Accounting Standards Have Developed Over Time to Reflect Changes in the Business

question 32

Essay

Accounting standards have developed over time to reflect changes in the business world as well as changes in our ability to account for such changes. Using the example of marking assets and liabilities to their fair value, explain why you would expect accounting standards to change.

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Definitions:

Joseph Schumpeter

An economist and political scientist known for his theories on economic development and capitalism, particularly the concept of "creative destruction."

Psychological Behaviorism

A branch of psychology that focuses on observable behaviors and the ways in which they're influenced by changes in the environment, rather than internal thoughts and feelings.

European Sociological Theories

A body of theories that originated or were significantly developed in Europe, encompassing a wide range of subjects including social structures, agency, and change.

Institute of Social Research

A research organization associated with the Frankfurt School, known for critical theory and interdisciplinary social science studies.