Reviews the book "The Alton Water Company Deffered Tax Case."

Reviews the book "Accounting Fundamentals," 3rd ed., by George A. MacFarland, Robert D. Ayars and Williard E. Stone.

Abstract This article focuses on the 1964 Concepts and Standards Research Study Committee of the American Accounting Association, which aimed to expand and to amend in part the statement on realization in "Accounting and Reporting Standards for Corporate Financial Statements--1957 Revision." That statement says the essential meaning of realization is that a change in an asset or liability has become sufficiently definite and objective to warrant recognition in the accounts. In considering this statement, and realization principles generally, attention will be focused on the problems of asset recognition and valuation and revenue recognition. The committee concurs with the statement of the 1957 Revision that primary emphasis should be given to the use by investors of published financial statements in making investment decisions and in exercising control over management. The committee recognizes the difficulty of developing a definition of realization that will have general applicability. Nevertheless, four of the committee members feel there is sufficient significance in the difference between realized and unrealized changes in value to justify making the distinction.

Abstract The article presents a report of the executive committee of the journal The American Review on general concepts and standards of accounting. The charge of the committee was to consider and to advise the Executive Committee through the Director of Research, what subjects should be reviewed and studied by task-groups of the Association in the preparation of statements supplementary to Accounting and Reporting Standards for Corporate Financial Statements. The committee has considered an extensive list of specific accounting problems. But this has led to the conclusion that the greatest need would be served by study and clarification of six underlying accounting concepts: business entity, the matching concept, realization, materiality, consistency and objectivity. According to a research report, the idea that the existence of a distinct business entity is something, which the accountant universally assumes, is not a current innovation; but its importance has recently been stressed. The concept of matching costs and related revenues in the determination of periodic income is firmly embedded in accounting literature and in accounting practice.