Half a Defence of Positive Accounting Research? Paul V Dunmore Massey University, Wellington, New Zealand Abstract Watts and Zimmerman staked a claim to the term “Positive Accounting Theory” for their...

Critical view of the Article
“ Half a Defence of
Positive Accounting
Research”
By
[Student Name]
Introduction
Positive Accounting Research is the one which comprises of Positive Accounting
Theory of converting theoretical concepts into empirical and evidence based
experiments. These researches try to predict various actions that a firm may take for
accounting practices. If a new accounting Standards are proposed than how are the
eactions going to vary for different firms.
The author in the article has tried to convince the audience about the importance of
positive accounting research but, have also lamented the way they are being ca
ied
out by the present researchers. They are mainly focused on proving hypothesis than
ather research for the parameters which would make the research more impactful.
Firms take decisions which minimize their costs at first place. These costs are
eflected in one or more financial statements hence involves accounting parameters. It
must be the sole focus of researchers to find out the variability of these parameters
and
ing out some fruitful results for the organization, rather than stating that this
parameter proves a hypothesis with certain confidence level. Such results are of no
practical use to the organization.
As the organization wants to minimize costs, the managers take several decision in
selecting accounting policies that is heavily influenced by biasness of human
ehavior of being opportunists. The involvement of human psychology makes the
accounting practice much more interesting and subject of research, how the managers
of firm would prefer a particular accounting policy over others, on the basis of firm
size, legal boundary, greater incentive, etc.
Summary of the Article
The Article „Half a Defence of Positive Accounting Research‟ by Paul V Dunmore
presents greater insights into the research methodology followed by the researchers
with specific reference to the field of Accounting. In general, researchers focus on to
understand the cause and effect relationship. The example of model cited in the article
“to develop a model of the audit fee as a function of the strength of legal regime and
audit complexity” (Choi et al., 2009), has many drawbacks which the author of the
model has ignored. Similarly, many other research works have been conducted to
study the Quantitative analysis and prove hypothesis, but according to this article, this
approach is not flawless. The focus of the researcher should be to study the
parameters rather than general replication of Quantitative hypothesis, and thus
accepting or rejecting at certain Confidence Interval.
This article points out to various loopholes that are present in the way Positive
Accounting Research is being conducted, thus the contribution of these research are
not significant. According to Paul, there is certain human behavior that accounting
process is attached to, so study must be conducted to understand those factors that
understand Human behaviors and how it influences general Accounting in the
organization. Though the article has cited examples from auditing papers, it provides
clear indication that the research conducted in...