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Arm - Module 2

The document discusses the objectives and characteristics of accounting research. It defines research as a process of collecting, analyzing, and interpreting information to answer questions in a controlled, rigorous, systematic, valid, verifiable, empirical and critical manner. The objectives of accounting research are to formulate new approaches, provide descriptions, diagnose frequencies, and test hypotheses. Good research must have clearly defined purposes and procedures that can be repeated by others. Accounting research aims to improve accounting standards, analyze economic transactions, understand tax laws, and discern the accounting profession's effects on capital markets.

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Angela Tibagacay Caballero
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39 views

Arm - Module 2

The document discusses the objectives and characteristics of accounting research. It defines research as a process of collecting, analyzing, and interpreting information to answer questions in a controlled, rigorous, systematic, valid, verifiable, empirical and critical manner. The objectives of accounting research are to formulate new approaches, provide descriptions, diagnose frequencies, and test hypotheses. Good research must have clearly defined purposes and procedures that can be repeated by others. Accounting research aims to improve accounting standards, analyze economic transactions, understand tax laws, and discern the accounting profession's effects on capital markets.

Uploaded by

Angela Tibagacay Caballero
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
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Download as DOCX, PDF, TXT or read online on Scribd
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POWER SCHOOL OF TECHNOLOGY INC.

ACCOUNTING RESEARCH METHODS


MODULE 2

OBJECTIVES OF RESEARCH
The purpose of the research is to discover answers to questions through the application of
scientific procedure. In order to be specific, the research must be identified by taking the system
requirements into account. In the process of identifying the objectives of the research, the
researcher must finalize the following:
• To formulate, i.e., develop a study to understand the topic from all angles.
• To be descriptive, i.e., to accurately picturize all the characteristics of a particular process,
individual, group, situation or institution
• To diagnose, i.e., to analyst the frequency with which something occurs
• To test hypothesis of a causal relationship between variables, i.e., hypothesis-based research
studies. In social set up, research is carried out with the help of research questions, hypothesis,
and boundary of the study.

Research questions – Problems which are resolve till date or not addressed by anyone else like,
purpose of the research, place of the research, present state of the research and possible ways and
means to finding solution to the research problem under study.
Hypothesis – It is a presumption or assumption about population/situation under study drawn by
researcher himself Boundary of the study – It is a limit set by research himself to restrict his work
or to concentrate on specific area in given/available set-up and resources.
The objectives of the study may be classified into qualitative or quantitative. The quantitative
objectives aim to optimize certain measure of performances of the system of study, e.g., a study
to estimate the demand of a product with a high precision. The qualitative objectives aim to
significance of hypotheses of a study of importance, e.g., a study of impact of level of education
of sales force of a company on its sales revenue.

CHARACTERISTICS OF RESEARCH:
Research is a process of collecting, analyzing and interpreting information to answer
questions. But to qualify as research, the process must have certain characteristics: it must, as far
as possible, be controlled, rigorous, systematic, valid and verifiable, empirical and critical.
Controlled - in real life there are many factors that affect an outcome. The concept of control
implies that, in exploring causality in relation to two variables (factors), you set up your study in
a way that minimizes the effects of other factors affecting the relationship.
This can be achieved to a large extent in the physical sciences as most of the research is
done in a laboratory. However, in the social sciences it is extremely difficult as research is carried
out on issues related to human beings living in society, where such controls are not possible.
Rigorous - you must be scrupulous in ensuring that the procedures followed to find answers to
questions are relevant, appropriate and justified. Again, the degree of rigor varies markedly
between the physical and social sciences and within the social sciences.
Systematic - this implies that the procedure adopted to undertake an investigation follow a
certain logical sequence. The different steps cannot be taken in a haphazard way. Some
procedures must follow others.
Valid and verifiable - this concept implies that whatever you conclude on the basis of your
findings is correct and can be verified by you and others.
Empirical - this means that any conclusion drawn are based upon hard evidence gathered from
information collected from real life experiences or observations.
Critical - critical scrutiny of the procedures used and the methods employed is crucial to a
research enquiry. The process of investigation must be foolproof and free from drawbacks. The
process adopted and the procedures used must be able to withstand critical scrutiny.
For a process to be called research, it is imperative that it has the above characteristics.

