TEORI AKUNTANSI (KEUANGAN)

THE ROLE OF MEASUREMENT IN ACCOUNTING

ACCOUNTING THEORY and MEASUREMENT are closely linked:
Acc theory: is ultimate concerned with
what information is needed by users:

Is involved with what is being measured

and how it is being measured:

Measurement is defined : as the assignment of numbers to the attributes or

properties of objects being measured
Objects themselves have numerous attributes or properties .
Accounting measures are made in MONEY TERM (MONETER):
There are still several others to which values could be assigned: These would
include:
HISTORICAL COST (is used for Financial Accounting : until this time being
;)
Others:
Replacement Cost of the in its present condition
Selling Price of the . in its present condition
Present Value of The Future cash Flows that will help to generate ;
THE MEASUREMENT PROCESS:

Depends on several factors:

1. The object itself
2. The attribute being measured
3. The measurer
4. Counting or enumerating operations
5. Instruments available for the measuring task
6. Constraints affecting the measurer
Ad.1:.
Ad.2:
Ad.3:
Ad.4: simple arithmetic in a cash count statistical sampling in inventory
valuation
Ad.5: large computer hand calculator pen pencil paper
Ad.6: time cost ; regulation/standard ;

MEASURABLE VS MEASURELESS
MEASURING - CHAIN
Skill Tools Measuring Techniques:
(1) CLASSIFICATION in MEASUREMENT
DIRECT (usually preferable ;)_
If the number assigned to an object
is an actual measurement of
the desired property
Ukur ending inventory dengan
Replacement cost :
Multipying: the current wholesale
price/unit for each inventory type
by the quantity held and adding
these amounts for all inventory
types ;

INDIRECT
If the number assigned to an
object / of a desired attribute is one
that
must
be
made
by
Roundabout means.
Ukur silver fox coat:
Cost originally : $ 1000: estimate
price for sale : $ 600 : normal mark
up : 20 %: Replacement Cost : ( $
600 : 1,2 = $ 500 ;

(2)
ASSESSMENT MEASURES
Are
concerned
with
Particular attributes
of objects (can be either
Direct or Indirect ;)
The
market
value
of
Marketable Securities.

PREDICTION MEASURES
Are concerned with factors that may be
indicative of conditions in the
future
Income of a present period might be
used as a predictor of devidens for the
following period.

TYPES OF MEASUREMENTS
Types
Nominal

Ordinal

Interval

Ratio

A simple classification system

Ekuivalensi :
Refleksive: x = x for all value of x
Simetris: if x = y , and then : y = x
Transitive: x = y & y = z : and then : x = z
Numerals assigned in ordinal rankings
indicate an order or preference.
The degree of preference among ranks is
not necessarily the same
(lebih besar daripada : > )
not refleksive:
not simetris: ..
still transitive: x > y , y > z : and then
:x>z
Assigns equal value to the intervals between
assigned numbers:
The change in the attribute measured
among assigned numbers must be equal.

Using in Accounting for

A
Chart
of
Accounts: in Balance
Sheet
:
Profit/Losses
Statement
Determine liquidity in
the balance sheet

Zero point must have a unique quality

Current Asstes $ 100 :

Current Liabilities $ 50
Using this type in Accounting: is possible and Current Asstes $ 200 :
only because of the uniqueness of the zero Current Liabilities $ 100:
poin in Accounting ;
Indicate: the property of $
2 Current Asstes for each
$ 1 of Current Liabilities.

QUALITY OF MEASUREMENT
Ijiri & Jaedicke view objectivity :
(Degree of consensus among measurers in situations where a given group of
measurers having similar instruments and constraints measure the same attribute
of a given object)
(Quality of evidence underlying a measurement ):
(in the statistical sense developed by Ijiri and Jaedicke, the word Verifiability has
tended to supplant Objectivity )
n
V = 1/n E ( xi x )
i=1
n = the number of measurers in the group
xi = measurement of the ith measurer
x = mean of all xi for all measurers involved
Ref: The closer each xi is to x, the more objective is the measure and the smaller
V will be.
Notes:
Two other qualities that are pertinent to both assessment and prediction
measures are : TIMELINESS and COST constraint .
Timeliness: means financial data which are aggregations of many
measurements should be up to date and ready for quarterly
announcements of earnings as well as for annual published financial
statement purposes.
(Oftentime, the need for information on a timely basis may conflict with
the cost constraint problem )
The costliness and timeliness of the information are other important
considerations underlying the measurement process.
Lose sight of the fact that data are costly to produce (it is easy to lose sight
;)
Many costs: computer information systems, accounting staffs, are fixed.
More precise or accurate measurement, as well as more timely measures,
involve expending additional resources.
Timeliness and costliness must be borne in mind in the Accounting
Policy- setting process IF NOT IN THEORY FORMULATION ;
There are often trade-offs between objectivity and the usefulness of
information (as the number being generated by the measurement process )
Meaningful Comparison.may thus be made among similar accounting
measurements for differents firms.
Measurement in accounting are simply calculations in which no
meaningful attempt is made to make them correspond to real economic
phenomena ;
The Next : Appendix 1-A: VALUATION SYSTEMS ( Wolk I harry Francis R
Jere Tearney G Michael : Accounting Theory : A Conceptual and Institutional
Approach )