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The paper presents the results of an empirical study in which bank loan officers evaluated a loan application which were accompanied by financial statements based on either accrual accounting or modified cash basis of accounting (MCBOA). The loan officers first decided whether to grant the loan and determined an interest rale. Second, they evaluated the financial statements information on the basis of three quality attributes: Overall reliability, freedom from clerical errors and freedom from the effects of fraud. The results verified a functional fixation hypothesis by showing that the loan officers examining the financial statements of the same company using either accrual information or MCBOA showed clear preference for the company when faced with accrual information. A conditioning factor is used to explain the results.

Accounting education is passing through a critical stage. In 1988 the American Institute of Certified Public Accountants (AICPA) voted overwhelmingly to require 150 semester hours of education, including a baccalaureate degree, for new members from the year 2000. AICPA together with the National Association of State Boards of Accounting (NASBA) is working to require the 150 hours education requirement to sit for the CPA examination. Twenty four states have passed various versions of this law; many more are in the process of passing it.

The purpose of this paper is to introduce the new journal and articles in the first issue.

The paper attempts to introduce the journal by answering the two “W” questions – what is Islamic accounting and why Islamic accounting research is important. In doing so, it indirectly highlights the need for a specialist journal like Journal of Islamic Accounting and Business Research (JIABR) and the potential research areas.

Islamic accounting research is still at the infancy stage compared to Islamic banking and finance. One of the reasons is due to lack of exposure of research conducted in the area at international level, ending up with only a few issues getting attention. Similarly, the lack of a platform where researchers interested in the area could showcase the diverse range of research as well as network and get support on their research hindered the progress of research in this area. Hence, JIABR could be the leading journal in the area of Islamic accounting and business research if all papers related to it are channeled in this specialist journal. In this way, researchers in the areas of accounting and business would be more aware of the development and contemporary issues to take the research forward.

This paper is useful to new readers of the journal around the world who are interested but have limited knowledge in the area, and also those who wish to submit to the journal, in that it highlights some potential areas for research.

The purpose of this paper is to provide an analysis of the paper entitled “Towards a paradigmatic foundation for accounting practice” by Nørreklit, Nørreklit and Mitchell as a way to open a debate about whether a “paradigm of accounting practice” exists and, if so, the nature of the methodological approach that would be needed to discover its nature.

The paper employs a critical, reflective discursive analysis.

The main finding is that there is a confusion in the paper by Nørreklit et al. about the nature of a “paradigm of accounting practice”, which, if it exists, should be a “skeletal theory” (Laughlin), rather than a methodology. The conclusion of the commentary is that a “paradigm of accounting practice”, using this understanding, might exist, but that Nørreklit et al.'s argument for the use of “pragmatic constructivism”, as a methodology for its discovery, is open to question.

The implication of the argument of this commentary is that the search for “paradigm of accounting practice” is important and should be pursued but the choice of an appropriate methodology for this discovery still needs further consideration.

Nørreklit et al., and this commentary, re‐energise an important debate and concern about paradigms in accounting that was present in the literature in the late 1970s and early 1980s. The search for a “paradigm of accounting practice” and how best it can be discovered is an important consideration for the future development of accounting thought.

Since accounting for an enterprise's human resources was first discussed more than thirty years ago, it has encountered two main barriers to entry into mainstream accounting. These were: 1. that employees do not qualify as assets and 2. an inability to establish a meaningful system of measurement. In the context of current accounting concepts the first of these barriers is discussed establishing the legitimacy of the paradigm. Acceptable methods of measuring the value of assets are examined concluding that the present value, using added value as a base, is most useful for the majority of enterprises. Accepting that human resources are an asset, consideration should also be given to recognising the associated liabilities. The impact of accounting for human resources is examined by reference to a set of published financial statements. With an ever changing accounting environment, the opportunity to recognise human resource assets and liabilities in the financial statements should be taken.

This study aims to examine the effects of firms’ accounting disclosure policies on stock price synchronicity and stock crash risk, using a sample including 13 emerging markets. Furthermore, this research investigates how these relationships are affected by country-level investor protection and firm-level governance rankings.

This paper uses accounting disclosure measures constructed based on survey questions by Credit Lyonnais Securities Asia (2001, CLSA). The accounting disclosure measure is used to explain the two dependent variables, stock price synchronicity and stock crash risk. The stock price synchronicity measure is defined as the logistic transformation of R2 following Hutton et al. (2009) and Jin and Myers (2006). R2 is taken from the estimation of an extended market model. The stock crash risk variable is measured as the frequency difference between extremely negative and positive stock return residues following Jin and Myers (2006). These stock return residues are taken from the estimation of an extended market model. Because the CLSA firm-level disclosure data are from 2000, this paper matches other data taken from the same year, for consistency. The final sample includes 204 observations in 13 emerging countries.

