The article discusses assessing prior distributions for applying Bayesian statistics in auditing. The results of this study suggest that auditors are willing to specify information from which prior distributions can be constructed. The prior distributions which were obtained, had most of the probability concentrated on small amounts of error, but there was considerable variability among them. It was found that there were substantial inconsistencies in the way some auditors specified information about the prior distributions. These inconsistencies and the variability among the prior distributions indicate that at least some of these distributions do not accurately reflect the auditors' beliefs about audit populations. Therefore, it is concluded that auditors should proceed with caution in relying on their prior distributions. To apply Bayesian techniques, the auditor subjectively evaluates the non-sampling evidence and expresses his belief about the audit population as a prior probability distribution. A likelihood function is then obtained by statistically evaluating the sample result.
The purpose of this paper is to clarify and sharpen the distinction between monetary and non-monetary assets and liabilities for general price-level accounting. This is done in several steps. First, the conceptual basis of general price-level accounting is examined and the distinction between general price-level accounting and conventional accounting is discussed. Second, an example is introduced to illustrate the nature of general price-level gains and losses and how these gains and losses differ from gains and losses now reported in general price level-accounting. Third, the definition used by several authorities for distinguishing between monetary and non-monetary items are examined and evaluated critically in the light of the theoretical concepts developed earlier. The paper concludes with proposed new criteria for distinguishing between monetary and non monetary items in general price-level accounting. If financial statements are to be of maximum benefit in providing a starting point for predicting future profits and losses, gains and losses due to one causal force should be reported separately from those due to other forces.
The article discusses a university accountant trainee program. There are three major aspects in the development of a person as an accountant--education, training and experience. For classroom work is designed to provide the first of these three. Many colleges and universities have looked for alternatives to the internship program since they have neither compatible academic schedules nor a sufficient number of conveniently-located intern sponsors to allow the operation of an internship program. One such alternative is a university accountant trainee program. Under such a program the university and the department of accounting of the school of business work together to select undergraduate accounting majors to work part-time in professional accounting jobs in the central business administration. Students selected for the program would typically begin their employment at the start of their junior year, having completed three accounting courses. These students would work approximately fifteen hours per week during their junior and senior years and forty hours per week during the summer between their junior and senior years.