Reflections on Accounting Measure: Priority of Balance Sheet or Income Statement?
Author:
Emeritus Prof. Alain BURLAUD, Emeritus Prof. Claude SIMON
JEL:
M 41
DOI:
Keywords:
accounting, measurement, cost, value, stocks, flows
Abstract:
Accounting is mainly based on two sciences: metrology - the science of measurement and taxonomy - the science of classification and reduce the complexity of an entity to a few numbers. This article is an attempt to call into question the concept of measurement and how it is used in accounting. \r\nThe shift from historical cost to the market value or the controversy regarding the primacy of stocks or flows are, in the opinion of the authors, events related to the governance in organizations that generate behaviors, rights and obligations affecting society as a whole. Therefore, the society cannot ignore the extent to which the main function of accounting - faithful representation - is met or not.\r\n