Reviewed by Paul Solomon San Jose State University
In “Objectives of Education for Accountants,” the Account-ing Education Change Commission encouraged accounting edu-cators to integrate the history of the accounting profession and accounting thought into their classes. This book of readings sat-isfies this objective well by providing accounting instructors eighteen diverse readings on the history of such financial ac-counting topics as the development of financial reporting stan-dards, income measurement and reporting, asset valuation, stockholders’ equity, capital maintenance and changing prices, pensions, and ratio analysis. In addition, this book contains two readings that are designed to provide guidance to scholars who are interested in conducting research in accounting history.
Although this book reports events that occurred in the eigh¬teenth and nineteenth centuries, its primary focus is on events of the twentieth century. The readings themselves were written over the period between 1956 and 1993, with 60% being published during the last decade. Although this book is appropriate as a supplement to students in several financial accounting courses, its readings seem especially suited to the intermediate accounting sequence. They are organized in roughly the same order as the standard table of contents found in intermediate textbooks, they expose students to historical aspects of tradi¬tional intermediate topics not found in intermediate textbooks, and they help to offset the increasingly encyclopedic coverage of intermediate textbooks with a more in-depth and enriched cov¬erage. This book of readings also provides instructors another means of developing the communication skills of accounting students. For example, the readings could be the basis of written assignments, oral presentations, and classroom discussions.
Clearly, some readings are more appropriate for assignment to students than are other readings. Examples include: “The De¬velopment of Accounting and Auditing Standards” in which Davidson and Anderson describe the important influence of British accountants, including Price Waterhouse & Company, on the economic development of the American West; Brown’s clearly written “The Emergence of Income Reporting”; Davis’s “History of LIFO” which features an excellent discussion of the base stock method; and Woodward’s brief but insightful “Depre-ciation — The Development of an Accounting Concept.” These and several other readings could easily be assigned to all ac-counting students who are beyond an introductory level. Other readings, however, presume more background than possessed by non-doctoral students; thus, their information would more efficiently be communicated to students through their instruc-tor. Examples include Sprouse’s unique perspective expressed in “Developing a Conceptual Framework for Financial Reporting;” “The Legal Significance of the Par Value of Common Stock: What Accounting Educators Should Know,” in which McGough, among other deficiencies in textbook coverage, pointed out that no texts explained that originally the par value of common stock was equal at issuance to its market value; and “A Short History of Financial Ratio Analysis,” in which Horrigan described how the current ratio has had more of a significant impact on finan¬cial statement analysis than any other ratio.
One minor inconvenience is the fact that some readings include an abstract while others do not. Although this inconsis-tency is not surprising given the fact that the readings are drawn from journals with different stylistic conventions, the editors could easily have developed a standard abstract for all readings in the interest of conveniencing their readers.
Overall, this book provides a rich source of insights about the history of financial accounting for both accounting students and their instructors.
