THE UNIVERSITY OF THE WEST INDIES

CAVE HILL CAMPUS

UNDERGRADUATE COURSE OUTLINE

ITEM DESCRIPTION

Course Title ADVANCE ACCOUNTING THEORY

Course Code ACCT 3040

Academic Units to offer Course

DEPARTMENT OF MANAGEMENT STUDIES

Level

3

Semester 2

Course Credit Load 3

Academic Staff Member

Name: Terry Harris, M.Phil., ACCA.

Email: terry.harris@cavehill.uwi.edu

Room # MS1

Tel: 417-4302

Office Hours: Mondays (4:00 pm 6:00 pm) Lectures: Thursdays (10 am - 12 noon)

Course Prerequisite ACCT 2014-FINANCIAL ACCOUNTING I

Course Co-requisite -

Course Post-requisite -

Course Anti-requisite -

Course Description

This course introduces the student to the nature of the changing landscape of

accounting thought and research. It also provides a bird's eye view of research methods

in accounting as a necessary part of understanding how these alternative views

developed; questioning the criteria for determining what is acceptable knowledge in

accounting. The course aims to develop critical thinking skills in students, thereby

enabling them to assess the current accounting thought particularly as it relates to the

Caribbean environment. Debating skills, critical awareness and essay writing for

2

academic purposes are some of the transferable skills that will be imparted to students

due to the nature of this course.

Course Rationale

The rationale behind this course is to develop critical analysis, communication skills

and thinking about accounting issues and challenges facing the accounting profession.

To achieve this, students will be exposed to a range of theories about accounting and

accountants, thereby providing them with a deeper understanding of accounting beyond

the technical procedures. As an advance course, the main purpose is to critically

examine and discuss the role of accounting and finance theories and frameworks in

understanding the nature and form of regulated and voluntary accounting information

choices. This course integrates knowledge gleaned in earlier courses and provides a

framework for examining current accounting theories and practices.

General Goals/Aims

The goals of this course are to:

introduce learners to a range of theories about accounting and accountants;

discuss the role of accounting and finance theories and frameworks and develop the student's understanding of the nature and form of regulated and

voluntary accounting information disclosures; and

enhance the student's understanding of the issues and controversies facing the accountant and the accounting profession.

Specific Learning Outcomes/Objectives

By the end of the course, students will be able to:

discuss the accounting regulatory environment;

explain and critically discuss alternative models of financial accounting and theories of accounting;

analyse regulatory and accounting choices in practice and apply the relevant theories to those choices;

critically explore and discuss issues which affect the accounting profession; and

explain the role of accounting and finance professionals.

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Course Content See page 4

Teaching Methodologies

This course consists of a two-hour lecture and a compulsory one-hour tutorial per

week. The teaching method will comprise of lecture/discussion and problem solving.

Students are expected to fully participate in tutorials in an effort to develop critical

thinking, problem solving and communication skills. To facilitate participation and to

receive credit for participation, each student must prepare assigned questions prior to

their respective tutorial.

Assimilating the concepts in this course depends very heavily on the level of

commitment of the student. Regular attendance at the tutorial sessions and active

participation will enhance the chance of a student achieving a good grade in this course.

A reasonable rule of thumb is to spend 23 hours outside of class time reviewing material and attempting assigned questions. Communication for the course will be

facilitated through elearning (Moodle).

Course Assessment

Methods

Coursework 30%

Paper review. 10%

Research paper 15%

Tutorial participation 5% Final Examination 70%

Short answer and essay type questions. Further details will be given during the semester.

Teaching /Learning Resources including

internet sources

Text

Craig Deegan & Jeffrey Unerman, Financial Accounting Theory, (second

European Edition) McGrae Hill (Paper-back)

Recommended Readings

Akerlof, G. A. (1970). The market for" lemons": Quality uncertainty and the market

mechanism. The quarterly journal of economics, 488-500. Ball, R., & Brown, P. (1968). An empirical evaluation of accounting income numbers.

Journal of accounting research, 159-178.

Basu, S. (1997). The conservatism principle and the asymmetric timeliness of earnings.

Journal of accounting and economics, 24(1), 3-37.

Fama, E. F. (1970). Efficient capital markets: A review of theory and empirical work.

The journal of Finance, 25(2), 383-417.

Jensen, M. C., & Meckling, W. H. (1979). Theory of the firm: Managerial behavior,

agency costs, and ownership structure (pp. 163-231). Springer Netherlands.

Watts, R. L., & Zimmerman, J. L. (1986). Positive accounting theory. Prentice-Hall

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COURSE CONTENT & LECTURE SCHEDULE

WEEK TOPIC CHAPTER QUESTIONS

Introduction

1 Introduction to the course

Introduction to financial accounting theory 1

1, 2, 4, 6, 9, 12

and 15

2 The financial reporting environment 2 1, 2, 3, 4, 5 and 6

3 The regulation of financial accounting 3 2, 3, 4, 5, 10, 11,

and 13

4 International accounting 4 1, 2, 3, 4, 7, 11

and 12

Theoretical Approaches

5 Normative theories of accounting 1: The case of accounting for changing prices and

asset values 5

1, 2, 5, 6, 7, 8 and

9

6 Normative theories of accounting 2: The case of conceptual framework projects 6 1, 2, 4, 5 and 9

7 Positive Accounting Theory 7 1, 2, 3, 4, 6, 13

and 14

8 Unregulated corporate reporting decisions: Consideration of system-oriented theories

8 1, 2, 3, 4, 8, 11

and 12

Contemporary Issues

9 Extended system of accounting: The incorporation of social and environmental factors

within external reporting 9

1, 2, 3, 4, 6, 8 and

13

10 Reaction of capital markets to financial reporting 10 1, 2, 4, 12 and 13

11 Reactions of individuals to financial reporting: An examination of behavioural

research 11

1, 2, 4, 5, 9 and

10

12 Critical perspectives of accounting 12 1, 2, 3, 4, 6 and 7

13 Revision