Accounting Theory
Containing overall analysis of accounting theory and its components are a source of reference to explain and predict phenomena or events in the accounting.
A set of concepts, definitions and propositions that are systematically interrelated proposed to explain and predict phenomena or hypothetical set of facts as a result of descriptive research using a particular scientific method.
Thus, the status of accounting theory will be equivalent to understanding the theory of science in astronomy, economics, physics, biology and so on. It can also be defined as the science that stands alone is the source or parent knowledge or accounting practices.
Accounting theory will be a set of descriptive hypotheses as a result of research by using specific scientific methods. This term is often intended as a logical reasoning provides an explanation and reasons about a particular accounting treatment and the accounting structure that applies in a particular area.
Accounting theory examines the processes of thinking or reasoning to explain the feasibility of certain accounting principles or practices already underway or to provide a conceptual basis in the determination of the new standards or practices.
From the above statements can be concluded that accounting theory is a logical reasoning, basic ideas, or ideas related to and consistent.
The process of logical reasoning could be called as engineering. Results of engineering in this case can be a set of general principles, a set of doctrines, or a structure / framework of integrated concepts.
General principles, doctrines, or the framework’s function is to:
* Reference evaluating current accounting practices
* Steering the development of new accounting practices and procedures
* Base impairment accounting standards
* The starting point of testing and improvement of current practices
* Potential troubleshooting guide
Accounting Theory Perspective
When accounting enforced as science, theory would constitute a scientific explanation. When accounting effective as the technology, this theory is defined as logical reasoning.
Any treatment applied, this theory will contain statements in the form of either an explanation or justification of a phenomenon or accounting treatment.
Target Aspect Theory
This distinction underlies the target aspects of accounting theory into positive and normative.
Positive explanation contains statements about everything as it is in accordance with the facts or what happened on the basis of empirical observation.
Normative explanation contains representations and reasoning to judge whether something is good or bad, or relevant or irrelevant in relation to certain social or economic policy.
Aspects of Semiotics plane
This theory can be distinguished on the basis of discussion and understanding of the target becomes:
* Semantic, to answer whether the financial statement elements really represent what was intended and to ensure that the meanings embodied in symbols dislahartikan not reporting by users.
* Syntactic, trying to give explanations and reasoning about what should be reported, who reported, when reported and how to report it.
* Pragmatic, discusses the reaction of parties to whom the accounting information. Is the information up to the intended and interpreted correctly is a problem of communication effectiveness.
Verification of the theory is a procedure for determining whether a theory is valid or not.
* Evaluated the validity of normative accounting theory on the basis of logical reasoning that underlies the theory proposed.
* Positive accounting theory validity is assessed on the basis of conformity with fact or theory of what actually happened.
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