer circularized for a statement as to the correctness of the balance shown owing to the company or to notify the debtor that he stands charged with the amount, with the request that he advise the auditor as to any exceptions that he may take.

Abstract In this article, the author focuses on the adequacy and reliability of corporate accounting reports provided to stockholders and security analysts. He tries to point out the gap in the regulation of accounting reports under Securities Exchange Act, based on around seventy selected corporate balance sheets and income statements for 1937. He also discusses a number of limitations inherent in the accounting material made available to investors. Accountants and investment analysts today are agreed that the income statement is much more significant and informative to the investor than the balance sheet. It reports that the Act applies to corporations with securities listed on national securities exchanges and requires such corporations to file with the Commission and with the exchange annual reports which comply with the standards imposed by the Commission and the exchange. The article undertakes to break additional ground in the inevitably forthcoming critical analysis of accounting categories and accounting concepts.