A Literature Review: Positive Accounting Theory (PAT)

Wiratama, Richard; Asri, Marselinus

doi:10.2139/ssrn.3523571

Cited by 6 publications

(7 citation statements)

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“…Positive accounting is a theory used to increase accuracy in calculating and analyzing various kinds of data on computers and database engines. These calculations are used in accounting research to find new models and discoveries regarding the future accounting theory [19]. The positive accounting theory explains the ability to understand the science that is considered suitable to assist in solving problems that will be faced.…”

Section: Issn: 2808-103xmentioning

confidence: 99%

“…The positive accounting theory explains the ability to understand the science that is considered suitable to assist in solving problems that will be faced. PAT aims to predict, explain, and observe financial problems and company calculation techniques [19]. On the other hand, a normative accounting theory is used based on the point of view to support the demands or guidelines in accounting.…”

Section: Issn: 2808-103xmentioning

confidence: 99%

“…On the other hand, a normative accounting theory is used based on the point of view to support the demands or guidelines in accounting. The normative theory works by explaining how accountants should act in processing financial information [19].…”

Section: Issn: 2808-103xmentioning

confidence: 99%

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The Contribution of Environmental, Social, and Governance (ESG) Disclosure to Reduce Investor Asymmetry Information

Sugianto

Riandy

Zainavy

et al. 2022

pssh

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The aim of this study is to determine whether environmental, social, and governance (ESG) disclosures have an effect on reducing information asymmetry between managers and stock market participants. This study tries to provide a comprehensive analysis of the company's ESG disclosure strategy. The data used in this study were collected from companies listed on the ESG Sector Leaders BEI KEHATI (ESGSKEHATI) and ESG Quality 45 IDX KEHATI (ESGQKEHATI). The findings show that ESG disclosure reduces stock market asymmetry. From these results, ESG disclosure strengthens the informativeness of environmental disclosures for the stock market. Stakeholders must assess and maintain an increased flow of information, a more efficient disclosure strategy becomes essential if companies are to convey a true picture of their ESG performance. The concept of company development in increasing ESG can be done through maintaining the surrounding environment, sustainable development, and establishing governance. The role of the company is also important, for example by maintaining good relations with employees, suppliers, consumers, shareholders, and various organizations or individuals who interact with the company.

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Section: Issn: 2808-103xmentioning

confidence: 99%

Section: Issn: 2808-103xmentioning

confidence: 99%

See 1 more Smart Citation

The Contribution of Environmental, Social, and Governance (ESG) Disclosure to Reduce Investor Asymmetry Information

Sugianto

Riandy

Zainavy

et al. 2022

pssh

View full text Add to dashboard Cite

show abstract

“…This possibility generates the important assumption of PAT, which states that managers are believed to be rational persons, and they will, if they have the opportunity, choose the accounting policies that best serve their goals. PAT assumes that managers will act only on their personal interest to maximize profits (Wiratama and Asri, 2020).…”

Section: Executives' Narcissism and Decision Makingmentioning

confidence: 99%

Executives' narcissism and decision making: reviewing 20 years of accounting literature

Ismail

Zaki

Abou-El-Sood

2022

JHASS

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PurposeThis paper aims to provide a systematic review of literature pertaining to how executive behavioral characteristics relate to financial reporting decisions.Design/methodology/approachThe authors review 44 papers published between 2001 and 2021 in top journals that are nested in leading business, economic and accounting journals.FindingsThrough the systematic review, the authors provide a framework for the emergence of narcissism and how it relates to decision making and hence, firm performance. Additionally, this paper identifies different measures of measuring narcissism with their pros and cons and suggest that different measures lead to different outcomes in prior literature.Originality/valueThe study contributes to a growing stream of research on executives' attributes influence on decision making. The authors recommend that future research may focus more on the chief financial officer (CFO) role as the majority of literature in CEO based. Additionally, the authors suggest that different settings may moderate the outcomes, and the authors propose that future research may be conducted to show how the regulatory environment affects or moderates narcissism effect.

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“…Furthermore, positive accounting theory was recognized when Watts & Zimmerman published their article entitled "Towards a Positive Theory of the Determination of Accounting Standards" in 1978. The article has created a paradigm domain of accounting research with positive accounting theory based on qualitative empirics and can be used to justify various accounting techniques or methods now used or find new models for the development of accounting theory in the future (Wiratama & Asri, 2020). In this case, positive accounting theory tries to explain or predict real phenomena and test them empirically (Godfrey, el al, 1997 in Ghozali andAnis, 2007).…”

Section: Introductionmentioning

confidence: 99%

Approaches and critiques of Positive Accounting Theory (PAT) and Normative Accounting Theory (NAT) : a literature review

Utari,

Manalu,

Lubis

et al. 2023

Braz. J. Develop.

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Positive Accounting Theory (PAT) is an accounting theory that aims to explain and predict accounting practices carried out by companies. This theory emerged as an alternative to the normative approach which emphasizes more on what accountants should do in presenting financial information. However, PAT also received criticism related to the assumptions used in this theory. Therefore, this paper aims to review how the approach and criticism of PAT. The method used in this research is Systematic Literature Review (SLR) which is conducted by identifying, assessing, and interpreting all available research evidence regarding approaches and criticisms of PAT. The sources used in this paper are articles, books, and journals related to Positive Accounting Theory (PAT) and the criticisms raised against it. The results show that PAT has developed into a science that can be used to explain the choice of methods to be used by managers and other constituents of financial statements that can be used for decision making. However, PAT has also been criticized including issues related to research methods, methodology, and the basic assumptions underlying the theory. In conclusion, Positive Accounting Theory (PAT) has had a significant impact on accounting practice, but keep in mind that this theory also has limitations and has been criticized by some parties. This paper provides an in-depth insight into the approaches and criticisms of Positive Accounting Theory (PAT), as well as highlighting the importance of critical evaluation of accounting theory in the development of accounting science as a whole.

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A Literature Review: Positive Accounting Theory (PAT)

Cited by 6 publications

References 0 publications

The Contribution of Environmental, Social, and Governance (ESG) Disclosure to Reduce Investor Asymmetry Information

The Contribution of Environmental, Social, and Governance (ESG) Disclosure to Reduce Investor Asymmetry Information

Executives' narcissism and decision making: reviewing 20 years of accounting literature

Approaches and critiques of Positive Accounting Theory (PAT) and Normative Accounting Theory (NAT) : a literature review

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