Accounting theory Essay

Accounting theory and its application is very fundamental to students and sea captain in accountancy. It equips people in the accountancy profession with financial account statement theory and associated query. Relevance of this theory is that it provides accountants with noesis to vituperatively investigate and read contemporary account issues. Research enables students to have broad thinking of up-to-date write up issues such as environmental aspects and social responsibility aspects. The area of popular culture lead to research concerning all the emerging issues in the Accounting profession.It brought about the question as to whether students or other stakeholders in the profession should engage the attention of people in the field of research. Deegan,C. (2009) in his book stated that there is little attention given to issues that bushel to aspects of the accounting profession. Relevant issues for body of work in accounting and auditing concern accounting principles and standards, auditing ,professional behavior and general professional matters, such as scope of services, aid of quality control and strategies.Study of popular culture has provided researchers with the following arguments to absolve implication of the Accounting profession. a. Accounting is a dynamic line of specialism where participants/accountants should be in a position to respond to changes in the short letter society and come up with revised accounting principles and standards. This leave invoke understanding of the financial statements to stakeholders and society in general. b. Public accounting bid other profession in United States should provide high direct of motivation for evaluating what the actual events.It further anticipates any additional changes in next to improve and provide information on value creation by entity from different dimensions from profit. From research this has lead development world-wide public field accounting standards The study of popula r culture will enable researchers to find oneself emerging issues such as, unexpected business failure, legal liability of an nonparasitic auditor and effectiveness and appropriateness of audit evidence gathered from the society.Besides, it will factor the complex nature of business transactions which normally extend to the position of an independent auditor. Studying the popular culture also provides researchers with knowledge to evaluate the value added to the financial statements by various entities. This helps to determine effectuate of social and environmental accounting highlights the role of culture in explaining world(prenominal) differences and disclosures in accounting. Popular culture enables society in understanding the response of capital markets to financial reporting.By understanding popular culture, it lead to research on fundamental issues such as corporate governance, social and environmental reporting which enables companies in their Annual Operating Plan se t deviation some amount to used in promoting things like sporting activities. farming has exceptionally attracted voluntary reporting by allowing research on institutional theory, legitimacy theory, stakeholders theory and positive accounting theory. Nevertheless the study popular culture has significantly analyzed normative theories of accounting as well as development of accounting for price level changes.It involves critical appraisal of Historical cost accounting approach, general purchasing agency approach and current cost accounting approach. Culture study highlights efforts towards international harmonization of accounting in terms of disclosure and reporting. Application of accounting research has influenced extension of financial reports such use statements which analyzes the benefits which employees get from employment which in turn its cost to the employer. Earnings per share analyze some(prenominal) basic earnings per share and diluted earnings per share in determin ing worthiness of company.Research of popular culture is very consequence in understanding economic actions to a particular interest of groups at heart society and to the entire society it involves extending the accountability of organization beyond the traditionalistic role providing financial account to the owners of the capital, in particular, the shareholders. Such an extension is predicated upon the speculation that companies do have wider responsibilities than simply to make money for their respective shareholders.