1. Coursework Discussion
IM51005B
Coursework Discussion
Dr Sarah Lauwo
Office Hours: Wednesdays 11:00-12:00
Thursdays :00-16:00
Office: Warmington Building R.124

2. Solomon’s (1991), “If accounting is to retain any credibility-and without credibility it is worthless - its guiding light must be neutrality in financial reporting”.
Required: Critically evaluate Solomon’s statement above. Reflecting on recent corporate scandals, such as Carillion, support your views with vivid examples. In order to critically evaluate this question please refer to the guidance below.

3. Is a key technology for rationalising financial transactions ?
What is Accounting?
Is a key technology for rationalising financial transactions ?
Is a device for transparency and accountability?
Input Process Output
Compliance
Corporate governance
Economic reality
Report market values
Report Fair Values
Financial statements try to replicate markets
Influence consumption and investment decisions
Focus is on measurement of income and wealth

4. Is accounting factual, neutral and objective?
Philosophical Realism
Accounting should confine itself to accurately measuring and reporting the monetary values associated with market transactions (Solomons, 1978, 1986, 1991).
According to Solomons, accounting data is complete in that it can faithfully represent the underlying economic reality. (Representational Faithfulness)
Solomons believes that economic reality exists, independent of our apprehension of it, and that this is the ultimate touchstone of truthfulness and accuracy for accounting symbols .

5. For Solomons, accounting is seen as a technique rather than a social technology.
The question is, What evidence is needed to show that accounting is neutral and faithful? What evidence has been provided?
For example, accounting Standards seem to bolster capitalism, power of corporations and stock markets.

6. Accounting as changed over the years!
Critical Theorist
Does Accounting take everything into account?
Leave out nothing ?
Give the full picture?
Does it provide a true, a fair view of something?
Compare it with other fields? e.g. history which creates past reality for us.
Accounting as changed over the years!
CT acknowledge the importance of broader socio-political, economic, ethical, philosophical aspects shaping accounting practice
Accounting provides Just an Idea (Hines, 1988 p.256).

7. Is the construction of reality dependent on theories or is reality lurking out there somewhere and all we need to do is to catch it and report it?
Is there a thing as reality? There is something there?
there is no such thing as reality, we construct the reality!
What is a theory ?
Are theories contested and do they result in alternative emphasis ?
Is there a single theory ?
idea, a metaphor, a concept

8. Accounting is partisan (Tinker).
According to Hines (1988), People create a picture of an organization, or the 'economy‘).
whatever they like, and on the basis of that picture (not some underlying 'real' reality of which no-one is aware), people think and act.
And by responding to that picture of reality, they make it so: it becomes 'real in its consequences‘ (p.257).
Accounting is partisan (Tinker).

9. Does the construction of reality matter to investors, creditors, employees, analysts?
Investors interest ?
Creditors Interest ?
Employee Interest ?
Analyst Interest ?

10. What kind of images might be embedded within the debates about construction of reality through accounting?
One view– Accounting is objective, it gives true picture of financial performance of the business
Another view– Accounting is a political activity shaped by socio-political, economic and power relations.

11. What should accounting be reporting?
This depends on the theory
It need to question taken for granted assumptions
It need to make visibility the silenced activities
Social Consequences of business activities
Pollution
Wage reduction
Workers discrimination

12. Accounting is a socially constructed practices
Other issues.

13. Hints and Tips
Structure your answer well – the better structured the answer, the more coherent it is = the more marks you are likely to get
Have a good structure – important for coherence of arguments
Aim for depth rather than breadth
Include examples and references to illustrate your point
As a general formula, for each key point: Describe – Illustrate – Explain – Evaluate.

14. Always read the question carefully. Underline the key words.
Essay Writing
Always read the question carefully.
Underline the key words.
Take time in constructing your answer.
Organise the material is some logical sequence
All essays tell a good story. Does yours?
A regular intervals ask yourself – am I answering the question set?
Make sure that you answer the question set.
Essays should not consist of random, disconnected sentences. 14

15. Be familiar with the key ideas and concepts
Essays require theories, evidence and analysis
Be familiar with the key ideas and concepts
Show familiarity with articles from your reading list
Additional articles can cited
Make good use of your press clippings file.
A good essay always considers counter evidence 15

16. All essays should conclude with Summary and Discussion
Have you addressed the question asked?
Brief summary of the essay.
How persuasive was the evidence?
Was the evidence sufficient?
Was the theory helpful? How good was its explanatory power?
If theory was limited then how could it be improved?
What does your essay tell us about the question asked? 16

17. Theories are Important
You must apply theory in your Essay to get a good grade
Each issue must be examined through theoretical lenses
Every answer should have a structure:
Intro / Body / Conclusion (theory incorporated within discussion of main points in Body)
Intro/ Theory / Body / Conclusion

18. Good Lucky!