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Koers

On-line version ISSN 0023-270X

Abstract

BUYS, P.. Reflections on the value concept in accounting. Koers (Online) [online]. 2009, vol.74, n.3, pp. 495-517. ISSN 0023-270X.

The recent meltdown in global finances and the reasons for it may make people doubtful about the stewardship function of accounting. In the global financial markets, there is a great fascination with the reality that accounting values intend to reflect. However, what many people considered valuable is now suddenly of no value. The question can therefore be asked what is meant by the value concept as a foundation to modern-day accountancy. "Value" is a concept that is open to different interpretations, based on the needs, perspectives and personal values of the interpreter. This article aims to reflect on the value concept from an accounting perspective in analysing the fundamental qualitative perspectives and how these perspectives might affect the quantitative value measurements, as reported in the financial statements. From a quantitative perspective, accounttancy aims to measure and report the monetary values of items. However, there is a move towards a mixed valuation model with many financial statements, including both historical cost and value-based accounting information. The article concludes that this questionable development opens up many additional and subjective interpretations of accounting value measurement and reporting. Both valuation measurement methods have merit when considered in the overall purpose of accounting information. However, subjective value-based measurements may cast a shadow of doubt on the reliability and comparability requirements of accounting value information.

Keywords : accountancy; accounting ethics; fair value accounting; stewardship; valuation; value measurement.

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