Significance of Research

THE IMPORTANCE OF ACADEMIC RESEARCH

Practicing accountants, whether in public practice or industry, spend considerable time and

effort conducting research for their clients. They have to decide how to implement new accounting

or auditing standards, how to present unusual economic transactions in the financial statements, and

how new tax laws impact their clients or employers. This research focuses on solving immediate

problems for a single client or small group of clients. However, there is another type of accounting

research that focuses on how the accounting profession affects the capital markets through academic

accounting research. Academic accounting research looks at various topics in financial reporting,

auditing, systems implementation, tax reporting, and other key issues from a scientific perspective.

The studies use evidence from many different sources, including financial statements, stock prices,

surveys, experiments, and even computer simulations and mathematical proofs. Research topics

range from immediately useful aids to improving current audit procedures to big picture issues

regarding the future direction of the profession. In addition, many papers focus on either the

production or the use of accounting information. To put it another way, academic research looks at

how accounting affects the world around us and how the world affects accounting. As a result, it can

provide powerful information and insights for regulators, auditors, tax consultants, and other

practicing accountants.

The academic research literature addresses all aspects of the accounting profession, from

managerial accounting to analyst forecasts of earnings per share. One of accounting researchers’

primary goals has been to examine the effectiveness of current accounting practices in conveying

information to stakeholders (e. g., Guenther and Young, 2000). Researchers have addressed all

aspects of this process, from the usefulness of managerial...