The Modern Corporation Statement on Accounting

3 Pages Posted: 4 Nov 2016 Last revised: 14 Dec 2016

See all articles by David Collison

David Collison

University of Dundee - Department of Accountancy & Business Finance

Andreas Jansson

School of Business and Economics, Linnaeus University

Ulf Larsson-Olaison

Linnaeus University

D.M. Power

University of Dundee

Christine Cooper

University of Strathclyde - Department of Accounting and Finance

Rob Gray

University of St. Andrews - School of Management

John Ferguson

School of Mangagement, University of St Andrews

Prem Sikka

Essex Business School

Yuval Yuval Millo

School of Management, University of Leicester

Karin Jonnergård

Linnaeus University

Marie-Laure Djelic

ESSEC Business School

Paolo Quattrone

University of Edinburgh

David J. Cooper

University of Alberta - Department of Accounting, Operations & Information Systems

Chris Carter

University of Edinburgh

Pik Liew

University of Essex - Essex Business School

Robert F Coles

University of Leicester - School of Management

Keith Robson

HEC Paris

Nihel Chabrak

College of Business, United Arab Emirates University

Lorna Stevenson

University of St. Andrews

Hugh Christopher Willmott

City University London - Sir John Cass Business School; Cardiff Business School

Jeroen Veldman

City University London - Faculty of Management

Date Written: November 3, 2016

Abstract

The way corporations are accounted for is tremendously important for shaping the way investors and other stakeholders see and assess them. A new understanding of the purpose of financial accounting with adjoining accounting methods thus creates powerful incentives for corporate managers to adjust their actions accordingly, to perform well according to those dimensions that are accounted for and therefore observed.

A number of regulatory initiatives on the national, international and EU levels both foster and fortify the principle of Maximizing Shareholder Value (MSV) in corporate governance. This tendency can be clearly seen in such areas as financial accounting standards and various soft and hard law initiatives pertaining to corporate governance that have flourished in recent decades. Such developments over recent decades can result in insidious changes whereby a highly contestable, accounting-based measure of business success can become an end in itself at the expense of more pluralist and socially accountable stewardship of companies.

A number of characteristics of these developments can be explicitly linked to the ascendance of MSV in corporate governance. We provide this Summary of certain fundamentals of accounting in an effort to help prevent analytical errors which can have severe and damaging effects on corporations.

JEL Classification: M00, M1, M10, M14, M4, M40, M41, O16, G3

Suggested Citation

Collison, David J. and Jansson, Andreas and Larsson-Olaison, Ulf and Power, David M. and Cooper, Christine and Gray, Robert and Ferguson, John and Sikka, Prem and Yuval Millo, Yuval and Jonnergård, Karin and Djelic, Marie-Laure and Quattrone, Paolo and Cooper, David J. and Carter, Chris and Liew, Pik and F Coles, Robert and Robson, Keith and Chabrak, Nihel and Stevenson, Lorna and Willmott, Hugh Christopher and Veldman, Jeroen, The Modern Corporation Statement on Accounting (November 3, 2016). University of Alberta School of Business Research Paper No. 2016-311. Available at SSRN: https://ssrn.com/abstract=2863935 or http://dx.doi.org/10.2139/ssrn.2863935

David J. Collison

University of Dundee - Department of Accountancy & Business Finance ( email )

Dundee, Scotland DD1 4HN
United Kingdom
+44(0)1382 344857 (Phone)

Andreas Jansson

School of Business and Economics, Linnaeus University ( email )

Växjö, S-35195
Sweden
+46470708230 (Phone)

Ulf Larsson-Olaison

Linnaeus University

Växjö, S-35195
Sweden

David M. Power

University of Dundee ( email )

Dundee, Scotland DD1 4HN
United Kingdom
(+44) 1382 344 854 (Phone)
(+44) 1382 224 419 (Fax)

Christine Cooper

University of Strathclyde - Department of Accounting and Finance ( email )

Curran Building
100 Cathedral Street
Glasgow G4 0LN
United Kingdom

Robert Gray

University of St. Andrews - School of Management ( email )

The Gateway
Fife, KY16 9RJ.
St Andrews, Scotland Scotland U
United Kingdom

John Ferguson

School of Mangagement, University of St Andrews ( email )

The Gateway
North Haugh
St Andrews, Fife KY16 9RJ
United Kingdom

Prem Sikka

Essex Business School ( email )

Wivenhoe Park
Colchester CO4 3SQ
United Kingdom

Yuval Yuval Millo

School of Management, University of Leicester ( email )

Leicester
Leicester, AK LE1 4AY
United Kingdom

Karin Jonnergård

Linnaeus University ( email )

Växjö, S-35195
Sweden

Marie-Laure Djelic

ESSEC Business School ( email )

3 Avenue Bernard Hirsch
CS 50105 CERGY
CERGY, CERGY PONTOISE CEDEX
France

Paolo Quattrone

University of Edinburgh ( email )

Old College
South Bridge
Edinburgh, Scotland EH8 9JY
United Kingdom

David J. Cooper

University of Alberta - Department of Accounting, Operations & Information Systems ( email )

Edmonton, Alberta T6G 2R6
Canada

Chris Carter

University of Edinburgh ( email )

Old College
South Bridge
Edinburgh, Scotland EH8 9JY
United Kingdom

Pik Liew

University of Essex - Essex Business School ( email )

Wivenhoe Park
Colchester CO4 3SQ
United Kingdom
+44 0 1206 873844 (Phone)
+44 0 1206 873429 (Fax)

Robert F Coles

University of Leicester - School of Management ( email )

Leicester
Leicester, AK LE1 4AY
United Kingdom

Keith Robson

HEC Paris ( email )

1 rue de la Liberation
Jouy-en-Josas Cedex, 78351
France

Nihel Chabrak

College of Business, United Arab Emirates University ( email )

P.O. Box 15551
Al-Ain
United Arab Emirates

Lorna Stevenson

University of St. Andrews ( email )

North St
Fife KY16 9AJ

Hugh Christopher Willmott

City University London - Sir John Cass Business School ( email )

106 Bunhill Row
London, EC1Y 8TZ
United Kingdom

Cardiff Business School ( email )

Cardiff CF10 3EU
United Kingdom

HOME PAGE: http://https://sites.google.com/site/hughwillmottshomepage

Jeroen Veldman (Contact Author)

City University London - Faculty of Management ( email )

London
United Kingdom

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