Standard setters and most academics maintain that accounting standards ought to rest on a set of guiding principles stated explicitly in a “conceptual framework.” The FASB and IASB are currently involved in a project to refine conceptual framework documents developed earlier. At this point,...

Attainment of rational expectations equilibria in asset markets calls for the price system to disseminate traders' private information to others. It is known that markets populated by asymmetrically-informed profit-motivated human traders can converge to rational expectations equilibria. This...

We examine four key conceptual tensions that are at the heart of many financial reporting dilemmas: stocks vs. flows, ex-ante vs. ex post, conventions vs. economic substance, and top-down design vs. bottom-up evolution as sources of accounting practice. Associated with each of these conceptual...