This article attempts to relate the school of philosophical thought known as pragmatism to accounting theory formation with the purpose of illustrating an interrelatedness of certain metaphysical assumptions of pragmatism to the thought structure, which seems to underly accountancy and which, in conjunction, might serve as a particular metaphysical base for accountancy. The metaphysics of pragmatism may be considered to refer then to the assumptions about man and nature within a system which includes especially a theory of experience and natural events, a theory of values, and a theory of man's relation to nature. Environment of operations the natural events of the accounting environment are to be accepted as a reflection of the reality of experience amenable to accounting thought and study and which establish the significance of the accounting function. The accounting function postulates a mixture of the incomplete and the complete, the determinate and the indeterminate. With respect to the implications of a pragmatic base for accountancy, it should be emphasized that the accounting function is believed to be rooted in the characteristics of change, uncertainty, and peril or hazard, and the resulting conditions of risk, needs, choices among alternatives and the creation of values.

Reviews the book "Management and Corporations 1985," edited by Melvin Anshen and George Leland Bach.

The accounting and management literature reflects an increasing interest in relative performance evaluation (RPE) measures, often called ‘benchmarking’. In this paper we illustrate how stochastic frontier estimation (SFE) can be used to estimate benchmark performance standards which control for differences in the environments of the benchmarked operating units. Our application of SFE uses cross-sectional data reported by school districts in the state of Missouri for the year 1990–1991. The results suggest that the districts may have had as much as $394 million of excess expenditures in their operations.

Accounting changes, Earnings smoothing, Interim reporting

Nicholas Dopuch, Ronald R. King, The Impact of MAS on Auditors' Independence: An Experimental Markets Study, Journal of Accounting Research, Vol. 29, Studies on Accounting Institutions in Markets and Organizations (1991), pp. 60-98

Accounting techniques, Earnings, Firm performance, Systematic properties of accounting numbers

Nicholas J. Gonedes, Nicholas Dopuch, Capital Market Equilibrium, Information Production, and Selecting Accounting Techniques: Theoretical Framework and Review of Empirical Work, Journal of Accounting Research, Vol. 12, Studies on Financial Accounting Objectives: 1974 (1974), pp. 48-129

Nicholas J. Gonedes, Nicholas Dopuch, [Discussion of Capital Market Equilibrium, Information Production, and Selecting Accounting Techniques: Theoretical Framework and Review of Empirical Work]: A Reply, Journal of Accounting Research, Vol. 12, Studies on Financial Accounting Objectives: 1974 (1974), pp. 138-141

Nicholas J. Gonedes, Nicholas Dopuch, [Discussion of Capital Market Equilibrium, Information Production, and Selecting Accounting Techniques: Theoretical Framework and Review of Empirical Work]: A Reply, Journal of Accounting Research, Vol. 12, Studies on Financial Accounting Objectives: 1974 (1974), pp. 158-169

We provide results from an experiment designed to assess whether mandatory rotation and/or retention of auditors increases auditors' independence by reducing their willingness to issue reports biased in favor of management. Auditors' reporting is compared across the following four regimes: one that does not require either rotation or retention, a second that requires retention only, a third that requires rotation only, and a fourth that requires both rotation and retention. We find that the rotation requirements in the third and fourth regimes decreased auditor‐subjects' willingness to issue biased reports, relative to the two regimes in which rotation was not imposed. In these other two regimes, however, many manager‐subjects voluntarily retained the same auditor‐subjects over multi‐periods. While the long running interactions between manager‐ and auditor‐subjects resulted in more favorable reports by auditor‐subjects (a lower level of independence), the established relationships also induced manager‐subjects to make higher investments.