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THE TECHNIQUE OF STABILIZED ACCOUNTING.

Henry W. Sweeney
The Accounting Review 1935 10(2), 185-205
Abstract This article attempts to describe the essence of stabilized-accounting procedure as the writer has developed it from the rather rudimentary stage in which it was left at the termination of the inflation period in Europe. The stabilizing procedure is based upon the index of the general price level. Stabilized accounting, by its use of price index numbers, estimates the reproductive or replacement costs of merchandise and fixed assets as at any dates for which reliable indexes are available. Stabilized accounting treats common stock and other investments in a business by its equity owners as real-value items, stabilizing them by the general index in order to show the current equivalents of the general purchasing power originally invested. When the accounts of a concern are stabilized, such restatement of capital stock does not mean, of course, that any stock records need be altered in any way. Stabilization on the basis of both original cost and reproductive-cost is shown in order to indicate how the two differ from each other and from accounting figures prepared from the books in the regular way.

THE AUDITING LABORATORY AT COLUMBIA UNIVERSITY.

Thomas W. Byrnes
The Accounting Review 1935 10(3), 295-298
Abstract The article focuses on the Auditing Laboratory course offered at Columbia University for the past twenty years. The course prepared for accountancy students, provides a link between the theory and practice of auditing as a business clinic where students might work among the records of actual transactions. A number of sets of used account books form the basis for the course of study which has been given since the spring of 1915. These records present many interesting and complicated problems, and offer a wide scope for analysis and investigation. Questions and problems, to be solved only by an actual examination of these records and books, provide the basis of the student's work. This gives hint a practical working test under conditions which very closely correspond to those met in actual practice. Other problems taken from the actual experience of practitioners are given for home study and solution. These deal not only with auditing practice but also indicate the unusual situations which public accountants are expected to meet.