A systems approach to the evaluation and development of the role of "accounting" in the information function

Bayoumy, El-Gharib Mohamed (1976) A systems approach to the evaluation and development of the role of "accounting" in the information function. University of Southampton, Doctoral Thesis.

Abstract

A general review of the literature of management science shows a prevalent dissatisfaction with the informational role of 'Accounting' in its present state. Moreover, the same criticisms have been continually repeated, largely unaffected by the considerable amount of literature concerned with accounting problems. This is the stimulus of the present study which is directed at the evaluation and development of that role.In the course of defining and evaluating the nature and scope of the informational role of 'Accounting' three aspects of the information function have been considered: 1 - the organization of information activities; 2 - the types of information required for performing management functions and the implementation of certain management techniques; and 3 - information evaluation in terms of certain qualitative properties and certain measures provided by statistical decision theory and information theory with special reference to the distinctive nature of accounting information.The study of these issues has exposed the essential need for a normative determinate framework of accounting measurement. Such framework has been approached through: a - an analysis of 'Measurement' in the abstract sense; and b - extending certain of the cybernetic .implications of systems study and feedback to accounting measurement.22The main characteristics of that framework are those of objectivity, determinacy and uniqueness.In order to explore and indicate the possible minimisation of the divergence between contemporary accounting measurement and those characteristics, the proposed framework has been extended to the context of cost measurement with particular application to product costing and cost information required for the implementation of inventory models.The validity of the proposed framework as a theory of, or a frame of reference for, accounting measurement. has been assessed through exploring its implications for certain features of current theory and practice of accounting measurement, with special reference to the indeterminacy of such measurement, the problem of uniformity, and the choice among alternative bases of measurement.

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