What's Wrong with Historic Cost Accounting?: An Overview of the Issues Involved in Inflation Accounting

The knowledge and practice that are known as accounting are little more than a complex series of conventions. The accounting historian, or researcher, or practitioner, cannot turn to any original authoritative source for confirmation or clarification on basic points of principle. To the financially untrained observer all talk of an unstructured and flexible foundation to accounting must seem to be at odds with the precision and authority with which he sees financial statements being presented to the reader, be he shareholder, banker or manager. Profit and loss accounts and balance sheets look so beautifully cut and dried, so obviously “right”. Well of course they are, but that is only because accountants have adopted and refined conventional procedures to produce such tidy statements. There is nothing unarguable or sacrosanct about accounts—absolutely nothing.