This paper finds that firms’ stocks are less synchronized with the entire market and have less crash risk if firms have superior accounting disclosure policies. These results suggest that the cost to collect firm-specific information may be decreased for investors if firms are more transparent. Thus, these firms’ stocks have more firm-specific information content. These results also suggest that management is less likely to hide some negative information and release such negative information suddenly in the future if firms have higher levels of accounting disclosure. Thus, these firms’ stocks are less likely to crash. In addition, the influences of firms’ accounting disclosure policies on stock price synchronicity and crash risk are more significant for firms with superior country-level investor protection and firm-level governance rankings. These results imply that external investors place more value on accounting disclosure by well-governed firms because firms with superior governance standards are less likely to intentionally disclose misleading information. Thus, these firms’ stocks can incorporate more firm-specific information and have less crash risk.

The current study is the first to show that the effects of accounting disclosure on stock price synchronicity and crash risk are more pronounced for firms with superior country-level investor protection and firm-level governance standards. Thus, this research extends the literature by providing a comprehensive picture of the influences of accounting disclosure on stock markets. In addition, the existing literature (Chen et al., 2006; Durnev et al., 2004) shows that firms with lower stock price synchronicity are associated with higher investment efficiency because managers invest based on the information in stock prices. Obviously, higher stock crash risk is highly related to higher bankruptcy risk for firms. Thus, examining the effects of accounting disclosure on stock price synchronicity and stock crash risk is of obvious importance to policy makers.

Recent reports on accounting education have observed that an increasing difference exists between what students are being taught and what accounting practitioners actually do. Yet, despite such criticisms of accounting education, methods exist that help blend study and practice more effectively. Included among the methods are accounting internships and related cooperative work‐ study programs. This study was conducted at the college of Business and Economics, United Arab Emirates University to investigate the effect of student internships on subsequent academic performance. The post‐internship course performance of students with accounting internship experience was compared to that of non‐internship students matched on the basis of grade point averages (GPA) and credit hours completed. The results indicated that the internship students performed significantly better than the non‐internship students in accounting courses, and in overall GPA subsequent to the internship semester. These findings contradict prior research and support accounting internships as tools to enhance students’ knowledge and motivation.

This study is conducted to identify which attributes that are considered important by accounting students of University of Malaya and International Islamic University of Malaysia in the job selection process. The questionnaires which lists the attributes of public accounting firms are distributed to the accounting students and they were asked to rate each attribute on a 5 point Likert scale. The students’ demographic profile and their academic achievements (CGPA) are also analysed to determine their relationships with the preference in the subjects’ job selection. It is found that the students rank opportunity and advancement as the most important attributes followed by office atmosphere/friendliness of staff and firms’ training programme. The findings from this study might assist public accounting firms in developing policies that might attract more quality recruits. They can also be used by institutions of higher learning to give more appropriate career advice to students who are seeking for their first accounting job.

This paper aims to discuss the accounting treatment of one of the most popular instruments of financing in Islamic banks, which is Islamic leasing or Ijarah. This research undertakes an empirical investigation of the accounting practices of Ijarah followed by UAE’s Islamic banks. The main objective of this paper is to compare the accounting practices followed by UAE Islamic banks and accounting practices recommended by Accounting and Auditing Organization for Islamic Financial Institutions (AAOIFI) for the accounting treatment of Ijarah.

This study also aims to examine the justification and explanation behind this practice and clarify the accounting treatment of Ijarah as defined in the regulatory framework and standards.

The author has found that the accounting treatment of Ijarah practiced by four UAE Islamic banks, it is clear that all of them are following IAS-17 and not FAS-8 of AAOIFI. The main difference is: FAS-8 issued by AAOIFI suggests that the accounting treatment for both Ijarah and Ijarah Muntahia Bittamleek be similar to operating lease transactions with certain exceptions. On the other hand, these Islamic banks are accounting for Ijarah as a financing transaction, just like finance lease – in accordance with IAS-17.

Taking out the right information from banks officials regarding Ijarah was a big hassle.

After considering the above-mentioned points, according to the researcher, Western accounting standards are not appropriate to be applied in Islamic financial institution because of their different nature and treatment of financial instruments. Therefore, Islamic banks and other Islamic finance professionals should consider making the standards of AAOIFI mandatory, and they should stick to these standards for information disclosure, building investors’ confidence, monitoring and surveillance. These standards would also ensure the integration of Islamic financial markets with international markets.

This study also aims to examine the justification and explanation behind this practice of bankers when the researcher approached these four banks, their officials mentioned that Ijarah contracts are similar to conventional form of financing, and it does not involve the central tenet of Islamic capitalism, i.e. to share risk and profit; therefore, they are justified and convinced to adopt IAS-17 in accounting for Ijarah transactions.

It is an original case study based on secondary research data.

The purpose of this paper is to draw out the accounting implications of the National Greenhouse and Energy Reporting (NGER) Act in Australia.

An analytical approach is undertaken to ascertain the (accounting) practice and research implications of the NGER Act.

Accounting researchers, especially those with interests in social and environmental issues, have a critical role to play in highlighting the potential of the accounting practice in managing, and providing accountability over, carbon emissions, facilitated via the NGER Act. A number of opportunities in social and environmental accounting research are also identified in this paper.

The paper highlights that the NGERS legislation which requires reporting of carbon emissions by affected parties has a number of implications for the accounting practice.

The paper relates a practical issue, in this case the NGER Act, to accounting and suggests that the accounting process can play a critical role in organizational attempts to manage, communicate and price carbon emissions.