Studies in accounting measurement indicate the absence of empirical relational structures that should form the basis for accounting measurement. This suggests the lack of objectivity of accounting information. Landmarks in the development of finance theory indicate the use of accounting measurement information as a basis for their development. This indicates that subjective accounting information is incorporated in finance theory. Consequently, this questions the status of finance as a universal science for all investigators, and its ability to construct precise models of finance experiences. This paper uses the principles of representational measurement to highlight the implications of subjective accounting information on the development of finance principles and concepts. It shows that finance, is not a universal science and that precise models of finance experiences are currently not constructible.

This study compares the principles of the going concern concept against the principles of representational measurement to determine if it is possible to establish foundations of accounting measurement with the going concern concept as a precondition. Representational measurement theory is a theory that establishes measurement in social scientific disciplines such as accounting. The going concern assumption is prescribed as one of the preconditions for measuring the attributes of the elements of the financial statements of an entity that is expected to continue in business for the foreseeable future. Studies in accounting measurement have so far not succeeded in establishing foundations of measurements under going concern. The findings of this study suggest that the going concern assumption is anti-measurement in nature. Consequently, the findings suggest that financial statements be prepared on a basis that distinguishes quantifications produced under conditions that facilitate accounting measurement from those that do not.

This study highlights the need for a theory of meaningfulness for accounting information. A theory of meaningfulness determines the theoretical position that may be taken about the scientific content of information. The need for such a theory in accounting arisesKeywords: Meaningfulness Problem in Accounting; Accounting Theory; Measurement Theory; Typologies of Scales INTRODUCTIONhe key concept in this study is the description of the meaning of accounting information. Such a description would provide background and fundamental concepts to the development of a theory of meaning in the discipline.The theory of meaning is rooted in the concept of measurement. According to Luce et al (1990) all processes of measurement must have criteria for determining the meaningfulness of the information produced. This suggests that all measurement information is considered to be meaningful information. The concept of seeking criteria to determine the usefulness of measurement information is known as the meaningfulness problem in measurement theory. Narens (2002) adds to this view by pointing out that the concept of information meaningfulness describes a theoretical position about scientific content and its role in inference. This means that a theory of meaningfulness describes the inferences that may be drawn from measurement information without distorting the meaning of the measure. If this is the case, it follows that measurement information can only be meaningful if the nature of valid inferences that may be drawn from the information are specified.Several sources in accounting literature (see, IASB, 2009; Wolk et al, 2002) highlight that accounting is a measurement discipline. If this is the case, then a user of accounting information would expect to find an outline of the valid inferences that may be drawn from accounting information. Furthermore, such an outline of the valid inferences should be supported by a clear description of a theory of the meaningfulness of accounting information. However, studies by authors such as Evans (2003); Francis and Schipper, (1999);Lev and Zarowin, (1999);Sterling, (1997) highlight that users of accounting information have not been able to draw valid inferences from accounting information and as a result have sought alternative sources of financial information. This indicates that users of accounting information have not been able to take a firm theoretical position about the scientific content of accounting information in the financial statements. Hence, this also suggests that the financial statements do not have a clear description of a theory of the meaningfulness of accounting information. Since, it has been highlighted that all measurement information must be meaningful information this viewpoint also weakens the accounting discipline's position as a measurement discipline.T

ABSTRACT

ABSTRACT