Accounting Theory

Accounting Theory provides students with a deep understanding of the concepts, principles, and frameworks that shape modern financial reporting and guide accountants in making professional judgments. The course examines the development of accounting standards, the role of the conceptual framework, recognition and measurement of financial statement elements, and the economic, social, and institutional factors that influence accounting practices. Students explore how accounting information supports decision-making, how different valuation methods affect reported results, and how transparency, comparability, and faithful representation strengthen the usefulness of financial statements. The course also introduces major theoretical perspectives—such as normative approaches, decision-usefulness theory, stewardship, and contracting views—to help students analyze why companies adopt certain policies, how financial reporting evolves over time, and how ethical considerations underpin responsible accounting. Overall, Accounting Theory equips learners with the analytical foundation needed to understand, evaluate, and apply accounting principles in both practice and research.