CRITERIA OF GOOD RESEARCH


One expects scientific research to satisfy the following criteria:
(a) The purpose of the research should be clearly defined and common concepts be used.
(b) The research procedure used should be described in sufficient detail to permit another
researcher to repeat the researcher for further advancement, keeping the continuity of what has
already been attained.
(c) The procedural design of the research should be carefully planned to yield results that are as
objective as possible.
(d) The researcher should report with complete frankness, flaws in procedural design and
estimate their effects upon the findings.
(e) The analysis of data should be sufficiently adequate to reveal its significance and the methods
of analysis used should be appropriate. The validity and reliability of the data should be checked
carefully.
(f) Conclusions should be confined to those justified by the data of the research and limited to
those for which the data provide an adequate basis.
(g) Greater confidence in research is warranted if the researcher is experienced, has a good
reputation in research and is a person of integrity.

GENERAL OVERVIEW OF ACCOUNTING RESEARCH


“Academic research looks at how accounting affects the world around us and how the world
affects accounting.” Teresa P. Gordon and Jason C. Porter
Accounting research plays an essential part in creating new knowledge. The hard sciences have
produced models of research and testing that can be used and applied over many disciplines
including accounting research. Using these models along with evidence such as financial
statements, stock prices, surveys, experiments, computer simulations, and mathematical proofs,
we can gain a scientific perspective and basis for the following:
• Deciding and implementing new accounting or auditing standards
• Presenting unusual economic transactions in the financial statements
• Learning how new tax laws impact clients and employers
• Discerning how the accounting profession affects the capital markets through academic
accounting research

FEATURES AND IMPORTANCE OF RESEARCH IN ACCOUNTING


If you can’t count it, you can’t manage it.
Accounting is very deeply rooted profession in almost every facet of management,
company matters and day to day activities of any person or group.
Accounting research is research on the effects of economic events on the process of accounting,
and the effects of reported information on economic events. It encompasses a broad range of
research areas including financial accounting, management accounting, auditing and taxation.
Academic accounting research “addresses all aspects of the accounting profession” using
the scientific method, while research by practicing accountants focuses on solving problems for a
client or group of clients. Academic accounting research can make significant contribution to
accounting practice, although changes in accounting education and the accounting academia in
recent decades has led to a divide between academia and practice in accounting.
ACCOUNTING RESEARCH TOPICAL AREAS
Accounting Information Systems (AIS)
Studies which address issues related to the systems and the users of systems that collect,
store, and generate accounting information. Users are defined broadly to include those involved
in collection, storage, or use of accounting information or even the implementation of the
system.
These systems may be electronic or not. Research streams include, but are not limited to design
science, ontological investigations, expert systems, decision aides, support systems, processing
assurance, security, controls, system usability, and system performance.

Auditing
Studies in which the topical content involves an audit topic. These studies vary widely and
include, but are not limited to, the study of the audit environment—external and internal, auditor
decision making, auditor independence, the effects of auditing on the financial reporting process,
and auditor fees.

Financial
Studies that address the topical content of financial accounting, capital markets, and decision
making based on financial accounting information.

Managerial
Studies that examine issues regarding budgeting, compensation, decision-making within an
enterprise, incentives, and the allocation of resources within an enterprise.

Tax
Studies that examine issues related to taxpayer decision-making, tax allocations, tax
computations, structuring of accounting transactions to meet tax goals, tax incentives, or market
reactions to tax disclosures.

Other Topical Areas


Studies that do not fit into one of the other topical areas. The topical areas in these studies vary
significantly and include such things as education, methodologies, law, psychology, history, the
accounting profession, work environment, etc.

PRIMARY PURPOSES OF ACCOUNTING RESEARCH


1. Management Policy. Private companies, government agencies, as well as nongovernmental
organizations seek solutions to their business problems which most likely have financial or
accounting implications. Through research, they would be able to address them though improved
policies, programs, and procedures. Some organizations make bad and expensive mistakes
because their decisions were not based on research.
2. Legislation. In many ways, all organizations are somehow affected by laws of the country. Hence,
research can pave the way to improve these laws. Poorly researched legislation may end up
hurting society and economy and could potentially lead to protest and dissatisfaction by the
general public.
3. Commercialization. Private companies operate for profit and they continuously search for and
develop new products and services stemming from ideas that can be commercialized. The
accounting research framework links current situation issues to future solutions as they are
deemed relevant to various sectors of the accounting professionals and business environment
with one or a combination of end goals.

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