Uses of
Accounting theory
|
1,
|
guide
to research
|
2.
|
aid
to teaching
|
3.
|
means
of acquiring additional knowledge
|
|
|
Non-directive
uses: descriptive--what is
|
1.
|
Explaning
why a particular practice exists
|
2.
|
Persuading
that one practice is superior to another
|
3.
|
Justifying
why a particular approach exists
|
4.
|
Explaining
why apparently inconsistent and contradictory practices are followed.
|
5.
|
Providing
definitions
|
|
|
Directive
uses--Normative-prescriptive--what ought to be
|
|
|
Tests of theory
|
1.
|
Internally
consistent
|
2.
|
useful
|
|
|
Attributes of
theory
|
1.
|
Should
be useful
|
2.
|
Clarity
|
3.
|
Impartiality
|
4.
|
Consistency
|
5.
|
Completeness
|
6.
|
Agreement
with empirical evidence
|
Propositions
must be consistent with one another
|
Propositions
should be complete
|