Abstract The 1957 Statement of the American Accounting Association's Committee on Concepts and Standards Underlying Corporate Financial Statements' makes two specific recommendations regarding the treatment of corporate income taxes in financial statements. (1) With respect to income determination, it states that interest charges, income taxes and true profitsharings are not determinants of enterprise net income. (2) With respect to the differences between reported and taxable business earnings and the tax payment. Although these two recommendations may be independent of each other, the inter-period allocation of income taxes is often associated with the treatment of the tax as an expense. The purpose of this paper is twofold: (1) The first part presents some arguments in favor of including the income tax as a determinant of income in all meaningful concepts of the corporation. (2) The second part presents some arguments to substantiate the inter-period allocation of income taxes and presents an alternative approach which may make the allocation process more palatable to the Committee on Concepts and Standards.

Abstract The article presents views of the author on the place of the accounting faculty, if any, in the work the school may undertake in connection with educational programs for outside businessmen. According to the author, at present the contract with the school calls for the faculty accountant to carry no more than the customary or conventional load, any other work that he does for the school is considered to be a new contract in which the school competes for his free time with other earning possibilities. Now that many schools are accepting a part in the management development movement and are organizing and selling educational programs on a cost-plus basis, they are able, by using the group approach to consulting, to compete with other earning opportunities of the faculty. The group consulting approach has several advantages. It increases the effectiveness of the accountant, it increases the extent of his impact on the business community, it helps the public relations of the business school and more importantly, it changes the outlook and the thinking of the accountant about the accounting function.

Reviews the book "Practical Financial Statement Analysis," 4th ed., by Roy A. Foulke.

Abstract As accountants, our responsibility is to report on the trusteeship of management. Management in turn should not be charged with accountability for assets and liabilities or for the determination of income on a basis other than the basis of the actual assets that were placed in use and consumed in operations. Furthermore, as accountants, we should firmly resist efforts to confuse accounting principles with devices to secure increased rates for a utility or to obtain income tax deductions. An accounting principle is supposed to apply with equal fairness and reasonableness in all situations where applicable, whereas a device is simply an expediency for a special situation. Historical cost of assets is not a fetish as some assert, but it is the actual basis on which management does its planning and operates the enterprise. Is not depreciation then the amortization of a capital expenditure that represents a charge to income of the actual cost of the expenditure over the useful life of the asset represented thereby? How can depredation with fairness and reasonableness be anything else than that?

Abstract A heated controversy is continually waged over the relationship of depreciation to the rate base. Difficult and controversial as is the issue for large and typical utilities, it is especially troublesome for small utilities, and the literature is noticeably lacking in this field. To help clarify objective thinking along these lines, it is proposed to take, as an illustration, a utility with only one plant and to enunciate the principles applicable to small and large organizations as well. This article presents a discussion of the method of determining the size and type of the rate base, comments on how to arrive at the rate of return equitable to all parties, on what part depreciation plays in the accounts and in the rate base and on some elementary aspects of utility financial structure as they relate to the topic. What seems to be a logical program has been brought to the front as all the various phases of the subject have been considered. It is not to be expected that the controversy will die down, but, nevertheless, it was essential to face all the issues squarely and not to avoid even the most controversial aspects of the whole question. The seriousness of inflation as it reaches out to touch utility regulation cannot be overemphasized.

Walter S. Salant, Beatrice N. Vaccara, Primary Effects on Employment of Shifts in Demand from Domestic to Foreign Products, The Review of Economics and Statistics, Vol. 40, No. 1, Part 2. Problems in International Economics (Feb., 1958), pp. 91-103