Accounting research is research on the effects of economic events on the progress on accounting. It also includes the effects of the reported information on economic events. It encompasses a broad range of research areas which include financial accounting, management accounting, auditing and taxation.
Overview of accounting research.
Accounting research is carried out by academic researchers and practicing accountants to address all areas of the accounting profession. It examines issues by using the scientific method and it uses evidence from a variety of sources that includes financial information, experiments, and computer simulations.
The research done by practicing accountants usually focus on solving immediate problems for a single client or a small group of clients.
This involves, for example,
- decision-making on the implementation of new accounting or auditing standards,
- the identification of unusual transactions in the financial statements, and
- the effect of new tax laws on their clients.
Accounting organizations such as standard-setting bodies like the IFRS, also carry out accounting research.
Brief history of accounting research.
During the 1950s, an accounting academia was established that adopted the requirements of social science academia, like PhD qualifications and research papers. The mid-1970s gave rise to positive research instead of normative research and it uses methods from finance, economics, and other established academic disciplines.
Academic research in connection to the accounting practice
The contributions of academic accounting research to accounting practices includes:
- the assessment of current accounting practices,
- development of new practices, and
- the development of university curricula.
Divide between academic and professional communities
Research publications that were published quite recently, have suggested that there is a divide between the academic and professional communities in accounting. The aspects of the divide have been theorized to include criticisms of academics for using their own jargon and focusing on the publication of research, rather than improving the practices. There are also criticism of practicing accountants for being resistant to change to the status quo and that they are reluctant to disclose data.
The divide was originally centered around whether a broader education or just technical training was the best method to educate accountants. Since the 1950s, the divide grew further due to the accounting academic community adopting requirements from social science academia, while practicing accountants continued to maintain an emphasis on professional qualifications and technical skills.
A variety of factors have been said to cause the divide, aside from accounting academia and practice that values different skills and requirements. One viewpoint is that a lack of training in reading academic research may lead practicing accountants to regard very helpful information as too complicated or too disconnected to be of any help to them.